K Street Bullish on McCarthy

Kevin McCarthy is the favorite to become the new Speaker of the House, but who stands to gain from it? TMG’s Ivan Adler discusses K Street ties in The Hill.

By Megan R. Wilson | September 30, 2015

House Majority Leader Kevin McCarthy’s stock is skyrocketing on K Street.

Even before the smoke clears from Speaker John Boehner’s (R-Ohio) bombshell resignation announcement, lobbyists are bullish about a presumed succession scenario that involves McCarthy ascending to the helm of the GOP conference.

The California Republican is a clear favorite to claim the Speakership. And K Street is standing squarely behind him.

In the first six months of the year, McCarthy received big checks from the chiefs of some top business groups. Business Roundtable President John Engler, National Association of Manufacturers President and CEO Jay Timmons and Nicholas Calio, the president and CEO of Airlines for America, all helped fill McCarthy’s coffers, as did dozens of prominent Republican lobbyists in town.

“He’s close to a lot of people on K Street. He has made a deliberate effort to reach out to the business community,” said Dan Crowley, a partner at K&L Gates, who has known McCarthy for two decades, going back to their time in the Young Republicans.

“When your role is leader of the party — which he will effectively be as Speaker — you need that,” Crowley said. “You need leader who recognizes that the role of the government is to create an environment in which business can prosper.”

From January to June, K Street donated more than $150,000 to McCarthy’s campaign fund and leadership PAC, Federal Election Commission (FEC) records show.

Many of his donors are former staffers, including former Boehner aides Sam Geduldig of CGCN Group and Jeff Strunk of Forbes-Tate and former aides to ex-Majority Leader Eric Cantor (R-Va.), such as Kyle Nevins and Steve Stombres at Harbinger Strategies and Cheryl Jaeger of Williams & Jensen.

But compared to Boehner, there is a relatively small network of former McCarthy aides-turned-lobbyists who stand to gain clout if their former boss claims the gavel.

About half a dozen of the majority leader’s ex-staffers have taken their talents to the private sector. Among them are Wes McClelland, a former McCarthy policy adviser who is now vice president for federal affairs at the American Insurance Association; Brian Worth, an in-house lobbyist at Uber; Steve Pinkos, a partner at American Continental Group who served as a policy director and general counsel to McCarthy; and Shelby Hagenauer, a senior policy adviser at law and lobby firm Nossaman.

“They become immediately more valuable because proximity to the Speaker is everything,” says Ivan Adler, a principal at The McCormick Group. “I’ve said it before, and I’ll say it again: If that happens, they become the instant new ‘it girl.’”

McCarthy’s K Street network is attributed in part to his meteoric rise in leadership since being elected to Congress in 2006