K Street's Favorite Democrat
In October 2005 Republican lobbyist Leo Giacometto hosted a NASCAR Fundraiser in Georgia. For $2,500 a pop donors received breakfast at the Ritz-Carlton and a day at Atlanta's famed Motor Speedway. Giacometto, a former chief of staff to Montana GOP Senator Conrad Burns--disgraced lobbyist Jack Abramoff's favorite senator--has been involved in a number of tawdry political scandals, raising questions about why any elected official would want to be associated with him. But the most interesting thing about his NASCAR party was the identity of the guest of honor: not a fellow Republican but the Democratic senator from his home state, Max Baucus. To Giacometto, Baucus, the ranking Democrat on the powerful Senate Finance Committee, was not a partisan adversary but a useful and valuable ally. "I believe that he's good for what I believe in," the lobbyist told the Billings Gazette.
Today, in the aftermath of the Democratic sweep of Congress, Baucus is still one of corporate America's favorite Democrats. As chair of the Finance Committee, he counts among his friends and political supporters a Who's Who of bankers, oilmen, ranchers, pharmaceutical lobbyists and Wall Street executives. He's particularly close to Montana's sole billionaire, industrialist Dennis Washington, a major donor to the Republican Party whose business interests Baucus has promoted over the years. The business community, in turn, expresses admiration for Baucus in its usual style--by writing big checks.
The Finance Committee has always had an incestuous relationship with corporate lobbyists, and with Baucus at the helm, the tradition continues. In their book about the tax reform act of 1986, authors Jeffrey Birnbaum and Alan Murray coined a term for the lobbyist-packed hallway outside the Finance Committee hearing room: Gucci Gulch. With jurisdiction over taxes, Social Security, Medicare, healthcare and international trade, the committee is the place that raises all the government's money and spends half of it. "It really is the committee, more than any other, that decides what kind of government you have," says Lawrence O'Donnell, former chief of staff of the Finance Committee, whose chair was Daniel Patrick Moynihan.
The rap on Baucus is that he has always valued his own re-election above all else. He's up again in 2008. The question is: What is he sacrificing to get there? When Democrats were in the minority, Baucus brokered the passage of two of George W. Bush's signature first-term achievements: his massive 2001 tax cuts and his 2003 Medicare prescription drug plan. He's spent the better part of the Bush presidency cutting deals with Republicans and infuriating members of his own party, voting for the war in Iraq, the energy bill, the bankruptcy bill and to confirm Supreme Court Justice John Roberts. On core economic issues, the very ones that come before his committee, only one Democrat, Nebraska's Ben Nelson, has a more conservative voting history, according to National Journal.
To be sure, not everything Baucus does is heresy to fellow Democrats. He's always been solidly progressive on issues like choice and the environment. After some initial pressure, he led the effort by Senate Democrats to block the privatization of Social Security. He recently came out for ending the conflict in Iraq (his nephew Philip, a Marine corporal, died in Anbar last July) and for providing all Americans with healthcare. Back home, he's one of the most popular politicians in Montana. In recent years the state has moved leftward, but there's mixed evidence on whether Baucus is currently following or resisting that trend. Unlike a deeply polarizing figure like Joe Lieberman, Baucus is not a rigid ideologue; he's a dealmaker. That's one of the reasons corporate America likes him so much.
As big business shifts to playing defense in Congress, Baucus will be one of its go-to guys. As chairman, Baucus says, he wants to operate by consensus and work across the aisle. "With the Democratic majority, it's an opportunity to be practical, to be pragmatic, to get results," he told me during an interview in his Capitol office, between votes on the minimum-wage bill. In the past, those results have often benefited big corporations and the Republican Party. Will they be any different now that Baucus is chairman? The Bush Administration is probably too weak for Baucus to again shepherd through a major pact. But he can still temper, dilute or block initiatives by his Democratic colleagues, deciding at any given moment whether an important piece of progressive legislation lives or dies.
Baucus seems like an accidental senator: not especially well spoken, engaging or smooth, though he looks the part with a tall athletic frame, mop of shiny gray hair and strong cleft chin. He speaks in a staccato monotone, smiles awkwardly by exposing his top teeth and rarely displays the backslapping manner customary in Washington. At Finance Committee hearings, the most remarkable thing about Baucus--other than his deference to the ranking Republican, Charles Grassley--is how unremarkable he is. He's managed to rise in the Senate simply by sticking around. Elected to the Senate in 1978, the son of a wealthy ranching family, Baucus was little known before he became the ranking Democrat on the Finance Committee in 2000.
That soon changed. After helping to craft the largest tax cut in a generation, Baucus raised more than $1 million in campaign contributions from the financial sector for his 2002 re-election campaign. Opening doors in both directions were former Baucus staffers. During the debate over whether to add a $400 billion privately run prescription-drug plan to Medicare, his former chief of staff, David Castagnetti, and legislative aide, Scott Olsen, were part of the Pharmaceutical Research and Manufacturers of America's $8 million lobbying effort. Shortly after the legislation--written largely by the pharmaceutical industry--passed, Baucus's top staffer on the Finance Committee, Jeff Forbes, left to open his own lobbying shop, with clients including PhRMA, the drug maker Amgen and the American Health Care Association. These companies have in turn donated generously to Baucus; almost $700,000 between 2001 and 2006 from the healthcare industry and pharmaceutical lobby.
A study last year by Public Citizen found that between 1999 and 2005 Baucus, along with former Senate majority leader Bill Frist, took in the most special-interest money of any senator. He tops the list of recipients from business PACs. And only three senators have more former staffers working as lobbyists on K Street (at least two dozen in Baucus's case). Now that he's chairman, "former aides of Baucus, in particular, have been in demand on K Street by companies that hope to limit damage to their business interests," reports Congressional Quarterly.