New Leadership at NFIB Makes a Return to Roots

The National Federation of Independent Business of the 21st century looks a lot like your father’s small-business lobby.

For Dan Danner, who took over the helm of the venerable Washington, D.C., powerhouse nearly a year ago, it’s been about maintaining the finer points of the institution.

“There hasn’t been a lot of radical change,— Danner said of his first nine months on the job.

Not surprising coming from an NFIB veteran who clinched the president and CEO slot after first being passed over by a relatively unknown yet successful small-business owner, Todd Stottlemyer.

Stottlemyer lasted three years as NFIB’s fifth president. Danner, meanwhile, has marked his 16th year at the small-business lobby. A former head of the group’s lobbying and political operation, the Ohio native governs the association with the steady hand of someone who has been around long enough to know the association’s ins and outs.

His group has long been known for its staunchly conservative views. The NFIB was nearly unstoppable in the Republican-controlled Congress, pushing ahead with tax cuts and successfully blocking policies, such as an ergonomics regulation, that the NFIB argued would cost its members billions of dollars to implement.

But health care reform, more than any other political issue, is how the trade association made its name. In the spring of 1993, the NFIB came out strongly against an employer mandate in the health care bill. While other business associations, including the U.S. Chamber of Commerce, opted to work with the Clinton administration on health care legislation, the NFIB aggressively went on the offensive to kill the bill. The small-business lobby used its extensive grass-roots network to target specific Members, such as Senate Finance Chairman Max Baucus (D-Mont.), to beat back the proposal.

The decision paid off. Health care reform tanked while the NFIB’s membership ranks soared, and its stature among Washington business trade associations reached new heights.

This year, though, the NFIB has taken the opposite approach on health care reform.

While the trade group came out aggressively against the Senate health care bill earlier this month, the association had been quiet up until that point, trying to negotiate on several portions of the bill to make it more favorable for small-business owners.

Lobbyists familiar with the NFIB say this didn’t win the organization many supporters in Washington. Republicans were dismayed that the business group was not more outspoken at the outset against health care reform. Liberals, too, have expressed their frustration with the NFIB for refusing to support the legislation.

These K Street sources add that the decision to negotiate on health care reform has hurt the trade group’s standing. As the NFIB staked a lower profile while negotiating on health care reform, the U.S. Chamber of Commerce filled the void, becoming the loudest critic of the legislation.

Several lobbyists said the NFIB’s decision to work with unions and the seniors lobby AARP on health care reform was uncharacteristic and was a vestige of Stottlemyer’s agenda to make the small-business association more moderate.

But Danner defends the decision to negotiate with Democrats, citing the NFIB’s system of surveying and balloting members for how the association makes policy decisions.

“Most of our members say today the status quo isn’t acceptable,— Danner said. “It’s why we’ve worked very hard to find something that can get passed.—

While the NFIB and its members largely lean to the right, Danner says he is aware of the need to engage Democrats.

“We know who runs Congress. We know who is at the White House, and at the end of the day, regardless of party, what our members really want is solutions,— Danner said.

To that end, Danner has also continued to forge relationships with Democrats with whom the trade group shares a turbulent past. Former NFIB President Jack Faris frequently sparred with liberals and even publicly fought with pro-business senior Blue Dog Coalition members, including Reps. Allen Boyd (D-Fla.) and John Tanner (D-Tenn.).

The association is also taking a more pragmatic stance on other issues important to its members, such as the estate tax. The NFIB has long argued that the estate tax should be completely eliminated. However, it has recently voiced support for a permanent 35 percent tax on estates worth more than $10 million.

Nevertheless, under Danner’s leadership, the NFIB will continue to work to swing the political pendulum to the right by contributing more heavily to Republicans than Democrats.

“We base our [political contribution] decisions on positions that legislators take to support small business,— Danner said. “The reality is there will be more Republicans that support those things than there will be Democrats.—

The trade association has spent about $1 million in House and Senate races during the past two election cycles, contributing another $5 million on independent expenditures in high-profile races and get-out-the-vote activities, according to Danner. This cycle, the group’s fundraising has dipped to about $30,000. Danner said that will pick up.

Danner has also turned the top lobbying job over to his former deputy Susan Eckerly, a former Labor Department official for the George H.W. Bush administration.

The NFIB has long been known as part of the farm team for Republican staffers heading downtown.

The association’s tentacles are deep into many of Washington’s venerable lobby shops and corporate offices. Former NFIB lobbyists include John Motley, who runs his own firm, Policy Solutions; Ralph Hellmann, now top lobbyist at the Information Technology Industry Council; Kent Knutson of Home Depot’s Washington operation; Mark Isakowitz, name partner of Fierce, Isakowitz & Blalock; and Nelson Litterst, a partner at C2 Group. Other former NFIB lobbyists include Brian Reardon, now at Venn Strategies; and John Emling, senior vice president at the Retail Industry Leaders Association.

Danner attributes the success of lobbyists moving onward and upward from the NFIB to giving junior lobbyists responsibility and reach on Capitol Hill.

The NFIB isn’t only focused on old-fashioned, face-to-face lobbying. It is also modernizing its operations under Danner, who says technology is a top priority.

The NFIB launched a new Web site in April and unveiled a database that will help the association improve its ability to target and mobilize its members.

“I’m a big believer in and an advocate for microtargeting,— Danner said.

He’s also looking to utilize social networking for NFIB members and wants to add social networking companies and other small technology firms to the NFIB’s roster.

That roster apparently has been shrinking. The small-business lobby, which reportedly had a membership of 645,000 in 2001, now counts its membership at about 350,000.

The NFIB’s own operations have not been immune to the struggling economy. While the association hasn’t had layoffs, Danner said the NFIB has cut back on travel, frozen any new hires for open positions and cut down on overhead for things such as the association’s publications.

But he doesn’t expect a large dip in membership.

“We might lose a few, but not a lot,— Danner said.