Lobbyists
In the USA, the ‘lobbying industry’ is based on K Street in Washington, DC, and is a $3.5 billion industry that directs approximately $3.5 trillion of government spending, as well as influencing legislation. It has also led to a phenomenon called ‘Revolving Door Syndrome’, where members of Congress or their staff leave their political jobs and go to work for a lobbying firm, while maintaining contact with their old colleagues.
Lobbying in the UK is much smaller scale, but it has grown in recent years with 114 lobbying firms now registered in the UK. A sign of the increasing practice of politicians becoming lobbyists was revealed by a scandal in 2015 involving two former foreign secretaries, Jack Straw and Sir Malcolm Rifkind. Rifkind claimed to be able to gain special access to global diplomats, through which he could represent the views of firms that paid him a fee, while Straw claimed to have been able to change EU rules on behalf of a commodity firm which had paid him £60,000.
With 12,411 registered lobbyists in 2012 and with the 'K Street corridor' becoming the centre for Washington-based lobbyist firms, it is clear that lobbying is now a 'persuasion industry' in its own right. Indeed in 2012, the US Chamber of Commerce employed 183 lobbyists, who spent $136 million on lobbying activities.
The impact of lobbyists on the 2010 Healthcare Act shows the influence of lobbyists on Capitol Hill. These include the following:
· The Sunlight Foundation highlighted how 20% of the campaign funds for Max Baucus, former chair of the Senate Finance Committee, was contributed by lobbyists linked to PhARMA, representing the wealthy pharmaceutical industry. Some argue that this influenced his decision to exclude from initial discussions about healthcare reform in 2009 those pressure groups demanding wider healthcare coverage. In 2005 Bill Tauzin retired from the House of Representative and was hired by PhARMA with an initial payment of 11 million dollars- while in the House he had pushed for an extension of Medicare which made billions for the pharmaceutical industry. In his capacity as chair of the House Committee on Energy and Commerce, Tauzin was one of the chief architects of the Medicare bill. Tauzin's appointment shortly afterward as chief lobbyist for the Pharmaceutical Research and Manufacturers of America (PhRMA), the trade association and lobby group for the drug industry, drew criticism from consumer advocacy group Public Citizen, which claimed Tauzin "may have been negotiating for the lobbying job while writing the Medicare legislation."
It's a sad commentary on politics in Washington that a member of Congress who pushed through a major piece of legislation benefiting the drug industry, gets the job leading that industry.
— Public Citizen President Joan Claybrook, 2004
In 2009, according to a study by the Center for Public Integrity, more than 1,750 companies and organisations hired about 4,525 lobbyists, who spent around $3.3 billion in order to influence the healthcare issue.
In the film The Distinguished Gentleman, freshman Congressman (and con man) Thomas Jefferson Johnson (Eddie Murphy) is schooled in the ways of Washington by legendary lobbyist Terry Corrigan (Kevin McCarthy).
Lobbyist establish connections with Congress members who could be convinced to propose or back laws that support their goals. They might also engage with key government officials in their field, such as cabinet members and high-ranking individuals in federal agencies. Representatives from J.P. Morgan and Goldman Sachs investment banks held more than 350 meetings with federal agencies between 2010 and 2012 while the agencies were formulating regulations for the banking industry in light of the recent financial crisis. Cultivating relationships with the personnel of influential figures in Congress or the White House can also be a tactic to gain influence, as they may sway their superiors. Certain advocacy groups have branches in various states across the US to conduct similar activities at the state level.
Pressure groups with enough money often hire professional lobbying firms, which are concentrated in and around ‘K-Street’ in Washington, DC, forming the ‘K-Street corridor of influence’. In 2019, over $3.47 billion was used for federal lobbying, mainly focused on current political issues. For instance, in 2019, businesses and industry pressure groups lobbied the government about Donald Trump’s new trade agreement with Mexico and Canada, while pharmaceutical companies objected to price restrictions on medical drugs. In 2010, a significant portion of the $3.51 billion spent on lobbying came from healthcare companies and associations aiming to shape Barack Obama’s Affordable Care Act. Research indicates that lobbying is effective, with one study suggesting that US corporate groups' lobbying expenses resulted in $90 billion in business subsidies.
Congress has attempted to regulate lobbying through laws like the Lobbying Disclosure Act of 1995 and the Honest Leadership and Open Government Act of 2007. Lobbying activities must be made public, and there are strict limitations on gifts from lobbyists to members of Congress. Despite these rules, the lobbying sector faces heavy criticism for its perceived elitism and undemocratic nature. Critics argue that well-funded interest groups can purchase influence. For instance, the US Chamber of Commerce consistently outspends other organizations on lobbying efforts, allocating $77 million in 2019. One of its objectives was to persuade Congress to approve the United States-Mexico-Canada Agreement, a goal achieved after consulting with 36 lawmakers. However, substantial financial investments do not always yield desired outcomes. The Chamber failed to persuade the Trump administration to reverse tariffs on Chinese and EU goods, as well as steel and aluminum imports, despite the adverse effects of these tariffs on US businesses. During the 2016 presidential race, Trump utilized populist language, emphasizing the necessity to eliminate corruption in Washington, DC. Yet, as president, he did not take steps to reduce the influence of lobbyists. Instead, within two years of his term, Trump appointed 281 lobbyists to government positions, equating to one ex-lobbyist for every 14 political appointments. This number exceeded the lobbyists hired by Obama over six years. Trump also maintained close relationships with several active lobbyists, granting them entry to his administration.