New Democrats Try to Assuage K Street

Posted September 19, 2005 at 7:04pm

Just months after registering its opposition to a key trade bill this summer, the centrist House New Democrat Coalition is reasserting itself with the business community and sending the message that it has not abandoned its support for opening up global markets.

The first sign of the 43-member coalition’s efforts came late last week when the New Democrat leadership met privately with high-profile business lobbyists to negotiate the terms of an upcoming free trade agreement with Thailand.

That session, the New Democrats say, was the first of many meetings with K Street to help troubleshoot trade deals that are set to come before Congress.

“We want to be sure the business community knows that we are at the ready to work with them, and we are interested in working with them,” said Rep. Ellen Tauscher (Calif.), chairwoman of the New Democrats.

Earlier this year, New Democrats came out as a group against the Central American Free Trade Agreement — a hotly contested measure that narrowly passed the House in July. In the end, just a handful of New Democrats supported the bill. The agreement passed, 217-215, just after midnight amid intense lobbying on both sides of the aisle and largely along party lines.

Tauscher said despite the group’s opposition to CAFTA, the New Democrats remain and will continue to be supportive of free and fair trade. Tauscher said CAFTA was a rare instance in which the centrist Democrats voted “no” on a key trade deal after concluding it was politically motivated and a bad deal for American workers and Central American countries.

“In the end, the deal failed the test and we couldn’t support it,” she said. “A lot of it was about politics, because that’s what the Republican majority wanted it to be about.”

Now, the New Democrats are looking to help fine-tune future agreements, including those involving Thailand, the Andean nations, Panama and others. Tauscher said her group is “engaged” and “in the game” when it comes to helping put together upcoming trade policies.

Rep. Artur Davis (Ala.), a New Democrat co-chairman, said the group has a long history of supporting small-scale trade agreements, including those with Chile and Singapore, as well as major deals, such as fast-track trade negotiating authority for the president and Permanent Normal Trade Relations status for China. CAFTA, he said, was a “uniquely flawed agreement.”

Davis said the recent meetings with business lobbyists aren’t about fence-mending but rather about working toward creating “real reforms” around which both Democrats and Republicans can rally. “You don’t abandon old friendships because of one vote,” Davis said.

“Honestly, I don’t think the New Democrats have anything to prove,” Davis added. “I think the New Democrats are the most consistent voice in the Democratic Caucus for fair trade policies.”

Even so, the New Democrats did not escape criticism from some pro-CAFTA lobbyists who felt the group had abandoned them and in doing so risked permanently damaging relationships. At the time, many said privately that the New Democrats had forgotten its free-trade roots.

Rep. Adam Smith (Wash.), who chairs the New Democrat political action committee, said those types of arguments came from a certain sector of the lobbying community and do not reflect all business interests. He said that while the New Democrats may feel a pinch in its fundraising because of its stance on CAFTA, he sees little other fallout from the vote.

“There are a whole lot of folks in the business community who are still very supportive of us,” Smith said.

The Washington Democrat added that while many argue the New Democrats shed its free-trade background, the organization has always had many interests, including advocating on national security and for pro-growth economic policies. He said the New Democrats have and will continue to work on crafting sound trade policies that open up new markets and protect workers at home.

“That’s what we’re trying to do,” Smith said. “We want to continue to move forward with trade.”

And many on K Street appear ready to take the group on its word.

“There will always be tensions about what happened on CAFTA,” said Ralph Hellmann, senior vice president of government relations for the Information Technology Industry Council, whose industry spent $100,000 promoting the trade pact. “But for the most part, we have an ongoing working relationship with the New Democrats, and we have to work together on a lot of issues. It would be unwise for people to write them off.”

Scott Parven, a lobbyist with Clark Consulting Federal Policy Group who represented the government of Thailand in the meeting, said that after seeing what happened with CAFTA, groups interested in promoting trade learned that they have to start talking up deals much earlier.

“There’s a lot of CAFTA-itis on the Hill,” he said. “Members and staff haven’t healed yet. I want to engage all swing groups, Republicans and Democrats, early, because as we can see, lobbying on [trade pacts] now requires a long lead time.”

The New Democrats restructured itself in February with an eye toward regaining its once-powerful footing in Congress. The group first organized in 1997 under President Bill Clinton, a philosophical ally, but in recent years lost much of its influence and stature within Congress.

The February reorganization included electing new leaders, adding new participation requirements and tailoring the group’s issue focus.

One Democratic technology lobbyist said that in light of the organizational changes and the CAFTA vote, some question whether the New Democrats are holding true to its long-standing support of free-trade policies. “The jury is still out,” this source said.

The lobbyist added, however, that even though feelings are still raw in the industry over CAFTA, there is unlikely to be any long-term consequences for the New Democrat Coalition or its members.

“In parts of the tech community, there is — particularly among some Republicans — a feeling that they want to screw the New Democrats who voted against it,” this lobbyist, who supported CAFTA, said. “But others with clearer heads understand there are other priorities that we need the help of the New Democrats on, and secondly, there are a lot of tech issues on which Republicans haven’t been that great.”

Tauscher said she doesn’t believe the New Democrat opposition to CAFTA should be the litmus test for the group on trade. And, she said, it shouldn’t lead to any real fallout for the organization, “except for maybe some in the White House and Republicans in the House.”

“I think it’s clear that no one wants a repeat of circumstances of the CAFTA vote,” Tauscher said.

Rep. Ron Kind (D-Wis.), another New Democrat leader, said that CAFTA taught lessons on both sides. For its part, he said, the New Democrats are focused on working to forge bipartisan trade agreements that can pass Congress with widespread support. Democrats argued mightily that CAFTA was negotiated in a vacuum without their input.

“Most people are looking for tomorrow, and the next issue,” he said. “We want to formulate good policy. We can always play what ifs, but it’s not going to change the history. This is an opportunity to move forward. Face it, CAFTA was not Congress’ finest moment.”

Tory Newmyer contributed to this report.