The mortgage calamity, market turmoil and threat of recession are battering the nation’s economy, but their combined effect has become something of a rainmaker in Washington.

Campaign donations from affected industries have spiked, putting their giving trends on track to easily surpass the 2006 election cycle. Lobbyists also are making money off the misery as they move to protect, or promote, their industries amid increased activity on Capitol Hill and at the White House.

Political action committees from the real estate industry, for instance, donated $75 million to political campaigns during the hard-fought midterms two years ago. As of the end of March, they’d already given $56 million, according to the Center for Responsive Politics.

Venture capital PACs dropped nearly $6 million into campaign accounts in 2006. Already this cycle, they’ve given nearly $5 million. And securities and investment PACs have surpassed by a half-million dollars their $71 million in campaign contributions of two years ago.

The spigots have become gushers of giving by the once shadowy but now newly targeted hedge fund and private equity sectors.

Hedge fund PACs have nearly doubled their donations to candidates in 2004 and 2006: They’ve given $8 million to 2008 candidates, up from $4.5 million in the last two election cycles.

Giving by their private equity brethren has jumped to $10 million this cycle, besting their record $8 million in donations in 2004 and well above the $6 million two years ago.

 And lawmakers aren’t the only insiders benefiting from the crisis. Lobbyists are also weathering the economic storm quite well.

More than 40 new lobbyist registrations have been filed with the Senate just since January, swelling the ranks of an already crowded army of influencers.

Among the newcomers are fresh advocates for concrete makers, home builders, real estate agents, hard-hit cities – even Freddie Mac, the quasi-government agency charged with assisting minority and low-income homeowners that already is considered a lobbying powerhouse.

The money that industries are pouring into their efforts to tweak, kill or promote new federal regulations was on the upswing in 2007 and will likely show continued growth when the first wave of 2008 reports are made public this summer.

The National Association of Realtors, which was just beginning to suffer the foreclosure nightmare, spent $14 million lobbying Congress last year, compared with just $6.4 million in 2006.

The securities and investment sector spent $87 million, up considerably from its $62 million payout just a year before. Commercial banks’ lobbying jumped to $47 million last year, compared with $42 million in 2006.

The handiwork of the real estate and housing industries was quickly evident when the Senate lurched toward legislating last week after getting blistered by voters during its two-week spring break.

Lending industry lobbyists actually demurred from racing to Capitol Hill after news broke that a bipartisan deal had been struck. Why? Heavy lobbying on the Democrats’ original measure, which faltered in February, had already shaped the options on the table.

When the final version of the legislation emerged, it was instantly apparent that the real winners were home builders and sellers, not homeowners.

The legislation cut housing counseling funds in half to $100 million. It didn’t include a provision to allow bankruptcy judges to review mortgages and adjust them to help distressed families save their homes. It did, however, include $11 billion in tax breaks for home builders and buyers of foreclosed homes.

The amendment offered by Senate Majority Whip Richard J. Durbin (D-Ill.) to insert the bankruptcy provision was tabled by the Senate. A less aggressive version is still being offered by Sen. Arlen Specter (R-Pa.).

Floor consideration of the Senate bill is scheduled to begin again today, but the big fight is now shifting to the House.

Civil rights and consumer groups already are tapping black and Hispanic caucus members to highlight the disproportionate effect the foreclosure crisis is having on minority communities and to fight for better protections for those homeowners.

Organizations representing minorities, seniors and union members have launched “a massive grass-roots campaign” aimed at leaning on lawmakers as the debate continues, said Wade Henderson, president of the Leadership Conference on Civil Rights.

The Center for Responsible Lending, a nonpartisan group that has been tracking the foreclosure crisis, also is timing the release of a new report on predatory lending practices for today’s renewal of debate in the Senate.

A primary goal among consumer activists is to get the bankruptcy provision into the House bill so that it will be on the table when a joint House-Senate conference committee reconciles the final legislation.

Late last week, the activists won a key ally when House Speaker Nancy Pelosi (D-Calif.) said the Senate bill isn’t tilted enough toward consumers. “I think the bankruptcy provision goes right to the heart of helping people who are in trouble,” she added.

Lawmakers could decide to punt on the controversial provision for now and clear the way for quick passage of a bill, which would demonstrate they are responding to the crisis.

If they do, Henderson predicts the issue would emerge again because the rate of foreclosures is likely to continue rising, and with that would come even more clamoring for Congress to act.

“For people who are really facing the potential loss of their homes and going into bankruptcy, this bill is nothing but a placebo,” he said.

Another indication that the economic rainmaker is unlikely to lose its luster anytime soon: Pelosi is now calling for a second stimulus package, a measure that would activate lobbyists from virtually every sector of the nation’s stressed economy.

© 2007 Capitol News Company, LLC