WHAT'S NEW IN PUBLIC AFFAIRS

Talk about your "topsy-turvy" world of Public Affairs. On Capitol Hill, women are the new men and Democrats are the new Republicans, while on K Street, formerly so "red" only Republican lobbyists need apply, things are turning "blue." According to Roll Call, a study by the Women's Campaign Forum found that women increasingly are the power behind the throne, with females holding approximately 23 percent of the top Senate staff positions and 31 percent of the top House staff positions. Democrats in particular are hiring more women as chiefs of staff. Meanwhile, Newsweek reports that for the first time in the modern political age, Democrats are raising more campaign funds than Republicans. Newsweek cites a Wall Street Journal story reporting that in the first six months of 2007, Democrats raised $388.8 million to the GOP's $287.3 million. As a result, some Democrats are becoming more conservative on some tax and business issues. Finally, according to Congressional Quarterly Weekly, even K Street is showing a "democratic slant" in terms of newly established lobbying firms, new hires and new political strategies. These stories and more in this edition of the Public Affairs News Monitor.

HEADLINES AT A GLANCE

"Women Taking Charge in Capitol"
"Betting Blue on K St."
"Dems Are the New Republicans"
"Companies Increased Giving by 4.8 Percent in 2006"
"Rangel's Tax Bill Likely to Frame Fiscal Debate for Election and Beyond"
"A Drive-By Swift-Boating"
"Economic Crime Is Pervasive at Companies Worldwide: PWC"
"Senators OK Ban on 'Phonemarking' in Quiet Adjustment of Lobby Rules"

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State & Local Government Relations Seminar
November 4-6, 2007 - Alexandria, VA
Tailored specifically for corporate and association state and local government relations professionals, this technique-oriented seminar features an outstanding faculty. They'll share their insights and experiences in managing successful state and local government relations operations.

Global Benchmarking Lunch
November 15, 2007 - Washington, DC
Join a select group of your peers in the international government relations arena for an informal, complimentary luncheon to discuss the key findings of the recently published International Government Relations Benchmarking Report. Participants in the luncheon will learn how Public Affairs Council-member companies successfully plan, resource, conduct and evaluate their worldwide government relations operations. Open to participants of the International Government Relations Project as well as those who have recently purchased the report.

2007 Teleconference: Preparing for the 2008 Conventions
December 4, 2007 - Teleconference
As the 2008 campaign kicks off in earnest, the nation's eyes will turn to the national party conventions. For public affairs professionals, the conventions are the perfect opportunity to implement a coordinated government affairs program that influences the local, state and federal government officials in attendance - provided you are in compliance with the new lobbying, gift and ethics laws. Ken Gross will answer your questions during this teleconference.

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"Women Taking Charge in Capitol"
Roll Call (10/15/07); Brotherton, Elizabeth

The Women's Campaign Forum released a study estimating that 23 percent of top Senate staffers and 31 percent of top House aides are female, versus 16 percent of senators and 17 percent of House Members who are women. WCF President Ilana Goldman commented that it is heartening to observe more women taking on leading staff roles on Capitol Hill, noting that, "The staffers, the advisers--particularly chiefs of staff--these are incredibly powerful positions." The study discovered that Democrats hire more female chiefs of staff. An important finding of the study was that many male House members hired female chiefs, according to Elizabeth Stanley, chief of staff for Rep. Nita Lowey (D-N.Y.). "That said, I think nothing can replace firsthand knowledge," Stanley said. "That's why we need more female Members." All the women participating in the study said family involvement was a primary factor in their decision to enter politics, although Goldman contended that it is more likely women will run for office with outside encouragement. This conceit is central to the WCF's "She Should Run" campaign, which has established a Web site where people can nominate a woman to run for political office anywhere.(www.rollcall.com)

"Betting Blue on K St."
Congressional Quarterly Weekly (10/20/07); Knott, Alex

Some of the most notable new K Street firms have a distinctly democratic slant. Elmendorf Strategies generated over $2 million since last December with only three registered lobbyists, including Steve Elmendorf, a longtime adviser to former Rep. Dick Gephardt (D-Mo.). Meanwhile, seven people on Capitol Counsel's lobbying team are connected democratically, even though Founder John D. Raffaelli does not expect his firm to turn completely blue. "With the K Street Project, they could basically tell everyone downtown to only hire Republicans," he notes. "But the Democrats could never operate like that. K Street represents the business community, and the business community always has to include Republicans to get to a majority vote." Raffaelli expects his firm's late filings for the first half of 2007 to exceed $2 million. Another firm, Parven Pomper Schuyler, is hoping to tap its centrist "Blue Dog" democratic contacts to drum up business. "Washington needs to understand that a new business model is developing, and politics, like the environment, will need new strategies," says Parven Pomper Schuyler President Scott D. Parven. "We are an all-Democratic firm ... and we are betting that 2009 in Washington will look a lot like our firm." (www.cq.com)

"Dems Are the New Republicans"
Newsweek (10/22/07) Vol. 150, No. 17, P. 20; Gross, Daniel

For the first time in the modern political age, Democrats are beating Republicans in terms of fundraising, with the Wall Street Journal reporting that Democratic entities raised $388.8 million to the GOP's $287.3 million in the first six months of 2007, writes Daniel Gross. Quadrangle Group Founder Steve Rattner believes the Democratic advantage stems from CEOs' frustration with Republican blunders--like the Iraq war and bad fiscal and disaster management--and from Democratic presidential candidates' outreach initiatives. Hillary Clinton seems particularly appealing to these executives, with her range of experience and understanding of entrepreneurship and business development. CEOs are not the only defectors. Last fall's CNN exit poll indicated that voters in the East making $150,000 to $200,000 preferred Democratic candidates by a 63 to 37 majority, while a September Wall Street Journal/NBC News survey estimated the percentage of professionals identifying themselves as Republicans dropped from 44 percent to 37 percent. Gross observes that apart from John Edwards, "the Democratic candidates and their congressional allies have been loath to embrace measures that would alienate their new friends." For instance, Democrats easily helped defeat a war income surtax targeting top earners.(www.newsweek.com)

"Companies Increased Giving by 4.8 Percent in 2006"
Chronicle of Philanthropy (10/18/07); Lewis, Nicole

In 2006, corporate donations increased by 4.8 percent, amounting to a median value of almost $33 million, according to a report by the Committee Encouraging Corporate Philanthropy. Strong profits, new philanthropic commitments, and better measures for gift tracking and accounting were cited as factors behind the increase. The committee used data supplied by 136 companies, of which 55 were ranked by Fortune magazine as being among the 100 largest in terms of revenue. Those companies contributed over $11.2 billion in cash and products last year, with the median total giving among these firms amounting to $50 million. The list of giving priorities was topped by gifts to health and social-service charities, followed by education and community and economic development, while the least popular charities were those for environmental causes. Of the 48 companies that furnished information in the past three years, 12.9 percent of donations aided people overseas in 2006, versus 9.6 percent in 2004. Twenty-one percent of respondents reported slashing donations by 10 percent or more, and the report attributes most of the declines to an absence of disaster relief gifts. Corporate spinoffs and department closures, conclusion of multi-year grants, and a lower overall production of goods were other reasons cited by respondents for the gift cuts. The information technology sector recorded the biggest increase in giving between 2005 and 2006, followed by utilities and the makers and distributors of food and beverages. An 11 percent decline in giving by health care providers represented the largest drop in industry sectors.(www.philanthropy.com)

"Rangel's Tax Bill Likely to Frame Fiscal Debate for Election and Beyond"
Congressional Quarterly Today (10/24/07); Rubin, Richard

"The mother of all reforms" is the term House Ways and Means Chairman Rep. Charles B. Rangel (D-N.Y.) used to describe his approximately $1 trillion tax overhaul bill. Although it is unlikely to pass in its current draft, the measure could spawn follow-on bills that would extend into the 2008 election and beyond--especially if the White House is won by a Democrat and Congress remains primarily blue. "It gives you a good snapshot into the future of what the world will look like," noted Ways and Means member Rep. Paul D. Ryan (R-Wis.). Rangel's bill calls for the repeal of the alternative minimum tax (AMT) and would impose higher taxes on top earners to offset the loss in revenue. It is anticipated that the bill will hike up the standard deduction, the earned-income tax credit and the child tax credit, while the 35 percent corporate tax rate will be reduced and corporate tax preferences will be removed to increase revenue. Some sort of tax bill will be enacted into law this year, given the deadline for preventing the AMT's expansion from 4 million to 25 million taxpayers. Lobbyists are keeping a close watch on the House, with its pledge to balance tax cuts with offsetting revenue boosts. Democratic presidential candidates' emphasis on the AMT and reducing corporate tax rates has been relatively small. (www.cq.com)

"A Drive-By Swift-Boating"
Washington Post (10/31/07) P. A19; Marcus, Ruth

A group called Democracy Still Works, staffed by Massachusetts Democratic strategists, sent out fliers supporting Massachusetts congressional candidate Niki Tsongas the weekend before the Oct. 16 special election to replace retiring Rep. Martin Meehan (D). Tsongas won, and Washington Post columnist Ruth Marcus calls Democracy Still Works' maneuver "the electoral equivalent of a contract hit, conducted by a mysterious assailant specially created for the mission at hand. That this brazenly campaign-related activity persists in 2007 does not augur well for 2008," she warns. Still, 527 organizations such as Democracy Still Works claim they can accept unrestricted contributions from anyone, and have become a growing political force. The Federal Election Commission (FEC) estimated that more than $150 million was injected into the 2004 presidential election by three such groups--America Coming Together, Progress for America, and Swift Boat Veterans for Truth. For their activities, the groups were slapped on the wrist with $1.8 million in fines two years later. The FEC must clearly communicate to 527s that they will suffer grave consequences in order to deter similar campaigning in 2008, writes Marcus. The commission has stated that such groups must adhere to federal election law if their communications are "unmistakable, unambiguous and suggestive of only one meaning," and about which "reasonable minds could not differ as to whether it encourages actions to elect or defeat a candidate when taken as a whole."(www.washingtonpost.com)

"Economic Crime Is Pervasive at Companies Worldwide: PWC"
Yahoo! Finance (10/17/07)

Forty-three percent of organizations worldwide fell victim to some form of economic crime in the past two years, according to PricewaterhouseCoopers. That figure is about the same as it was two years ago. The survey of 5,400 companies from around the world also showed the average amount of money lost has risen almost 40 percent. In 2005, the average loss was $1.7 million; now it is $2.4 million. The most common cause of loss included asset misappropriation, accounting fraud, bribery, corruption, money laundering, and intellectual property infringement. Economic crime was especially prevalent in the world's leading developing countries: Brazil, China, India, Indonesia, Mexico, Russia and Turkey. Those seven countries made up 45 percent of the world's total $4.2 billion in losses. Experts say the increase in losses shows current controls on economic crime are not sufficient. To better protect themselves businesses should work harder to establish ethics and company loyalty as part of their culture. They also should set up hotlines for whistleblowers, set clear consequences for violations, and make financial reporting as clear as possible.(www.biz.yahoo.com)

"Senators OK Ban on 'Phonemarking' in Quiet Adjustment of Lobby Rules"
Congressional Quarterly Weekly (10/19/07); Jansen, Bart

Lawmakers attempting to coax bureaucrats into spending money on local projects, also known as "phonemarking," is a practice banned by an amendment to a Commerce-Justice-Science spending bill introduced by Sen. Jim DeMint (R-S.C.) that the Senate passed on Oct. 16. The provision bars federal agencies from bypassing "any statutory or administrative formula-driven or competitive awarding process to award funds to a project in response to a request from a member of Congress ... unless the specific project has been disclosed in accordance with the rules of the Senate or House of Representatives." The amendment was drafted to apply to lawmakers, committees, and legislative staff. DeMint's provision awaits negotiation with the House in conference, as does an amendment added to a defense spending bill that exempts multiple plane reservations from a gift ban dictated by the new ethics and lobbying ordinance.(http://www.cq.com/)