WASHINGTON (CNNMoney.com) -- As lawmakers debate how to extend the Bush tax cuts on income, heavy hitters from big business have their own goal: persuading Congress to extend tax breaks for dividends and capital gains.
Hundreds of companies - especially utilities, telecom and financial firms - have sharpened their lobbying efforts, concentrating on moderate Democrats who fear the economy may be too weak for any tax breaks to lapse right now.
The tax cuts lowered the tax rates on capital gains and dividends to 15%. If Congress does nothing, the capital gains tax rate will revert to 20% and dividends would again be taxed as ordinary income -- as much as 40% for the wealthiest taxpayers.
So companies that see a threat from higher investment tax rates have formed advocacy groups with progressive-sounding names. Among them is Defend My Dividend, which represents 50 electric and gas utilities. It has lobbyists and one television ad, which ran in Florida for four weeks.
"Clearly we're in the crunch time," said Jim Owen, spokesman for Edison Electric Institute, which represents investor-owned utilities and paid for the TV ad. "We're trying to make the case to Congress that they do need to act quickly."
Also pushing is the Alliance for Savings and Investment, which includes about 25 companies and groups including insurer Mass Mutual, telecom provider Qwest (Q, Fortune 500) and the U.S. Chamber of Commerce.
The alliance has run print ads in Capitol Hill newspapers, published a Website featuring concerned seniors, and hired high-powered Washington consultants and lobbyists.
"The economy is upper most on the minds of most members on the Hill," said Jim McCrery, a Louisiana Republican who used to sit on the House's tax-writing committee and now is part of a lobbying firm working for the alliance. "Most members are concerned about making sure the economy continues to grow and avoids a double-dip recession."
What's at stake: Dividend taxes are especially important to telecom and utility companies that woo investors with big payouts. If dividends are taxed at a higher rate, investors would be less likely to buy into such companies. That's why AT&T (T, Fortune 500), Verizon (VZ, Fortune 500), Duke Energy (DUK, Fortune 500) and Xcel (XEL, Fortune 500) Energy are all involved in the push on Capitol Hill.
Other blue-chip companies that pay big-time dividends - including cigarette maker Altria (MO, Fortune 500) and United Parcel Service (UPS, Fortune 500) - also belong to the Alliance for Savings and Investment.
The corporate advocacy groups say higher capital gains taxes could dampen investment in firms and economic growth.
The Securities Industry and Financial Markets Association, which helped found the alliance back in 2005, says extending dividends and capital gains tax breaks helps the economy, because it encourages saving and investing.
However, some argue that since capital gains and dividends are concentrated among higher-income households, tax breaks in those areas could ultimately put a greater burden on the less well-to-do to pay more in taxes, while pushing deficits higher.
That's why President Obama is pushing for a compromise that some of the big companies could live with.
The Obama administration would keep the 15% cap for the middle class, and hike taxes on capital gains and dividends to just 20% for those individuals making more than $200,000 and families making more than $250,000.
But even that package of moves could add as as much as $347 billion to federal deficits over the next 10 years, according to Treasury estimates. Plus, Congress may be forced to come up with a funding source to plug that hole, according to budget rules.
It's not clear yet what Congress will do. But the big business lobbying campaign has found at least one Democratic supporter. Rep. John Adler, D-N.J., is circulating a letter among lawmakers seeking support for an extension of current tax rates for dividend and capital gains taxes.
"By keeping dividends and capital gains tax rates linked and low for everyone, we can help the private sector create jobs and allow seniors and middle class households to save and invest more," states the letter addressed to House Speaker Nancy Pelosi.
Beer sales in Russia are losing their fizz as the economy grinds to a halt, hurting Western brewers such as Carlsberg. More
Small business owners say the economy is still their biggest challenge, which keeps them from expanding and hiring, according to a CNNMoney-Manta survey. More
Steve Ballmer quits Microsoft's board to spend more time running the LA Clippers. More
When hairdresser Mark Bustos isn't cutting the hair of fashion designers and real estate moguls, he's traveling around the world giving free haircuts to the homeless. More