GUNS OR BUTTER?: Defense sits atop the 2003 budget, but as DouglasQuenqua learns, public affairs is key to ensuring money is kept asidefor other domestic issues

The release of the President's budget registers in the mind of the average American about as strongly as whether or not the groundhog sees his shadow. But for a public affairs person, the event marks the first day of a whole new year.

The release of the President's budget registers in the mind of the average American about as strongly as whether or not the groundhog sees his shadow. But for a public affairs person, the event marks the first day of a whole new year.

And the release of President Bush's 2003 budget may well have marked the beginning of a new era.

Spending on "homeland security

- a soothing yet undefined term adopted by Americans with telling ease following the horrors of September 11 - and the military are in; domestic programs are out. If you're hawking F-22 Raptors or a stronger cockpit door, that's good news. If you're the National Education Association, it may as well be six more weeks of winter.

But the catch is this: The President's budget carries less legal weight than a parking ticket. It is merely a suggestion, the President's idea of where the country should be spending its money in the coming year.

What it does carry is the strength of the bully pulpit. Congress ultimately decides what money will go where, but it ignores the President's requests at its own peril, depending on many factors.

For example, how popular is this President and what price will Congress pay for ignoring him? How closely do his suggestions reflect voters' priorities?

And how soon before each lawmaker must again ask those voters to keep him or her on the job?

Will Bush get his way?

With the collapse of the Twin Towers fresh in the public's mind and the President's popularity hovering in the stratosphere, it's a safe bet Bush will get what he wants in the areas of military spending and homeland defense: 23% and 111% increases, respectively. But November brings with it Congressional elections, and domestic spending cuts could translate into job losses for members of Congress. So don't count on the President's requests for limited spending on things like education and the environment to stand for long. Instead, expect heated battles on and off the floors of Congress - with public affairs help on retainer all the way.

Perhaps the biggest story across the public affairs industry is the opportunity created by the need for that still-unknown entity: homeland security.

On what, exactly, will the government be spending that $38 billion?

The trick in 2002, say public affairs and budget experts, will be to redefine your pet issue or product as a matter of homeland security. If you can convince Congress that your company's widget will strengthen America's borders, or that funding your client's pet project will make America less dependent on foreign resources, you just might be able to get what you're looking for.

Not surprisingly, America's defense contractors are in the pole position for those opportunities. Most of their public affairs people are loathe to discuss such things. Some even suggest that the increase in defense spending will not impact how they do their jobs this year (one Lockheed Martin representative goes so far as to insist that the media hasn't been running more articles on defense issues following September 11). But the signs are there.

Raytheon, the US' fourth-largest defense contractor, is scrambling to let the government know about its homeland security products. A press conference last month at the National Press Club served a dual purpose.

It touted an existing contract with the Federal Aviation Administration to install baggage screeners at airports throughout the country, and it debuted Raytheon's new Emergency Command Control Vehicle, which allows greater mobility and communication for "front line

responders in a crisis.

"We are going to be out there telling all (government) agencies what we have to offer, even at state and local levels,

said David Shea, director of media relations in Washington. "We want to raise the consciousness of decision makers around the country - definitely here in Washington - as to what our capabilities are in homeland defense."

A host of smaller companies are vying for Congress' attention on this front as well. With fewer in-house capabilities, however, these firms are likely to go looking for agency help to open doors.

Tom Hoog, former CEO of Hill & Knowlton and now managing director of its Washington office, has seen this firsthand. To accommodate this new business, his firm recently formed a partnership with government-procurement expert The Spectrum Group. Stocked with ex-military and ex-cabinet officials, Spectrum will help H&K's clients navigate the often-murky waters of government contracting, while H&K raises awareness of their products and how they can keep America safe.

And the homeland security gold rush isn't limited to defense contractors or tech firms. Associations and special-interest groups are also selling themselves as vital. Seaver Sowers, director of legislative policy at the Agricultural Retailers Association, says his group will be pushing for greater USDA (United States Department of Agriculture) funding on the argument that more money is needed to secure America's food supply.

Defending domestic issues

But what about those people who can't (or don't want to) make the homeland security argument?

At first glance, it doesn't look good for people pushing most social programs, environmental initiatives, education, etc. But public affairs and budget experts aren't so quick to write those eulogies.

"My guess is that the President's proposals on the domestic side of the budget are basically already forgotten,

says Stan Collender, national director of public affairs at Fleishman-Hillard and one of the foremost budget commentators in Washington. "This is one year where there's going to be a lot of additional spending."

Why? Well, to begin with, November is right around the bend, and voters rarely reward legislators for slashing programs they favor. That presents public affairs professionals with some unique opportunities.

"Democrats in Congress will want to carve out a few wedge issues that they think will give them an edge in their campaigns,

predicts Lance Morgan, head of public affairs at Weber Shandwick Worldwide. "The best way to do that is in the budget. Look for it to happen in healthcare programs and a Medicare prescription drug benefit. Certainly look at Social Security."

All this makes Lisa Davis, director of communications at AARP (formerly known as the American Association of Retired Persons), very happy. The 35-million-member group, which represents the interests of older Americans primarily through grassroots organizing, has identified its top priority as the addition of a prescription drug benefit to Medicare. While Bush did include money for that in the budget, he didn't do so for AARP's other priorities, and many Democrats feel it wasn't nearly enough. Hence its plans to take full advantage of the coming elections.

"We don't give money and we don't endorse candidates. That's not where our expenses lie,

she explains. "But we have 35 million people who we can mobilize into voting booths. We'll be letting our members know where the candidates stand on the issues."

In fact, the grassroots approach will likely be the method of choice for many advocates of domestic spending, says Larry Haas, director of public affairs at MS&L and a former director of communications at the Office of Management and Budget (OMB), which writes the President's budget.

"Groups that are seeking higher spending in a variety of different programs will build coalitions and seek to build grassroots support,

he says. These tactics are effective in years when more spending is needed in general, and the combined force of many small groups is likely to make that happen more than any individual organization can. Haas sees the areas of healthcare and the environment as the most likely to spawn such coalitions.

As much opportunity as the election presents to turn around the President's domestic proposals, all agree it will be an uphill battle. And at the end of the day, that's always good news for PR agencies.

"People are going to have to pull out all the stops to try and maintain funding,

says Ogilvy PR managing director of public affairs Jamie Moeller.

"For that, they will need to use the various tools of the trade, and that means more lobbying and public affairs help."

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