Lobbying in the USA: A dirty democratic business

As Nobel Prize-winning economist Joseph Stiglitz stated recently, “In Washington, money talks”. This is the business of lobbying and it poisons America’s illusion of democracy.

The word lobbying in its current usage means to curry favour with politicians, and in some cases the general public, in order to gain support for areas of special interest.

The term probably has its origins in the UK, where members of the public could approach their elected representatives in the hallways or lobbies of the Houses of Parliament.

However, regardless of the word’s origins, lobbying has become big business in the USA, albeit with a less than savoury reputation.

The idea of lobbying – promoting special interests to elected representatives – is based on sound democratic principles. People should make sure the people they elect to make laws and decisions on their behalf are adequately representing their views. In fact, lobbying is protected in the US Constitution as “the right to petition”.

However, lobbying has become about more than writing letters.

A lobbyist is paid by a special interest group, such as cotton farmers or weapons companies, to influence, get money from, or bring issues to the attention of, those in power.

While there are any number of lobby groups intent on gaining support for issues like the environment, immigration and women’s and gay rights – the real heavy hitters are the extremely wealthy industrial and business lobbies, keen to protect their industries and maintain their profitability. This is where things can get murky.

The lobbying industry was worth $3.3 billion dollars last year, with the biggest spenders in the last 6 years being the Health sector, closely followed by Banking (Finance), Insurance and Real Estate.

There are currently 12,552 registered lobbyists (since 1995 all lobbyists have been required to be registered). In the middle of this decade, during the height of the Bush era, there were 34,750. Compare that to the 100 senators and 435 congressmen and you can see there is a problem of influence.

A lot of lobbyists are ex-politicians with friends still in power. In fact, the salary of the lobbying occupation lures nearly half of all lawmakers once they leave congress.

Specifically speaking, there are 6 registered health lobbyists for every congressman, according to the Guardian, a UK-based newspaper.

And it is the recent healthcare reform controversy that has really highlighted what some would call the dark side of lobbying.

Health companies have reportedly spent $380 million through lobbying in an attempt to influence the health care debate and subsequent laws. They have made huge direct financial payments to some of the key political figures involved.

In the process, they have managed to convince a large portion of the US population that universal access to health care is the equivalent of communism.

On Saturday, President Obama attacked the health insurance companies. “They're filling the airwaves with deceptive and dishonest ads. They're flooding Capitol Hill with lobbyists and campaign contributions. And they're funding studies designed to mislead the American people,” he said.

The lobbying issue has been a particular concern for the current US administration. In his first days of office in January this year, President Obama issued an executive order on ethics banning lobbyists from working for an agency they have lobbied in the past for 2 years.

He also banned lobbyists from giving gifts to members of his administration – something akin to bribery. The problem is that it is congress, not his administration, where the main problem of influence lies.

The issue of lobbyists and campaign funding is a thorny one as well, with change also signalled in this area. The idea goes that businesses provide candidates with money they need to campaign for election to congress. In return, candidates promise to vote for laws they want.

Since 2002, the maximum amount any firm, organisation or individual could donate was $2,000. However, the advent of a campaign bundler, a person who rounds up a large number of small donations from a group of people, has meant that special interest groups still have the ability to donate large sums and maintain influence over a candidate.

Obama mostly refused large sums of money from big business, instead raising millions of dollars via small donations from people online. This has meant he has been less constrained by the interests of big business. He did, however, use some money from lobbyists, with both he and McCain using campaign bundlers during the election.

Despite the downsides of lobbying, it’s important to remember that it has its part to play in the democratic process.

However, it is not the principle of lobbying, but the huge sums of money being paid by big business that is at the heart of the problem.

They are able to do this because of the loop holes in the lobbying laws. Such loop holes must be changed if America is to reduce the level of corruption that is damaging its country, and often the world.

And given it is the politicians who benefit from it, this will only happen if there is sufficient public outrage as a result of people becoming aware.

By Jo Blick