Lobbying has grown in direct proportion to government spending, with special interest groups consistently spending almost exactly $1 million for every billion dollars in federal expenditures.
The correlation suggests that while liberal politicians portray K Street lobbyists as villains ruining Washington, it may be Big Government policies that attract them, according to a Washington Examiner analysis.
The money spent on lobbying rose from $1.5 billion in 1998 to a high of $3.6 billion in 2010, during President Obama’s stimulus package. During that same time period, spending grew from $1.7 trillion to $3.5 trillion.
Experts said that as lawmakers have created new government programs and pumped up spending on existing programs, companies and activist groups have mobilized lobbyists to figure out how to cash in on the newfound money.
“To paraphrase James Carville, drag a billion dollars through a trailer park, and there’s no telling who will turn out,” said Bill Allison, a lobbying expert at the Sunlight Foundation. “Lobbying is an overhead expense of Big Government — a constant.” Sunlight is a nonprofit that seeks more government transparency.
In some ways, it’s a chicken-and-egg relationship, and a competing theory is that lobbyists are causing the government to grow.
To be sure, some companies lobby to increase the federal budget in areas on which they can profit. That includes defense contractors like General Dynamics, Lockheed Martin, and Boeing; government consultants like Accenture; quasi-public entities like public television stations; and healthcare firms like Emergent BioSolutions and AdvaMed.
But many companies would prefer lower taxes over new government spending. If their lobbyists were successful, the result should be less government spending — in order to balance out the lower taxes — rather than the increase in government outlays, as measured by the Congressional Budget Office.
Lobbying on taxes are mammoth companies like Microsoft, Wal-Mart, ExxonMobil and FedEx. Those companies may boost their lobbying presence as a reaction to government growth, which they see signaling higher taxes on the horizon.
Three thousand entities hired lobbyists on federal appropriations last year, while 2,000 hired lobbyists on tax issues, according to the Center for Responsive Politics.
Lobbyists generally don’t create demand, they sense an opportunity and respond to it, Allison said. “If I didn’t think government had an interest in funding me, I wouldn’t be putting the effort into lobbying it.”
Often that interest comes in the form of well-intentioned programs crafted by liberals from which companies almost always seem to find a way to profit. Politicians created government-backed student loans, for example, out of concern for young people. But for-profit colleges now lobby heavily for them, and depend upon the revenue that results.
Soda and junk food manufacturers lobby to boost the food stamp program, and green-energy companies’ business models depend on legal carve-outs.
Big Government spending on defense and national security has the same effect. Creation of a new cabinet-level agency, the Department of Homeland Security, after the Sept. 11, 2001, attacks, set off a gold rush of lobbying, as did the heightened defense spending of the subsequent wars in Iraq and Afghanistan, said Tim LaPira, a political science professor at James Madison University.
Government taking on an expanded role — as it has done recently with healthcare — brings out lobbyists for both sides of an issue, as well as a crop of entities who were formerly not politically active, but now see a chance to profit.
“A governmental decision to become involved in an issue area sets the agenda for existing and potential organized interests,” LaPira and colleagues wrote in an academic paper titled “Drawing lobbyists to Washington.”
“If government had no authority over or involvement in an issue-area, then there would be little point in forming an interest group to lobby,” LaPira and colleagues wrote.
Demian Brady of the National Taxpayers Union noted that, while lobbying parallels federal spending, it doesn’t match up so smoothly with federal revenues.
“New federal programs create new constituencies who then lobby not only for additional benefits but to protect what they’ve already been granted,” he said.
“The benefits to the constituents of a given program are concentrated, while the costs of those programs are diffused, so that those people with the benefits have a much greater incentive to lobby on behalf of themselves than” taxpayers do to keep costs down.
