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Keeping Congress at arm’s length might not seem like wise business judgment. Most companies are only too glad to make their case on Capitol Hill and to ply lawmakers with pricey meals and lavish campaign contributions. But others, such as Google, have stayed largely immune from Potomac fever. Google defies the conventional wisdom that the bigger a company, the bigger its lobbying operations in Washington. Not that conventional wisdom isn’t convention for a reason. In 2005 the top 50 Fortune 500 companies spent more than $120 million during the first six months of the year on issues such as pension reform, energy legislation, and health care. To cite just one example, Wal-Mart Stores Inc., Fortune‘s chart-topper last year, has more than doubled its lobbying operations in the past five years. In 2000 the company spent $1.36 million on lobbying and employed three in-house lobbyists and two outside firms. Last year, Wal-Mart spent that much in the first six months of the year and had seven in-house lobbyists and eight outside firms looking out for its interests. But not every big company follows Wal-Mart’s lead. At least eight of the top 50 Fortune 500 companies don’t even have a Washington office. One closed up shop and now runs its lobbying operations from company headquarters. Three others have stayed out of Washington altogether. Take Berkshire Hathaway. Despite having an avid interest in tax policy and insurance legislation (not to mention owning a big chunk of the Washington Post Co.), the nation’s 12th-largest company has steered clear of the influence game. Run by the famously thrifty Warren Buffet, Berkshire Hathaway tends to invest in companies that have a slew of lobbyists, such as American Express Co. and Coca-Cola Co. Others that eschew Washington are home-improvement giant Lowe’s Companies Inc. and bargain retailer Costco Wholesale. Lowe’s confirmed it does not have Washington offices but declined to comment further. Costco confirmed it does not lobby in Washington. Those three are exceptions in corporate America. Even large companies that don’t have a Washington shop tend to keep at least one employee at headquarters to oversee hired guns in the nation’s capital who look after their interests. That’s a model that works for Safeway Co., McKesson Corp., and Cardinal Health Inc., none of which maintains a Washington office. “It’s more of a factor of being able to manage it from here,” says Jim Mazzola, a spokesman for Cardinal Health. Cardinal’s in-house operation works out of the company’s Ohio headquarters. In 2005, Cardinal paid one lobby shop, Strategic Health Solutions, in Washington to focus on health care and medical manufacturing issues. Ann Berke, the head of McKesson’s lobbying arm, agrees. McKesson relies on Van Ness Feldman as its primary lobbying outfit in Washington, with Berke running its in-house operation out of California and flying in as needed. Safeway Co. has worked on and off with lobby shops since 2000. But last year the company upped its commitment in Washington by signing on with Quinn Gillespie & Associates, thereby boosting its spending in the District from $40,000 a year to $120,000 for six months of work. “The impact of potential regulations make it necessary to have that presence in D.C.,” says Kevin Harklog, head of Safeway’s in-house government relations team. “It’s just smart business sense.” Safeway is concerned with a range of issues, including everything from bioterrorism legislation to anti-methamphetamine bills. Sears Roebuck set up shop in Washington only in 2001, spending $600,000 to influence bankruptcy legislation, privacy issues, and health care reform that year. But the company left Washington after its merger with Kmart Corp. in 2005. “We streamlined the operation after the merger,” says Chris Brathwaite, a spokesman for Sears. Kmart’s and Sears’ lobbying operations have been condensed under one roof, working out of Sears’ headquarters in Illinois. The company relies on one outside lobby shop, the OBC-Group, to follow legislation. Still, most large companies have at least a small operation in Washington to keep their issues near the top of the list with lawmakers. Valero Energy Corp. fits that model. The company has had a government affairs division at its San Antonio, Texas, headquarters since it opened its doors in 1980. Three years ago, however, the company decided to make the jump to the District. “We have just gotten so big; I couldn’t get to Washington enough,” says James Greenwood, vice president of government affairs at Valero. His solution: hire Craig Felner, a former aide to Sen. Kay Bailey Hutchison (R-Texas), to staff the D.C. office. Last year pharmaceutical giant Amerisource Bergen followed suit. Only four years old, the company got the message that being a part of the highly regulated pharmaceutical industry means it needs to play ball in the nation’s capital. As Google grows, it seems to have learned that lesson as well. Now the question remains: Has it learned it in time?
Anna Palmer can be contacted at [email protected].

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