• by David Goetzl  @dgoetzl, February 12, 2009

One of the industry's top lobbyists suggested Thursday that with Democrats now in charge, the outlook for advertisers in Washington is grim. With the government looking to tighten regulations on private business, he said advertisers could be hurt by new rules curtailing practices from pharmaceutical marketing to product placement.

"Government is going to be in your lives and more in your business than ever before," said Dan Jaffe, executive vice president of government relations for the Association of National Advertisers. In a speech at an annual ANA event, Jaffe warned the ad business to be on guard against damaging moves by the Obama administration and Democratically controlled Congress.

"(Democratic) Congressmen want to regulate our business, which is not good," he said.

Jaffe warned marketers that while DTC, food advertising and tobacco advertising are likely targets for Democratic constraints, advertisers in other industries (perhaps quick-service restaurants) may also find themselves facing new limitations.

Trouble could come from powerful Democratic committee chairmen who have been eager to clamp down on parts of the ad business for eight years. With the Bush administration gone, Jaffe said they may believe they have a better chance of getting legislation signed into law.

In response, Jaffe promised the ANA would fight back, informing legislators that advertising is a massive industry; certain restrictions could affect jobs in a dismal economy. "Regulators must be made aware of the economic damage this would cause," he said.

Jaffe cited Henry Waxman, the new chairman of the House Energy and Commerce Committee, as posing a threat to the industry. Waxman has proposed a moratorium on direct-to-consumer advertising for prescription drugs for several years after they are launched. (DTC advertising has been a tactical boon for pharmaceutical marketers and a financial one to media sellers since 1997.) If Waxman is successful in pushing DTC legislation in the House, he may find a Senate ally in Ted Kennedy, chairman of the Health, Education, Labor and Pensions Committee. That alliance could lead to both bodies passing new DTC regulations given to President Obama to sign into law.

Jaffe suggested DTC regulation (as well as further rules governing food advertising) could be enacted as part of an omnibus health care bill that Kennedy wants and Obama campaigned for. But Jaffe said momentum for the bill has slowed, partly because of Kennedy's deteriorating health and partly due to the derailed appointment of former Sen. Tom Daschle as Secretary of Health and Human Services. Jaffe, however, admonished advertisers: "This is merely a deferral and not a reprieve."

Waxman has joined with powerful House Democrat Ed Markey to push for potential new regulations on product placement in TV shows--an industry detriment, Jaffe said. Ultimately, the FCC could force marketers to clearly identify when one of their products is woven into a show as part of a paid integration, perhaps while the product is onscreen.