Blue Dogs Fill Their Bowls with Cash

Original Link: http://www.publicintegrity.org/articles/entry/1572/

By Josh Israel, Aaron Mehta

Whether the subject is health care reform, climate change, or pay-as-you-go budgeting rules, almost everyone, it seems, suddenly wants to talk with the Blue Dogs. President Obama’s White House meeting with members of the fiscally conservative Democratic coalition earlier this week is but the latest indication that the Blue Dogs — 52 members strong — have deftly turned themselves into a key voting bloc at the nexus of power. With them, the Democrats do not need a single Republican to back their legislation; without them, the Democratic agenda would be in serious peril. And as their clout has expanded, fundraising has grown accordingly, not just from traditionally Democratic contributors, but from unexpected quarters as well.

So far this year, the Blue Dog Political Action Committee is on track to shatter all its fundraising records; in fact, the total for the first six months of 2009 — more than $1.1 million — is greater than what was raised in the entire 2003-04 fundraising cycle. Furthermore, according to analysis by the Center for Public Integrity of CQ MoneyLine data, the energy, financial services, and health care industries have accounted for nearly 54 percent of the Blue Dog PAC’s 2009 receipts (up from 45 percent in 2004). These contributions poured in as President Obama and the Democratic Congress have been making a major push to reform health care, develop a new energy policy, and restructure oversight of the banking sector. Clearly, these Dogs are having their day.

From Small PAC to Top Dogs
Their beginnings were humble. The Blue Dog Coalition was formed in 1995 following elections the previous fall that cost Democrats control of Congress. One of the co-founders, then-Alabama Representative Glen Browder, says the original members — 23 in all — “were unhappy with the direction of our own party and felt we needed to chart our own course.” Drawing from a combination of a famous series of paintings of blue-colored dogs by George Rodrigue and the notion that they were “yellow dog democrats” who had been “choked blue” by the liberals who dominated the party, they became “The Blue Dogs.”

Over time they evolved into what former Texas Representative Nick Lampson calls “a close-knit group.” Today, they hold weekly meetings with no staffers and focus on voting as a bloc. One issue above all others unifies them: a commitment to fiscal discipline. For instance, the group has successfully pushed for President Obama to endorse a pay-as-you-go requirement for Congressional budgeting; a PAYGO bill passed the House on Wednesday. The group’s website describes the coalition as “a policy-oriented group [formed] to give moderate and conservative Democrats in the House of Representatives a common sense, bridge-building voice within the institution,” and notes their relentless pursuit of a balanced budget.

As the coalition grew, it quickly sought to raise money to protect and expand its ranks, forming a political action committee in August 1995 just for Blue Dogs.

The Power of the PAC
As individuals, the 52 Blue Dogs have received the plurality of their 2009 campaign contributions from a traditional Democratic ally: organized labor. Labor political action committees have filled the Blue Dog Coalition members’ campaign committee coffers with more than a million dollars so far this cycle.


Click for larger viewBut it’s the Blue Dog PAC that is most illuminating for spotting trends. The Blue Dog PAC raises money mostly from other PACs and automatically disburses the maximum possible contribution to each of its members for their re-election campaigns. This helps preserve their ranks, especially since many of them represent swing districts and are among the most targeted incumbents at election time.

The PAC also helps expand their coalition. By a two-thirds vote of the Blue Dog Coalition, their PAC can endorse and contribute to like-minded Congressional hopefuls. When successful, these freshmen often become Blue Dogs, growing the membership. In the 2006 cycle, the Blue Dog PAC gave a total of $70,000 to help nine Democratic candidates win seats, eight in Republican-held districts. All nine joined the Blue Dog Coalition. In addition to expanding the group, these new members provided half of the 16 seats the Democrats needed to control the chamber. With a Democratic majority, Blue Dog Collin Peterson of Minnesota became chairman of the House Agriculture Committee, while more than a dozen other coalition members became subcommittee chairs. Then the money really started rolling in. And more money to spread around meant another round of funding and recruiting for the 2008 elections.

In its first election cycle in existence, the Blue Dog PAC took in $103,996 from other political action committees. Though the Blue Dogs remained for years a minority within the minority party, that figure increased steadily each cycle. Between the 2005-2006 and 2007-2008 cycles, as fundraising for the National Republican Congressional Committee declined by nearly 33 percent and fundraising for the Democratic Congressional Campaign Committee grew by just 26 percent, the Blue Dog PAC more than doubled its receipts, from $1,239,516 to $2,636,273. In the 2007-2008 fundraising cycle, the Blue Dog PAC raised more than $47,000 per Blue Dog from other political action committees — more than double the “per Dog” amount from 2003-2004.

In years gone by, the business community has favored the Republican Party, which has pushed for low taxes and limited regulation. But former Representative Lampson, a one-time coalition member, believes that the Blue Dogs may be helping to bridge the divide between his party and parts of the business sector. He says they “have been the group of Democrats who have been more open to business, over the long haul, than others in the Democratic Party.”

In the 2008 cycle, their PAC received $508,800 from the health care sector (up 90 percent from 2005-2006 cycle), $451,500 from the financial services sector (up 371 percent from the previous cycle), and $238,300 from the energy sector (up 48 percent). In just the first half of 2009, the PAC all told took in $1,058,750 in contributions from political action committees. Health care PACs have already kicked in $297,500 to the Blue Dog PAC; energy PACs, $162,500; and financial services PACs, $134,500.

Former Representative Charlie Stenholm says the business community’s strategy is no mystery; it is making donations, in part, in an attempt to gain influence with the Blue Dogs. “I mean, what other conclusion could you come to?” he laughs. “And that’s something that the Blue Dogs have sought. They want to be in that position, to have influence.”

Former Representative L.F. Payne, a founding member of the Blue Dogs, believes that the energy, financial services, and health care sectors “feel that they have an open ear when they are speaking to Blue Dogs and find that that’s one of the places they go in the Democratic Party to be heard.” Payne says firms are also “investing in the Blue Dogs in hopes that they will affect the overall balance of power and some of the issues affecting their industry.”

Billy Tauzin, the president and CEO of the Pharmaceutical Research and Manufactures of America (PhRMA), told the Center in a statement that the coalition has “helped foster much-needed bipartisanship and middle ground. … Above all else, they have consistently provided a moderating voice on Capitol Hill.” Tauzin was a founding Blue Dog who left the coalition and the Democratic Party to become a Republican in 1995. PhRMA’s Better Government Committee (its PAC) has donated more than $10,000 to the Blue Dog PAC since 2005 (and had never donated to the PAC previously).

Representatives of several industry PACs that have contributed to the Blue Dog PAC told the Center that they give money to those who support their organizations’ interests — and that the Blue Dogs have been reliable friends. In all, 357 political action committees donated to the Blue Dog PAC in 2007-2008, up from 223 in the previous cycle.

Bark or Bite?
Are the Blue Dogs worth it to their new friends? That’s not entirely clear. A recently published study by Burdett Loomis of the University of Kansas observed that though Blue Dogs “have centrist tendencies,” in recent years they “have voted much more like their fellow partisans than as independent individuals or a centrist bloc.” This is confirmed somewhat by the Center’s analysis of the 2008 National Journal annual Congressional vote rankings: on economic issues, the average Democrat in the House had a 70.4 percent liberal voting record, the average Republican had a 22.9 percent liberal voting record. The average Blue Dog? 56.6 percent, much closer to the other Democrats than to the Republicans.

So where is the Blue Dogs’ impact? According to former Representative Payne, with roughly 20 percent of the House Democrats among their ranks, “clearly it’s a voice behind the scenes” that allows them to shape the policies before they come to the floor.

Erin Kanoy, an expert at the conservative Heritage Foundation, also senses off-stage impact. “The Blue Dogs have been … extremely influential,” she says, “in standing their ground, pulling [the policy agenda] back to the center.”

The health care bill is the most visible recent example. Already Ways and Means Committee Chairman Charles Rangel has made revisions to his initial draft to make the bill more attractive to wavering Blue Dogs. And the Blue Dogs reportedly believe their White House get-together garnered them a tentative agreement to look harder at cost-cutting. Overall, says an expert in the health care field who asked not to be named, Congressman Mike Ross of Arkansas and other Blue Dogs “want more out of savings and less out of revenues” and for the total costs to be lower — but negotiations continue.

Sometimes the Blue Dog influence creeps into public view. This was the case as the House considered the climate change bill earlier this summer. Blue Dog Peterson of Minnesota and some of his agriculture-sector supporters were not happy with the initial draft. As chairman of the Agriculture Committee, Peterson was particularly concerned about how the Environmental Protection Agency was going about regulation of renewable fuels such as ethanol. Peterson announced that he and his bloc of allies — including every Democrat on his committee — would vote against the bill unless the draft was altered to include protections for the industry. The leadership complied.

While the Blue Dogs took no official position on this bill, two facts are worth noting: first, 18 of the 28 Democrats on Peterson’s Agriculture Committee are Blue Dogs and, second, the Blue Dog PAC had — for the first time ever — received $4,500 in PAC contributions from the nation’s second-largest ethanol producer, Archer Daniels Midland (ADM), in the 2008 cycle. The Renewable Fuels Association, a trade association in which ADM is a key member, cheered Peterson’s efforts and backed the underlying bill. Colin O’Neil of the Center for Food Safety, which opposed the changes, said Peterson “was integral in formulating language in the bill and pulling the Blue Dogs and the ag community in.” Peterson and six other Blue Dogs from the Agriculture Committee voted for the bill when it reached the floor. The bill passed the House, 219-212; their votes were the margin of victory.

And while it may seem that this was a victory for the ethanol industry, it was also a victory for many in the financial services community. Goldman Sachs, for instance, has significant investments in advanced ethanol development. The firm was another new donor to the Blue Dog PAC in 2008 with $10,000, and also has been lobbying the climate bill.

Go-To Members
Some former Blue Dogs warn that the coalition’s new-found power must be wielded carefully. Jimmy Hayes, a former Blue Dog Representative from Louisiana, sees less leverage for the coalition, especially if they are not united, as a result of the expanded Democratic majority following the 2008 elections. There is “a little more room for losing some votes in the caucus,” he believes.

But, for now, with $1,806,398 in the bank and a virtual veto over major legislation, it appears the Blue Dogs will be the go-to members — and the give-to PAC — for those hoping to ensure a fiscally centrist and pro-business path for the nation.

“The business community realizes that [the Blue Dogs] are the linchpin,” says former Representative Mike Parker of Mississippi, “and will become much more so as time goes on.”