Lobbyists resetting Trump expectations

Lobbyists resetting Trump expectations
© Greg Nash

Lobbyists began the year with high expectations for a Republican-controlled government, but many are recalibrating after a rocky start for President Trump’s agenda.

Most Republican lobbyists who spoke to The Hill said Republicans still have plenty of time to rack up big legislative wins, even if the road ahead is a tough one. 

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“When you’ve had such an unusual 100 days, the pressure for a victory is even greater than normal,” said Stewart Verdery, a lobbyist who worked at the Department of Homeland Security during the George W. Bush administration.

“In the administration’s defense, a lot of victories can happen without legislation,” he said. “A lot of what industry wants is reducing regulations or fixing regulations, and that takes a lot of time through the regulatory apparatus. … He’s got a phone and a pen as well.”

Yet others in the lobbying industry spoke of a growing sense that the heady atmosphere after Trump’s White House win is fading.

“K Street started the year with, ‘Well, we’re going to get stuff done,’ and that has very quickly turned into, ‘Oh s---, how are we going to go back to members or clients at the and of the year and say that nothing has happened?’” said one financial services lobbyist who asked for anonymity in order to speak freely.

“The fiduciary issue is a great case in point: The administration said one thing, but then did no follow up, and it looks like the rule is going to go into effect as it would have if Hillary [Clinton] won,” the lobbyist added, referring to an Obama-era investment adviser rule fiercely opposed by business groups.

Trump called for a review of the fiduciary rule and a delay that could have been a prelude to repeal, but it now appears that the regulation will be implemented after a delay.

One of the bright spots in Trump’s first few months in office has been on the regulatory front. With help from Congress, Trump has signed legislation overturning many of President Obama’s rules, even as his agencies take steps to roll back other regulations that businesses say are onerous.

“President Trump’s administration is new to the front lines, and that brings new forms of uncertainty, but his administration is one that, at its core, shares our common goals,” said Robert Cresanti, the leader of the International Franchise Association, applauding what the administration has already achieved with its regulatory changes.

However, many in Washington say Trump needs a major legislative achievement within his first year in office to establish himself as the dealmaker he promised to be during the campaign.

One lobbyist said serious progress needs to be made on Trump’s agenda in the next year, or the hiring boom that K Street enjoyed after the election could sputter out.

“People will say, ‘Same gridlock, different people,’” the lobbyist said.

Trump made big promises on the campaign trail about what would happen in his first 100 days, including renegotiating the North American Free Trade Agreement, building a wall along the U.S.-Mexico border, signing $1 trillion infrastructure legislation and overhauling the tax code.

However, as the 100-day mark approaches later this month, all of those priorities are facing serious roadblocks.

Republicans in Congress aren’t giving up, with leaders determined to enact healthcare and tax legislation before the midterm election season takes hold.

“It’s easy for K Street to be pessimistic about what can happen in any given time. Right now, the fact that the election is far off means they don’t have urgency,” said a Republican lobbyist who asked not to be quoted on the record.

“An off-year election is about promises kept. They made two promises: healthcare reform and tax reform. If they get those two things done before next summer, they will maintain the majority,” he added. “If they feel that’s threatened, that gives them an incentive to deliver.”

Another Republican lobbyist and former leadership staffer said he has been careful to have reasonable expectations for progress.

“We’re not really pivoting strategy … but we are looking to call some audibles as they come up,” he said. “At this point, because it’s so early, you have to stay the course on a lot of these things.”

Although Speaker Paul RyanPaul RyanGOP agrees on one thing: ObamaCare taxes must go Ryan reminds lawmakers to be on time for votes Lawmakers consider new security funding in wake of shooting MORE (R-Wis.) and the White House are still trying to negotiate a deal on ObamaCare repeal, lobbyists told The Hill that “healthcare fatigue” has set in among congressional staffers.

Some lobbyists are calculating their strategies accordingly.

“We’ve pivoted from a reform agenda to a reauthorization agenda,” said Jenn Higgins, a partner at Chamber Hill Strategies, who specializes in healthcare policy. “We thought this was going to be the year that big things would get done.”

The focus is now reauthorizing big, established healthcare programs, such as the Children’s Health Insurance Program and the Prescription Drug User Fee Act, Higgins said.

“If there are opportunities for policy developments, you’re going to have to play on the edges of those issues,” she said, adding that the Department of Health and Human Services, run by former Rep. Tom Price (R-Ga.), is already having listening sessions with lobbyists and stakeholders.

“If AHCA is not the policy goal, our focus and our energy will be on regulatory and administrative policy development,” Higgins said, referring to the GOP’s healthcare bill, the American Health Care Act.

But before Republicans can take any action on healthcare, they’ll have to avoid a government shutdown, with the funding deadline looming on April 28.

“The question I have is, can the Republican leadership reach out and try to have a substantive discussion with Democrats on what they need? The conversation [when they return] is going to be on government funding. That’s where the attention has to be,” said David Castagnetti, a Democratic lobbyist. “To me, that’s a place where Republicans are going to need Democrats. It’s the first real test of them potentially working together.”

A majority of members in the House have never governed at a time when Republicans have had control of government, the last instance being in 2006.

If Republicans and Democrats can work together ahead of the impending deadlines to fund the government and handle the debt ceiling, said Brian Dodge, senior executive vice president for public affairs at the Retail Industry Leaders Association (RILA), lawmakers will better be able to handle more complex issues.

“Success begets success,” he said.

While much of the day-to-day lobbying that happens in Washington is on smaller items or issues that fly under the radar, there’s little doubt that the single biggest issue on K Street is tax reform.

RILA, for example, is fighting a prized component of the House Republicans’ tax plan that would place a tariff on imported goods — including pouring resources into a lobbying and advertising campaign against it.

Congress set an August goal for enacting tax reform, but the deadline is nearly certain to slip. That’s a dangerous prospect, lobbyists say, as the chances of success will shrink dramatically as time passes.

“It actually gets harder and harder as you go forward and the elections approach. There are hard choices to make, and they don’t get easier as time goes on,” said the financial services lobbyist. “If you’re going to screw over retailers [on tax reform] — that’s somehow easier to do in an election year?”