A Harvard-trained political economist, Shapiro is the head of a consulting firm called Sonecon. That business card doesn’t do it for you? He’s got a few more in his wallet:

Shapiro, a Democrat, has advised presidents and presidential candidates, and has held powerful government posts. It stands to reason, then, that when he has thoughts on public policy, he can find an outlet ready to publish them.

Recently, he’s had ideas on how the government can address the debt crisis in Puerto Rico and how it can end the conservatorship of Fannie Mae and Freddie Mac by moving them into the private market. Before that, he had a take on how to deal with Argentina’s debt crisis. For all three, he produced academic-looking papers, complete with footnotes and charts.

All three situations have one thing in common: If they were resolved the way Shapiro suggested, a variety of bets placed by a select group of the most politically powerful hedge funds would pay off in a huge way. In the case of Argentina, they mostly have. Fights over how to resolve the other two issues are still raging in Washington.

For this article, we called Shapiro to ask on whose behalf he has been waging these intellectual battles. His answer was surprising in its honesty: He’s working with DCI Group, a political dark arts master known to be advocating on behalf of a group of powerful hedge funds that are changing how Washington works.

Shapiro, it turns out, is but one foot soldier in the hedge fund infantry. A review of public documents, tax filings and interviews with people involved finds that in each of the three campaigns, hedge funds have enlisted the same set of lobbyists, political operatives, dark money groups and think-tank experts spanning the political spectrum.

No single document or set of disclosures ties all of these groups together. They don’t put out joint press releases, parade themselves around Washington as part of a coalition, or chat together on conference calls. Finding the players in this game, instead, is more a process of deduction. For a group of firms and experts to be working for vulture funds on the issue of Argentine debt is normal Washington practice. (Vulture’s meaning here isn’t pejorative: it refers to an investment strategy that feeds off of assets the market has left for dead.)

For the exact same people and groups to be working on the next big issue that these funds care about — the Puerto Rican debt crisis — could be a coincidence. But now, the hedge funds are focused on a third issue — government-sponsored enterprise reform, which refers to the effort to establish new housing finance policy in the wake of the federal takeover of lenders Fannie Mae and Freddie Mac. And it’s the same political firms and the same independent experts that are once again weighing in — coincidentally, all on the side of the hedge funds.

Maybe it’s all coincidence, but let’s run the traps either way.

The band that has gotten together for the big three hedge fund jam sessions includes some unlikely allies: There’s DCI Group, the powerhouse lobbying firm. Then there’s the Raben Group, operatives whose specialty is working in the progressive space and lobbying Democrats. There’s the American Continental Group, a bipartisan lobbying firm. There’s 60 Plus and the Center for Individual Freedom, two groups that call themselves part of the conservative movement, but in reality are dark money groups known to run whatever campaign they’re paid to run, and that are happy to conceal the source of the funding. All these groups have roughly nothing in common, other than that they all have united in advocacy campaigns that alternately go up against the Argentinian people, Puerto Ricans and the rest of the American public.

Each of these campaigns appears to have been run by or aided by the DCI Group. We say “appears” because DCI is one of Washington’s great black boxes — news articles that involve DCI routinely include a line informing readers that the organization did not respond to a request for comment. This article is no different.

Old Washington hands involved in these particular fights say that nothing they’ve seen before in politics has prepared them for the mercenary campaigns the hedge funds are now waging.

“There’s something about this that’s almost more disturbing, because you get an issue that’s not particularly a big public issue and people can spend and spend and spend,” said a veteran policymaker who found himself on the wrong end of the hedge funds. “And I don’t know how anybody can compete with it. And then you start losing the narrative and you see groups on the left get bought out and corrupted — really corrupted. I don’t know what to do about it.”

What is being done only exacerbates the situation. Current tax policy allows hedge fund managers to pay billions less every year than competitors who don’t get the same advantage. And tax-exempt pension funds — teachers, nurses, firefighters — invest heavily in hedge funds, hoping to make up big shortfalls with risky investments. The generous tax policy leaves hedge funds flush with cash. What money they’re not stashing off shore, they’ve been spreading freely around Washington.

They may have finally gone too far. A backlash is brewing, threatening not just their current bets, but their various tax benefits too. One senior House Republican aide who’s worked closely with the hedge funds says that members of Congress have seen enough. “I think on the Fannie stuff, they’ve hurt themselves,” he said. “We’re like, f..k em. If they’re not your friends, they’re your enemies.”

And the hedge funds may be losing a crucial progressive ally. Responding to concerns from the Hispanic advocacy community, the Raben Group dropped its work on Puerto Rico two weeks ago.

***

When big banks squared off against merchants such as Walmart in 2011 over the cost of debit card and credit card swipe fees, Washington saw a spending spree and a dirty campaign the likes of which it hasn’t seen since. But at least the arguments on both sides of the swipe fees issue made some rational sense.

“This one, I feel just disgusted by it,” said one GOP Senate aide who witnessed both.

With the hedge fund battles, a group ....

http://www.huffingtonpost.com/entry/vulture-fund-lobbying_us_57350001e4b077d4d6f2a374