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Billions of dollars are spent on lobbying that we have no idea about

According to the official statisticsover $3.3 billion was spent lobbying the US federal government in 2012. But as massive as that number is, it falls far short of the reality — because it only counts payments made to lobbyists who've actually registered. Billions more are spent in Washington's influence industry, including on payments to "shadow lobbyists" who work to influence government policy despite not being registered at all.

Tim LaPira, a political scientist at James Madison University, has done research indicating that the true amount of money spent on lobbying is likely twice that size — or even more. "We're talking probably $7 billion" in 2012, he tells me, and "less than half of that is really accounted for." LaPira is currently working on a book about revolving door lobbyists, and I spoke with him a few months ago about his research.

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The shadow lobbyists

When Senate Minority Leader Tom Daschle (D) lost his reelection in 2004, he went to go work for the law firm of Alston & Bird, and later to the even bigger firm DLA Piper. But though these firms do extensive lobbying and government advocacy work, Daschle has never registered as a lobbyist.

That's because the Lobbying Disclosure Act requires registration only under particular circumstances. "You have to spend 20 percent of your time on behalf of one client in the quarter in which you're reporting," LaPira says. But such a narrow definition could leave out many people who do lobbying or advocacy work. "How often do you spend an entire day working on a single project every week, for an entire quarter?" LaPira asks. "That's just not the modern professional world."

LaPira believed there were many more examples than just Daschle. During his research, he would often look up a particular registered lobbyist, and notice that he or she would be working with others doing similar things — except those others weren't registered. It made him wonder, just how many unregistered lobbyists are out there?

Google-stalking

So LaPira consulted Lobbyists.info, which he calls "the lobbyist phone book." The site compiles an extensive directory of people in federal lobbying-related jobs, including many who don't fit the law's technical definition. LaPira bought their full catalog of over 30,000 names, and pulled out a much smaller random sample from that. He then had student research assistants "essentially Google-stalk" the people in that sample "to try to reconstruct their resumes." The question he sought to answer was, he says: "Is the job that we can determine from their biography or from their job title or from the firm they're working for — are they engaged in federal public policy? If so we call them a policy advocate."

What LaPira found was that, of the people in the sample who did do that work, "about half of them were registered to lobby and half of them weren't," he says. He co-authored a paper with Herschel Thomas of the University of Texas at Austin on these findings, and then wrote a post for the Sunlight Foundation extrapolating further. Since disclosed spending on federal lobbying has been around $3 billion each year recently, he argued, the actual spending was likely twice that.

The revolving door

LaPira points out that not all lobbyists do the same sort of work. One group, which he calls "conventional" lobbyists, have worked in a particular industry for years and have become experts in that industry. They fiercely advocate for their clients' interests, but they tend not to represent clients from, say, both the health and energy sectors.

For "revolving door" lobbyists — former government staffers who've headed to the influence industry — it's a different story. In another paper, LaPira and Thomas found that these lobbyists tend to have clients from completely unrelated industries. "We interpret this to mean that the revolving door lobbyist is trading on her process knowledge and connections and access," rather than any particular industry expertise, LaPira says.

The consequence is that when these lobbyists' political patrons leave office, the lobbyists themselves become less valuable. This was demonstrated particularly vividly in a recent paper by Jordi Blanes i Vidal, Mirko Draca, and Christian Fons-Rosen. "Lobbyists with experience in the office of a US Senator suffer a 24 percent drop in generated revenue when that Senator leaves office," they write. They say the effect is immediate and long-lasting, and "consistent with the notion that lobbyists sell access to powerful politicians." So when Max Baucus, chair of the Senate Finance Committee, announced last year that we wouldn't run for another term, it was very bad news for his many ex-aides who had become lobbyists.

Does money always win?

So, the research shows that billions of dollars are being spent, it's often undisclosed, and former political staffers are trading on their connections. But there may be at least some semi-good news — lobbyists frequently fail to get what they want out of the government.

In graduate school, LaPira helped research the book Lobbying and Policy Change, written by Frank Baumgartner of the University of North Carolina and four other co-authors. It was a large-scale project that tracked lobbying spending on various issues, and it found, in LaPira's words, that "the side that spends more does not necessarily win."

"Inside the government, politicians have their own motivations," LaPira says. "They have their own public policy goals, and chiefly, they have reelection in mind." For a lobbyist, "it's really hard to get out of the government what you want, especially when you multiply it by the tens of thousands of other interests out there that are all trying to do the same thing."

Recommendations for further reading

Andrew Prokop: Tell me how you estimated the size of the unregistered lobbying industry.

Tim LaPira: I'm under contract writing a book on revolving door lobbyists. We're still working on that book, but what we did in that project is we took lobbying disclosure of LDA [Lobbying Disclosure Act] registered lobbyists as our sampling frame. And I pulled a random sample out of that and gave the name to student assistants who sat here in my office, and essentially Google-stalked them to try to reconstruct their resumes as best they could.

But in the process of doing that project, we were noticing that when we would search for, say, Lobbyist X that was on our sampling frame, they would be employed in an office right next to another person that was doing similar work, and we'd realize, well, that person is not registered. So then it raised the question of, how common is that? Because most of the media reporting on this — I'm assuming you're familiar with the Tom Daschle loophole. Tom Daschle comes off the Hill  — he didn't want to, but he did — gets a job at this law and lobbying firm, brings in all these clients, brings in millions of dollars — never registers to lobby — and he can do that perfectly legally because he was reading the statutory definition of what a lobbyist is in the LDA very closely.

So the kicker there is you gotta spend 20 percent of your time on behalf of a client in the quarter in which you're reporting. That is — so think about that, that is one day a week, one entire day in a week, for one particular client. How often do you spend an entire day working on a single project every week - for an entire quarter? That's just not the modern professional world. So Daschle starts doing that. Then Gingrich gets called out in the Republican nomination race a few years back, he called himself a policy historian for Fannie Mae, right, and earned 10 million dollars.

But my question was, how common actually is it? So I went back to the drawing board, and drew a new sample. So I went to Washington Representatives, Lobbyists.info is their website, and I bought the whole thing to use as my sampling frame. Every single name in that directory as of 2012. And I pulled out a random sample of them and basically had students do the same thing — go Google-stalk them, figure out where they worked.

The question was, is the job that we can determine from their biography or from their job title or from the firm they're working for, are they engaged in federal public policy? If so we call them a policy advocate. There's a number of people in that directory that didn't exactly fit the bill, but most of them did. And of the people that were involved in any way in public policy, about half of them were registered to lobby and half of them weren't.

Based on that we extrapolated out and tried to — based on the assumptions of this population, the actual size of the influence political economy — it's at least twice as much, right? So we're talking probably 7 billion dollars, and less than half of that is really accounted for under the Lobbying Disclosure Act. And the truth is I'm probably undercounting a lot of that.

Andrew Prokop: What would you say about Eric Cantor, who now works at an investment bank in a Washington office, would he count?

Tim LaPira: I would have to look a little bit more closely because I think he's being really careful about what his job is. But, probably, right? Being involved in the public policy process involves not just pushing policy recommendations and providing policy information — to me, it also includes monitoring political activities and policy developments that the general public does not have access to. This also describes the so-called political intelligence industry. Even a registered lobbyist, 90 percent of her job is monitoring policy developments, right? Her job is not just to push her clients' issues towards the government, it's also to pay attention to what the government's doing and report back to the clients. And they get paid a lot of money to do that because they have contacts on the Hill, they know what sources of information to check as opposed to just waiting for a story to break in the media. So associations and corporations pay a lot of money for this, because if they have a five-year budget cycle, they know — gee, down the road, is there going to be a big push to regulate our industry or is there going to be some change that's going to affect our customers, or whatever it might be — there are a lot of good, perfectly legitimate reasons to monitor public policy. And if that's what lobbyists are doing — and political intelligence agents or whatever they call themselves are doing the same damn thing — it's a distinction without a difference, basically.

Andrew Prokop: How is a revolving door lobbyist different from an ordinary lobbyist?

Tim LaPira: I have a journal article on that that compares the clienteles of revolving door lobbyists to regular lobbyists. Essentially what we find is that the revolving door lobbyist has a much greater variety of their clienteles. So for instance, if you had worked in say like three offices on Capitol Hill, chances are you're going to be representing clients from the ag industry, the health care industry, and the energy industry, that aren't related to each other whatsoever as far as politics and policy expertise. But if you're a conventional lobbyist, you most likely have come up through your industry and established yourself as an expert. So you're only going to represent either health care or agribusiness or energy. So we interpret that to say — what the revolving door lobbyist is doing is trading on her process knowledge and connections and access. Relative to your typical or conventional lobbyist, that is much more a policy expert, their job is to provide information subsidies to government, so that they can make good policy decisions. So that's what that project was. In the book we're going to look at how much money they make, the types of issues that they lobby on, and all that stuff.

Andrew Prokop: What does the public misunderstand about lobbying?

Tim LaPira: The number one thing is, the public and much of the media and even some of the good government groups out there, conflate campaign finance with public policy influence. The assumption is that every dollar spent putting an ad up on a campaign, turns into something — as if it's an investment vehicle to get out of the public policy process what they want. It sounds so simple.

But we know that the public policy process and the way our government works is so much more complicated, that it doesn't always mean that a dollar on the campaign finance side is going to influence any kind of public policy outcomes. In fact, the best-known project, the Baumgartner et al Lobbying and Policy Change book, I was a researcher on that in grad school. And they show this — the side that spends more on campaign finance does not necessarily win.

We know that inside the government, politicians have their own motivations. They have their own public policy goals, and chiefly, they have reelection in mind, right? So they’re not just sort of standing back and waiting for an interest group to come up and ask them to dole something out to them. So if we think about it like that it’s really hard to get out of the government what you want, especially when you multiply it by the tens of thousands of other interests out there that are all trying to do the same thing.

Baumgartner’s argument is basically that interest groups respond to the government agenda. The most successful interest groups are going to be the ones that have the credibility and the resources to best respond when issues that matter to them become a top priority. So outside interests don’t push the agenda as much as they respond to it.

This interview has been condensed and edited for clarity.

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