A Mix of Politics and Business
an interview with Tim Howe of Foley & Lardner, LLP
David M. Boelke
Posted Saturday, May 1, 2004
4 U.C. Davis Bus. L.J. 11 (2004)

Timothy J. Howe has over 25 years of experience in government-related service with the California Legislature, U.S. Congress, campaign management, and lobbying. Mr. Howe served as campaign manager for Assembly Member Vic Fazio in his first campaign for Congress, and from 1979 to 1981, he served as Congressman Fazio's first administrative assistant. While in Washington, D.C., Mr. Howe also served as a national campaign consultant for the National Committee for an Effective Congress during the 1980 congressional elections.

When Mr. Howe returned to Sacramento, he maintained both a private law practice specializing in business and tax law and a campaign consulting business from 1982 to 1987. In addition, during 1986, Mr. Howe also served as chief executive officer of Granular Systems, Inc. In 1987, Mr. Howe returned to the California State Assembly as chief of staff to Assembly Member Lloyd G. Connelly. During his 11 years with the Legislature, Mr. Howe authored and staffed many laws affecting the daily lives of Californians, the most noteworthy of which is Proposition 99 (the Cigarette Tax Initiative) in 1988. Other bills he wrote include the nation's first state law prohibiting genetic discrimination and California basic law permitting the generic substitution of prescription drugs. Mr. Howe received his Bachelor of Arts Degree in Political Science from the University of California, Los Angeles in 1968; Masters of Arts Degree, Political Science from the Eagleton Institute of Politics, Rutgers University, New Brunswick, 1970; Juris Doctor Degree from the University of California, Davis School of Law in 1978; and Masters of Law in Taxation from Georgetown University, Washington, D.C. in 1982.

Q: From your experience, how would you say the political climate is towards business in California compared to a few years ago?

A: It has probably gone from bad to worse. It was probably at the nadir under Davis, it has improved under Schwarzenegger. Basically, California has been a Democratic state since 1992, with a Democratic legislature all but four years since 1958. But with Republican governors- Deukmejian, Wilson, Schwarzenegger- you have a stalemate, so it can't get really bad. Having said that, the Democrats made progress on some environmental reforms, because some governors like Wilson were more open to environmental issues. Then Davis came in and it was pretty easy for labor [unions] to achieve their agenda. But generally California is a very regulation-oriented state, with a lot of environmental regulation and workplace rules that many employers find onerous or burdensome. The general cost of during business is very high compared to most other states.

Q: One of the major political issues facing business right now is the workers' compensation system. What can you tell me about the problems associated with that system?

A: In terms of the details of the system itself, I'm not really qualified to speak on that. But politically, the most significant thing that's happened with workers' comp was Tuesday's election, because the governor showed that he could go over the heads of the legislature and go to the people. He got 2/3 of the voters to support him on the bond issue, and the bond was a tough sell. The significance of this to workers' comp is that up until that election, the Democrats' view was that Schwarzenegger didn't get a mandate when he was elected, it was all about rejecting Davis. Tuesday really was his victory, his election. Now he truly is, at least for the time being, the 800-pound gorilla that the Legislature has to contend with. They have to decide whether to cut a deal, and cut their losses, on workers' comp, or do they let him take it to the people by initiative. The initiative would be more pro-employer than any legislative deal, so that is the conundrum that the Democrats face.

Q: How does a typical lobbying assignment work? What's your typical day at the office?

A: It depends a lot on what time of year it is. This time of year we are reviewing all the bills. February 20th was the bill introduction deadline. We have a computer researcher that reads all the bills, has a program to identify bills that are important to our clients. So right now it's mainly research and information gathering. Bill hearings will start in a few weeks, and then for the next six months, we're writing letters to the affected committees, talking to legislators and staff and educating them on our position and asking them for a yes or no vote or an amendment or a bill. So Phase 1 is information gathering, Phase 2 is communicating our message, and throughout the year we focus on coalition building- getting organizations with similar goals together and strategizing. We don't just lobby the Legislature- at the same time, we're getting our message out to the Governor and the Administration.

Q: What do you make of the stereotype that lobbyists are unethical or bad for democracy?

A: Well, they are a key component of democracy, actually. Having gone from a staffer to a lawyer to a lobbyist, my mother asks me when am I going to get a job where she doesn't have to defend me [laughs]. But democracy really couldn't function without lobbying. The term "lobbying" comes from people standing in the lobby of Parliament hundreds of years ago. I also like to point out that virtually everybody has a lobbyist. In our complex world, most people are busy going about their daily lives and don't have time to come to the Capitol and petition the government, and of course, it would be a very disorganized system if all of a sudden, 10,000 people came to lobby their members everyday. So I think lobbyists are necessary in our system. The UC System has one, the UC students have one. There are now over 1100 registered lobbyists representing about 10,000 businesses and associations. So when people say something negative about lobbyists to me, I can almost always tell them, "You have a lobbyist". In terms of ethics, I think lobbyists are the same as any other profession, there are ethical and unethical people involved. There are ethical and unethical lawyers, ethical and unethical doctors, lobbyists are no different.

Q: Are there any issues that a number of clients have in common?

A: Sure. I follow all the tort reform issues, which is one that many of our clients are concerned with. Labor laws are another one. Outsourcing is a hot issue right now that affects a lot of different businesses. Those tend to be the issues where coalitions are made- any broad-based business issue. I'm involved now in coalitions on outsourcing, privacy, employment law and tort reform.

Q: How do regulations on lobbying affect your clients and your job?

A: The regulations basically just deal with reporting and disclosure. There are a few prohibited acts- you can't go and say, "Mr. Senator, here's your $1000 campaign contribution from my client, and by the way, my client wants you to vote no on A.B. 12 tomorrow." Most people would think that's common sense. For the most part, you are just prohibited from doing things that are pretty egregious, so it doesn't really affect me. There is a restriction on paying more than $10 for someone's lunch. That was a big lunch in 1974, but now it's not that unusual. When I had my job interview here 10 years ago, we had a lunch and George [Steffes] paid for it. Two days later, I got a letter requesting a check for $1.12, because my share of the lunch was $11.12. So what's the effect of that rule? I don't take legislators out to lunch. For one, I don't think it's very productive. But secondly, it's not worth the hassle of reporting it, and it's embarrassing to ask a member for a $1 or $2 check if they go over $10 for lunch. Sometimes I'll take [legislative] staff out to lunch, because there's plenty of less expensive places that you can go with staff where you can get a lunch for under $10- you don't feel compelled to go to the Esquire or more expensive restaurants like you might with a member. But generally, you still have to remember to report it. So I know many lobbyists that do very few lunches or dinners.

But it's not burdensome. It's a nuisance but there's a reason those regulations were passed- because there were abuses. Legislatures, when they pass these rules, are usually are responding to some real or perceived abuses. There was a lobbyist that once said, "I own the California Legislature". That was a very dumb statement to make, and it created a backlash. We also can't make political contributions. I think that's wonderful because I don't have 120 members calling me and asking me to contribute to their campaigns. I can say, "I would love to, but it would be a felony".

Q: During the '90s, a lot of Democrats were increasingly open to free trade and a pro-business outlook. Do you think the Democrats have become less business-friendly or protectionist since then?

A: I think a lot of those changes come in cycles. When you have a two-party system, both parties can have a pretty big tent. Generally speaking, the Republicans are more pro-business, and the Democrats are more pro-labor, but within that there's a lot of shades. I think what you're seeing now is what you generally see during a recession, or a jobless recovery. The Democrats seem to be a little more protectionist now than they were in the '90s because we had a booming economy in the '90s and now the economy is not quite so booming, and there are major states in play that have huge job losses, like Ohio and Michigan. Outsourcing has become a hot-button issue, too, with telephone center jobs going to India as an example. But those are global issues: Is Japan outsourcing jobs when they build a Toyota plant in Ohio? Is BMW outsourcing jobs when they build a plant in Alabama? It's a very complicated issue.

Q: How does your experience as a former CEO affect your perspective on business lobbying?

A: That was so long ago I don't even remember [laughs]. It was a small company that I got involved with through my law practice at the time. There was the concept guy, the major investor, and I was their lawyer helping them secure a state grant. The concept guy ran into administrative trouble and the investor asked me to come in and clear up some CAL-OSHA issues and straighten some things out. I guess the major lesson I took from that personally was that it is a lot easier to follow the regulations than to ignore them, and it is a lot cheaper in the long run.

Q: What would you recommend to someone who may be interested in becoming a lobbyist?

A: I believe that government experience is very beneficial before one becomes a lobbyist. It's also the most common path to lobbying, a little less so than a few years ago, but to lobby government I think it's important to know how government works. You learn how government works by being on the inside. When I used to hire interns, I would tell them that if they took nothing else away from the experience, learn the rules. If you know the rules of the place, you know how it works. And also how to pull out information- those two things. Those are the lessons you take with you into lobbying. So if I hired you right now, you would be learning about the lobbying job but you would also be learning about how the thing works that you are lobbying. That's a longer learning curve, but if you understand how decisions are made, you can affect the outcome of those decisions better than you can otherwise.