Stocks, Bonds and, So Far, Few Democrats
The newly minted Securities Industry and Financial Markets Association was supposed to give Wall Street a powerful and unified lobbying voice in Washington, D.C. But so far, lobbyists and Congressional sources say the group’s lobbying division is a muffled operation that’s saying pretty much one thing these days: Help wanted.
And the help it needs is from Democrats.
Interviews with nearly a dozen people familiar with SIFMA, a creation of a merger last year between the Securities Industry Association and the Bond Market Association, reveal an organization that is struggling to meld two cultures together and, more importantly, struggling to retain lobbyists, particularly Democrats.
By the group’s own admission it is behind schedule in filling a slot for a Democratic co-head of government relations at a time when Democrats control Congress and are examining crucial issues such as corporate taxation, 401(k) reforms, credit card fees and predatory lending practices.
Marc Lackritz, SIFMA’s president and co-CEO, said that hiring a Democratic co-chair for the group’s lobbying division is “obviously the highest priority we have right now.”
Lackritz said the organization is in a bind for two reasons.
“We just merged two organizations and are creating a new organization, and we also have a new political environment as well,” he said. “We’ve got a lot of moving parts here. We’re moving as quickly as we can to hire.”
But instead of bringing on new lobbyists, the group has lost many.
Democrat Roger Hollingsworth left for the Senate Banking, Housing and Urban Affairs Committee, chaired by Sen. Chris Dodd (D-Conn.). Peter Roberson, SIFMA’s director of public policy, soon will head to the Democratic staff of the House Financial Services Committee, chaired by Rep. Barney Frank (D-Mass.). Democratic lobbyist Michael Williams recently departed for Credit Suisse. And the group also lost Democratic lobbyists Jonathan Paret and Steve Judge. Republican Jon Traub also left to join the Ways and Means Committee staff.
Democratic lobbyists and aides familiar with SIFMA say the group is having a difficult time recruiting a top Democrat because of its reputation as a GOP-leaning operation. The one recent hire in SIFMA’s lobbying department is Shahira Knight, a former top aide to then-Ways and Means Chairman Bill Thomas (R-Calif.). And Richard Hunt, a former aide to Rep. Jim McCrery (R-La.), was appointed as the Republican co-chairman of the government relations shop. Several lobbyists said Hunt ruffled Democratic feathers when Republicans ran Congress by making sure only Republicans on his team made lobbying visits to GOP offices.
One lobbyist familiar with the group said Hunt, although a GOP partisan, is not at fault.
“He doesn’t try to hide that or use that as some kind of sword to cut anybody down,” said this lobbyist. “He’s been given the unenviable task of putting together a legislative team while they are looking for a co-head.”
Another lobbyist familiar with SIFMA said, “There’ve been a lot of problems with the merger itself. If you’re a Democrat downtown, why do you want to join an organization that isn’t on clear footing and has this partisan backdrop?”
SIFMA has one longtime Democratic lobbyist on staff, Josie Storrs, and both co-CEOs have Democratic credentials.
“We’re going to be hiring more lobbyists,” said one knowledgeable SIFMA employee, who would speak only on background. “We had hoped to have them all in place by now.”
But, this employee pointed out, SIFMA’s management team was not announced until early December, by which time Democratic lobbyists already were fielding many offers.
“There was some downsizing because of the merger, and then there are other people who chose to go other places,” this person said.
According to this employee, SIFMA plans to first bring on the Democratic co-head of the lobbying department and then together Hunt and the Democrat will fill out the roster of other lobbyists. Sources familiar with the position said the top Democratic slot pays from $500,000 to $800,000 a year, a top salary by K Street standards.
SIFMA does maintain a roster of outside lobbyists that includes the bipartisan shops of Washington Council Ernst & Young and OB-C Group, which is headed by longtime Democratic insider Larry O’Brien and includes Charles Mellody, who has ties to House Ways and Means Chairman Charlie Rangel (D-N.Y.).
“We’ve lost some terrific people that we made every effort to keep,” Lackritz said. “For the Democrats — and some Republicans — they’ve gotten great opportunities.”
K Street sources said that SIFMA has recently been in talks with a House Democratic aide, and before that had offered the job to Citigroup lobbyist Jimmy Ryan, a one-time aide to Senate Majority Leader Harry Reid (D-Nev.), who reportedly turned down the offer. Ryan declined to comment.
Ivan Adler, a lobbyist headhunter with the McCormick Group, said the competition for Democrats for any organization is intense.
“Senior-level Democrats, especially those who have experience in the health care, financial services and tax areas are the new ‘it girl’ for K Street,” he said.
When it comes to SIFMA’s legislative agenda, Lackritz said no matter the election and no matter the merger, many of the lobbying priorities remain the same, including regulatory reforms and retirement and pension issues.
“We’re creating a new organization that represents the whole industry and all the markets,” he said. “We’re going to have a broader and deeper agenda. As a result, we plan to be the best we can be and to put the best team in place as we move forward.”