FUTUM COMMUNICATIONS, INC Data Processing Typesetting Printing Mailing 512-389-1500 FAX 512-389-0867 3019 Alvin DeVane, Suite 500 Austin, Texas 78741 revenues and profits. Vinson & Elkins, the biggest and most profitable, reported 1988 profits of $91.3 million on sales of $173 million, a profit-percentage of more than 50 percent. The other firms report only slightly smaller ratios of profit to sales. Why this explosion of money in the influence-peddling business? There are a number of forces behind it the first of which is the simple convenience mega-firms offer by providing a wide range of services under one roof. Secondly, the size of the lobbying business has ballooned due to a surge in legislation that affects business. The thrift-bailout bill, for instance, provoked almost every bank, thrift, and developer in the country to hire a lobbyist, thus transforming House Banking Committee hearings into daily mob scenes. In cases where the clients didn’t have enough money to pay, such as with federally seized thrifts, the taxpayer unwittingly stepped in to pick up the tab. Many of the same firms that did lobbying on the bailout bill will reap hundreds of millions of dollars in Texas by assisting in the Resolution Trust Corporation’s disposal of the government’s inherited assets. One Banking Committee member jokingly referred to the bailout legislation as the Lawyer, Lobbyist, and Consultant Full Employment Act of 1989. But for pure lobbying, nothing beats the current traffic jam in the House and Senate office buildings over the clean-air bill. While the thrift bill was limited to three industries, nearly every polluting industry in America, from small dry cleaners to big steel companies, has signed on with someone in Washington. Lobbyists presently clogging the halls of Congress include those who represent oil and petrochemicals, natural gas, pharmaceuticals, all electric utilities, the coal industry, trucking, airlines, state and local governments, and health and environmental interest groups, among others. The third major reason for big firms is a growth in the number of people who need to be lobbied for any given piece of legislation. Old-time Texas lobbyist Charts Walker says that when he came to Washington in 1959, the business was much less complicated because only a handful of people really counted. “If you had Sam Rayburn, Wilbur Mills, and a top Republican your work was done [in ANDERSON & COMPANY COFFEE TEA SPICES AUSTIN, TEXAS 7W731 512 453-1533 Send me your list. Name Street City Zip the House],” he says. But the number of people in Congress who have to be lobbied has grown since committee chairs became elected offices in 1974 and as younger members have discovered the power of television and money. The rules of influence buying have changed, too. When Roy Miller lobbied for Texas business interests and against the New Deal, he bought so many lawmakers’ lunches that a table in the Capitol was named after him. Today, political action committee money has driven the average cost of a House seat to $390,000 and a Senate seat to $4 million, Today, political action committee money has driven the average cost of a House seat to $390,000 and a Senate seat to $4 million .. . making it harder and harder for incumbents to be beaten., Not to be outdone by their clients, law and lobbying firms are now creating their own PACs, and not to be outdone by other states, Texas is out front on this trend as well. Cleveland-based Jones, Day, Reav is & Pogue, whose Dallas office constitutes one of the largest Texas law firms, has the largest law-firm PAC. According to the Federal Election Commission, Akin, Gump, and Vinson & Elkins have the secondand thirdlargest Washington law-firm PACs respec tively. Though their numbers are still small compared to industry groups, law-firm PACs have been growing at near-exponential rates over the last decade. In the years leading up to the 1988 election, 12 Texas firms gave $1,220,506 to the candidates of their choice contrast, 10 years earlier there were only three Texas law-firm PACs and they gave only $254,486. They spread their money as evenly as manure on a vegetable patch. Akin, Gump has more of a Democratic tradition and some of the Houston firms lean more Republican, but all realize that cash has to be shared among anyone who has power to affect legislation. Law money tends to favor Texans, people on the Senate Finance and House Ways and Means Committees, and very powerful people. Senator Lloyd Bentsen, who fits three of these categories, regularly receives the maximum $5,000 from these PACs. PAC money rarely goes to challengers, because no one wants to create an enemy out of an incumbent. But an industry PAC might occasionally support a challenger who is particularly open to its point of view. Law and lobbying money never does this. It is the most status quo money available. It normally doesn’t even show up in open-seat elections. One exception was in the race to replace Mickey Leland, who died in a plane crash in Ethiopia last summer. Feeling pressure to be heard in a race for the district where its headquarters is located, Vinson & Elkins cut $1,000 checks to both candidates. Craig Washington and Anthony Hall on the same day, no less. The numbers and incomes of these lawyerlobbyists help drive up Washington real estate prices at a time when many here feared that Ronald Reagan’s budget axe would send the local economy into a tailspin. Not surprisingly, they are attracting more and more resentment from people with fewer dollars. Even Marlin Fitzwater, Bush’s jovial press secretary, declared recently, “Everyone ought to take every opportunity they can to bash lawyers.” THE TEXAS OBSERVER 13
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