BOSTON — Rep. Paul Kanjorski, the House Financial Services Committee’s second-highest ranking Democrat, was standing next to Boston Harbor, flanked by old ships and modern yachts, at a gala thrown by six large companies and trade groups.
The hosts, like the many other financial firms spending hundreds of thousands of dollars to throw invitation-only receptions and other get-togethers at the Democratic National Convention, hoped that the event would help enhance their clout with lawmakers like Rep. Kanjorski.
But if that was the purpose, it was lost on him.
“Quite frankly, we don’t know who the hell throws” the parties, the Pennsylvania lawmaker said. “It doesn’t make any real impression.”
That does not stop companies from trying. From Fenway Park to Faneuil Hall, banks and other financial services firms were funding and hosting parties at all hours — many of them at the same time — during the convention. The groups involved said they are a way to participate in the political process and build bonds with important players.
But that opportunity comes at a hefty price for many.
The National Association of Federal Credit Unions’ bash for Sen. Tom Carper of Delaware on Monday night, paid for by Fannie Mae, Freddie Mac, MBNA Corp., HSBC Holdings PLC, and Visa International, cost about $300,000, knowledgeable sources said.
A similar price tag hung on an event hosted the next day by Fannie, Freddie, the Independent Community Bankers of America, the Mortgage Bankers Association, the National Association of Home Builders, and the National Association of Realtors.
A Financial Services Roundtable brunch hosted by some of the nation’s largest banking companies was relatively inexpensive at about $60,000. Sources said the trade group asked 29 of its members to kick in $2,000 each.
None of those costs include donations to the convention host committee. Bank of America Corp. and State Street Corp. were the only financial services companies listed as “platinum” sponsors — meaning they each gave more than $1 million. Citizens Financial Group Inc., a subsidiary of Royal Bank of Scotland Group PLC, and Sovereign Bank contributed at least $500,000; Citigroup Inc., Fannie, and Freddie gave more than $250,000.
What does all this cash buy? That depends on whom you ask.
At a brunch hosted by important members of the Financial Services Roundtable, the guest of honor, Rep. Barney Frank of Massachusetts, did not mince words when asked about what companies get in return. He leaned in and mouthed, “Nothing.”
Then he reconsidered.
“You know what? I take it back,” Rep. Frank said. He proceeded to dispute and turn around a view, often repeated in the news media, that the parties are a donation to the lawmakers.
“Frankly, we do them a favor by showing up,” he said. “They are not doing us a favor. They get to show their members how they are regarded or how important they are.”
Both he and Rep. Kanjorski eventually acknowledged that the parties might make some impact — even if it is a subtle one.
“Here you get national input,” Rep. Kanjorski said. “A lot of people who are movers and shakers from all over the country who want to talk to you about something or remind you of something. You record that, and it has an effect on what you do when you are back. It’s very helpful. Without it, we would be very isolated.”
Several lawmakers brushed aside criticism that the parties are tantamount to political contributions that do not have to be disclosed.
“There is nothing sinister about it that goes on,” Sen. Tim Johnson of South Dakota said during an interview at a party hosted in his honor by the Securities Industry Association and the Bond Market Association. “It is just interacting in a very casual atmosphere. There are no long, substantive policy talks that go on at these kinds of things. … It is mostly just a matter of getting to know each other better and having that kind of interaction.”
Steve Bartlett, a former member of Congress and now the president of the Financial Services Roundtable, said all he wanted was to give his members an opportunity to visit socially with one another and with lawmakers.
“It’s a chance to mingle and deepen that relationship,” he said. “If you know somebody by first name and you have something to say, then they are liable to listen an extra 30 seconds.”
Camden Fine, the ICBA’s president, said he wanted to use the party his group co-hosted to increase its visibility.
“Definitely” was his answer when asked if it was worth the tens of thousands spent. “Any national association advocating for its members must get its message to the policymakers, so it must go where the policymakers go, so the message can get through.”
The parties vary in size and ambition but are basically of two types: those at which some policy matters are discussed, at least in passing, and those that are pure entertainment.
Citi helped set the bar high by hosting a pregame party Sunday night at Fenway Park as the Boston Red Sox took on the New York Yankees. (Attendees were treated to an appearance by the Democratic presidential nominee, Sen. John Kerry, who threw out the ceremonial first pitch, then saw the Red Sox beat the Yankees, 9 to 6.)
Few weighty matters were being discussed at the NAFCU-sponsored event Monday evening. Sen. Carper jumped on stage to enthusiastically introduce the band Little Feat, who jammed on the upper level of Faneuil Hall for much of the night. It presented an odd scene: dimly lit rooms filled with conservatively dressed people jiving to rock music.
Across town Freddie, the American Bankers Association, American Express Co., the Bond Market Association, Capital One, and the Credit Union National Association were hosting an event featuring the rock band the Goo Goo Dolls. Both parties went until nearly 2 a.m.
The event for Rep. Frank was more subdued. It began at 9:30 a.m. Tuesday on the 33d floor of the E-Trade building on State Street. The many hosts of the low-key affair, which featured a pianist and an omelet bar, included Washington Mutual Inc., MBNA, MassMutual Financial Group, Credit Suisse First Boston Corp., Bank of New York Co. Inc., Bank of America, and Wachovia Corp. Despite its lack of rock and roll, the party attracted major Democratic members of the Senate Banking and House Financial Services committees.
On Tuesday afternoon many of the same financial services lobbyists attended an SIA-sponsored event at Fenway Park’s 406 Club to promote financial literacy. Guests got a tour of the ballpark and a Red Sox cap and munched on hot dogs and hamburgers.
Fannie and Freddie had a live band at their party Tuesday night in the Wharf Room of the Boston Harbor Hotel. Attendees could not help but notice the event’s theme: the American dream of homeownership. A replica of a house entrance stood next to a red, white, and blue picket fence, with mailboxes nearby. Proverbial apple pies sat in a faux window.
The event Wednesday night for Sen. Johnson was one of the few to include both delegates and financial lobbyists. Several South Dakotans sporting cowboy hats and a number of Indians wearing “Native Americans for Kerry” buttons attended. The co-hosts included American Express, Bank of America, Citi, Deutsche Bank, and Wells Fargo & Co.
By that time Sen. Johnson had lost track of how many events he had attended. “I couldn’t tell you,” he said. “There have been several each day.”
At least one financial industry lobbyist acknowledged that the parties conveyed only a moderate benefit to host companies. But he was not in a rush to tell his bosses. “Come on, where else can you go see the Goo Goo Dolls and Little Feat in a single night?”
