Like a lot of industry groups, the farm lobby says it would prefer that Congress tackle climate change rather than leaving the job to the bureaucrats at the Environmental Protection Agency. But now, the prospect of EPA greenhouse gas regulation looms large — mostly because agriculture and so many other interests haven’t liked any of the climate bills so far on Capitol Hill.

Not to worry. The same onslaught of lobbyists and lawyers that helped dim prospects for climate legislation in this Congress (representing about 1,170 businesses and interest groups by the fourth quarter of 2009 ) is now engaged in an energetic, multi-front offensive to delay or block any attempt by the Obama administration to enact an alternative through regulation. Overt and covert support for Alaska Republican Sen. Lisa Murkowski’s pending resolution to stop the EPA from regulation (and similar legislation introduced in the House) is but one prong of this assault. Opponents of federal curbs on fossil fuel emissions are also seeking allies in the states and in other federal agencies, while paving the way for court action to directly challenge EPA’s initiative.

Rick Krause, the American Farm Bureau Federation’s senior director for congressional relations, says the EPA’s Clean Air Act permitting system — the vehicle for its proposed climate change regulations — has “very little flexibility.” Although he says the Farm Bureau would prefer a congressional climate bill, he admits the group hasn’t backed any bills so far: “We don’t feel that the threat of bad regulation is enough to warrant the enactment of bad legislation.”

So the Farm Bureau supports the Murkowski resolution, says Krause, and also has been talking to state regulators about the problems they could face administering the EPA program — especially the changes meant to moderate the impact on small businesses. State regulators, for their part, indeed have asked EPA for one to two years to get their own rules in line. But Bill Becker, executive director of the National Association of Clean Air Agencies, says that should not be read as opposition to the EPA regs. “I kind of laughed at industry friends I hadn’t seen for years treating me as their best ally because they read our comments,” he said. Becker said the states’ administrative problems likely can be dealt with in months, and are no reason to block the whole program.

But some argue that EPA’s effort to avoid hurting the little guys has not gone far enough. The Small Business Administration’s Office of Advocacy argues that EPA should have convened a Small Business Advocacy Review Panel before proposing the rules. The SBA has identified at least 1,200 small businesses — including foundries, refineries, coal mines, and municipal utilities — that would be swept into the program. Susan Miller, vice president of the Brick Industry Association, shared concerns with SBA that EPA’s air pollution permitting process “would take both time and money — something the industry doesn’t have a lot of right now,” in the housing downturn aftermath.

EPA spokeswoman Cathy Milbourn said in an email that the agency complied with rulemaking requirements, but is considering the SBA Advocacy Office’s recommendations as it works to finalize the rules. In fact, the EPA has plenty of such recommendations. The agency received more than 400,000 letters, emails, and briefs on just one rule to alleviate the impact on businesses with modest emissions. It received somewhat fewer comments (380,000) on its Dec. 7 finding that greenhouse gases posed a danger to public health and welfare — the action that paved the way for regulations.

Groundwork also is being laid for another line of assault on EPA — through the courts. Jeff Holmstead, partner at the law and lobbying firm Bracewell & Giuliani LLP, which represents Southern Company, Duke Energy, and other electric power interests, says the EPA’s effort to craft a rule delaying the impact on those small emitters is on “pretty shaky ground as a legal matter.”

“It makes sense that EPA wants to avoid placing additional burden on mom and pop businesses, but the courts are unlikely to allow EPA simply to rewrite the Clean Air Act,” he says. Holmstead, one of the lobbyists who advised Murkowski on her resolution, has personal experience regarding the courts and EPA. As assistant administrator in charge of EPA’s air program during the Bush administration, he helped write the Clean Air Interstate Rule, an effort to address pollution that moves across state boundaries. But a federal appeals court struck down that rule in 2008, finding no explicit authority in the Clean Air Act for what EPA did. Holmstead argues the agency has gone further this time-proposing initially to regulate only facilities that emit more than 25,000 tons per year of greenhouse gases. The law spells out thresholds as low as 100 tons per year for other pollutants.

The EPA maintains it is on solid legal ground, because courts have held such language in the law need not be applied if doing so would produce “absurd results” or would be impossible to administer. But even if the agency can defend its pragmatism, it may not escape a trial on global warming science. The National Cattlemen’s Beef Association, Massey Energy Company, and other mining interests already have filed a petition for court review of the EPA’s endangerment finding. “We think the EPA had a pre-selected outcome, then shaped the science to fit that outcome,” says lawyer Paul Phillips of the Holland & Hart law firm in Denver. But at least 16 states and four major environmental organizations have asked for court permission to join in that case. The latter group reprises much of the coalition that proved successful in the 2007 Supreme Court case that found greenhouse gases were a pollutant under the Clean Air Act, paving the way for EPA regulation.

Meanwhile, the EPA is working to finalize its first phase of those greenhouse gas rules — for cars and light trucks — by March, in time for the 2012 model year. That was the deal the Obama administration struck last spring with the auto industry, which has pledged not to challenge the rules. No one else has made a similar promise. “Up to the end there will be calls for delay, and anyone and everyone will be seeking to influence the process in any way they can,” says Frank Maisano , spokesman for the Bracewell lobbying firm. “And it will continue through to the legal battle that is sure to follow.”

A version of this post was originally published on the website of the Center for Public Integrity and is reposted on Grist with CPI’s kind permission.

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It is said that borders don’t matter to the atmosphere — all nations have to work together to tackle the problem of climate change.

But the forces that seek to block that effort likewise know no national boundaries. They’re rallying coal miners in Appalachia, stirring up aluminum workers in Australia, and slowing renewable energy in China. They’re using their exalted position in Indian society to discourage the government from making international commitments. In Brazil, they’re not giving up free rein over rainforest land without a fight.

Their handiwork will be evident as negotiators from 192 nations gather in Copenhagen this December to forge the most important environmental treaty ever. There is no question negotiators face a daunting task: to reduce the pollution from the burning of oil, coal, and gas that has fueled economic development since the Industrial Revolution. But their difficult job has been made overwhelming by the tactics wielded the world over by powers rooted in the economy of the past.

In the United States, there has been the well-orchestrated rallying of “grassroots” opposition to climate legislation. Coal millionaire Don Blankenship, chief executive of Massey Energy, is an outlier in the public debate as a vigorous global warming denier.  But his message at a West Virginia rally he organized, that “environmental extremists and corporate America are both trying to destroy your jobs,” is a real factor on Capitol Hill. ­­The Senate bill now in play has no hope of passage without winning votes in the economically struggling coal states and coal-dependent industrial Midwestern states.

The message is strikingly similar in an Australian port town known both as a gateway to the Great Barrier Reef and a smokestack industry haven. Russian aluminum billionaire Oleg Deripaska, with a big stake in a refinery there, has lobbyists battling that nation’s climate change plan as “destructive for jobs, destructive for new and existing investment.” Such arguments helped defeat climate legislation in the Australia in August.  The business lobby has to be strong to slow climate policy in the hottest and driest inhabited continent, amid a years-long drought that contributed to deadly wildfires while it watches its climate-stressed tourism jewel, the Great Barrier Reef, on course to be “functionally extinct.”

Pressure from old-line business interests may be more transparent in the United States and Australia, but forces also are determined to put on the brakes in the developing world. In China, for instance, wind turbines rising against Xinjian Province mountains have become an iconic image of a growing clean energy commitment. The government’s goal is to achieve 20 percent renewable power by 2020, on the road to which it has doubled its installed wind power in each of the past four years. But China is also building coal plants so fast that it still gets just 1 percent of electricity from wind. Only one of the top 10 power companies-all state-owned enterprises-will meet the government’s interim goal of 3 percent renewables by 2010. The power company executives, all quasi-governmental officials, have resisted proposals to help renewables by raising the price of coal. “There don’t need to be ‘lobbyists’ when discussions can happen directly through the Party,” says Beijing-based political commentator Zhao Jing.

The approach is less subtle elsewhere. For example, Brazilian President Luiz Inacio Lula da Silva recently offered to reduce the pace of deforestation in the Amazon rainforest — one of the world’s most important natural absorbers of carbon dioxide — by 80 percent by 2020.  But Carlos Minc, Lula’s environment minister, has faced an onslaught from the agriculture industry and its allies in elected office who balk at curbs on land use. One governor even threatened him with rape. “Many of those industries talk about zero deforestation, but when we press them they want to kill us,” he says. “They call me to speak in the Senate or the House and I stay for five hours under a massacre. They’re favorable to zero deforestation, provided it doesn’t affect … their own land.”

The 1997 Kyoto treaty on climate change was marked by the decision that developing countries, where millions of people still lived without electricity, would not have binding obligations to reduce emissions. The burden of making cuts would fall first, instead, on the countries that grew wealthy in fossil-fueled economies. But the way Kyoto dealt with the rich-poor divide remains a political stumbling block in the United States. And since the International Energy Agency projects that 97 percent of the increase in global emissions between now and 2030 will come from developing countries, hopes have been high that negotiators of the successor treaty at Copenhagen would find a new way to bridge the gap between past and future engines of the climate problem.

But the principle that developing countries shouldn’t have binding treaty obligations is dearly held by businesses that have the ear of government in those nations. In Delhi, India, Bharat Wakhlu, resident director of the powerful Tata Group — that nation’s largest business conglomerate with nearly 100 companies from power generation to autos — says the company recognizes it has a role in addressing global warming. But, he added, “We believe in a ‘common but differentiated’ approach, as we have to retain our competitiveness as well as ensure the planet is safe.” In United Nations climate change lingo, “common but differentiated” is a shorthand reference to just one key differentiation — only wealthy nations have obligations.

Juan C. Mata Sandoval, Mexico’s top climate official and a negotiator for Copenhagen, is frank that one of the business lobby’s chief concerns has been that his nation remain a “non-Annex 1″ country-one without required emissions cuts. “We need to communicate with them constantly,” he said. “The private sector also wants a voice and an opinion on how much is Mexico going to put on the table.”

But in its own way, Mexico-like China, India, and Brazil — is addressing climate change. Mexico has a national climate change plan with 86 specific goals it says will slow the growth of its carbon emissions. In absolute terms, Mexico’s carbon output would still rise in the short term, but the country also has mapped out a long-term pathway to reduce its emissions-if it receives technical and financial support from developed countries.

Many see these types of developments as cause for optimism, even while conventional wisdom says the Copenhagen talks are on a path toward stalemate. “All the major economies are prepared to lay down significant low-carbon development plans,” U.S. climate negotiator Todd Stern said at a recent U.S.-India energy forum in Washington. “This is big news. It’s never happened before. It’s important stuff.”

But that headline hasn’t registered. Instead, the prevailing view is much more likely to be that of Brian Flannery, climate guru for energy giant ExxonMobil. “The only way to get to these low [emissions] levels is for the whole world to act together with common targets and a common carbon price,” he said in an interview at run-up negotiations in Bangkok in October, where he was a registered observer for the International Chamber of Commerce. “We’re not going to have everyone with the same target, the same price on carbon … It does raise fundamental questions about whether the negotiating process should aspire to unachievable targets and work in an area of confrontation and dismay, or try to work towards achievable targets.”

It’s hard to tell how much lower the targets need to go for fossil-fuel stalwarts. No developed country has set an unconditional goal of reducing emissions 25 to 40 percent below 1990 levels by 2020 — the short-term target the U.N.-backed Intergovernmental Panel on Climate Change said would be necessary to achieve stabilization.

Given the power of industry lobbying, advocates for climate progress see their best hope as the growing number of businesses that support action. Dan Reicher, director of energy initiatives at Google, who was a member of President Barack Obama’s transition team, is confident a plan can gain support in the U.S. Congress, if it has plenty of business flexibility and opportunity. But he is under no illusions it will be easy. At a recent conference in Washington on energy efficiency — a pursuit Google aims to advance by providing people real-time home electricity information — Reicher summed up the climate change politics succinctly: “This is going to be an epic, epic struggle.”

This story is part of The Global Climate Change Lobby, a project by the International Consortium of Investigative Journalists. ICIJ correspondents Christina Larson in Beijing, Fernando Rodrigues and Marcelo Soares in Sao Paulo, Marian Wilkinson in Sydney, and Kate Willson in Bangkok contributed to this report.

This post was originally published on the blog of the Center for Public Integrity and is reposted on Grist with CPI’s kind permission.

With its hefty bankroll and polished messaging, the American Coalition for Clean Coal Electricity looked like a juggernaut going into the climate change debate on Capitol Hill. But ever since the House narrowly passed a measure in late June to set the country on a path to addressing global warming — a measure with plenty of concessions to coal but still lacking ACCCE’s support — the advocacy group has been beset by struggles.

First, Bonner & Associates, the lobbying firm ACCCE subcontracted to help stoke its vaunted grassroots network, was found to have forged at least 13 letters to members of Congress purportedly from senior citizen and minority groups opposed to the legislation. Bonner blames a rogue employee and ACCCE has fired Bonner, but a congressional investigation continues.

The large power company Duke Energy, whose chief executive James Rogers has long advocated climate legislation, withdrew from the coal group this week — a story first reported by Energy Daily (subscription required). ACCCE burst on the scene in 2008 with the message that it did support a practical, affordable climate plan — essentially Duke’s position. But Duke said a rift became apparent during the debate over the House bill. “We believe ACCCE is constrained by influential member companies who will not support passing climate change legislation in 2009 or 2010,” the company said in a statement. After the Duke story broke, the blog EnviroKnow confirmed that aluminum maker Alcoa had earlier quit the group.

The aluminum maker decided to quit paying dues to the coal advocacy group about a month ago as part of its company-wide effort to reduce costs. “You may have heard of a little thing called the economic downturn,” Alcoa spokesman Kevin Lowery said in an interview with The Center for Public Integrity. So it was an economic, rather than a philosophical decision? “Any kind of economic decision has to have a business case — whether you invest money and make money at the end of the day,” Lowery said.

Alcoa, which has reduced its own carbon emissions 36 percent since 1990 while doubling production, sees a genuine business case for cap-and-trade, since a law would increase the incentive to make vehicles and planes more lightweight and fuel efficient through use of aluminum.

The loss of companies like Alcoa and Duke (which in addition to coal power has seven no-carbon-emissions nuclear reactors and is planning three more) comes at the same time that ACCCE has added members whose fortunes are more closely tied to coal. Berwind Natural Resources, which owns and leases large coal reserves in the Appalachian Mountains; Buckeye Power, a co-op with two coal units on the Ohio River; Crounse Corporation, a Kentucky-based barge line that hauls primarily coal on the Ohio River and its tributaries; and International Coal Group, a producer in Central Appalachia and the Illinois Basin, all have joined ACCCE’s membership roster since the spring.

Duke spokesman Tom Williams said in an interview with the Center that the break had nothing to do with the giant power companies that remain ACCCE members — Southern Company, American Electric Power, or Progress Energy. Although Williams declined to name names, saying ACCCE’s steering committee was well aware of which of its members were intransigent on climate legislation, ACCCE includes many smaller rural electric co-ops completely dependent on coal who have been some of the most adamant opponents of legislation. Buckeye Power, for example, urges activism against “Cap and Tax” legislation on its web site.

But some companies that support climate legislation remain in the ACCCE fold — the largest and most diverse being General Electric. GE spokesman Daniel Nelson said in an email that ACCCE does not reflect GE’s views on climate change legislation, which is that cap and trade would help “drive American technological innovation and competitive leadership … We advocate that view within ACCCE and have and will work to make it the majority view in that organization.”

ACCCE, for its part, released a statement [docx] that said, in part, “From time to time, individual coalition members may have different perspectives with regard to important policy positions.” With the Senate set to take up climate legislation on its return, ACCCE launched a new round of TV advertisements “emphasizing the need to keep electricity costs affordable by strengthening the use of coal in our energy mix.”

This post was originally published on the website of the Center for Public Integrity and is reposted on Grist with CPI’s kind permission.

More than 460 new businesses and interest groups jumped into lobbying Congress on global warming in the weeks before the House neared its historic vote on climate change legislation, a Center for Public Integrity analysis of just-disclosed lobbying records shows.

The surge in the 12 weeks leading up to the June 26 vote meant that about 1,150 different companies and advocacy organizations were promoting their vision of how the nation should tackle climate change, a more than 30 percent cumulative jump over the 880 companies and associations that were storming Capitol Hill on the issue as the year began. Some 190 of the interest groups that were lobbying in the first quarter of the year did not continue their lobbying in the April-June time period.

It’s impossible to say with certainty how much money was spent on lobbying the climate bill, since businesses don’t have to detail expenses for separate issues they are pushing in Congress — like climate, health care, the economic stimulus, or taxes. But so many groups were lobbying climate that even if the issue consumed only 10 percent of their efforts, the cost would have been more than $27 million in just the second quarter-from April through June.

From Turbines to Teaching

The interests were wide-ranging. It’s no fluke that farm interests took center stage as the vote approached, considering that nearly 20 companies and organizations that produce or promote biofuels — including refiners and would-be refiners of plant matter from corn to wood chips to algae — started lobbying climate legislation for the first time. But they were joined by a host of others. American Superconductor of Devens, Massachusetts, pushed for the electricity grid modernization in the bill — a move that would enhance the market for its superconductor wires, which the company says can carry ten times the power of traditional copper cables and potentially double the power capacity of wind turbines. Electric grid investment also was a primary goal for PickensPlan, the advocacy project of billionaire T. Boone Pickens, which joined the lobbying fray in the second quarter. Pickens had sunk millions into the Texas wind power he touts as an important domestic resource, but electricity from the rural plains isn’t going anywhere without more wires. In fact, Pickens last month postponed his power plan due to financing problems.

Numerous religious groups, from Hadassah, the Women’s Zionist Organization of America, to the National Advocacy Center of the Sisters of the Good Shepherd, have been lobbying on the bill over the past year. In the second quarter, another advocacy group joined in: the Americans United for Separation of Church and State, concerned about possible subsidies to “faith-based” organizations for energy system retrofitting.

T. Boone Pickens. Photo courtesy of

About 30 higher education institutions and associations — from Ivy League to community colleges — also joined in lobbying on the climate bill in the final weeks before passage, most with an eye on federal money that might be available for climate-based educational programs or research. The Exploratorium — a San Francisco-based, interactive science museum — along with four other science centers, said in a letter to the climate bill’s authors, “we see few more important issues for our future as a species” than global warming; the organizations wanted to be sure that institutions like science centers and natural history museums also would be eligible to compete for climate education grants.

“The closer we got to finishing the bill, the more intense the frenzy to get little pieces into the bill,” said a senior Congressional staffer. The aide believes the integrity of the legislation held up, nevertheless, even as the measure ballooned from the initial 648-page draft to the 1,428-page mammoth passed by the House. The main goal — reducing the nation’s carbon dioxide emissions 17 percent by 2020 — remained intact, the source said. “It worked out okay, but sometimes at the end of the day you felt like you had been pawed by a lot of people — all your good friends who just wanted to help you out on this piece of legislation.”

A Corn-Fed Force

New Biofuels Interests in the Climate Lobbying Game

Companies and advocacy groups that started lobbying on global warming in the second quarter, according to filings with the Senate Office of Public Records.

Adage LLC
Algenol Biofuels, Inc.
American Sugar Cane League
Aurora Biofuels
Corn Refiners Association
Fulcrum Bioenergy, Inc.
GeoSynFuels
Green Earth Fuels
Growth Energy
Kai Bioenergy
National Biodiesel Board
New Generation Biofuels (Formerly H2Diesel)
Patriot Renewable Fuel
Petroalgae, LLC
Poet LLC
Renewable Biofuels
Novogy
Southern Minnesota Beet Sugar Cooperative
Targeted Growth

What did all these groups get for their lobbying dollars? In the case of agriculture — with nearly 80 total businesses and interests groups lobbying — it’s pretty clear, due to the high-profile showdown forced by House Agriculture Committee Chairman Collin Peterson, D-Minn., who threatened to deep-six the bill. To gain his votes and those of other committee members, the climate bill’s authors, House Energy and Commerce Committee Chairman Henry Waxman, D-Calif., and his global warming subcommittee chair, Rep. Edward Markey, D-Mass., agreed to enhance the benefits farmers would gain for participating in the nation’s effort to cut greenhouse gases. And the legislation gave some protection to the makers of ethanol, the fuel alternative distilled mostly from corn, despite opposition from critics who claim it’s not as green as portrayed.

Agriculture-based alternative fuels were especially well represented among the new lobbying entrees. For instance, there were lobbyists from technology firms claiming they can make fuel from new sources, with at least four separate companies touting the promise of algae (Algenol Biofuels, PetroAlgae, Kai BioEnergy, and Aurora Biofuels). There were also companies like sugar maker Florida Crystals, which operates the largest biomass power plant in North America, and was pushing for greater support of biomass power development.

But the biofuel lobbying powerhouses remained the companies that refine ethanol from corn, especially POET Biorefining of Sioux Falls, South Dakota. In 2007 POET overtook agricultural giant and longtime industry standard-bearer Archer Daniels Midland as the nation’s leading ethanol producer, and its first foray into lobbying on climate was the second quarter of this year.

Former NATO Commander Wesley Clark

Leading the charge for POET was the new interest group it helped create with several other ethanol makers last fall, Growth Energy. Retired four-star general and former NATO commander Wesley Clark is the group’s public face, but there’s also a team of lobbyists behind the scenes. In addition to its chief executive Tom Buis, a long-time fixture in the farm lobby, and former Iowa Republican congressman Jim Nussle as special adviser, the group paid $30,000 to Kountoupes Consulting last quarter. That brought on board former Clinton administration congressional liaison Lisa Kountoupes, who also had been a staffer to Energy and Commerce chairman emeritus John Dingell, and Melissa Shannon, former legislative aide to House Speaker Nancy Pelosi.

Since the House vote, Growth Energy has added even more Washington firepower, hiring Anne Steckel, former aide to Illinois’ Democratic Senator Dick Durbin, the majority whip, and Ted Monoson, former aide to House Minority Leader John Boehner (R-Ohio). With what is widely seen as a tough battle coming in the Senate over the climate bill, Growth Energy’s CEO Buis says there is plenty of work ahead, beyond the changes made at the behest of House Agriculture committee chairman Peterson.

“What he did was stand up for all of rural America and say ‘We’re gong to be impacted by this and we want some of these issues addressed,’” said Buis. “Did he get them all addressed to satisfy everyone? I think that obviously Senator [Tom] Harkin [D-Iowa] and the Senate Agriculture Committee are going to be addressing other concerns. Because if you look at the Senate, it’s going to have to address ag issues, because I don’t see how you get to 60 votes without it.”

It’s a Gas, Naturally

Even so, it’s still energy interests and heavy energy users that dominate the lobbying scene. Leading the pack were manufacturers, with about 200 companies and advocacy groups, followed by the power companies and utilities, with some 130. Coal and coal utility interests were seen as making out well in the House climate bill, especially regarding provisions requiring the federal government to initially give away carbon emissions “allowances” that likely will eventually be worth billions of dollars. But not all energy interests gained in that deal, which likely will slow the move to low-carbon forms of electricity generation. Enter a new interest group: America’s Natural Gas Alliance, representing more than two dozen producers of natural gas that are independent — that is, not affiliated with a larger oil company. The alliance, which represents about 40 percent of U.S. natural gas production today, argues that they should be fueling a much bigger share of the nation’s electricity production since natural gas is the least carbon-intensive fossil fuel. The coal industry has argued that such fuel-switching could be costly, but ANGA is plying the Senate, the White House, and Obama administration energy and environmental officials with maps showing how new drilling techniques mean the nation can rely more heavily on natural gas without fear of the price spikes that have previously plagued the fuel.

ANGA’s argument is being aided by a team from Wexler & Walker Public Policy Associates, including Joel Malina, a former political aide to New York Democratic Representative Nita Lowey, and Jack Howard, who was on the White House staff of both President Bushes. Howard had also been a senior adviser to GOP House Speakers Dennis Hastert and Newt Gingrich, as well as former Senate Majority Leader Trent Lott.

Rod Lowman, who spent 17 years in Washington defending the plastic industry against environmentalist critics as president of the American Plastics Council, is now pushing the benefits of natural gas as president of ANGA. “The principal question we’re getting, quite frankly, is ‘Where have you been?’” says Lowman. “The utilities and the coal industry have been at this for a very long time.” Because “most of the deals had been cut” in the House by the time ANGA started lobbying on May 1, he says the group is focusing its sights on the battle on the other side of the Capitol. Senate Environment and Public Works Committee chair Barbara Boxer, the California Democrat, says that battle will begin September 8. “The Senate will be looking at those emissions allowances, looking at offsets, looking at renewable energy standards — all those things will be revisited — and we want to make sure we are a part of that discussion,” says Lowman. “We will be a part of it.” And so, apparently, will more than 1,100 others.

David Donald, M.B. Pell, Joe Kokenge, Josh Israel, Te-Ping Chen, and Sarabeth Sanders contributed to this article.

This post was originally published on the website of the Center for Public Integrity and is reposted on Grist with CPI’s kind permission.

The world’s largest coal company and one of the nation’s top fossil-fueled power companies are among the leading donors so far this year to Newt Gingrich’s political advocacy group, which has been fighting climate legislation on Capitol Hill with a “Stop the Energy Tax” phone-in campaign to Senate offices.

Peabody Energy, the St. Louis-based coal giant, gave $250,000 to American Solutions for Winning the Future in February, putting it atop the Gingrich-led group’s big contributors for the first half of 2009, according to the nonprofit’s newly filed report at the Internal Revenue Service. Peabody also gave American Solutions the same amount in 2008. The firm’s chief executive, Greg Boyce, has publicly expressed doubts about global warming, so it is not entirely surprising that Peabody would support an issues advocacy group that is going all-out against the climate bill.

Top Six Contributors to American Solutions for the First Half of 2009

Peabody Energy, St. Louis, $250,000 The world’s largest private sector coal company Crow Holdings LLC, Dallas, $250,000 International investment company chaired by GOP donor Harlan Crow, who had been one of the large donors to the Swift Vets campaign against John Kerry in 2004. Workforce Fairness Institute, Washington, D.C.: $150,000 An advocacy group that opposes so-called “card check” legislation that would make it easier for unions to organize. American Electric Power, Columbus, Ohio, $100,000 Among the top two power-generating companies in the country, heavily reliant on coal—the most carbon-intensive fuel—to make electricity. Dan Heard of Houston, $100,000 No information is provided, but Federal Election Commission records show a donor with that name and address as a retiree who has given to Republican candidates in the past. Plains Exploration and Production Company of Houston: $100,000 An independent oil and gas producer that is fighting California to open an offshore drilling platform near Santa Barbara for the first time since the spill that fouled 150 miles of coastline 40 years ago.

Source: IRS

More surprising, perhaps, is the $100,000 donation in May from American Electric Power, of Columbus, Ohio. Though the company is either the largest or second-largest source of carbon dioxide emissions in the U.S. power industry, AEP has voiced support for the climate bill passed by the House. Although the company would like further changes in the bill on greenhouse gas targets and timetables, company spokesman Pat Hemlepp confirms AEP supports climate legislation, and says the company is not in step with Gingrich on the issue.

“AEP gives funds to a variety of organizations that have views on issues that for the most part align with our company’s views on the issues,” said Hemlepp. “That doesn’t mean that all the organizations’ views align with ours.”

In particular, he said AEP strongly agrees with American Solutions’ advocacy on development of more domestic energy resources. “Some of their positions on climate we don’t necessarily agree with, but they are also involved in health care and economic issues and since some of their positions align with ours we thought it was a good place to put some money,” Hemlepp said.

AEP Chief Executive Mike Morris himself had been a leader in the utility industry in talking about the greenhouse gas problem as a member of the Pew Center’s Business Environmental Leadership Council. AEP was a founding member of the first U.S. voluntary greenhouse gas emissions reductions system, the Chicago Climate Exchange (CCX); and it exceeded the targets it set under that program to reduce its carbon emissions, mostly through energy efficiency measures.

AEP had not joined the business-environmental coalition most active in lobbying for the legislation, the U.S. Climate Action Partnership, although the company released a statement earlier this year saying it was “in basic accord with most of the principles of USCAP today.”

Gingrich, on the other hand, has been a vocal opponent of what he calls the “cap-and-trade energy tax,” railing against it in frequent appearances on Fox News and recently at a news conference at the National Press Club. American Solutions also ran TV ads against the climate bill the week that it closely passed the House.

In addition, American Solutions has boasted on its web site that phone calls to House member offices ran “as much as 19-to-1” against the bill, and has urged its supporters to call offices at the Senate, slated to take up the bill in September.

Numerous conservative groups and TV commentators have joined in urging phone calls to Capitol Hill. Joe Romm, a former Clinton administration energy official who writes the Climate Progress blog for the Center for American Progress, reports that Senate offices are receiving hundreds of calls daily against the climate bill.

Altogether, American Solutions took in $8.1 million in contributions in the first half of 2009, about 45 percent, or $3.7 million, from donations of less than $200 (meaning the donors’ names did not have to be reported under IRS rules). But three of the six largest donations came from companies that would be directly affected by climate legislation.

Vince Haley, vice president for research and policy at American Solutions, says the contributions from the fossil fuel industry haven’t dictated the agenda for the organization, but “it has certainly attracted people who agree” with the group.

“We’re happy to take money from any organization that agrees with our positions,” he said. “And what you see is a dynamic where the more vocal we are, and more effective we are, the more support we get.”

Haley says with the Senate vote coming up, “I’m sure American Solutions will be quite engaged in working to stop the energy tax.”

As a 527 nonprofit issues advocacy group that does not campaign for or against candidates, American Solutions is not subject to federal campaign finance law or its prohibitions on accepting donations directly from corporations. But it is required to regularly report contributions and expenditures to the IRS. American Solutions — which gained notoriety for its “Drill Here, Drill Now” campaign last year, was the third largest 527 group in the 2008 election cycle, taking it $22.7 million, according to the Center for Responsive Politics. Although the group calls itself nonpartisan and even “tri-partisan,” many of large donors last year were big GOP contributors, as the Center for Public Integrity detailed in a special report.

Gingrich himself had said one of the reasons that he chose not to embark on a presidential run in 2008 was to devote time to American Solutions; but he has raised his profile this year, and in interviews has left the door open to a future run for high office.

David Donald and Tuan Le contributed to this post.

Download full list of contributors here.

This post was originally published on the website of the Center for Public Integrity and is reposted on Grist with CPI’s kind permission.

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Southern Company, the nation’s largest electric power generator, also had the largest force of lobbyists among the hundreds of businesses and interest groups that were seeking to influence the landmark climate change legislation that just passed the House.

With 63 lobbyists, the Atlanta-based energy giant had nearly twice as many climate lobbyists as any other company or organization, according to registration statements filed with the Senate Office of Public Records for the first quarter of 2009. (The second quarter filings won’t be available for a few weeks.) Eleven of Southern’s climate representatives were in-house, while the rest came from a dozen different lobbying shops.

Southern’s interest in the bill is not surprising, since more than 80 percent of the 200 million megawatt hours of electricity its plants generate annually is fired by fossil fuel — the main source of greenhouse gases. (A database comparing electric companies and emissions, based on 2006 government data, can be found here.) For a comparison that illustrates just how huge Southern’s lobbying force is, look at the No. 2 power generator, American Electric Power, headquartered in Columbus, Ohio, which actually has a more fossil fuel-intensive fleet and higher carbon dioxide emissions than Southern. AEP had only nine registered climate lobbyists as discussions on the bill began early this year.

“We feel it’s very important to educate our legislators, and we continue to work with Congress to further address the issues we see as critical to our ability to provide affordable, reliable energy,” said Southern spokeswoman Terri Cohilas, when asked about the company’s large lobbying contingent. As for the bill so far, she said Southern supports “significant portions” of the legislation that passed the House. But she added: “We do believe it will have a profound impact on the U.S. economy, and the bill does not do enough to reduce the cost to customers or to provide regional fairness.”

So expect more lobbying ahead, as action moves to the Senate, where Senate Majority Leader Harry Reid has said he wants to take up the legislation this fall.

Below are the top 10 businesses and organizations by the number of lobbyists they’ve hired on climate change so far this year. Although the list is certainly dominated by big energy generators and users, there are a few unabashed advocates of climate action on the list — most notably the political action arm of the Washington, D.C.-based Bipartisan Policy Center, headed by Jason Grumet, who served last year and in the transition as a top energy adviser to President Obama.

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An advocacy group run by a political operative with oil industry ties (and a famous photo-op history) is spearheading a late advertising blitz to sway Senate races, spending more than $650,000 in the last month to blast the Democratic candidates in Colorado and Kentucky, and to urge support for Republican incumbents in Mississippi.

The American Energy Alliance, which describes itself as a new nonprofit group dedicated to informing “policymakers that there is no such thing as a ‘free’ energy or environmental vote,” has outlined its new campaign in reports filed with the Federal Election Commission. The filing is required for ads that identify candidates by name in the weeks prior to an election.

The AEA is run by Thomas Pyle, who served as an aide to Republican powerhouse Tom DeLay when he was House Majority Whip. AEA is the “grassroots arm” of the Institute for Energy Research (also headed by Pyle), a nonprofit foundation that worked earlier this year to defeat climate change legislation. The Institute was represented by the Alexandria, Virginia-based public relations firm CRC Public Relations, which was also representing Chevron at the time.

Pyle was registered as a lobbyist for the National Petrochemical and Refiners Association earlier this year and for the refining and chemical company Koch Industries in 2007. But he is probably best known as the face in the front row of the “Brooks Brothers Riot” of young Republican House aides who stormed the Miami-Dade County polling headquarters at the height of the 2000 Bush-Gore post-election battle. Now Pyle is leading a new charge “to hold our leaders accountable as to whether or not they support market-oriented policies that lead to abundant, affordable, and reliable energy for American consumers,” says the group’s website.

Target one: Democratic Colorado Representative Mark Udall, who is leading former Representative Bob Schaffer, a Republican, in the race for the Senate seat being vacated by GOP Senator Wayne Allard. “Mark Udall’s votes helped create America’s energy and economic problems,” says a radio spot being run by AEA over the last week. Udall wants to raise taxes on energy companies, “squeezing our pension and 401(k) plans that are already reeling from bank failures and the mortgage disaster,” the ad says.

In Kentucky, AEA has begun airing radio spots about the “Lunsford tax,” attacking Democrat Bruce Lunsford, who polls show trailing in the race to unseat Senate Minority Leader Mitch McConnell. The ads refer to Lunsford’s work 30 years ago, when, as a member of Governor John Brown’s administration, he urged the Kentucky legislature to pass a law that pegged the state’s gas tax to the value of the fuel rather than the number of gallons sold — a change that now adds 12 cents a gallon to the price of gas in the Bluegrass State for the state highway fund. “It is very nearly beyond belief that anyone today could be proud of making energy more expensive for working families. But Bruce Lunsford is,” said Pyle in a statement on AEA’s website. “That should serve as a warning to Kentuckians about what his approach on energy policy might be if he joins the U.S. Senate.”

AEA also has a positive message, at least about Republican Senators Thad Cochran and Roger Wicker of Mississippi. “Our senators fought to lift the congressional ban on offshore exploration and production, paving the way for new American energy,” says the radio ad. “Thank them for working to lift the offshore energy ban and tell them to fight against the forces that threaten to stop offshore exploration before it even starts.” Although Cochran is viewed as comfortably leading his Democratic challenger, Wicker is seen as facing a more difficult race to retain the seat he was appointed to by Governor Haley Barbour after Senate Minority Whip Trent Lott’s resignation last year. He faces former Democratic Mississippi Governor Ronnie Musgrove.

It’s not clear yet if AEA plans to make energy policy an issue in any other races, but in addition to the three states where it has already run ads, the organization lists Georgia, New Mexico, North and South Carolina as states where it maintains “chapters.”

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Newt Gingrich appeared on C-SPAN’s morning program “Washington Journal” on August 6 to promote “Drill here. Drill Now.”

Photo Courtesy of C-SPAN

Former House Speaker Newt Gingrich isn’t running for president this year, but due to a gusher of support for his campaign to promote opening up more offshore areas to oil drilling, he’s chairing the election season’s hottest conservative advocacy group.

The slogan “Drill here. Drill now. Pay less.” is fueling Gingrich’s American Solutions for Winning the Future, a so-called 527 group not subject to federal campaign finance law and its limits on donations. So far this election cycle, it has raised $13.1 million; only two other 527 groups, both liberal, have collected more money, according to the Center for Responsive Politics.

While the sum pales beside the cash amassed by the largest of the 527s that so dominated the political landscape during the 2004 presidential race, American Solutions has raised more funds than the best-known unregulated conservative political group raised at the same point four years ago: Swift Vets and POWs for Truth. The Swift Vets, which ultimately spent $19.3 million [PDF] on TV advertising attacking Democratic nominee John Kerry’s military record, had raised only $8.8 million by the end of September 2004.

Officially, Gingrich’s organization says it does not intend to play a role similar to the Swift Vets in support of Republican nominee John McCain or any other candidate. But the reality is that the group’s signature campaign, launched one month before McCain’s call to lift the ban on federal offshore oil drilling, has already helped to shape the debate on what could prove to be a pivotal issue in the 2008 race for the presidency. And the group is poised to keep the political heat on the energy issue in the weeks ahead.

The role of American Solutions raises questions beyond the reach of current campaign finance law. The group doesn’t talk about candidates, and by all appearances strives to steer clear of danger that the Federal Election Commission would declare its “major purpose” to sway the election — a finding that would subject it to campaign finance rules. It calls itself “bi-partisan,” or even “tri-partisan,” in approach, seeking out issues that appeal to both parties and independents.

At the same time, American Solutions’ chairman, public face, and magnet for donations, Gingrich, is an outsized Republican figure on the political landscape who has declared openly, “I’m doing everything I can to be helpful to the McCain campaign.” The majority of the group’s major donors are GOP stalwarts — including at least seven of McCain’s leading fundraisers, five of them among the so-called Trailblazers who have raised in excess of $100,000.

Republicans in Congress are leading the drive to open up vast areas for offshore drilling, the issue American Solutions is pushing hardest — and McCain is echoing. “We’ve got to drill now; we’ve got to drill here,” he said in August at the nationally televised candidates forum at the evangelical Saddleback Church in Lake Forest, California. At the Republican National Convention, speaker after speaker took up the theme, and the delegates’ chant of “Drill, baby, drill” shook the rafters of the Xcel Center. “Even more than tax cuts, drilling is now the central organizing issue in the Republican coalition,” wrote political pundit Matt Cooper at Portfolio.com.

Of course, 70 million or more acres of undrilled coastal water are already open to the oil industry. And if Congress voted tomorrow to lift the protections now in place on the Atlantic and Pacific coasts and the Gulf of Mexico close to Florida, it would all but certainly be a long wait for the crude to reach the gas pumps. Drilling rig shortages assure that development would be slow. The U.S. Energy Information Administration, the federal agency that compiles official government energy statistics, says there would be no impact on prices until 2030. Even then, because the amount of oil gained would be a drop in the bucket of the global market, the impact could be “insignificant,” EIA said. But Gingrich and American Solutions have pressed their case for vastly expanding the areas open to drilling, arguing that even if no supplies reach consumers for years, the prospect of expanded U.S. oil development would lower current prices by dampening speculation in the oil futures market.

Observers from both political parties say the work of American Solutions has indeed lent the Republican candidate a helping hand. GOP pollster Matt Towery said McCain owes Gingrich a debt of gratitude, while liberal activist group Moveon.org warned its supporters in an e-mail that due in part to the leadership of Gingrich, “We could end up losing the election AND the fight for clean energy.” But election laws don’t recognize American Solutions as a political committee that’s taking sides in the race, as long as the group hasn’t raised or spent money by making a pitch for McCain.

Drilling into the energy debate

American Solutions could not be missed at the Democratic or Republican political conventions. The group sponsored a giant illuminated “Drill Here. Drill Now. Pay Less.” billboard across from Denver’s Pepsi Center throughout the Democratic convention. It had planned a similar sign for the Republican conclave, but decided against it due to Hurricane Gustav, said spokesman Dan Kotman. But with or without the outdoor advertising, American Solutions staged events at both gatherings to present the nearly 1.5 million signatures it has garnered for a petition urging Congress to open up more federal lands and offshore areas to eventual oil drilling.

The message took off with remarkably little advertising, about $100,000 worth in June and July, including buys on Fox News Network; in Roll Call, a Capitol Hill newspaper; and with Adtekmedia, an agency specializing in ad placement at gasoline pumps. But Gingrich mentioned the petition in his frequent TV appearances as an analyst on Fox News. And “it pretty much took off virally,” said Kotman. Links to the “Drill Here” petition at American Solutions appeared on numerous conservative blogs. American Solutions also reached out through online social networking sites like Facebook and LinkedIn. The web organizing is in the hands of the manager of the group’s Silicon Valley office opened earlier this year, David Kralik, who while in college in 1997 set up one of the first College Republicans websites and later managed the National Association of Manufacturers Internet programs.

The group generated so much web traffic in June that right-wing blogger Soren Dayton mused whether “Drill Now” had become “the conservative Moveon,” referring to the liberal group that has built so much support online.

Genesis of an ‘ideas’ group

American Solutions did not start out with an energy focus. Gingrich established his new nonprofit without fanfare, just before the Democratic sweep of the November 2006 election.

That election reversed the gains of the Republican Revolution of 1994, when the GOP had united behind none other but Gingrich and his Contract with America agenda for rolling back government regulation and taxes. In the 2006 election aftermath, Gingrich blasted the Bush administration for mishandling the Iraq war and for the “fiasco” after Hurricane Katrina, and also said fellow Republicans had wasted money on campaign ads.

Speculation grew rampant that Gingrich would jump into the presidential race, but he deferred a decision, and in an interview on Fox News, gave an outline of his plans for his new group. “What I’m really trying to do … is develop a new generation of solutions, American solutions, that build on what we did with the Contract with America.” He said he hoped to make his solutions “available to candidates in both parties.”

American Solutions made only glancing mention of energy at first, focusing instead on broad themes like renewing values, rooting out incompetent bureaucracy, and the need for a strong defense against the nation’s “enemies.”

Gingrich openly mulled a presidential run for months, yet never set up an exploratory committee, which would have been subject to campaign donation limits. But American Solutions paid for travel by Gingrich and his staff in 2007 to the early primary states of Iowa, New Hampshire, and South Carolina, his spokesman told the Atlanta Journal-Constitution last year. American Solutions set up a booth at the Ames straw poll with a station for Iowans to upload on YouTube ideas for “solutions to the most pressing challenges facing America.”

In late September 2007, Gingrich announced that he would not seek the presidency, and that instead he would devote himself to American Solutions. He said campaign finance law, which he opposed, made clear that he could not make a run for office while running the nonprofit. “American Solutions is in the early stages of being a genuine citizens’ movement,” he said, adding he did not want to walk out just as it was getting launched.

In November, the group unveiled the huge Platform for the American People, which included more than 90 ideas — ranging from border security to keeping the words “one nation under God” in the Pledge of Allegiance — that the group said had broad support among Republicans, Democrats, and independents. The group said it spent six months developing the ideas, based on workshops, town hall meetings, and national surveys. One of those ideas: “With appropriate safeguards to protect the environment, we should drill for oil off America’s coasts to reduce our dependence on foreign oil.”

But that one line in the platform didn’t morph into the “Drill here. Drill now. Pay less.” campaign until six months later. At the end of May, with summer travel season about to begin and the price of oil crossing $130 a barrel for the first time ever — more than double the price of a year earlier — American Solutions began its petition drive. In early June, American Solutions released its own polling data [PDF] showing that “86 percent of conservatives, 77 percent of moderates, and 74 percent of liberals backed intensified use of the U.S.’ domestic reserves.”

On June 12 on Fox’s The O’Reilly Factor, Gingrich offered this advice for McCain: “He ought to focus on the price of gasoline,” and should push steps such as releasing oil from the Strategic Petroleum Reserve and opening the coastal waters to drilling. In the same appearance, Gingrich promoted American Solutions’ “Drill Here. Drill Now. Pay Less.” petition campaign.

American Solutions’ “Drill Now” campaign merged into the presidential campaign theme on June 16, when McCain, who had supported the long-standing federal moratorium on offshore oil development during the 2000 campaign, said in a speech that he wanted to see the ban lifted as part of his energy plan. Two days later, President Bush joined in the call.

McCain adopted the American Solutions language on the campaign trail, not only at the Saddleback Church forum in August but also in numerous town hall meetings. Gingrich delighted in this development in remarks he made August 6 at a state and local issues summit organized by his old political action committee, GOPAC, in Arlington, Virginia.

“Senator McCain is now aggressively campaigning actually on this slogan,” he said. “This is not, by the way, the position of either [Senate Majority Leader] Harry Reid or [House] Speaker [Nancy] Pelosi, in case you hadn’t noticed. And Senator Obama has suggested we could do as well by inflating our tires. Which led me to suggest that their bumper sticker should be, ‘Inflate Here. Inflate now. Avoid reality.’”

At that same GOPAC summit, Gingrich was asked who he favored as a Republican vice president. He said his first choice was Louisiana Governor Bobby Jindal. But then Gingrich spoke at length about a candidate on few people’s minds at that time. His second choice, he said, would be Governor Sarah Palin of Alaska, “who is, I think, very smart and very much of a reformer and has had a very good track record of trying to change things.” McCain, he said, “could use a lot of help in broadening the party, which I think that Jindal would do,” and he felt Palin could widen his lead with women. “Plus she is a maverick,” said Gingrich. He thought the candidates then being most discussed, like Minnesota Governor Tim Pawlenty and former Massachusetts Governor Mitt Romney “are all terrific people,” but each “looks like a Republican.”

“We need to be a party where you look up and see the campaign campaigning and you think, ‘Gosh, that’s interesting,’” he said.

When McCain ultimately chose Palin, Gingrich called it “a home run.” The governor of one of the nation’s leading petroleum states will be sure to keep the campaign focus on exploiting more federal lands for oil, and even favors going further than McCain would go — opening up the Arctic National Wildlife Refuge. “Our opponents say, again and again, that drilling will not solve all of America’s energy problems — as if we all didn’t know that already,” Palin said in her speech at the Republican National Convention. “But the fact that drilling won’t solve every problem is no excuse to do nothing at all.”

Although American Solutions spokesman Kotman said the group takes credit for pushing the issue — “We are definitely the ones who started this debate” — he said the organization is not working to bolster any candidate. “From day one we’ve always been positive and solutions-oriented,” he said. “We’re not going to go negative on anyone. We’re just presenting issues that a majority support. Drilling obviously is one of the most pressing issues right now, but we have a whole range of issues listed in our platform that are supported by a majority of Democrats, Republicans, and independents. We’re going to keep talking about those issues that unite the American people.”

But outside observers see American Solutions as playing a role in tipping the political scales. “If John McCain and the GOP want to thank someone for helping turn around what seemed a dead-in-the-water campaign in a matter of weeks, they can thank former House Speaker Newt Gingrich,” wrote Matt Towery, the former Georgia state lawmaker who runs the media and polling firm InsiderAdvantage, in an Aug. 21 column at the conservative website, Townhall.com. “[Gingrich's] decision to use his ‘think tank’ American Solutions organization to push for a ‘Drill Here, Drill Now’ petition back in the spring is likely the source of John McCain’s miraculous rebound in the polls.”

And both American Solutions and Gingrich will be keeping the drilling debate alive as the presidential campaign revs up this fall. In mid-September, the conservative publishing house Regnery will release Gingrich’s Drill Here, Drill Now, Pay Less book, which the publisher said “is sure to become the talk of the presidential campaign season.” (Regnery, which has published two other Gingrich books, put out the anti-Kerry Swift Vets book, Unfit for Command, in 2004, and this year has The Case Against Barack Obama on the bestseller list.) A movie, We Have the Power, based on Gingrich’s book, will be unveiled at American Solutions’ Solutions Day event at the Cobb Galleria in Atlanta on September 27, which will also be webcast. Gingrich says the goal of Solutions Day (where he said new ideas will also be featured) is “really setting the stage for the October finale of the presidential and congressional and gubernatorial and local campaigns.”

American Solutions is extending its web-organizing success by hosting a contest for “Drill Here, Drill Now” videos to appear on YouTube — with a year’s free gasoline as a prize. It will also urge its growing network of supporters to flood Congress with calls to force a vote to lift the 27-year-old federal moratorium on offshore drilling in September. Meanwhile, Gingrich is blasting efforts on Capitol Hill to forge a bipartisan compromise on drilling that could defuse the issue’s potency as an election issue. Instead, he is vocally backing conservatives who have threatened, in a tactic that hearkens back to Gingrich’s own heyday in power, to use a budget showdown to shut down the government at the end of September over oil drilling.

Funded by GOP donors

American Solutions calls itself a “new, innovative, and nonpartisan political organization.” According to the group’s required filings with the Internal Revenue Service, some of its first donations came from Gingrich friends and longtime backers. But the ball really got rolling with two $1 million donations in late 2006 and early 2007 — from Las Vegas casino billionaire and patron of conservative causes, Sheldon Adelson, and North Carolina real estate developer Fred Godley, who had not been active in politics previously.

Although the two remain American Solutions’ top backers (Adelson, with contributions that now total $4.6 million), the group has since widely expanded its supporter base to thousands of donors, with fundraising hitting $3.75 million in June and July. About 44 percent of the money this summer came in small donations — from contributors who kicked in less than $200 each. Some of the fundraising undoubtedly is the work of the call-center operation InfoCision Management, of Akron, Ohio (“specializ[ing] in political, Christian, and nonprofit fundraising,” according to its website), which has raked in more than $2 million in fees from American Solutions, the group’s biggest expenditure so far. Still, just 40 big donors, including five businesses, account for $8.9 million, or 68 percent, of American Solutions’ funding. Also, there are signs that the movement might have broadened as far as it can. Fundraising was down from June to July, as was web traffic. And the group fell short of the goal it stated in a July e-mail to supporters of gathering 3 million “Drill Now” petition signatures by the political conventions.

At least one environmental group, the Alaska Wilderness League, has argued that American Solutions is “funded by Big Oil,” but in fact the top donors have few apparent direct links to major oil companies. Peabody Energy, the world’s largest private sector coal company, is the only energy company among American Solutions’ big donors, with a $250,000 contribution in June.

If there is any glue binding the top donors of American Solutions, it is their past generosity to Republican candidates. American Solutions’ biggest supporters include seven top McCain fundraisers:

• Adelson, chairman of the Las Vegas Sands casino company, bankrolled the nonprofit advocacy group Freedom’s Watch, which advocated continued involvement in the Iraq war. A McCain Trailblazer, he was among a clique of fundraisers who met with the candidate in Aspen last month.
• Carl Lindner III, the co-chief executive of American Financial Group in Cincinnati and another Trailblazer, held a fundraiser for McCain at his home in June. He and his father, Carl Jr., the United Dairy Farms tycoon, were both among President George W. Bush’s top fundraisers, known as Rangers.
• Richard Farmer, founder and chairman of Cintas, the giant corporate uniform company in Cincinnati, also a former Bush Ranger, co-chaired the June fundraiser at Lindner’s home.
• Robert Wood “Woody” Johnson IV, owner of the New York Jets, and an heir to the Johnson & Johnson fortune, hosted in May what was then the single largest fundraiser to date for McCain, raking in $7 million. The close to $10 million he raised for the RNC convention earned him his own hospitality suite in St. Paul.
• Gordon Smith, a real estate developer in suburban Washington, D.C., raised nearly $100,000 for McCain by tapping friends, colleagues, and people he “had done favors for,” he recently told the University of Maryland’s Capital News Service.
• Stephen Brauer, president of Hunter Engineering in St. Louis, gave to American Solutions a month before hosting a fundraiser at his St. Louis estate in July that reportedly netted $1.6 million for McCain and the Republican National Committee. A Bush Pioneer in 2000 (having raised more than $100,000), Brauer was appointed ambassador to Belgium by Bush in 2001. He was a Bush Ranger in 2004.
• Fred Malek, the private equity tycoon who is McCain’s national finance co-chairman and a Trailblazer, isn’t in the top tier of American Solutions’ contributors, but he did give $5,000 to Gingrich’s group a year ago.

One other notable American Solutions donor: The group’s biggest haul in July was a $250,000 donation by Crow Holdings, the Dallas-based international investment company chaired by big Republican benefactor Harlan Crow, a trustee of the George H.W. Bush Presidential Library Foundation. In 2004, Crow Holdings kicked in $100,000 to the Swift Vets group near the start of its television advertising campaign.

All in all, of the 35 individual donors who gave American Solutions $25,000 or more [PDF], 32 gave to McCain or one of his Republican challengers during this presidential campaign — many having reached the maximum amount federal election law allows individuals to contribute directly to candidates. Only five of the 35 gave to Obama or another Democratic presidential candidate, and four of those five gave to Republicans as well.

Non-partisan group, partisan chair

American Solutions, as a political group formed as a nonprofit under section 527 of the tax code but not registered with the Federal Election Commission as a political action committee, falls into a murky area of campaign finance law. Such 527s are not barred from taking corporate money nor do their donors face any limits on how much they can give. But a 527 can cross the line if the FEC determines it has as its “major purpose” the election of a candidate to office. Indeed, two years after the 2004 election, the FEC fined the Swift Vets and several other 527s for their activities during that campaign.

Because of the FEC rulings in those cases, and the antipathy that both Democratic nominee Barack Obama and McCain have expressed for the role of outside political groups, conventional wisdom has been that 527s will play a limited role in the 2008 race. But even if American Solutions hews to its stated non-electoral purpose, “to build a movement which focuses on developing and implementing a generation of solutions for winning the future both here at home and abroad,” its chairman, Gingrich — frequently dipping back and forth between speaking on his organization’s behalf and his own — has made no secret that he takes sides in the presidential race.

In an Aug. 13 appearance on Fox’s Hannity & Colmes show, Gingrich said flatly, “I’m doing everything I can to be helpful to the McCain campaign … because I think they’re dramatically better for America.” During the same appearance he also said he was glad that Obama is “weakening on drilling,” and that House Speaker Nancy Pelosi also was voicing some support for expanded oil development on federal lands and coastal waters. “So maybe what we’re doing at American Solutions with ‘Drill Here. Drill Now. Pay Less.’ with that petition that has almost 1.5 million signatures, maybe it’s having an effect,” Gingrich said. “And I think that’s good for the country.”

But Gingrich has been hostile to the efforts to strike a compromise on drilling that both Republicans and Democrats — including Obama and Pelosi — have indicated they could accept. In a column on the conservative Human Events website, Gingrich decried the efforts by the so-called “Gang of 10″ senators — five Republicans and five Democrats — who have mapped out a deal. Their proposal would open some new offshore areas to oil and gas drilling while giving a boost to renewable energy by passing the long-delayed extension of their tax credits, and pay for it by rolling back oil industry tax breaks. Gingrich called it “an $85 billion tax increase disguised as an energy bill.” Gingrich’s personal spokesman, Rick Tyler, said the speaker opposes the Gang of 10 approach because it wouldn’t lower gas prices: “From an economic perspective, corporations don’t bear the burden of taxes; customers do.” And Tyler said the compromise would still limit drilling 35 miles further than necessary, in Gingrich’s view, to preserve the sight lines of shore.

Instead, Gingrich is actively supporting GOP hardliners who want federal restrictions on offshore drilling lifted altogether. President Bush helped turn up the heat on Congress in July, when he officially lifted the presidential order against drilling on the Outer Continental Shelf that had been implemented by his father when he was president. That meant that the only remaining bar was the congressionally imposed moratorium due to expire at the end of the fiscal year in September. Republican pollster Towery, a friend of Gingrich’s who served as his congressional campaign manager in the early 1990s, wrote in his Townhall.com column that the former House speaker “met several times” with the House Republican Conference and “encouraged them to dig in their heels” on forcing a vote to lift the moratorium. Gingrich joined the holdouts at a news conference outside the Capitol in early August, with the former speaker declaring he was “very proud” of their efforts.

Turning up the heat on Capitol Hill

The stage is set for a standoff when the fiscal year ends on Sept. 30. The drilling moratorium has been extended each year as a provision attached to a spending bill lawmakers have to pass to keep the government running. But hard-line Republicans, led by South Carolina Senator Jim DeMint, are rallying support to block the budget bill if it includes the drilling moratorium — a move that would shut down the government and force a high-profile battle over oil drilling just weeks before the election. The last time such a ploy was executed on Capitol Hill was in 1995, when then-House Speaker Gingrich led a budget showdown against President Clinton.

Kotman said that American Solutions aims to stay in the forefront on the moratorium issue. “We’ll certainly stay at the center of this debate,” he said. “The next big moment will be whether Congress lets the offshore drilling ban expire,” he said. “We’ll certainly be watching that and encouraging all of our activists to contact their member of Congress.”

Democratic pollster Mark Mellman, a leading energy issues researcher for the party, views Gingrich’s opposition to the Gang of 10 drilling compromise as a tip-off to his motivations and those of his supporters. “If they were interested in supporting drilling, they’d support this package because compromise is the only way that you’re going to get drilling done in Congress,” Mellman said in an interview. “Without a doubt, they are looking at the political calculations, not looking at reducing gas prices.” Nevertheless, Mellman said he sees no evidence that the drilling issue had eroded Democratic support in either the national presidential race or in the congressional races. “If you look at the polling,” Mellman said, “there is no question there is a different attitude toward drilling today than a few years ago, with the majority in support of some kind of drilling — but it is also true that they only think that’s part of the answer and that it’s not necessarily the best answer.” He said most people favor drilling as part of an array of energy solutions, including alternative energy and greater efficiency.

There are signs that Gingrich has seen those same polls. In his news conference with GOP House members in early August, he said he foresaw “a majority in the House in favor of drilling — but beyond drilling, a majority in favor of wind, of solar, of hydrogen, of nuclear, of flex-fuel cars, of biofuels, because the Republicans’ ‘all of the above’ bill is about really beginning to solve America’s energy problem.” Yet the package he favors would include a wholesale lifting of the federal protections against oil industry development on the coasts, so sweeping it is sure to generate opposition in California and Florida and create a firestorm on Capitol Hill.

It remains to be seen whether turning up the heat over the protected coastal areas is a strategy that will hurt Democrats in the end, by backing them into the corner of appearing to favor environmental protection over affordable energy. American Solutions doesn’t blast Democrats, but assails “the anti-energy elites” in its e-mails to supporters. Yet there’s no question that some American Solutions donors — even if they haven’t been too enthusiastic about McCain — are hoping that their support of the Gingrich group will help defeat Obama.

Bill England, who runs a used tire business in the Dallas/Fort Worth area, gave $200 to American Solutions in July after getting a telephone solicitation; he said in an interview that he was inspired by the “Drill Here, Drill Now” campaign and by Gingrich. (England views Gingrich’s 1994 Contract With America as “one of the greatest things we have ever seen.”) England had been a supporter of Fred Thompson, and about McCain he said, “I don’t know that he is that much of a conservative.” But he wants to see Obama defeated. “I really can’t see that Democratic representation of ‘Don’t drill, bigger government, I want to take care of you, I want to be your daddy and let the government take care of you.’”

Scott Buzby, a retiree in Vero Beach, Florida, gave a total of $1,100 to American Solutions, inspired by his admiration for Gingrich, whom he had hoped would run for president. Buzby said in an interview that when Gingrich announced last fall that he would not run, he understood that Gingrich “can do more from the outside — he’s freer. He doesn’t have to worry about the nuances of what he says.” Buzby, who donated to Rudolph Giuliani in the fall and has donated to the Republican Party, but not directly to McCain, said he views Obama as “all style and not substance, a great tap dancer.”

“He’s got a glass jaw and I think McCain can knock him out,” Buzby said, but only if he is “smart” and heeds the advice of better communicators like Gingrich. Buzby said he gave to American Solutions in the hope the group would help sway the direction of the presidential campaign. “Democracy is not a spectator sport,” he said. “You’ve got to get on the field and play.”

Matthew Lewis assisted with the research for this story.