When Washington Helped Small Business, Washington Was Helped

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WASHINGTON — Car dealers and private schools, restaurants and doctors, hotels and contractors all got money from the program established to help small businesses survive the coronavirus. But a subset of the list of recipients reads like a guide to a professional political class that thrives in the nation’s capital no matter what is happening elsewhere in the country.

When the Trump administration on Monday publicly detailed many of the beneficiaries of the $660 billion forgivable loan program, it showed money going to dozens of the lobbying and law firms, political consulting shops and advocacy groups that make up the political industrial complex.

Advertising and fund-raising firms assisting President Trump’s re-election campaign were listed alongside companies doing polling and direct mail for his Democratic opponent, former Vice President Joseph R. Biden Jr.

Donor-supported think tanks on both sides of the ideological divide received money, as did lobbying firms that have had a surge in business related to the pandemic.

There is no evidence of any string-pulling on behalf of politically connected outfits, and recipients said they applied for the loans for the same reason as other businesses around the country: to save jobs.

But the use of taxpayer funds to prop up Washington’s permanent political apparatus seemed especially discordant to some critics against the backdrop of a pandemic that has shined a bright light on gaping disparities between the haves and the have-nots.

“Every lobbying firm, political consultant and huge corporation that received a loan is a reminder that this program was administered to cater to the well-connected and powerful over small businesses,” said Austin Evers, the executive director of the liberal watchdog group American Oversight.

The group has filed public records requests for communications between the Small Business Administration, which administered the loan program, and lobbyists with connections to the Trump administration who represented some applicants for assistance.

As the program was being developed and put into action, there was an effort to limit the aid going to some of the businesses most emblematic of professional Washington: lobbying and political consulting firms.

The version of the stimulus bill originally passed by the House included a provision that would have barred businesses from counting lobbyists’ salaries toward payroll calculations of how much money could be sought. But after negotiations between the House, the Senate and the administration, the restriction fell out of the final version of the legislation signed into law by Mr. Trump in March.

Yet the S.B.A. still made clear that applications would be subject to agency regulations prohibiting loans to any business “that derives over 50 percent of its gross annual revenue from political or lobbying” activity.

The American Association of Political Consultants sued the S.B.A. in April seeking to overturn the ban as an infringement on free speech rights. But a federal judge upheld the restriction.

Lawyers for politically oriented companies and nonprofit groups pointed out that the S.B.A. did not clearly define political or lobbying activity. They said they had advised their clients that they could still apply for the loans as long as they could reasonably argue that less than half of their revenue came from overtly partisan political activity or direct lobbying of government.

“It’s a very individualized determination based on the specific kinds of work firms do for clients,” said Jason Torchinsky, a leading Republican political lawyer who argued the political consultants’ case against the S.B.A., and who represents a number of conservative nonprofit groups.

Polling conducted by corporations or advocacy groups to assess public attitudes on politically related issues might not be considered political activity by the S.B.A. Nor would advertising and government relations campaigns rallying support for issues without specifically advocating a vote for or against a bill or candidate.

For instance, loans of $350,000 to $1 million went to a pair of firms that have been paid a total of nearly $600,000 to do polling for the Biden campaign. But the firms — Anzalone Research and Lake Research Partners — also both conduct research outside of campaigns.

Anzalone, which is based in Alabama, lists companies including Airbnb and Volkswagen, as well as the Chicago Cubs and the Seattle Seahawks, among its clients. Lake Research’s founder and president, Celinda Lake, said less than half of the firm’s revenue was from “electoral politics.” She said, “We do a lot of different kinds of work — marketing, government, nonprofits, labor unions, corporate.”

Loans also went to three firms that have collectively been paid more than $3 million for direct mail by the Biden campaign — Belardi Wong, Chapman Cubine and Hussey and Resonance Campaigns.

A spokesman for Belardi Wong said that 99 percent of its work was for consumer brands, mostly in high-end fashion and home goods. The firm sought a loan in response to “the downturn in demand for consumer goods and its impact on their business,” he said.

At least three firms or their affiliates received loans totaling at least $1.7 million while being paid millions by Mr. Trump’s re-election campaign and the committees supporting it.

FLS Connect, a Republican fund-raising firm, has been paid more than $22.6 million since the beginning of 2017 by Mr. Trump’s campaign committees and the Republican National Committee. Yet the firm received $1 million to $2 million in loans.

Jamestown Associates, which received a loan of $35,000 to $1 million, has been paid $1.5 million from early 2017 to mid-May by Mr. Trump’s re-election campaign and a super PAC supporting it to produce videos and advertisements.

And America Rising Corporation — an opposition research vendor that has been paid more than $1.3 million since July 2017 by Mr. Trump’s campaign and allied committees — received a loan worth $350,000 to $1 million.

America Rising used the loan to keep employees on the payroll, said its founder and chief executive, Joe Pounder. He said the company had already completely paid back the loan “with interest.”

Loans went to two nonprofit groups that had been in the constellation of outfits associated with David Brock, a longtime ally of Hillary Clinton, that are training their sights on Mr. Trump and his allies.

The watchdog group Citizens for Responsibility and Ethics in Washington, where Mr. Brock had served on the board until stepping down a few years ago, has filed complaints and public records requests about Mr. Trump and his allies. It received a loan valued at $350,000 to $1 million. And Mr. Brock’s flagship group, Media Matters for America, which tracks the conservative news media and Mr. Trump’s allies in it, received $1 million to $2 million.

About $350,000 to $1 million went to the Center for a New American Security, a think tank founded in part by Michèle Flournoy, a former Defense Department official under President Barack Obama who has supported Mr. Biden’s campaign.

Conservative think tanks and policy advocacy groups, some that espoused a small-government ideology, also availed themselves of the loans.

The foundation arm of Americans for Tax Reform, which supported Mr. Trump’s signature tax cuts, received a loan of $150,000 to $350,000.

While the group has been a vocal critic of government spending, it said in a statement that it did not oppose the stimulus loans because it considered the money to be compensation for the government depriving it of funds by ordering shutdowns to slow the spread of the virus.

Liberty Counsel, a conservative legal group that led a campaign championing Mr. Trump’s push to reopen churches, received $350,000 to $1 million.

Millions of dollars in loans went to K Street, home to many lobbying firms whose fees have increased during the pandemic as businesses have paid handsomely for help navigating various government assistance programs.

The lobbying firm Van Scoyoc Associates received $1 million to $2 million.

Loans of $350,000 to $1 million went to lobbying firms headed by William S. Cohen, a Republican former senator from Maine who also served as defense secretary in the Clinton administration, and Michael Chertoff, a former homeland security secretary in the George W. Bush administration.

One staple of Washington’s political economy that has been especially hard hit by the shutdowns — power lunch spots — was well represented in the loan lists.

The Prime Rib, a K Street steakhouse, obtained a loan of $2 million to $5 million; BLT Steak, a nearby see-and-be-seen restaurant, received $350,000 to $1 million; so did Charlie Palmer Steak, a popular destination for political fund-raisers near the Capitol, and the esteemed Georgetown watering hole Martin’s Tavern, which had been visited by every United States president since Harry S. Truman until Mr. Obama broke the streak.

Eric Lipton contributed reporting.

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