How Lobbying Affects Political Decisions and the Future of a Country

In 2022, $3.06 billion was spent on lobbying in the United States of America. Views on lobbying are mixed, with some people comparing it with legalized bribery while others say it’s a legal and necessary part of our democracy. RSnake spoke with lobbyists working primarily in tech, an energy lobbyist, and most recently, a political fundraiser to find out how these practices influence politics.

What is Lobbying?

Simply put, lobbying is a way for people to petition those in government to create or keep legislation that works in their favor. RSnake guest and president of KG Strategies Kinnan Goleman said that as a lobbyist, “You’re an advocate on behalf of a constituency or a particular business.” Lobbying is legal, and protected under the First Amendment, which includes the “right to petition the government for a redress of grievances.” Many see lobbying as a necessary part of a healthy democracy. Goleman explained, “The fact is everybody has a place in any public forum for their voice to be heard.” Andrew Cates, a lobbyist and strategic advisor with Salient Strategies explained lobbying is helpful to politicians, who simply don’t have the time or the resources to become educated on all the issues of the day. He said, “They just can’t learn everything all at once, at all times, and have an informed opinion to make an informed vote.” Lobbyists help government officials better understand the issues at play. Sometimes they present pertinent information to one or more government officials in formal meetings. At other times lobbyists may host parties or attend lunches to meet with government members less formally. Other forms of lobbying can include calling or emailing a member of congress, or protesting. Leaders of organizations may also lobby indirectly by writing opinion articles for publication in newspapers or magazines, or sharing their views on talk shows. Sometimes lobbyists will help government officials draft legislation. Lobbyists may also work to quash new laws that don’t benefit the interests of their clients.

Lobbying Regulation

In the U.S., there are regulations that govern lobbying. According to the Lobbying Disclosure Act, organizations that spend over $14,000 on lobbying in a quarter are required to register with the government. Lobbying firms also have to register each client that pays them more than $3,000 per quarter. When meeting with government officials, lobbyists are also mandated to disclose, upon request, whether or not they are lobbyists and who their clients are. Lobbyists may work for either domestic or foreign clients. Foreign clients can include governments or private organizations.

Lobbying Statistics

The total amount of money spent on lobbying in the U.S. more than doubled from $1.45 billion in 1998 to $3.31 billion in 2008. Since then, the amounts have generally stayed within the $3 billion range. Why these amounts grew so rapidly during this time is anyone’s best guess. Lee Drutman, author of The Business of America is Lobbying noted a marked change in how businesses related to government beginning in the 1970s. It is difficult to compare amounts spent on lobbying in the U.S. with other countries since data on lobbying isn’t tracked the same way elsewhere. Canada, for example, tracks who is involved in lobbying, but not necessarily the amount of money spent. We do know that tech companies Apple, Google, Facebook, and Microsoft collectively spent over €27 million on lobbying in the European Union (EU) in 2021. This number doesn’t account for other companies like pharmaceuticals, oil and gas, or banks that have also been known to spend on lobbying in the EU. One organization called Transparency International tracks not lobbying, but corruption in 180 countries around the world. It ranks countries based on data from the World Bank and the World Economic Forum using a number of criteria including laws around transparency, nepotism, and more. In 2022 the U.S. ranked 24th out of the 180 countries; behind Denmark, Finland and New Zealand which occupied the top spots, but ahead of Israel (31st) and Spain (35th).

Who is Lobbying the Government?

Data show that the pharmaceutical industry spent the most on lobbying in 2022, spending just under $284 million. Electronics manufacturing and equipment (the tech industry) came in second, spending almost $165 million, and the insurance industry came in third with just over $122 million. The oil and gas industry, which many people characterize as being heavy lobbyists came 9th on the list behind the real estate industry and health services/HMOs. The U.S. government also tracks foreign influence. According to the organization Open Secrets, in 2022, China (including Hong Kong) spent the most on lobbying with over $50 million. The west African country of Liberia was next, spending over $44 million. Other countries in the top ten were Japan, the United Arab Emirates and South Korea.

The Pros and Cons of Lobbying

Many people dislike and distrust the idea of lobbying. Cates joked with RSnake that he, as a lawyer and a lobbyist, represents two of the most hated professions in the world. However, many people support lobbying as being an important part of the political process.

Pros

Proponents of lobbying say it helps government officials understand how laws will affect certain industries and communities. They say that organizations should be able to work with lawmakers to influence policy. In conversation with RSnake, Chris Sanchez, a senior partner with Salient Strategies explained that, for the most part, people in government don’t make laws in their own best interests. “It is not a widespread issue that you run up against,” he said. Lobbying isn’t necessarily always about big money. According to Forbes, politicians are happy to meet with trade organizations to hear their concerns. Smaller grassroots groups also coordinate lobbying campaigns that can be fruitful. Health advocacy organizations like the National Eczema Association, for example, have worked to influence legislation in support of their members.

Cons

Others argue the amount of money necessary to lobby effectively automatically cuts some people out of the equation. Big companies with big budgets can hire lobbyists, and people in a small town, for example, can’t. Lobbyist turned media personality Jimmy Williams quit lobbying because he found it unethical for exactly those reasons. In an article for Vox he wrote, “It’s a system of sycophantic elected leaders expecting a campaign cash flow, and in return, industry, interest groups, and big labor are rewarded with what they want: legislation and rules that favor their constituencies.” Some would argue that if lobbying didn’t work in the favor of organizations, they wouldn’t spend so much money on it. It’s possible that the rise in spending on lobbying since the late 1990s is due to its success. Lobbying can also increase public distrust in government. The Organization for Economic Co-operation and Development (OECD) wrote in a report, “Lobbying is perceived in most countries as a mechanism for perpetuating special interests at the expense of the public interest.” The same report showed a strong correlation between transparency in lobbying and increased trust in government. In the U.S., trust in government is currently low. A 2022 Pew Research survey found that only 20% of respondents said “they trust the government in Washington to do what is right just about always/most of the time.”

What About Fundraising and PACs?

Government officials don’t receive money through lobbying. That money goes to lobbyists. They do, however, receive money for campaigns through fundraising and political action committees (PACs). There are regulations governing how corporations may donate to political campaigns. They are not permitted to donate to campaigns directly, but can establish a separate segregated fund (SSF) or give money to an independent expenditure-only PAC. There are also limits on the amounts that can be donated. In her conversation with RSnake, fundraiser Pasha Moore explained this money can help to fund candidate commercials, or pay utility bills, for example. Moore also opined that since corporations pay taxes, like individuals, they should have a seat at the political table. “They’re a taxpayer just like I’m a taxpayer,” she said. “They’re paying in, so why don’t they get some sort of a say?”

Which Party Gets the Most Money?

In the midterm election cycle, from 2021 to 2022, both parties raised a total of $1.9 billion. The Democrats raised slightly more than the Republicans with over $982 million. The Republicans raised over $941 million. In 2021-2022, both parties received roughly the same amounts in PAC funding, with the Republicans raising $177.2 million, and the Democrats roughly $177 million (rounded to the nearest hundred thousand). Both parties received money from a combination of PAC sources including corporate, labor membership and non-connected PACs. In terms of corporate sources, Republicans received just over $68 million, and the Democrats got $56 million. The Democrats received more from labor and membership PACs than the Republicans.

The Takeaway

There is no doubt that money talks, in politics, as in other parts of society. Just how much influence it can have in government depends largely on the ethics of those elected to power. To get an insider’s take on lobbying, listen to RSnake’s conversation with the Salient Strategies team and Kinnan Goleman. For more on fundraising in politics, check out his chat with Pasha Moore.