'We have to have shared values'

In his first year as a lobbyist, James Morhard is taking a measured approach. He has started his own business but is weighing potential clients carefully.

The congressional credentials Morhard built as a staffer on Capitol Hill allows him to be choosy. He says he’s turned down more clients than he’s accepted, even though revolving-door rules prevent him from lobbying this year.

By the time Morhard decided to enter the private sector, he had spent 26 years on Capitol Hill. His last job was as the majority staff director for the Senate Appropriations Committee, the place where companies come calling, hat in hand, for federal earmarks.

Morhard is well-connected enough to consider Sen. Ted Stevens, the former Senate Appropriations Committee chairman and one of the Senate’s most powerful members, like a second father. For his part, the Alaska Republican calls his former staff director “one of the true great gentleman I’ve worked with all my life. … Absolutely loyal to the Senate and its processes.”

Morhard also served as staff director to the Senate Appropriations Committee’s Commerce, Justice and Science Subcommittee when Sen. Judd Gregg (R-N.H.) was its chairman. Gregg — “one of the great minds of the Senate,” Morhard says — now heads the Senate Budget Committee, another powerful panel.

Morhard retired after a career of 18-hour days and brutal policy fights, and when K Street firms and companies heard he was leaving they pounced on the opportunity to add his almost line-by-line expertise in the federal budget to their teams. He had multiple offers from the private sector.

But after running the entire Appropriations Committee, which has some 75 staffers, Morhard says he was interested in starting his own business. Although he acknowledges that he expects to be paid well, he adds that he’s not interested in a “quick buck.”

Morhard says he likes to choose clients who share his values.

“We have to have shared values and a shared mission,” he says. “If they have those values, then I have to make sure I can help them navigate the process.”

Currently, just three clients have fit the bill: Owens Corning, the Air Transport Association of America and DRS Technologies. He also worked on a short-term basis for the database company LexisNexis.

Although his client list isn’t long — he plans to become more aggressive when the lobbying restriction is removed in March — business is not slow either. Midyear lobbying registrations show his three main clients paid him a total of $180,000 his first six months as a consultant. (End-of-year reports are not available yet.)

But he has stepped cautiously along K Street.

“All I left with was a lot of experience and my reputation, and I’m interested in keeping that reputation intact and producing for my customers, because you’ve got to come back and fight another day if it doesn’t work out for you.”

Morhard describes his job for the past year as helping fit his clients’ issues into a broader public-policy context and advising them about the congressional process.

He advised Owens Corning, for instance, to put one of its main products — insulation — into the context of the nation’s current energy needs. And he has advised the company on how it should go about trying to persuade Congress to fund a pilot project that takes shingles the company manufactures — which have been filling up landfills during the current housing boom — and uses them as an energy source for cement kilns.

“You have to know how to exert influence on every part of the process,” he says.

Morhard began his congressional career after working for the Navy comptroller directly after college.

He won a fellowship in 1982 to work in Congress from the Office of Personnel and Management, which placed him on the staff of Sen. Pete Wilson, a California Republican.

“I liked it immediately,” Morhard says. (Typically, he describes his former boss as a “special guy.”)

While working for the Navy, Morhard also went to night school to get an MBA, which he completed during his first year on Capitol Hill.

But he noticed that as he progressed up the congressional food chain there were times he felt outmaneuvered by his counterparts who were lawyers. So he went to Georgetown, again at night, to get a law degree.

“I was getting beat on the Senate floor, and I knew I needed it,” he said.

He was smart and driven enough to finish in just three and a half years, a semester early for night school.

“There wasn’t much left of me at that point,” he said. “When I got done, life got a lot better.”

He got married a year later, at 39.

But Morhard didn’t leave late nights behind. Steve Cortese, who at the time was the Senate Appropriations staff director, tapped him to take over the staff of the Commerce, Justice and Science (CJS) Subcommittee, despite Morhard’s objections.

“I said this wasn’t an issue that I really want to do, and he said it wasn’t my choice. I tried to quit a month later, and he said it wasn’t an option,” Morhard said.

Scott Gudes, who is now the Republican staff director on the Budget Committee, was then the staff director for Sen. Fritz Hollings (D-S.C.) on the CJS panel and had known Morhard ever since he worked for Sen. Robert Kasten (R-Wis.), whose staff he joined after working for Wilson. Gudes was an appropriations staffer at the time.

Morhard was leaving the relative calm of military-construction appropriations, which largely follows the direction of the authorization committee, to what Gudes calls the most diverse of the 13 appropriations committees.

During the mid-1990s, the CJS bill had emerged as a major point of contention between the Clinton White House and the Republican Congress. When Morhard arrived in 1997, the bill had not passed the Senate floor as a stand-alone measure for two years, Morhard says.

When he told Gudes of the move, Gudes told him the two wouldn’t be friends by the end of the year, Morhard said. Morhard lost 20 pounds and was sleeping in the Senate during the difficult negotiations.

“At one point, my daughter said to me, ‘Are you trying to break the record for not coming home at night?’” he recalls.

But eventually, Morhard and Gudes, along with their bosses, found the right compromises, and the measure passed unanimously two years in a row.

Despite the warning, Morhard and Gudes remain friends.

“Jim is a prince,” Gudes said. “He was always fair, open and honest — a very decent guy.”