Lobbyists not sweating McCarthy’s drawn-out battle for the gavel

LOBBYISTS NOT SWEATING DRAWN-OUT SPEAKERSHIP RACE: Kevin McCarthy’s push to become House Speaker dragged on for the fourth day this afternoon, though the California Republican saw some major breakthroughs today. Despite many remaining questions about the inner workings of the chamber for the 118th Congress, K Street isn’t too flustered by the length of the proceedings (even as Washington influencers copped to being glued to C-SPAN like the rest of us).

— While no smart observer of politics expected any major legislative developments in the opening days of the new Congress, the speakership election has snarled other housekeeping priorities like determining committee membership and has left unsettled races to lead key panels.

— “There’s still some outstanding major, major committee leadership decisions to be made,” noted David Peluso, a former aide to a member of House GOP leadership now at Kountoupes Denham Carr & Reid. That includes the tax-writing and health care-adjacent Ways & Means Committee as well as a number of subcommittees.

— “I think we all knew January was going to be sort of like a slow start,” Aaron Cutler, a former House GOP aide who runs the lobbying practice at Hogan Lovells. Cutler, who spoke to PI from the Consumer Electronics Show in Las Vegas, joked that he was texting his colleagues back in D.C. about wanting to “sit in front of C-SPAN all day long.”

— “The committees are going to take more time to get organized now. And it’s going to take more time before the first hearings start … the first bill gets dropped in the new Congress — it’s just gonna take some time,” he added.

— The delay in electing a Speaker also means Republicans must wait a little longer to launch their much-touted oversight agenda, though “I think that kind of flips on once they clear this and get the Speaker,” Peluso predicted. The uncertainty has left lobbyists with an “X factor” as they plan for the year ahead with clients, he added, though in many cases there’s still a general sense of how things might pan out.

— Lobbyists are also watching what concessions McCarthy makes to conservative holdouts on issues like the appropriations process and how to handle earmarks, which could make it more difficult for lobbyists to win certain provisions.

— But the disagreements playing out now also “portend kind of a more bottom-up, committee-driven approach to things” no matter who becomes speaker, Peluso said, one of several factors set to potentially provide lobbyists with more opportunities to shape legislation in the new Congress.

— Another is the lifting of rules this week allowing lobbyists and other members of the public to freely roam the Capitol once again, following almost three years of pandemic restrictions. “There’s certainly a lot of enthusiasm among folks downtown to get up and get back to, you know, being in the mix and in person on the Hill and in the hearing rooms,” Peluso said, arguing that “that’s where a lot of … the real process happens.”

— Once the House gets to work, K Street will “have to work with members all across the spectrum in the House to get legislation through,” Cutler added, “because you see what can happen if five members don’t like a bill.”

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VIEW FROM THE OTHER SIDE: Unsurprisingly, Republicans on K Street are more bullish on the House GOP’s ability to govern over the next few years than their counterparts across the aisle, but they’re not completely writing the House off.

— “While we are not particularly optimistic that chaos will spur some sort of bipartisan ‘coalition of the willing,’ we do think that the oxygen currently feeding the McCarthy revolt will dissipate a bit after this week,” Hogan Lovells’ Ivan Zapien, Timothy Bergreen and Ches Garrison — all Democrats — write in a memo to clients on their view of the landscape.

— “In time, we think the House will get back to some semblance of normal (at least by its own standards), and some things will get done,” they added, “though we remain worried about the debt ceiling and government funding this fall.”

ASSESSING THE CORPORATE PAC FREEZE-OUT 2 YEARS LATER: “Political action committees affiliated with more than 70 major corporations said they would pause or reconsider donations to those who objected to certifying the results of the 2020 election after the attack on the U.S. Capitol two years ago. Then they gave more than $10 million to members of Congress who did just that,” POLITICO’s Jessica Piper and Zach Montellaro report.

— “In the aftermath of the Jan. 6, 2021 riots — fueled by former President Donald Trump’s false claims that the 2020 election was stolen — dozens of companies including Walmart, Comcast and Lockheed Martin said they would either suspend political donations entirely or specifically cut off Republicans who echoed Trump’s stolen election claims or voted against certifying the election results.

— “But over the next two years, amid a contentious midterm battle, less than half of those companies kept those promises for a full election cycle, the analysis of campaign donations found. The contributions made by corporate political action committees to the 147 members of Congress who sought to challenge the election results represent only a small fraction of the more than $350 million that those members raised over the past two years.”

Read the full article on POLITICO.