Just hours before Senate Republicans voted Tuesday to block a bill that included some of the business communitys most prized tax credits, three GOP Senate leaders held a private meeting with about 20 of K Streets biggest Republican names.
The gathering held inside the Capitol with Senate Minority Leader Mitch McConnell (Ky.), Minority Whip Jon Kyl (Ariz.) and Finance ranking member Chuck Grassley (Iowa) was aimed at keeping the business community from drifting away and supporting the Democratic-backed tax package.
The Democratic plan includes offsets to pay for the extension of the expiring tax credits, which include credits for companies doing research and development and for renewable-energy programs.
The tax-credit extensions would be paid for primarily by delaying tax breaks for interest earned overseas and eliminating deferred compensation in some offshore accounts.
Senate Republicans oppose the offsets. But the priority for many in the business community is achieving those tax extensions, in some cases even if they have to align themselves with Democrats.
There was a feeling that some in the business community were peeling off, said one lobbyist who attended the meeting.
He said the GOP message is that if business leaders accept a tax on one industry now to pay for their tax extenders, other industries might be hit hard in the future as well.
The Senate Republicans clearly want the business community to know that if you have a tax bill that has a tax increase, you may not be hit now, but if you continue to support those efforts, eventually your industry is going to be hit, said the lobbyist.
Lobbyists at the session hailed from big-business groups as well as from such sectors as financial services, technology and health care.
It was a whos who of industry lobbyists, said a second K Streeter who attended.
Sources said the participants included Nick Calio, Citigroups top lobbyist; John J. Castellani, president of the Business Roundtable; Duberstein Group lobbyist Eric Ueland, the one-time chief of staff to then-Senate Majority Leader Bill Frist (R-Tenn.); Dave Hoppe, a lobbyist with Quinn Gillespie & Associates; and Richard Hunt, a senior managing director at the Securities Industry and Financial Markets Association.
Also present, sources say, were Candida Wolff, recently President Bushs top Congressional liaison who is now a partner at Hogan & Hartson; Hazen Marshall of the Nickles Group; Bruce Josten, executive vice president of the U.S. Chamber of Commerce; and the National Federation of Independent Business Executive Vice President Dan Danner.
One Republican leadership aide said the meeting was to address a sense of panic that some business lobbyists have expressed over the fate of the much-beloved tax credits.
Some lobbyists have indicated their companies would be willing to accept tax increases on other sectors in order to get the tax-extenders package passed into law. And several major corporations including Bank of America, Citigroup, Ford and Pfizer recently sent a letter warning that failure to approve the tax extensions could harm the economy.
The [Senators] message was, Wed be far better served if we stuck together as a group, this GOP aide said. We shouldnt permanently increase other taxes to temporarily extend tax credits.
Yet another lobbyist said the Senators expressed their intention of wanting to do the tax extenders as soon as possible.