From the Center’s money in politics watchdog site Open Secrets:

Overall in 2010, the Chamber spent $132 million on lobbying, down 8.6 percent from its all-time high of $144 million in 2009. Nevertheless, the Chamber again in 2010 ranked as the No. 1 top-spending lobbying client — although it should be noted that many organizations, unlike the Chamber, report only federal-level lobbying expenditures in these reports.

The Chamber spent on average roughly $50 million a year on lobbying through the Bush years. It spent about $55 million in 2007 and about $80 million in 2008. Lobbyists at Mayer Brown LLP received $560,000 from the Chamber this year. Mayer’s other clients include telecommunications companies, auto manufacturers and health insurance companies.

An increasing number of businesses in recent years have dropped membership with the Chamber over what they say are its backward views, particularly on the environment. As the Colorado Independent reported two years ago, Colorado businesses joined with high-profile U.S. corporations in breaking with the Chamber over its opposition to climate change legislation. Chamber representatives said proposed climate change laws were based on junk science and would derail the American economy.

Heavy hitters like Apple, Exelon, Levi Strauss and Pacific Gas and Electric Co. outright quit the Chamber in 2009. Nike resigned from the Chamber’s board but maintained its membership, and companies like Duke Energy, General Electric, Alcoa and Johnson & Johnson have disavowed the chamber’s positions on global warming.

“It’s our professional opinion that the U.S. Chamber of Commerce is out of step with the leading edge of economic recovery,” said Paul Sheldon, senior consultant with Longmont-based Natural Capitalism Solutions, which has provided corporate sustainability consulting to companies representing 3 percent of the nation’s gross domestic product, including Goldman Sachs.

“We have tracked 13 different studies which document that those companies that come into clean sources of energy, sustainability and responsible corporate behavior are outperforming their competitors before, during and after an economic downturn,” he added.

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The Sierra Club is determined to reduce U.S. oil dependence. (Flickr, The Sierra Club)

The Sierra Club is in the process of trying to answer that question. For the past six months, it has worked on a massive study on how to reduce the United States’ oil dependence in an economically and environmentally beneficial way. The group is also building a coalition of environmental advocates and lawmakers to support the project, which will quantify potential oil-use reductions across every industrial sector.

“Over the next 20 years, how steep can we make cuts in oil consumption while allowing the economy to flourish and while creating more jobs rather than penalizing individual workers or communities?” Sierra Club Executive Director Michael Brune asked. “So, this will be a major priority of the club over the next several years — to build a broad based coalition of organizations and elected officials who will want to stand up for a very thoughtful and pragmatic, but visionary and aggressive plan to get off oil.”

Brune, who took over his post just one month before the oil spill started, recently sat down for an interview with me. He outlined the organization’s oil study, talked about the prospects for energy legislation and previewed the upcoming mid-term elections.

Here is an edited-down version of our talk:

What is the major issue going forward for the Sierra Club right now?
Our top issue remains fighting climate change in a way that increases the availability of clean energy like solar and wind, while also improving the public health benefits associated with decreasing our reliance on fossil fuels.

Is the focus now on Environmental Protection Agency regulations, Congress or both?
I would say both for sure. We see great opportunity in EPA rulemakings to increase public health benefits by forcing utilities in particular to account for the cost of their pollution. A top priority right now is organizing around EPA’s hearings on coal ash, to make sure that coal ash is treated as a hazardous waste. But, over the next couple of years, we’ll be looking at a whole series of rulemakings, many of which are focused on stationary sources like coal plants, but we’re also looking at EPA rulemakings to cut our dependence on oil.

Is there a serious concern about challenges to EPA’s regulatory authority under the Clean Air Act going forward?
Yeah, certainly many threats have been made to EPA’s authority to act under the Clean Air Act, attempts either to gut the Clean Air Act or eliminate EPA’s authority. So, we’re taking those threats very seriously. We also think that should there be a public debate about these issues that the public overwhelmingly supports strong, effective and cost-effective regulations that have come out of the EPA for the last 40 years under the Clean Air Act. We think there’s broad public support for retaining its authority.

In terms of Congress, it doesn’t seem that anything is going to happen on cap-and-trade any time soon. Is that your thinking as well?
Well, you know, I think it is difficult to predict too far into the future. We think Congress should act. We know that members were put into office with the expectation that there would be a meaningful, substantive response to climate change and that Congress would enact laws that would put a down payment on scaling up clean energy. So, we know that the demand is there. But whether or not senators in particular will respond remains to be seen.

Putting aside cap-and-trade, there’s been talk of a narrower energy bill. It looks like Sen. Jeff Bingaman (D-N.M.) and Sen. Brownback (R-Kans.) are introducing a renewable energy standard that they are hoping to get passed. Is there a specific RES target that you would like to see or is it that the policy needs to move forward as soon as possible?
Well, let me make a general point. There was far too much of a focus earlier this spring on a single bill to address climate change economy-wide. And, in reality, there are dozens of things that Congress can do to fight climate change and to increase energy security in the country. In regards to this particular RES bill, our focus is primarily on keeping it clean. We want to see a renewable energy standard that is focused on truly clean energy and doesn’t have absurd giveways to nuclear power or so-called clean coal or any one of the other handful of options. And then of course to increase those investments as quickly as possible.

Is there a number that’s being thrown around among your members now?
Yeah, but it’s not something I really want to discuss in the public right now.

What other things are you focusing on in Congress?

I’d say the top thing is a plan to get off oil. We just experienced the largest environmental disaster in our country’s history and in response, Congress has done nothing. There’s not even a plan to fully reform what used to be called MMS and there’s not yet a plan to hold oil companies fully accountable and to lift the liability cap. And most importantly, there’s no effective plan right now to significantly reduce our dependence on foreign oil. So, if there’s one thing that Congress can do in the next couple of months, it would be to challenge the oil industry and deliver us a plan to get off oil.

It’s been sort of an uphill battle trying to get an oil spill response bill to pass, something that is incredibly popular with the American people. And you’re right, it seems like the bill is getting held up on this idea of liability, whether or not an oil company should be held 100 percent liable for spilling thousands of gallons of oil into the ocean. What are your thoughts on that?
We shouldn’t be privatizing the gain and sharing the risk with the public. If oil companies are going to be benefiting from oil drilling, they also have to be able to absorb any of the risks associated with drilling.

Do you expect that Congress will pass an oil spill bill this year?
We do.

I wanted to also touch on the mid-term elections. It’s on everybody’s mind right now. What is the Sierra Club doing in terms of working with individual candidates?
So, there’s lots that we’re doing. The Sierra Club has 1.4 million members and supporters, so over the next several weeks, a big job of ours will be to educate our supporters about what’s at stake Nov. 2., trying to get people out to the polls and to engage our members to become volunteers. So, the Sierra Club endorses specific candidates.

We get very heavily involved in local and state propositions. Arguably our biggest priority this year is to defeat Prop 23, which would undermine the Global Warming Solutions Act, AB32, that was passed in California a few years ago. With that, we’re doing a massive voter mobilization drive. Individual members will be calling voters to encourage them to get out. We are also part of a coalition of groups that is doing advertising, thought we’re not doing any ourselves.

Are there any other races that are of particular concern for you?
We’re looking at the Senate races in Nevada and Missouri. Obviously, Harry Reid has been excellent in fighting the coal industry as well as supporting big investments in clean energy. We are also looking at the Florida race. Democratic Senate candidate Meek has a 100 percent League of Conservation Voting score. He’s been strongly in favor of Florida’s solar bills as well as the ban on offshore oil drilling. There’s obviously dozens or even hundreds of races in which the environmental voice is an important one.

There has been a lot said by the oil industry and Gulf coast lawmakers about the Obama administration’s offshore drilling moratorium’s impact on jobs, though there was a report that came out last week that said job losses might not be quite what people estimated. What’s the Sierra Club’s position on all of this? Should the moratorium be lifted?
No, I think that a full moratorium should be put in place. We’re mindful of the fact that we need to make stronger investments in clean energy jobs so that those who work in the oil industry who want to put food on the table for their families have viable alternatives in growing industries that they can work in.

To be clear, we’re not advocating turning off the spigot in the Gulf. There are more than 4,0000 rigs operating in the Gulf right now and we are not saying there should be no oil drilling in the Gulf, not until we have a clear plan to get off oil. But what we’re saying is that since it’s been proven now that oil drilling offshore is dirty and it’s dangerous and it’s deadly, we need to tighten up the safety regulations to make sure that disasters like this don’t happen in the future. And we need to stop investing in exploring for new oil and instead explore much more carefully and aggressively investments in solar and wind so that we’re not poisoning our coastlines as we’re trying to keep our lights on.

On pipeline safety. There have been a couple major disasters this year. Of course, the natural gas pipeline explosion in San Bruno, Calif. And before that there was an oil spill in Michigan from an oil sands pipeline. Looming over this you have a massive proposed pipeline project, the Keystone XL project, that is going to go from Canada to Texas. Has the Sierra Club been looking at the issue of pipeline safety through a new set of eyes now that we’ve had these disasters?
Yes, we have. There’s two things that we’re doing. Clearly, the cost of our reliance on oil — when you talk abut the Michigan spill, the Gulf oil spill and the Keystone pipeline — is so much higher than what we pay at the pump when you consider the foreign policy implications, the fact that our entire economy is held hostage to wild fluctuations in oil prices.

So, what we’ve done over the last six months since I started at the Sierra Club is to build out a much more aggressive, comprehensive plan for how our country can get off oil. Over the next 20 years, how steep can we make cuts in oil consumption while allowing the economy to flourish and while creating more jobs rather than penalizing individual workers or communities. So, this will be a major priority of the club over the next several years — to build a broad based coalition of organizations and elected officials who will want to stand up for a very thoughtful and pragmatic, but visionary and aggressive plan to get off oil.

And then, regarding natural gas, we don’t think we can simultaneously phase out coal, oil and gas at the same time. Gas will need to stick around for a while. But there the challenge is to have much higher and much tighter safety standards so we’re not in this disastrous position again and again and again where people are losing their lives due to an industry is ineffectively regulated.

On oil sands or, as some call them, tar sands. There were senators in Canada last week reviewing oil sands production in there. Is there a message you would like to send to them in terms of how oil sands should be treated? Because there’s an argument out there that it’s better to get oil from Canada, despite the high greenhouse gas emissions of oil sands production, because we’re no longer reliant on the Middle East.
I think that’s just misguided thinking. The Pentagon says that climate change is one of the top national security threats in the 21st century. We have to deal effectively with climate change. Importing oil from the tar sands is 2-3 times more greenhouse gas intensive than conventional oil. You don’t solve a problem by making it worse. So, I understand that the notion that we have oil that is under the sands of our neighbors to the north is attractive to people who think we can have a simply pipeline solve a lot of problems. But the reality is that if we rely too much on a different source of oil that is dirtier, that will accelerate climate change rather than reduce it’s impacts, we’re only going to be replacing one set of problems with an entirely different set of problems. The only effective way to address this problem systemically is to adopt a plan to get America off oil.

Can you be more specific about this plan?
We’ll have a plan that we can introduce probably in the next 3-6 months. It looks at every major industrial source of oil consumption, from the oil that’s used in medium- and heavy-duty trucks, light trucks, cars and SUVs, the oil used for pesticides and paints. Whatever the major source of consumption is, we’re looking at a major, comprehensive plan to phase it out where and whenever possible.

What’s the time frame of this phase-out?
The big challenge is political will. For example, clearly it is technically possible, one would presume, to produce nothing but plug-in hybrid and electric vehicles in the next couple years. Whether that’s politically possible, of course remains to be seen. If the United States were to mobilize as we did in World War II and completely transition the entire automobile fleet to produce a new technology, clearly that could be done.

What we need to do is measure the distance between what we can do and what we’re willing to do as a country and develop what we feel as responsible and pragmatic, but also aggressive tactics to achieve energy independence. To help inform that decision we would look at the cost of different decisions under different time scenarios, the benefits economically, environmentally or socially depending on our foreign policy and what would the oil savings be in real-world terms. Then we’d highlight a few different options. We’ll have the data shortly. Then we’ll figure out how to use it. We’ve commissioned this first study just as the Sierra Club, but we anticipate doing more with a broad coalition.

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Key numbers:

BP and other companies involved in the gulf disaster employ as lobbyists more than three dozen former lawmakers, congressional staffers and bureaucrats. BP alone has hired at least 31 internal and external lobbyists with government experience, records show.

The American Petroleum Institute, the industry’s leading trade group, employs 48 lobbyists with previous federal experience, the analysis shows. They include former senator J. Bennett Johnston (D-La.), who helped deregulate the natural gas industry, and former congressmen Jim McCrery (R-La.) and Charlie Stenholm (D-Tex.), both of whom strongly backed oil interests while in Congress.

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Familiar names include former Senate majority leaders Bob Dole (R-Kans.) and Trent Lott (R-Miss.); former House majority leader Dick Gephardt (D-Mo.); former Speaker of the House Dennis Hastert (R-Ill.); and former Rep. Michael Oxley (R-Ohio), the coauthor of the Sarbanes-Oxley Act. All in all, 17 former members of the House or Senate banking committees are lobbying on behalf of financial industry clients, and 73 former members of Congress total — plus 66 banking committee staffers, 82 other Hill employees, 42 alumni of the Treasury Department and seven former staffers of the Office of the Comptroller of the Currency, the bank regulator. The companies that hired the most federal government alumni as lobbyists in 2009 and 2010 are: Citigroup (60), Visa (50), the American Bankers Association (49), Prudential (47) and Goldman Sachs (47).

From the press release:

“Wall Street hires former members of Congress and their staff for a reason,” said David Arkush, director of Public Citizen’s Congress Watch division. “These people are influential because they have personal relationships with current members and staff. It’s hard to say no to your friends, but that’s what Congress needs to do. Listening to them would result in a bill that would fail to get the job done and would disappoint the American people.”

Added Sheila Krumholz, executive director of the Center for Responsive Politics, “Companies pay a premium for lobbyists who’ve spun through the revolving door because it can be a small price to pay relative to the huge payoff if they can shape legislation. These lobbyists tap insider knowledge and personal relationships, knowing that their old friends and former co-workers won’t want to let them down.”

On one hand, this is old news. Wall Street banks have a lot of money and ample incentive to persuade Congress to water down legislation, particularly by enacting loophole-ridden provisions. On the other, it goes to show how successful this bill might be in spite of all the lobbying — particularly if bank-unfriendly provisions such as the Merkley-Levin Volcker Rule and Lincoln’s derivatives language make it in.

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Showdown on K Street protesters in New York (showdowninamerica.org)

The union giants SEIU and AFL-CIO as well as community organizing umbrella group National People’s Action held a “Showdown on K Street,” bringing around two thousand workers and organizers to protest against big Wall Street banks, the lobbyists they have hired to attempt to water down the Senate bill and continued economic strife more generally. Indeed, the event ended up more of an expression of sustained populist anger at the sour economy and banks’ $1.4 million-a-day lobbying effort than a protest against specific practices or provisions in the bill.

It started on Sunday when more than a hundred activists protested on the front lawns of two executives: Bank of America’s Gregory Baer, the company’s counsel for regulatory policy, and Peter Scher, J.P. Morgan Chase’s executive for government relations. At Baer’s home, NPA noted that Bank of America — after requiring a $45 billion taxpayer bailout — has spent $16 million lobbying against Sen. Chris Dodd’s (D-Conn.) regulatory reform bill.

Adolfo Abreu, an organizer for NPA who came down for the events from his home in the Bronx, noted that Baer came home while organizers were occupying his front doorstep, with one woman describing how Bank of America continued to attempt to collect payment from her on a phone call 30 minutes after she learned of the death of her son. Abreu said that Baer “started yelling at us, like, ‘Get out of here!’”

“These banks are way too involved in the economy, and they have been way too involved in protesting this bill,” Abreu said. “We are focusing on people, not people with privilege. We need these rights.”

At 11 a.m. on Monday morning, dozens held a vocal protest outside of the downtown offices of the Podesta Group, the powerful Democratic lobbying shop headed by Tony Podesta, who worked in the Clinton administration and has earned the left’s ire for lobbying against Democratic priorities. Protesters shouted, “Tony Podesta is hurting America!”

And at noon, the protest started in full, with approximately 2,000 gathering in McPherson Square. They held bright hand-painted signs and shut down traffic, as they did when protesting on Wall Street itself last week. Joel Hershey, a middle-school science teacher in Syracuse, N.Y., took to the microphone to fire the crowd up. He said he had taught for four years, and three weeks ago heard that he “would not be going back to school” — one victim of municipal layoffs due to budget cutting. He noted that his wife and he are “just two of the 300,000 teachers that could lose their jobs in the next year….devastating news for America’s children.”

The crowd then marched to and occupied the busy intersection at 14th and K Streets — “lobbyist central,” as one SEIU volunteer put it. The protesters, soaked by pouring rain at that point, had set up a 20-foot-tall paper-and-wood pulling the marionette strings of Congress and passed around whistles and drums.

Al Marshall of Oakland, Calif., took to the loudspeaker as the protesters engaged in a “sit in.” (The actual sitting part did not happen, with the pavement soaked.) With tears rolling down his cheeks, the construction inspector explained that he had purchased a “fixer-upper” but that he and his wife had struggled to make payments to Wells Fargo after she lost her job. The bank reclaimed the home as a foreclosure after “laughing” at him when he asked for a loan modification. “There shouldn’t be a homeless person anywhere in America,” Marshall said.

Ed Whalen, a member of the Sheet Metal Workers’ International Association Local 100 in Baltimore, affiliated with the AFL-CIO said he was there to protest such “financial anarchy.”

“The downturn has affected everybody, but it has proportionately affected the construction industry and my line of work because every part of the business relies on financing,” Whalen said. “There’s no getting around it. I’m at a loss for words to described what’s wrong here.”

Later on, the protest split up with smaller groups visiting the Hill and even interrupting goings-on at local bank branches. SEIU protesters, for instance, flooded a Bank of America branch on Capitol Hill, shouting “Bank of America — Bad for America!”

Another group of 100 protesters — many part of the Alliance to Develop Power, a Massachusetts group — showed up unannounced at the Russell Senate Office Building offices of Sen. Scott Brown (R-Mass.). The protesters complained that Brown had campaigned against the Troubled Asset Relief Program and contended that he now “does big banks’ bidding in the Senate.” The protesters brought a “big tent” into the cramped space (and then asked staffers “Who’s in your big tent!”) and eventually convinced office members to arrange a meeting between the senator and protesters.

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Here’s the Norton work history as provided by her campaign website:

* 1986-1987 — Norton served in the Colorado House of Representatives.
* 1988-1993 — Norton worked in the Department of Health and Human Services under Presidents Bush and Reagan.
* 1994-1999 — She was Head of the Office of Strategic Partnerships at Medical Group Management Association (MGMA).
* 1999-2002 — She was Executive Director, Colorado Department of Public Health.
* 2002-2006 — She was Colorado Lt. Governor under Gov. Bill Owens.
* 2007 — Named executive Director of the Denver Police Foundation.

Fox 21 in Colorado Springs described Norton yesterday this way:

Norton served in both the Reagan and first Bush administrations. She was also a representative in the state Legislature before becoming Colorado’s first woman Lieutenant Governor under Gov. Bill Owens.

Even for a short TV profile, descriptions of Norton should include the jobs that occupied the longest period of her work life (her years at MGMA and in Washington DC), as well as her noteworthy position as Colorado’s Lt. Governor. Both her private and public sector history should be spotlighted. That’s the most even-handed way to describe Norton.

Fox 21 selected a few of Norton’s jobs from random periods in her career. Why not include the five years in the private sector with MGMA as well as her public service? In fact, as I’ve noted elsewhere, Fox 21 isn’t the only Colorado media outlet that’s failing to describe Norton’s career accurately.

Reporters want to keep things simple and it’s not easy to guess what Norton did as head of MGMA’s “Office of Strategic Relationships.” So why confuse people? MGMA’s Office of Strategic Relationships is simply the organizations lobbying department. Norton headed up MGMA’s lobby shop– a fact readily confirmed by the folks at MGMA.

As for MGMA, it’s an association of medical professionals.

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Friends of Colorado’s Rivers is listed on the “paid for” line in the ads, which advocate for the property rights of landowners along Colorado rivers. The ad reaches out to landowners who may want to keep commercial rafting outfits from pulling out on their property in order to portage rough sections of water or deal with emergency situations.

Arkansas River (CC photo, Kahunapulej, Flickr)

The group caused some confusion for proponents of the legislation, who argue Colorado rivers should be kept open to the state’s $142-million-a-year rafting industry – even along private stretches. The problem was that Friends of Colorado’s Rivers isn’t listed with the Colorado Secretary of State as a political committee. It is, however, registered as a nonprofit corporation (pdf) under the SOS business section.

Feeley is in fact a registered lobbyist, and as the registered agent for the Lakewood-based nonprofit is not legally required to register as a political committee when lobbying in support or opposition of proposed legislation.

Curry’s bill, HB 1188, passed in the House by 40-25 vote but now faces a much tougher battle in the Senate, where it will be the hotly contested subject of a Senate Judiciary Committee hearing on March 17, according to the Denver Post.

Curry, who late last year switched from Democrat to independent, introduced the bill because two commercial rafting outfitters in her district were barred by a Texas developer from running a stretch of the Taylor River they had been rafting for years.

The Texas developer, Lewis Shaw, who, according to the Grand Junction Daily Sentinel, bought up thousands of acres along the Taylor with the intention of selling them off as 35-acre ranchettes, is not listed among Feeley’s principals on the SOS lobbyist disclosure site. But Friends of Colorado’s Rivers was just registered on Feb. 12, so the developer may show up on a future disclosure.

It’s also possible the developer or a property rights group called the Creekside Coalition hired Feeley’s government relations law firm, Brownstein Hyatt Farber Schreck, to work on their behalf.

According to one political observer, Secretary of State Bernie Buescher is working on rules that would require the companies or individuals behind a lobbying effort to be disclosed on the SOS website, not just the law firms or lobbyists they hire.

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Elizabeth Warren, chair of the Congressional Oversight Panel (EPA/ZUMAPRESS.com)

Indeed, Republicans are already treating the protection agency like poison. Senate Banking Committee Chairman Christopher Dodd (D-Conn.) may have abandoned his finance-reform talks with Sen. Richard Shelby (R-Ala.), an outspoken foe of a separate agency to protect consumers. But Shelby’s replacement at the negotiating table is Sen. Bob Corker (R-Tenn.), who said recently that, just as Republicans were unanimous in opposing the public plan in the health care debate, so too are they united against an independent consumer financial protection agency, or CFPA — a proposal championed by Elizabeth Warren, head of the TARP oversight panel.

“For Republicans, including me, a free-standing agency is a nonstarter,” Corker told The Hill last week. Instead, Corker wants to carve out a consumer protection unit within a much larger bank regulator being proposed by Dodd.

Yet that idea worries many consumer advocates, who argue that the agency charged with ensuring the soundness of the nation’s financial institutions shouldn’t also be responsible for protecting consumers. It’s not difficult to imagine, for instance, situations in which firms profit from unfair or abusive practices. In those cases, the strategies that bolster the firms’ financial health might do so by taking advantage of the same confused consumers the agency is supposed to safeguard.

“These two missions can conflict,” Travis Plunkett, legislative director of the Consumer Federation of America, said Tuesday at a finance reform discussion hosted by the New America Foundation in Washington. “It would be like putting the Department of Commerce in charge of the EPA. … It would mean that we haven’t learned the lessons of the crisis.”

No matter. Despite the recent Wall Street collapse — a crash that required trillions of dollars in federal help and has left nearly a fifth of the country underemployed — the powerful financial services industry has retained remarkable sway on Capitol Hill. Not only have the nation’s largest firms rebounded to a point where seven- and eight-figure bonuses are again the norm, but they’ve also pumped tens of millions of dollars into K Street to lobby against the Democrats’ reform plans in general and the CFPA in particular.

The industry warns that too much government oversight would stifle innovation and ultimately limit access to the same credit that’s the lifeblood of the economy — not unlike the health insurance industry warning that the public option would ultimately harm the same consumers it’s designed to help. And lawmakers are listening. Not only are Republicans united against the CFPA, but a handful of Democrats — including Sens. Tim Johnson (S.D.), Ben Nelson (Neb.) and Mark Warner (Va.) — are wary as well. That opposition means that the Democrats would have had trouble creating the CFPA even before the surprise victory last month of Sen. Scott Brown (R-Mass.), which has forced the Democrats’ health care reforms to the back burner.

The saga highlights the dilemma facing Democrats in Congress and the White House in the run-up to November’s mid-term elections. On one hand, party leaders want to bolster their populist image; on the other, they’ll have to rally the support of at least a few business-friendly senators to get anything at all through the upper chamber, where 60 votes are required to pass everything. Meanwhile, Democrats also don’t want to alienate the same Wall Street firms that gave heavily to the party in 2008. If the enactment of strict new financial regulations was a foregone conclusion in February of 2009, a year later it’s looking like the Democrats will have to settle for weaker tea.

Another hurdle facing the CFPA, according to some observers, has been the failure of Democratic supporters to sell the importance of their proposal. Tim Fernholz
, writer at The American Prospect, pointed out that most voters have experience with mortgage loans, or car loans, or credit card rates or overdraft fees. The question is: why haven’t CFPA supporters been able to convince those same folks that a consumer protection agency would work to their benefit? “It really should be something that’s politically popular,” Fernholz said.

Jonathan Mintz, commissioner of New York City’s Department of Consumer Affairs, agreed that, despite all the evidence that the industry needs a shorter leash, the Democrats’ messaging has failed to resonate with the public at large. “You can be very specific about the harm that’s being done,” he said. “Suddenly what you’re talking about is a literal problem with a literal solution.”

Not that all Democrats are done fighting for the CFPA. “There needs to be a new agency with new powers for whom this will be a primary mission,” Lawrence Summers, White House National Economic Council director, said last month. More recently, White House Press Secretary Robert Gibbs echoed that sentiment, telling reporters Friday that an independent consumer protection authority remains “a great priority” of President Obama.

Congress is half way there. In December, House Democrats passed a financial reform package that included a stand-alone CFPA. Sponsored by Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, the bill would prohibit certain complex financial products, require greater transparency surrounding terms and rein in misleading marketing campaigns. It received exactly zero Republican votes.

Some state financial regulators warned Tuesday that the industry has evolved quickly, with more and more companies dabbling in the complicated products that few seem to understand. “The fringe sector really isn’t so fringe anymore,” said Sarah Bloom Raskin
, Maryland’s commissioner of financial regulation.

Plunkett agreed, noting that the recent turmoil was caused by a series of regulatory failures that allowed the nation’s financial institutions to make a habit of abusive practices — a “parade of horribles,” Plunkett said, that extended well beyond sub-prime mortgage lending into the realm of credit cards, overdraft fees and payday loans. Because no one agency concentrates exclusively on protecting consumers, he said, they were able to focus elsewhere without much consequence — until it was too late.

“It’s a failure of will,” Plunkett said. “No one had consumer protection as a priority.”

And if Corker and the others have their way, that trend will continue.

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Overall, lobbying expenses across Washington increased less than 5 percent in 2009 — higher than the rate of inflation, certainly, but nearly half of the average yearly increase in spending seen during the last several years.

The financial sector’s increased commitment to Washington lobbying in 2009 was driven by multi-million dollar budget hikes in the commercial banking, credit union, credit card and venture capital sectors. Meanwhile, securities and investment firms posted a slight decline in their lobbying expenditures, as did private equity companies.

Those companies would undoubtedly insist — in compliance with the Byrd Amendment, which prohibits companies from spending money received from the federal government on lobbying — that there was a strict demarcation between corporate money and federal TARP funds. But when those TARP funds were used to keep the corporation afloat, it’s a paper-thin wall at best.

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But the industry didn’t fold. Payday lenders in some of the same states that passed reforms continue making payday loans – and sometimes at higher interest rates than they did before the laws were enacted, according to public policy experts and consumer advocates who follow the industry.

Indeed, most major payday lenders still are in business, using loopholes in existing small loan laws or circumventing new laws entirely to continue charging triple-digit annual interest rates, in some cases as high as nearly 700 percent, advocates contend. Now lenders issue loans in the form of a check and charge the borrower to cash it. They roll into the loan a $10 credit investigation fee — then never do a credit check. Or they simply change lending licenses and transform themselves into car title companies, or small installment loan firms, while still making payday loans.

“In Ohio, New Mexico, Illinois and Virginia, every major payday lender is violating the intent of the law,” said Uriah King, senior policy associate with the Center for Responsible Lending. “I’ve been involved in public policy issues for a long time, and I’ve never seen anything like this.”

“It is kind of astonishing. The more I look into it, the more brazen the practices are. Payday lenders, as a trade association, have consistently circumvented the intent of legislative efforts to address their practices.”

In Colorado, Democratic Denver state Rep. Mark Ferrandino has been leading the charge to to rein in the industry. In 2008, he introduced legislation that he said was weakened through amendments and ultimately failed to pass. He told the Colorado Independent that he has been working with consumer advocacy groups to develop a stronger bill this year. He said he was considering writing it as a referendum and submitting it to the public for vote on the November ballot in order to circumvent the powerful payday industry lobby.

“I am up against a very strong lobbying core. They have a lot of money and a lot of influence down here. They have the ability to take any bill that is moving forward and shape it to their own interests and really stop any real reform. I want to make sure I have my ducks in a row before I go ahead on this,” he said.

Just anti-business

Representatives of the industry refute accusations that they are circumventing the laws. Steven Schlein, a spokesman for the Community Financial Services Association of America, a payday lending trade group, said it’s simply untrue that payday lenders are circumventing the law in Ohio, or in any other state. “That argument is untenable,” he said. “It just shows you that our critics are really just anti-business.”

The dispute over Ohio’s payday lending practices began after voters upheld a 28 percent interest rate cap on payday loans in November of 2008, and many payday lenders began operating under several small loan laws already on the books. The legislature approved the cap in the spring of 2008, and payday lenders fought back with the voter referendum, but failed.

The small loan laws, which have been in existence for decades, are intended to govern installment loans, not single-payment, two-week payday loans. Payday lending opponents say the lenders are exploiting those laws to avoid the 28 percent rate cap. Lenders contend they are legitimately licensed by the state to make the small loans.

Some 800 of the Ohio’s 1,600 payday lending stores have shut down since rates were capped – and the rest are “trying to make a go of it” by adhering to the small loan laws, said Ted Saunders, CEO of CheckSmart Financial Co., a national payday lender with more than 200 stores in 10 states. “We’re lending money for far less than we did when all this started,” he said. “This is not business as usual. The activists just want to put us out of business entirely.”

Those activists are pushing the Ohio legislature to move once again, to close the loopholes in the loan laws by placing them all under the 28 percent cap. More than 1,000 payday lenders already have gotten licenses to make short-term loans under the old small loan laws, which allow for high origination fees and other charges, according to a report by the Housing Research & Advocacy Center in Cleveland.

Under those laws, for a 14-day loan of $100, lenders can charge an origination fee of $15, interest charges of $1.10, and a $10 credit investigation fee, for a total amount of $126.10, or a 680 percent annual interest rate.

The loan you really want is for $505

David Rothstein, a researcher with Policy Matters Ohio, an advocacy group that pushed for payday lending limits, said testers for his group found that lenders sometimes told borrowers certain loan amounts, such as $400, were not allowed. But they could borrow $505. Loans over $500, according to the small loan laws, allow lenders to double origination fees to $30. Lenders also often issued the check for the loan from an out of state bank, but said borrowers could cash it immediately if they did so at their store – for another fee, often 3 to 6 percent of the loan total. Testers contended employees at some of the stores laughed as they explained the procedures, saying they were only trying to get around the new law.

In other cases, lenders directed borrowers to go get payday loans online, where rates can be higher.

“The General Assembly, in a bipartisan manner, passed a strong law on these loans and the governor signed it,” Rothstein said. “Then, the industry took it directly to the voters, who reaffirmed support for the law by some 60% despite the millions of dollars spent by the industry to overturn the law. This is a slap in the face. They are absolutely disregarding the spirit of the law that was passed.”

Resetting the debate on payday loans

Saunders, however, said consumer advocacy groups promised that low-cost payday lending alternatives would pop up once the law was passed – but that hasn’t happened. Instead, there’s been an increasing demand for payday lending services by strapped consumers. “Should we be further eliminating access to credit in a bad economy?” Saunders asked. “We exist because we’re still the least expensive option for a lot of people.”

People hit by high overdraft fees from banks or faced with late charges on multiple bills sometimes decide that taking out a payday loan can be a cheaper alternative, he said.

Based on those kinds of arguments, the debate in Ohio now has shifted from how to best enforce the new law to arguing again over the merits of payday lending. Payday lenders are contending that curbing payday lending in a recession hurts low-income borrowers, and results in job losses. Lawmakers have yet to move on the latest bill to end the loopholes. King, of the Center for Responsible Lending, said that while payday reform advocates have fought in the past to make sure new laws were followed, Ohio marks the first time where the payday lending debate seems to have started over entirely.

“I haven’t seen that elsewhere,” he said. “Ohio is something new. I think there is some degree of frustration as to why we are redeliberating every aspect of this issue. It’s made a tough issue even tougher.”

Self-styled car title lenders

Ohio isn’t alone in dealing with pushback from payday lenders, even after laws are passed.

In Virginia, payday lenders responded to laws passed last year to limit their fees by reinventing themselves as car title lenders, while still essentially making payday loans, said Jean Ann Fox, director of financial services for the Consumer Federation of America. Car title loans are high-rate loans usually secured by the borrower’s car.

State officials ordered payday lenders in December to stop making car title loans to borrowers who already had a car title loan outstanding, and to start filing liens on borrowers’ vehicles, as is the usual practice with car title loans.

In New Mexico, the state attorney general sued two small installment lenders, contending they used a legal loophole to continue charging extremely high rates on short term loans – in some cases, more than 1,000 percent. In both New Mexico and Illinois, the payday lending lobby supported reform laws, but then began using the small loan laws once the new limits took effect, CRL’s King said.

For other states, such as North Carolina, Pennsylvania, Georgia, and Oregon, state lawmakers or the attorney general had to go back and tighten laws or ramp up enforcement after initial payday reform legislation failed to rein in high fees. In Arkansas, an effort to end payday lending wound up involving the state Supreme Court and an aggressive campaign by the attorney general.

Payday loaners / financial literacy counselors

In Ohio, Saunders said payday lenders will be gone entirely if lawmakers move to limit their use of the small loan laws. The additional fees allowed by those laws, he said, are “the cost of doing business,” and companies like his can’t realistically operate without them. His solution is to launch a statewide financial literacy campaign, in which CheckSmart will provide an expert to train nonprofit groups and churches and provide them with a variety of resources to help consumers with budgeting and saving issues. The campaign won’t involve marketing payday loans or pushing any products. Saunders said he took on the idea after several lawmakers during the 2008 debate told him his firm needed to have a higher community profile. Providing financial literacy help, he said, will highlight CheckSmart’s good corporate citizenship.

“In 2010, financial literacy is a big part of what we’ll do going forward,” he said. “It’s not a conflict of interest. We’re going to be giving good, sound financial advice for free. I have nothing to hide. Look, no amount of financial literacy would solve every person’s financial shortfalls. If consumers were being served by other sectors, we wouldn’t be here. This is a way of saying, ‘We’re the good guys.’”

While consumer advocates may not see it that way, attempts in Ohio to limit charges on short-term loans also have been hampered by confusion over who should take the lead – the governor, lawmakers, the attorney general, or state agencies, Rothstein said. As that fight goes on, the question of how much people in financial peril should have to pay for a short-term loan remains as unresolved as ever, in Ohio and in many other states.

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Additional reporting by Joseph Boven.

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