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CONTACT: Center for Responsive Politics
Dave Levinthal, 202-354-0111
Federal Lobbying Climbs in 2009 as Lawmakers Execute Aggressive Congressional Agenda
WASHINGTON - February 12 - The economy stunk. Corporations slashed jobs. And some firms, once juggernauts of American industry, simply ceased to exist.
But for federal lobbyists, 2009 proved to be a year of riches unlike any other, a Center for Responsive Politics analysis indicates.
In all, federal lobbyists' clients spent more than $3.47 billion last year, often driven to Washington, D.C.'s power centers and halls of influence by political issues central to the age: health care reform, financial reform, energy policy.
That figure represents a more than 5 percent increase over $3.3 billion worth of federal lobbying recorded in 2008, the previous all-time annual high for lobbying expenditures. And it comes in a year when a recession persisted, the dollar's value against major foreign currencies declined and joblessness rates increased.
In 2009's 4th quarter, lobbying expenditures increased nearly 16 percent over 4th quarter levels from 2008, whereas spending only increased about 3 percent from the 3rd quarter of 2008 to the same period in 2009.
Last year's 4th quarter also marked the first quarter in U.S. history that federal lobbying expenditures cracked the $900 million mark -- which they did with ample room to space, hitting a record $955.1 million for the quarter, the Center's research shows. (Track increases and decreases in lobbying spending here using the Center's new lobbying comparison tool.)
"Lobbying appears recession proof," said Sheila Krumholz, the Center's executive director. "Even when companies are scaling back other operations, many view lobbying as a critical tool in protecting their future interests, particularly when Congress is preparing to take action on issues that could seriously affect their bottom lines."
At nearly $266.8 million, the pharmaceutical and health products industry's federal lobbying expenditures not only outpaced all other business industries and special interest areas in 2009, but stand as the greatest amount ever spent on lobbying efforts by a single industry for one year.
The pharmaceutical and health products industry was followed last year in overall lobbying expenditures by business associations ($183 million), oil and gas ($168.4 million) and insurance ($164.2 million). In each case, the 2009 totals are greater than that of 2008. Electric utilities, at $144.4 million, placed fifth, although this industry's 2009 lobbying total is slightly off its 2008 pace.
Rounding out the top 10: computers/Internet companies ($118.9 million); general manufacturing and distributing ($113.4 million); hospitals and nursing homes ($108.4 million); television, movies and music ($107.3 million) and education ($98.6 million).
Other health-related industries also ranked highly among the more than 120 industries and special interest areas tracked by the Center for Responsive Politics, such as health professionals ($84.6 million) and health services ($73.9 million).
The general business sector, which encompasses an array of industries from retail sales to manufacturing to business associations, experienced a nearly 19 percent increase in its 2008-to-2009 lobbying expenditures. The more than $558 million spent by the general business sector in 2009 is a record for any of the 13 broad sectors that the Center tracks.
It's followed closely in 2009 by the health sector, which includes a variety of health-related industries. In 2009, this sector spent nearly $544 million on federal lobbying efforts, up almost 12 percent from its 2008 total of about $487 million.
(Note that these figures may in coming weeks change slightly, as a small number of companies and organizations have yet to submit their final 2009 lobbying disclosure reports. Furthermore, some entities may file amendments to reports already submitted.)
Months and months of congressional health care reform debates prompted this heavy lobbying spending by health-related industries.
The pharmaceutical industry, for example, experiences a nearly 11 percent increase in its lobbying output between 2008 and 2009. Health services and HMOs? More than 14 percent. And the miscellaneous health industry - a collection of health-related companies that don't easily fit into other health industries - jumped more than 43 percent from 2008 to 2009.
A prolonged health care reform debate also partially accounts for increased spending by industries and organizations not typically associated with health care issues.
The U.S. Chamber of Commerce helped vault the business association industry to new levels in 2009 with more than $144 million in lobbying expenditures -- exponentially more than runners-up ExxonMobil ($27.43 million), the Pharmaceutical Research and Manufacturers of America ($26.15 million), General Electric ($25.52 million) and Pfizer ($24.6 million). Some of the Chamber's lobbying largess is attributable to its voluntary inclusion of "grassroots" lobbying efforts that most other organizations don't include in their reporting.
The food and beverage industry in 2009 also recorded the largest percentage increase in lobbying expenditures -- nearly 127 percent -- of any industry.
Beverage companies and associations in particular aggressively lobbied lawmakers last year against supporting a "soda tax" to help fund health care reform initiatives. Perhaps not surprisingly, lawmakers never gave a soda tax serious consideration, and they didn't included it within either the U.S. House or U.S. Senate versions of health care reform legislation.
The American Beverage Association, for example, spent $18.85 million in 2009 to lobby the federal government after reporting a comparatively paltry $667,590 worth of lobbying spending in 2008. That's a more than 2,700-percent increase from year to year. PepsiCo? Similar story, as the soft drink manufacturer poured $9.24 million into federal lobbying work last year, up from $1.18 million in 2008, for an increase of 685 percent.
Extraordinary as those numbers may be, JetBlue Airways soars to the apex of expenditure increases by investing $600,000 in lobbying efforts for 2009 after recording just $10,000 the year before -- a decidedly stratospheric 5,900-percent increase.
While many industries and organizations boomed despite economic troubles in 2009, some long-time corporate stalwarts indeed collapsed under the financial strain.
American International Group, for instance, spent just $2.27 million on federal lobbying -- or roughly a quarter of its 2008 spending -- before shutting down its K Street presence in June.
Mortgage giants Fannie Mae and Freddie Mac in 2009 stopped lobbying the federal government altogether after each spent tens of millions of dollars on lobbying efforts earlier in the decade.
The savings and loan industry, meanwhile, has watched its lobbying presence all but vanish: In 1998, the industry lobbied to the tune of $6.2 million, while in 2009, its output had dwindled to below $1.2 million.
The automotive industry, for its part, experienced unbridled lobbying growth during much of the decade, peaking in 2007 with nearly $71 million in expenditures. Although economic woes have battered car makers' balance sheets, the industry still managed about $60.2 million in federal lobbying expenditures last year.
In a seemingly counterintuitive development, the number of companies or entities that reported lobbying the federal government in 2009 (15,712) increased slightly from the year before (15,049).But the number of actual, registered federal lobbyists decreased, falling to 13,742 in 2009 from 14,442 in 2008.
Potential reasons for this phenomenon include some lobbyists effectively "deregistering" as lobbyists while still continuing to work in the business of political influence.
The general business sector employed 3,513 registered federal lobbyists in 2009 -- more than any of the 13 sectors the Center tracks. The health care sector employed 3,405 lobbyists, while the finance/insurance/real estate sector tallied 2,654 lobbyists. In each case, these sectors employed marginally fewer registered lobbyists in 2009 than they did the year prior.
As for lobbyists themselves, numerous firms experienced bumper years.
At the top: the Podesta Group, which saw its federal lobbying income jump from $16 million in 2008 to nearly $25.6 million in 2009 -- the largest gross increase among all lobbying firms.
Patton Boggs LLP earned the most money overall at nearly $40 million. Among other top-five firms in terms of income are Akin, Gump, et. al. ($32.4 million); Van Scoyoc Associates ($27.3 million); Podesta Group and Brownstein, Hyatt et. al. ($23.5 million).
While their overall dollar figures proved modest, Capstone National Partners generated exponential growth for itself, taking in $856,000 from clients in 2009, up from $20,000 in 2008 -- a more than 422 percent increase.
The nation in 2010 faces a number of new legislative challenges, including the possibility of revised health care legislation, more financial reform, immigration issues and climate change legislation. Any significant decline in lobbying activity, therefore, appears unlikely.
"Despite the odds, last year was a record year for lobbying," Krumholz said. "However, it's entirely possible that even more lobbying dollars will be spent in 2010."
To explore the Center for Responsive Politics' full lobbying database, log onto: www.opensecrets.org/lobby.
The database now includes
a new feature, available at www.opensecrets.org/lobby/