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Taco John
03-24-2009, 09:10 AM
Congress ‘Hypocrisy’ on Trips Angers Hotel Executives

By Lorraine Woellert

March 23 (Bloomberg) -- The U.S. Senate last month passed a measure limiting “luxury” spending for corporate travel by recipients of federal bailout funds. Two weeks later, about two dozen senators of both parties left town for political meetings on the Florida coast.

Hotel-industry leaders are seizing on those trips as ammunition in a campaign to get lawmakers and Obama administration to tone down the rhetoric against business travel, which they say is adding to their economic difficulties.

“It’s just the hypocrisy,” said Frank Fahrenkopf, a former chairman of the Republican National Committee who is president of the Washington-based American Gaming Association, one of the groups urging politicians to moderate the criticism. “We’ve got to have Washington stop beating up on us.”

On March 11, hotel executives including Jonathan M. Tisch, chairman of New York-based Loews Corp., which operates a chain of 18 hotels in North America, Bill Marriott, chairman of Bethesda, Maryland-based Marriott International Inc., the biggest U.S. lodging chain, and Jay Rasulo, chairman of Walt Disney Parks and Resorts, a unit of Burbank, California-based Walt Disney Co. that operates its theme parks, met with President Barack Obama and three Democratic senators to express their concern.

Cancellations

The executives said the political attacks are having a broad effect on their business, even though the restrictions are intended to apply only to recipients of federal bailout money, and cancellations have been increasing as the rhetoric heats up.

“We’ve seen companies cancel meetings last minute, leaving 100 percent on the table just to avoid criticism and ridicule,” said Frits van Paasschen, president and chief executive of White Plains, New York-based Starwood Hotels & Resorts Worldwide Inc., the third-largest U.S. lodging company, who attended the White House meeting.

“We’ve also seen meeting planners move meetings from resort locations to city locations, at a greater cost to their companies, again, for optics’ sake,” he said.

A preliminary survey by the U.S. Travel Association, a Washington trade group, suggests the hotel industry suffered about $1 billion in cancellations in January and February. Las Vegas has been hit especially hard, losing more than $131 million in non-gambling revenue in recent months.

On March 18, the U.S. Commerce Department reported that spending on travel and tourism fell 0.4 percent in 2008, the first yearly decline since 2001. Spending on accommodations fell 10.1 percent in the fourth quarter of 2008.

‘Sense of McCarthyism’

The political rhetoric “has a terrible sense of McCarthyism about it,” said Laurence Geller, president and chief executive of Chicago-based Strategic Hotels & Resorts Inc., which owns 19 properties, including the Hotel Del Coronado in San Diego. Geller didn’t attend the Washington meetings.

Christopher Dodd, a Connecticut Democrat who heads the Senate Committee on Banking, Housing and Urban Affairs, sponsored the amendment to the $787 billion stimulus package that requires companies receiving funds from the Troubled Assets Recovery Plan to curb “excessive or luxury expenditures,” including spending on events and private jets.

Over the weekend of Feb. 27, two weeks after the Senate passed the measure, the Democratic Senatorial Campaign Committee and the National Republican Senatorial Committee, the party fundraising arms for Senate candidates, each held their annual winter meetings in Florida.

Naples Fundraiser

About a dozen Democrats, including Dodd, 64, gathered at the Marriott-operated Ritz-Carlton resort in Naples, Florida. Donors who gave at least $15,000 were invited and offered a “coastal view” room at the group rate of $469, according to the Democrats’ invitation.

At least 11 Republican senators held a similar retreat at The Breakers resort in Palm Beach. Rooms could be had for $475 a night. For another $292, participants could play in a golf tournament. The invitation urged guests to make reservations for the resort’s spa “indulgences.”

Dodd spokeswoman Kate Szostak didn’t return phone calls and emails seeking comment. Afshin Mohamadi, a spokesman for Senator Robert Menendez of New Jersey, the chairman of the Democratic Senatorial Campaign Committee, didn’t return a call seeking comment.

Democratic committee spokesman Eric Schultz said the group doesn’t comment on its fundraising.

Republican Response

Brian Walsh, spokesman for the Republican Senate Committee, which is led by Senator John Cornyn of Texas, said the spending for the congressional meetings in no way resembles the actions of financial institutions that accepted billions of dollars in taxpayer bailouts and then spent money on sales meetings and conventions.

“This was not paid for by taxpayers or the government,” Walsh said. “It’s private donations from contributors,”

Hotel executives said their business began to suffer after Obama, 47, warned Feb. 9 during a town-hall meeting in Elkhart, Indiana, that companies receiving bailout money “can’t go take a trip to Las Vegas or go down to the Super Bowl on the taxpayers’ dime.”

Soon after, Northern Trust Corp. was criticized for organizing a conference and golf tournament in Beverly Hills, California. The Chicago-based bank received $1.6 billion in federal bailout money.

‘Frittered Away’

House Financial Services Chairman Barney Frank, a Massachusetts Democrat, and 17 other lawmakers on Feb. 24 demanded that the company return what it “frittered away on these lavish events.”

The day the senators boarded the planes for Florida, San Francisco-based Wells Fargo & Co. -- which received $25 billion in bailout funds -- canceled a four-day event in Las Vegas, saying the trip may send mixed signals to the public.

“We can only shake our heads at the cynical behavior of our politicians,” Geller said. “It is political rhetoric to fan the fuel of fear.”

Van Paasschen of Starwood said the senators’ Florida trip sends another message. It “speaks to the point that getting out and traveling is important,” he said. “I would encourage the members of our government to get out and travel.”

David Burke, vice president of sales and marketing at the Breakers, welcomed the debate -- and the business.

“Regardless of the nature of a meeting, conference or event -- including this Republican senators group -- all business is important to us at The Breakers,” Burke said in an e-mail. “The rhetoric from Washington has clearly impacted the hotel and travel sector as a whole.”

http://www.bloomberg.com/apps/news?pid=20601087&sid=aRQWnoXi_6Zk&refer=worldwide

jAZ
03-24-2009, 09:19 AM
Why aren't you bitching about the communist companies taking tax dollars instead of bitching about communist travel policies?

Seriously, they weren't forced to take the money, and some are giving it back. But don't take it, and bitch about the strings attached.

And you, targeting travel restrictions, instead of corporate welfare... that's cartoonish.

BigRedChief
03-24-2009, 09:24 AM
Why aren't you bitching about the communist companies taking tax dollars instead of bitching about communist travel policies?

Seriously, they weren't forced to take the money, and some are giving it back. But don't take it, and bitch about the strings attached.

And you, targeting travel restrictions, instead of corporate welfare... that's cartoonish.
No chit, you don't want the strings? Don't take the friggin money. Or if its too harsh a living to exsist on the tax payer dime then just give the money back and jet set all you want to on your own balance sheet.

Taco John
03-24-2009, 11:35 AM
Why aren't you bitching about the communist companies taking tax dollars instead of bitching about communist travel policies?

What are you talking about? I was against the communization of these companies in the first place.

Garcia Bronco
03-24-2009, 11:58 AM
No chit, you don't want the strings? Don't take the friggin money. .

Some banks like BB&T, that didn't get involved in subprime lending, were forced to take TARP money.

Taco John
03-24-2009, 12:07 PM
No chit, you don't want the strings? Don't take the friggin money.

It's a stupid argument. It's like telling a two year old, "you don't want to be fat? Don't take this candy!"

The executives are going to do what's best for their own necks. Look at AIG. Their bonuses hung in the balance, and by taking the money, they ensured that they received them while leaving the future to deal with the economic consequences of their decision to accept the communization of their company. Meanwhile, the Liberals are up in arms over the results of their plan, and demanding, of course, more regulations because the last ones didn't work.

The only solution was to liquidate. Communizing these companies might work for a short period of time, but there is only one logical end to communism - the is only one logical end to ANY Ponzi scheme.

BigRedChief
03-24-2009, 12:59 PM
Some banks like BB&T, that didn't get involved in subprime lending, were forced to take TARP money.
BS. All the banks have been told publically that they can give back the money at any time without interest. We gave you $20 billion just give us back $20 billion.

It's all on the banks now. You borrow money the lender has a right to put stipulations in the agreement.

How can you defend these banks wanting to live like they are making mega profits?

Ultra Peanut
03-24-2009, 01:02 PM
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