Something is out of balance in Washington. Corporations now spend about $2.6 billion a year on reported lobbying expenditures—more than the $2 billion we spend to fund the House ($1.18 billion) and Senate ($860 million). It’s a gap that has been widening since corporate lobbying began to regularly exceed the combined House-Senate budget in the early 2000s.
Today, the biggest companies have upwards of 100 lobbyists representing them, allowing them to be everywhere, all the time. For every dollar spent on lobbying by labor unions and public-interest groups together, large corporations and their associations now spend $34. Of the 100 organizations that spend the most on lobbying, 95 consistently represent business.
One has to go back to the Gilded Age to find business in such a dominant political position in American politics. While it is true that even in the more pluralist1950s and 1960s, political representation tilted towards the well-off, lobbying was almost balanced by today’s standards. Labor unions were much more important, and the public-interest groups of the 1960s were much more significant actors. And very few companies had their own Washington lobbyists prior to the 1970s. To the extent that businesses did lobby in the 1950s and 1960s (typically through associations), they were clumsy and ineffective. “When we look at the typical lobby,” concluded three leading political scientists in their 1963 study, American Business and Public Policy, “we find its opportunities to maneuver are sharply limited, its staff mediocre, and its typical problem not the influencing of Congressional votes but finding the clients and contributors to enable it to survive at all.”
Things are quite different today. The evolution of business lobbying from a sparse reactive force into a ubiquitous and increasingly proactive one is among the most important transformations in American politics over the last 40 years. Probing the history of this transformation reveals that there is no “normal” level of business lobbying in American democracy. Rather, business lobbying has built itself up over time, and the self-reinforcing quality of corporate lobbying has increasingly come to overwhelm every other potentially countervailing force. It has also fundamentally changed how corporations interact with government—rather than trying to keep government out of its business (as they did for a long time), companies are now increasingly bringing government in as a partner, looking to see what the country can do for them.
If we set our time machine back to 1971, we’d find a leading corporate lawyer earnestly writing that, “As every business executive knows, few elements of American society today have as little influence in government as the American businessman, the corporation, or even the millions of corporate stockholders. If one doubts this, let him undertake the role of ‘lobbyist’ for the business point of view before Congressional committees.”
That lawyer was soon-to-be Supreme Court Justice Lewis F. Powell Jr., whose now-famous “Powell Memorandum” is a telling insight into the frustration that many business leaders felt by the early 1970s. Congress had gone on a regulatory binge in the 1960s—spurred on by a new wave of public-interest groups. Large corporations had largely sat by idly, unsure of what to do.