The spread of the novel coronavirus across the United States has paralyzed economic activity and social interaction. But in one industry, business has hit a surreal, frenetic phase.
Lobbyists in the nation's capital are readying for the ultimate honey pot: a massive stimulus package that could prop up entire modes of business that have buckled as the outbreak has worsened. Reports on Tuesday suggested lawmakers could end up passing a bill with a price tag north of $1 trillion. While about half of that is expected to take the form of either a payroll tax holiday or direct cash payments to everyday Americans, a portion is destined to go to struggling industries as well. And in order to get their hands on that pie, those industries are turning to the best of pie-getters: K Street.
One top Democratic lobbyist told The Daily Beast that the current state of the lobbying industry was “frantic.” Clients were not only trying to get their interests in front of sympathetic lawmakers, they explained, but also aggressively pushing for even small parcels of insight about the historic pandemic from the Hill.
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In other words, lobbyists are losing their cool, too, even as they rush to cash in on chaos.
“There is an intense desire for information to the most granular level because everybody is impacted,” the lobbyist said. “After 9/11 you had one industry (the airlines) particularly impacted and two states—New York and Virginia. It wasn’t economy wide. With the [Wall Street bailout of 2008], yes the economy was in free fall. But one, people believed it was the fault of one industry and two, people felt you had to prop up that one industry. Here, you feel like you have to prop up an entire economy. It is much bigger.”
A top Republican lobbyist echoed that point. “The crisis could be a boon,” the lobbyist said, noting that they already have signed one new client. “Any time there is a crisis and Washington is in the middle of it is an opportunity for guys like me.”
What form a coronavirus stimulus package will ultimately take is not yet known. But it is clear, from both sides of Pennsylvania Avenue, that the legislation will move quickly and be designed as almost a direct substitution for normal demand in a suddenly-stagnant economy.
On Tuesday, Treasury Secretary Steve Mnuchin embraced the idea of sending low and middle-to-upper-middle-income Americans a direct check for $1,000 and potentially more. He and President Donald Trump also discussed the need to provide direct financial assistance to entire industries—including airline, cruise, and hospitality—as well as specific businesses like Boeing and General Electric.
Trump, meanwhile, has met with CEOs of top companies at the frontlines of the coronavirus economic fallout, including senior officials at the nation’s top fast food companies on Tuesday.
Not everyone is going to get money from the federal government; at least not in the first tranche. And some industries that say they need immediate capital injections won’t rely on lobbyists to help get them. Amtrak, for example, said that it would “need approximately $1B in supplemental funding through the remainder of the year to make up for the unprecedented loss of ridership and revenue." The government-subsidized rail line does not employ lobbying firms.
On K Street, the expectation is that the transportation sector and airline industry in particular will be propped up because of the role they play in U.S. commerce. United on Tuesday said it was projecting that revenue this March would be $1.5 billion lower than one year prior.
But there was also a creeping sense that the cascading impact of the coronavirus was simply too vast for one bill to meaningfully address.
Among industries acutely affected by the pandemic—ones that rely on a steady stream of physical human customers to stay afloat—the economic situation is extremely bleak. Those sectors are scrambling to get a piece of the coronavirus aid package, without which they say the financial outlook is near-apocalyptic.
“Based on current occupancy, estimates for the immediate future and historical employment impact rates, 1 million direct industry jobs and 3.9 million total jobs have either been eliminated or will be in the next few weeks,” predicted Jennifer Myers, a spokesperson for the American Hotel and Lodging Association, in an email to The Daily Beast late Tuesday morning. Hotels are currently “on pace to lose more than $200M in room revenue per day,” Myers noted. “This pace means a loss of $1.4B every week and will only further escalate.”
The trade group sent a delegation to the White House on Tuesday to press for emergency assistance to keep its member companies afloat. “We are [also] part of ongoing Hill discussions,” Myers said. “Everything is fluid at this point.”
It’s not just checks from the federal government that K Street is after, however. Regulatory changes in the past few weeks and upcoming ones could have dramatic impacts on bottom lines. Take, for instance, the EPA’s decision to add bleach wipes and bleach solution made by Medline Industries to its list of proper disinfectants on March 3. Coming as the coronavirus was rapidly spreading, that decision lent major credibility to Medline just as consumers were seeking out expertise on which products could help ward off the virus.
Medline’s appearance on the list also happened to come shortly after it hired the CGCN Group, a firm stacked with high-profile Republican staffers, including a former senior EPA official, to lobby federal environmental regulators.
What’s complicated things for K Street is that while the demand for lobbyists may never be greater than in the upcoming days and weeks, the means by which the craft is performed have—like almost every other facet of life—been dramatically upended.
Lobbying is, inherently, a schmoozer’s business. But coronavirus has put a dramatic end to direct human-to-human interaction. There is no way for influence peddlers to now get on the Hill to meet with aides or lawmakers in steakhouses, congressional offices, or anywhere. There is no evening fundraising circuit to hit up for the purposes of pushing an agenda. There are competing demands from home life, too.
Lobbyists, after all, are humans as well.
“Most of K Street is just really worried about their kids, to be honest with you. Almost everyone in this area, their kids are at home,” said John Feehery, a partner at lobbying firm EFB Advocacy. “It’s a really strange time. There are a lot of industries really getting killed. There are a lot of folks trying to figure out ways, if you’re gonna get a stimulus, if it can keep our business alive.
“But it’s not easy to request meetings because you can’t get in,” he added. “It has changed lobbying. You have to send your request in through email, and hope to get a response.”
Federal lobbying disclosures come in quarterly, so the public will get a better understanding of what Washington’s influence-peddlers have been up to on the coronavirus front next month. But at least one lobbyist has already reported working on that precise issue. In fact, Jack Burkman is the only one so far to mention coronavirus by name in lobbying registration paperwork, which he submitted last month on behalf of a Florida doctor for whom Burkman said he would be “lobbying re coronavirus issues; treatments.”
Burkman is better known these days as a hapless would-be dirty trickster who has tried and failed to implicate prominent Democratic politicians in fabricated sex scandals. Reached by phone on Tuesday morning, the doctor who hired him to lobby on coronavirus matters said, “I don’t know how much I can tell you" about Burkman’s work for him, and declined to comment further.
Among more reputable K Street denizens, there is a fear—with members of Congress talking about passing a stimulus and then returning to their districts for the foreseeable future—that this current spike in business may actually be the last for the time being. After all, if payroll is being cut and there is no one to lobby, why employ a lobbyist?
“If you’re McDonalds and you have an e coli outbreak and you have to fire one guy—the fry guy, the burger guy, or the gardener who gets you the produce—who do you cut? The gardener,” said the aforementioned Republican lobbyist. “Well, we are the fucking gardeners. People aren’t going to fire themselves before they fire us.”
