Exiting lawmakers put in calls to K Street

Exiting lawmakers put in calls to K Street
© Istock

Lawmakers heading for the exits at the end of the congressional session are already testing the waters for jobs on K Street. Nearly three-dozen lawmakers are set to be free agents in 2019, including four members who have already left office. That number is certain to grow, with more retirements expected this spring.

With the midterm election shaping up as a possible “wave” against the GOP, the competition for jobs at lobby firms and associations could grow intense by the end of the year — and some members are getting an early jump on the process.

ADVERTISEMENT
“I would say my phone has been ringing at a fairly healthy clip, with people off [Capitol] Hill or out of the administration who are thinking about what’s next for them professionally,” said Nels Olson, a vice chairman at executive search firm Korn Ferry.

Positions working “downtown” at law and lobby firms are attractive for former members of Congress, as they keep them in the thick of the action while increasing their paychecks at least three-fold.

Salaries for members of the House and Senate start at $174,000 per year and increase to $193,400 for those in leadership. The House Speaker earns $223,500.

The “revolving door” from Congress to lobbying swings especially fast in election years, when there is heavy turnover, including at the staff level.

This year’s class of retirees includes an unusually large number of heavy hitters, with at least 10 committee chairmen leaving Congress.

That includes Rep. Ed RoyceEdward (Ed) Randall RoyceTop Dem lawmaker pushing committee for closed-door debrief with Trump’s interpreter Lawmakers target link between wildlife poaching, terror groups GOP lambasts Trump over performance in Helsinki MORE (R-Calif.), who leads the foreign affairs panel; Rep. Rodney FrelinghuysenRodney Procter FrelinghuysenOvernight Energy: Proposed rule would roll back endangered species protections | House passes Interior, EPA spending | House votes to disavow carbon tax House completes first half of 2019 spending bills 'Minibus' spending conference committee abruptly canceled MORE (R-N.J.), chairman of the powerful House Appropriations Committee; House Financial Services Committee Chairman Jeb HensarlingThomas (Jeb) Jeb HensarlingOn The Money: Fed chief lays out risks of trade war | Senate floats new Russia sanctions amid Trump backlash | House passes bill to boost business investment House passes bipartisan bill to boost business investment On The Money: US files complaints at WTO | House leaders get deal to boost biz investment | Mnuchin says US will consider Iran sanctions waivers | FCC deals blow to Sinclair-Tribune merger MORE (R-Texas); Rep. Bob GoodlatteRobert (Bob) William GoodlatteWill Congress ever hold our federal agencies accountable for contempt? Lots of love: Charity tennis match features lawmakers teaming up across the aisle Dems try to end hearing on bias against conservatives in tech MORE (R-Va.), the leader of the House Judiciary Committee; and Rep. Bill ShusterWilliam (Bill) Franklin ShusterOvernight Defense: VA pick breezes through confirmation hearing | House votes to move on defense bill negotiations | Senate bill would set 'stringent' oversight on North Korea talks House passes bipartisan water infrastructure bill Stakeholder group urges Senate panel to fund Amtrak, Northeast Corridor MORE (R-Pa.).

“From my perspective, I think there is certainly going to be a lot of interest from retiring members in trying to get to an association or a K Street firm,” said Ivan Adler, a principal at The McCormick Group. “But the competition for that, due to the number of them, is going to be greater than it’s been in a very, very long time.”

Multiple headhunters who spoke with The Hill said lawmakers and people with ties to the Trump administration have been calling them up to talk about private sector opportunities and what they might be worth on the job market.

The opportunities aren’t just lobbying, either. Some former members have chosen to hit the speaking circuit, practice law or sit on a corporate board.

“There is a desire to go off the Hill and focus in on one thing, as opposed to trying to explain this crazy political system to people back at home,” said Tim LaPira, an associate professor of political science at James Madison University who studies lobbying. “It’s not fun anymore.”

For lawmakers and high-level congressional staff, paychecks on K Street can soar as high as $1 million and beyond.

Generally, a member of Congress can fetch a salary of at least $500,000 by moving into public relations or lobbying. Senators can easily expect a seven-figure payout.

Scholarly research shows that the number of retiring members who become lobbyists or have lobbying-related jobs has increased dramatically over the years, LaPira said.

In the 1970s, only a handful of former members made the jump. Now, however, he estimates that it’s about one in every two retiring lawmakers. The overall figure stands at about 40 percent, but that doesn’t include former policymakers who head to K Street but don’t actually register to lobby, a practice informally known as “shadow lobbying.”

Meanwhile, the amount that lobby firms are willing to pay former staffers varies widely. However, some of them can be particularly valuable to firms, with professional committee staff on the money-related panels — such as the Senate Finance Committee, the House Ways and Means Committee and the Senate Banking Committee — worth the most, sometimes regardless of how long they worked in Congress.

At firms, earnings in the low- to mid-six-figure range are guaranteed for former congressional staffers of all stripes, while headhunters say some of the highest-ranking former committee staffers have garnered $1 million or more.

All of those figures, experts say, are just a base price.

“Then if you bring in the business, the world is your oyster,” said Julian Ha, a partner at Heidrick & Struggles.

Others noted that those figures for both former members and staffers are subject to change and may decrease after the initial year based on the results and clients they bring in.

For lawmakers eyeing their next move, there are already several prominent positions available.

As of the latest count, there are at least seven trade associations searching for new leaders: the Grocery Manufactures Association, the American Petroleum Institute, the Financial Services Roundtable, the Mortgage Bankers Association, the Wine & Spirits Wholesalers of America and Croplife America, an industry group that represents manufacturers and distributors of pesticides.

Leaders of those associations have historically made anywhere from $760,000, including retirement benefits, in the case of Craig Wolf, at Wine & Spirits Wholesalers, to the upwards of $6 million that was paid in total compensation to American Petroleum Institute chief executive Jack Gerard.

“The reality is, for a major advocacy association, the key for CEO on search committee is having not only Washington experience, but also having real management experience. That can be a challenge for a member of Congress if they haven’t had business management experience in the past,” Olson said.

Corporate America is also going to be calculating how the midterm elections in November may affect the political climate.

“If the House and Senate flip [to Democrats], which may happen, they’re going to need to hire members that are at least capable of having phone calls and interactions with the other side,” Adler said. “There are some firms that are going to wait until they can read the tea leaves and see what’s going to happen politically to decide which member to hire.”

 

— This story was updated at 10:22 a.m.