The AFL-CIO spent $1.1 million in 2007 to lobby Congress on issues that included a Senate bill to raise taxes on carried interest.
Lobbying on the carried-interest debate is only part of the reason the tax break has survived, said David Donnelly, the national campaigns director at the Public Campaign Action Fund, a Washington nonprofit group that tracks political contributions. Investors who are paid in carried interest are often the well-heeled donors that members of both parties turn to for campaign contributions, he said.
"I don't think it's simply the lobbying," Donnelly said. "The people who are interested in this particular provision are high net-worth individuals. That's a constituency that Congress always cares about when they have to raise money to fund their campaigns."