Capitol Punishment: The Hard Truth About Washington Corruption from America’s Most Notorious Lobbyist
In 1982, Mississippi senator John Stennis was chairman of the Armed Services Committee. Stennis was a senator of the old school—literally. When he retired in 1989, after forty-one years, he was the chamber’s most senior member, and the second-longest-serving member in the Senate’s history. And so he did things a little differently than we’re used to today. Asked by a colleague to hold a fund-raiser with defense contractors, Stennis recoiled. “Would that be proper?” he asked. “I hold life and death over those companies. I don’t think it would be proper for me to take money from them.”
Harvard professor Lawrence Lessig recounts Stennis’s story in Republic, Lost: How Money Corrupts Congress—and a Plan to Stop It (as does Robert G. Kaiser in the excellent So Damn Much Money*). It is a story, Lessig writes, that
reflects a change in norms. Stennis was no choirboy. But his hesitation reflected an understanding that I doubt a majority of Congress today would recognize. There were limits—even just thirty years ago—that seem as antiquated today as the wigs our Framers wore while drafting the Constitution.
Crucially, those limits were not always legal. Stennis wasn’t concerned that holding the fund-raiser would break the law. He was worried it wasn’t “proper.” He wasn’t worried about breaking the law. He was worried about breaking with the prevailing norms on Capitol Hill. This, Lessig says, is what has changed.
“Would that be proper?” is not, it seems, a question that ever occurred to disgraced ex-lobbyist Jack Abramoff. His lawbreaking landed him in jail. His norm-breaking created a national scandal, and arguably lost Republicans control of Congress in 2006. But consider who it is that Abramoff mainly lobbied for, and what it is they actually wanted.
Abramoff lobbied for the Northern Mariana Islands, which sought exemption from certain labor rules for a variety of Native American tribes, which sought to continue a low-regulation, low-tax environment for their casinos, and for defense contractor Tyco, which wanted a tax cut. He was, in these efforts, successful. Arguably too successful. But these are hardly the life-and-death issues of American politics. In a sense, his tactics could only be so extreme, and his wins so decisive, because his issues were so small. What politicians do about the Northern Marianas moves few voters and receives few headlines. Had he been waging more high-profile wars, his hardball tactics would have come to light much sooner, and his career would likely have collapsed far earlier. As every child knows, it’s easier to break the rules when no one is watching.
Abramoff might be the most prominent example of the corruption that has infected our political system, but he is not the best example of it. He is not even a very good example of it. If anything, he’s a throwback to the lobbyists who led Washington more than a century ago. Until 1853, bribing members of Congress was legal, and lobbyists did so with impunity. After bribes were outlawed, lobbyists realized that the law permitted them to pay congressmen “consulting fees,” which they did until well into the twentieth century. Worse, the politicians took bribes with impunity. Early in the nineteenth century, while still a congressman with direct power over its continued survival, Daniel Webster wrote to the Bank of the United States with a blunt message: “If it be wished that my relation to the Bank be continued, it may be well to send me the usual retainers.” Abramoff would have had the check in the mail later that morning.
“The ordinary lobbyist today is a Boy Scout compared with the criminal of the nineteenth century,” Lessig writes.
The lobbyist today is ethical, and well educated. He or she works extremely hard to live within the letter of the law. More than ever before, most lobbyists are just well-paid policy wonks, expert in a field and able to advise and guide Congress well. Regulation is complex; regulators understand very little; the lobbyist is the essential link between what the regulator wants to do and how it can get done…. Most of it is decent, aboveboard, the sort of stuff we would hope happens inside the Beltway.
Abramoff’s memoir is, ultimately, a tale of small-time Washington corruption. It’s the story of how one lobbyist, working on behalf of the Choctaw Indians’ parochial interests, managed to offend a nation’s conscience. Lessig’s story, which focuses on lobbyists whose everyday practices are far less offensive and whose clients are, in the aggregate, far more important, is the story of how lobbying has managed to undermine a nation.
As Lessig writes, the typical lobbyist today plays an important, even crucial, part in the political system. In addition to providing campaign contributions and employment prospects to outgoing elected officials and their staffs, he or she provides legislative expertise. Political scientists call this “the legislative subsidy” model of lobbying, and it poses a serious challenge to the view that lobbyists are little more than parasites.
The theory was first proposed by Richard Hall and Alan Deardorff in a 2006 paper entitled “Lobbying as Legislative Subsidy.” The paper was an attempt to solve a problem that, at first glance, should not have needed to be solved, because it should not have existed in the first place: Why is the behavior of lobbyists so hard to predict?
For instance: you would think that lobbyists would concentrate their financial power and well-honed connections on the politicians they need to persuade. But they don’t. They concentrate it on the politicians who are already most convinced of their positions. Abramoff was an example of this: he spent most of his time among conservative legislators who were already committed to fighting tax increases and new regulations.
Another puzzle: lobbying, at least in its bluntest form, doesn’t seem to work. For many Americans, lobbying is a form of bribery. A rich lobbyist goes to a corrupt congressman, money changes hands, and the lobbyist gets his vote while the congressman gets money for his campaign. Many researchers have tried to find systematic evidence of vote buying. Very few have succeeded. Lessig quotes research by Dan Clawson, Mark Weller, and Alan Neustadtl, which concluded, “Many critics of big money campaign finance seem to assume that a corporate donor summons a senator and says, ‘Senator, I want you to vote against raising the minimum wage. Here’s $5,000 to do so.’ This view, in its crude form, is simply wrong.” Lessig concurs:
If the only way that government power could be converted into campaign cash were by crossing the boundaries of criminal law, then there would be no book to write here. If the only possible “corruption” were the corruption regulated by bribery statutes, then I’d be the first to insist that ours is not a corrupt Congress.
Hall and Deardorf proposed an alternative: lobbying, they argue, is
a matching grant of costly policy information, political intelligence, and labor to the enterprises of strategically selected legislators. The proximate objective of this strategy is not to change legislators’ minds but to assist natural allies in achieving their own, coincident objectives. Their budget constraint thus relaxed by lobbyists’ assistance, already likeminded legislators act as if they were working on behalf of the group when in fact they are working on behalf of themselves.
In other words, lobbyists act like a volunteer, and highly skilled, army for politicians who already agree with them.
This is the most benign, generous explanation of lobbying, but it does not render the practice innocent. In this model, the point of lobbyists is not so much to change votes as to change the legislative agenda. Perhaps you are a legislator interested both in reforming the nation’s drug laws and in cutting taxes on large corporations. If you focus your time on tax cuts for large corporations, you’ll get an enormous amount of money, aid, and attention from lobbyists. If you spend your time on drug policy, you’ll be ignored and your campaign will be underfunded. The disparity is even greater on smaller issues where there may not be another side to engage the debate: if a group of paper companies spends a couple of million dollars hiring lobbyists to persuade politicians of the merits of a change to an obscure provision of the tax code that will net the paper companies a couple of billion dollars, there is likely no one on the other side of that issue amassing materials to explain why this change isn’t a good idea.
Since 1998, OpenSecrets.org, a research group analyzing money in politics, has been tracking spending on lobbyists. The Chamber of Commerce easily leads its list, having spent more than $800 million on lobbying between 1998 and 2011. The American Medical Association comes in second, with over $264 million. Then there’s General Electric, with almost $263 million. Then come the American Hospital Association, the Pharmaceutical Research and Manufacturers of America, AARP, Blue Cross/Blue Shield, the National Association of Realtors, Northrop Grumman, and Exxon Mobile. Altogether, the top ten lobbying clients spent more than $2.6 billion on lobbying between 1998 and 2011.
The numbers are even more impressive when you sort the spending by industry. Health care comes in at number one, with more than $4.87 billion in spending. Finance, insurance, and real estate is just behind them, with more than $4.85 billion. Comparatively, energy firms are cheapskates: they’ve barely spent $3.6 billion.
There are significant chicken-and-egg questions here. Health care industries likely spend so much money lobbying because Congress spends so much time debating health care legislation—like 2010’s Patient Protection and Affordable Care Act—rather than the other way around. But $4.86 billion buys you a lot of legislative subsidy. It gives you an opportunity to shape the way members of Congress think—an opportunity that is not available to those who don’t have $4.86 billion to spend on lobbying.
Lists like this one are common when writing about money and Congress, and for good reason: the numbers are enormous, and unsettling. In fact, they are much more than unsettling. They are discrediting. Whether the reality is as corrupt as these figures suggest, most Americans believe it is as corrupt as these figures suggest. “In a poll commissioned for this book,” Lessig writes, “75 percent of Americans believe ‘campaign contributions buy results in Congress.’ Three to one, with Republicans (71 percent) just as convinced of this as Democrats (81 percent).” That alone should be reason enough to drastically change how Washington works.
But it is not. The American people have been hearing numbers like these for years, and little has been done about them. In part, that’s because legislators themselves do not want to do much about them. They don’t believe money buys their votes. They believe they are decent, honorable people, and they think that many of the lobbyists they work with are, too. In theory, what should happen next is voters should kick them out of office. After all, the American people want the money out of politics, and their elected representatives aren’t getting that done for them. But that doesn’t happen, either. In part, that’s because procedural reforms aren’t the foremost issues in people’s minds. But it’s also because people tend to have a much higher opinion of their member of Congress than they do of the institution as a whole. They may believe Congress is corrupt, but they don’t believe their congressman is corrupt.
Nor does Lessig. “When we actually meet our congressman,” he writes,
we confront an obvious dissonance. For that person is not the evil soul we imagined behind our government. She is not sleazy. He is not lazy. Indeed, practically every single member of Congress is not just someone who seems decent. Practically every single member of Congress is decent. These are people who entered public life for the best possible reasons. They believe in what they do. They make enormous sacrifices in order to do what they do. They give us confidence, despite the fact that they work in an institution that has lost the public’s confidence.
Lessig’s book is a theory of how decent souls have come together to create an indecent system. At its core is the idea of the “gift economy.” As Lessig explains it,
a gift economy is a series of exchanges between two or more souls who never pretend to equate one exchange to another, but who also don’t pretend that reciprocating is unimportant—an economy in the sense that it marks repeated interactions over time, but a gift economy in the sense that it doesn’t liquidate the relationships in terms of cash. Indeed, relationships, not cash, are the currency within these economies.
To see how a gift economy works, Lessig offers an everyday example:
I give you a birthday present. It is a good present not so much because it is expensive, but because it expresses well my understanding of you. In that gift, I expect something in return. But I would be insulted if on my birthday, you gave me a cash voucher equivalent to the value of the gift I gave you, or even two times the amount I gave you. Gift giving in relationship-based economies is a way to express and build relationships.
The key mistake most people make when they look at Washington—and the key misconception that characters like Abramoff would lead you to—is seeing Washington as a cash economy. It’s a gift economy. That’s why firms divert money into paying lobbyists rather than spending every dollar on campaign contributions. Campaign contributions are part of the cash economy. Lobbyists are hired because they understand how to participate in the gift economy.
Lobbyists build up relationships with politicians they like and, in many cases, agree with. They give those politicians money and they invite them out for dinner, or to their corporate box to watch ball games. They argue for the client’s interests, but they don’t argue too hard, or cross any ethical boundaries. And, over time, the politician comes to see the lobbyist as a friend. After all, the lobbyist is doing all sorts of thing that, in a person’s normal life, would lead to friendship, or at least a warm business relationship: he’s supporting the politician’s work and spending lots of time having interesting conversations with him and showing up at his events. The lobbyists are smart and personable and interesting and connected. They have expertise he needs, and connections that can help him, and information about what other political actors are doing that gives him a leg up. It is a perfect mixture of ideological comradeship, financial perks, and personal affinity. But it is the sense of comradeship and affinity that makes the whole thing work.
In many cases, the lobbyist actually is the politician’s friend. She is his former staffer, or a colleague he used to see three times a week at the congressional gym. After all, there are any number of wealthy, well-connected people who might like to bend a senator’s ear. But senators have limited time and busy schedules. They can’t make space for every supplicant with a thick bill roll and a fat rolodex. And so clever lobbying shops have figured out a way to get to politicians: hire their friends. Hire the people they have already demonstrated an interest in talking to, and accepting counsel from.
Abramoff talks at length about how he would go out of his way to hire the staffers of powerful legislators. “How did we get this access?” He asks rhetorically. “By hiring people who already had access of their own.”
From the taxpayers’ point of view, it was even worse than that. Abramoff would often extend the opportunity a few years before they were ready to retire. Abramoff relays the upshot of the strategy in almost mafioso terms:
Once I found a congressional office that was vital to our clients—usually because they were incredibly helpful and supportive—I would often become close to the chief of staff of the office. In almost every congressional office, the chief of staff is the center of power. Nothing gets done without the direct or indirect action on his or her part. After a number of meetings with them, possibly including meals or rounds of golf, I would say a few magic words: “When you are done working for the Congressman, you should come work for me at my firm.”
With that, assuming the staffer had any interest in leaving Capitol Hill for K Street—and almost 90 percent of them do, I would own him and, consequently, that entire office. No rules had been broken, at least not yet. No one even knew what was happening, but suddenly, every move that staffer made, he made with his future at my firm in mind. His paycheck may have been signed by the Congress, but he was already working for me, influencing his office for my clients’ best interests. It was a perfect—and perfectly corrupt—arrangement. I hired as many of these staffers as I could, and in return I gained increasing influence on the Hill.
But notice how Abramoff says this worked: he would first find a congressional office that was “helpful and supportive” to him, and then he would become personally close with the chief of staff—someone who probably already agreed with Abramoff on most issues, and liked him personally—by going out for good meals and playing golf. Only after years of this would the job offer come. Today, Abramoff admits it was a “corrupt” arrangement. But it probably didn’t feel that way to either side. The job offer only came after years of successful collaboration and, even more importantly, personal friendship. The gifts preceded the cash.
And the gifts are, if anything, better than the cash. Because the gifts do more than the cash. If someone walks up to you with a bag full of money and asks you to vote to make coal companies more profitable, that’s not a very persuasive argument. Even if you take the money, you’re going to feel dirty the next day. And most people don’t like to feel dirty. But if one of your smartest, most persuasive friends, a friend you agree with on almost everything, is explaining to you that those environmentalist nuts are going too far again—they’re always doing that, aren’t they?—and they have sneakily tucked a provision into a bill that would make it more expensive for your constituents to buy electricity, that’s very persuasive. And if it’s also in your self-interest to listen to him—and lobbyists are good at nothing if not making sure it is in a politician’s long-term self-interest to listen to them—then all your incentives are pointing in the same direction. You’ll listen.
The outcome of this is that a disproportionate number of people who have access to politicians, and who are owed favors by politicians, are lobbyists. And so those politicians are listening to a lot of lobbyists—lobbyists who are being paid by a client to invest in their relationships with politicians in order to advance the client’s interest. On some level, the politicians know that. But it doesn’t feel that way to them. It feels like they’re listening to reasonable arguments by people they like and respect on behalf of interests they’re already sympathetic to. And what’s so wrong with that?
The answer, of course, is that players with money are getting a lot more representation than players without money, not in sacks of cash delivered in the middle of the night, but through people a politician listens to and trusts and even likes having lunch with in the bright light of the day. That’s why savvy and well-funded players will contract with a number of different lobbyists at a number of different firms. Every lobbyist will have legislators he’s close to and legislators he isn’t. Some lobbyists, like Abramoff, specialize in conservatives. Others are more connected among liberals. Some firms have the former chief of staff to the chairman of the Senate Finance Committee. Others can offer the former legislative director to the chairman of the House Ways and Means Committee. If all a client needed was the money, all he would need to do is cut a big check to one lobbyist. But what you need isn’t the money. It’s the relationships. And each lobbyist only has so many of those.
Which is why it’s so damn difficult to actually kill off lobbying. Outlawing bribes is easy. Outlawing relationships isn’t. But it’s worth asking another question, one that often goes unasked, perhaps because the answer is assumed to be so obvious. If we got the money out of politics, which problems, exactly, would we have solved?
To Lessig, money isn’t just a problem in American politics. It is the problem in American politics. Money, Lessig writes, is
the root—not the single cause of everything that ails us, not the one reform that would make democracy hum, but instead, the root, the thing that feeds the other ills, and the thing that we must kill first. The cure that would be generative—the single, if impossibly difficult, intervention that would give us the chance to repair the rest.
Lessig’s strongest argument in favor of this claim is that money poisons the citizenry’s trust in government, and thus its interest in participating in government:
When democracy seems a charade, we lose faith in its process. That doesn’t matter to some of us—we will vote and participate regardless. But to more rational souls, the charade is a signal: spend your time elsewhere, because this game is not for real. Participation thus declines, especially among the sensible middle. Policy gets driven by the extremists at both ends.
There are two separate points being made here. One is that the rise of money is behind the decline in trust in government. The other is that money empowers ideologues and alienates the middle. Neither claim stands up to scrutiny.
Lessig marshals ample poll evidence to show that Americans are angry about money in government and that anger is a contributor to their distrust of, and disgust in, the political system. None of that is in doubt. But Lessig is saying that it’s the driver, the root of all our other problems.
The Pew Research Center for People and the Press collected data from the National Election Studies, Gallup, ABC/Washington Post, CBS/New York Times, CNN Polls, and their own polling to analyze trends in the public’s trust of government going back to 1958. The numbers show that trust in government held above 70 percent in the Eisenhower and Kennedy administrations. But under President Lyndon Johnson, it began to plummet. When he left office, it was barely above 60 percent. Richard Nixon’s presidency drove it below 40 percent. Jimmy Carter’s presidency sent it under 30 percent. And, with the exception of September 11, it has remained between 20 percent and 50 percent ever since.
The fall, in other words, long preceded Stennis’s comments wondering whether a fund-raiser with defense contractors would be proper. And it long preceded Lessig’s timeline for the rise of money in politics, which begins with the 1994 election, when Republicans took back control of the House of Representatives after forty years in the minority, and so both parties, realizing that congressional elections were now competitive, had to enormously increase their fund-raising in order to win. That was, Lessig says, the beginning of “the fundraising Congress,” but the polling shows that trust in government actually rose through the 1990s.
Nor is it clear that more money leads to more power for “the extremists at both ends.” For one thing, the timing doesn’t work. Polarization begins to accelerate in the 1980s, not the 1990s. For another, it simply seems unlikely. If you’re talking about lobbying, or fund-raising, the money is with the corporations. But the biggest employers of lobbyists—the Chamber of Commerce, GE, the American Medical Association, the National Association of Realtors—aren’t interested in endless partisan warfare, and they’re not, themselves, run by hard-core partisans, such as the Koch brothers. America’s corporate class tends toward a kind of elite centrism: they like compromise, and deficit reduction, and technocratic problem solvers. Michael Bloomberg—who has proposed letting all of the Bush tax cuts expire—would win these guys in a landslide. Jim DeMint and Bernie Sanders wouldn’t have a chance of getting their votes.
Conversely, small donors, particularly on the congressional level, tend to be more ideological types. There’s good evidence that legislators who make extreme statements have an easier time fund-raising than those who don’t. When House Republican Joe Wilson shouted “You lie!” during President Obama’s health care address, he raised $2 million in under a week. The thing about the “sensible middle” is that they, quite sensibly, don’t spend all that much of their time following congressional races, or even politics. So politicians looking for small donors need to find the engaged, invested voters who are actually interested in primary campaigns, and those voters are usually so engaged and invested because they have chosen a side, and done so strongly.
Which isn’t to say that it wouldn’t be worthwhile to get the money out of politics, or to publicly finance elections, or, as Abramoff suggests, to make it impossible for onetime public servants to lobby. But it’s not clear that any set of campaign finance reforms or anti-lobbyist regulations would restore trust in government or ratchet down partisan polarization. Such policies, if they worked, would likely have more modest effects: a bit more trust in government, maybe, and a bit less of a reliance on lobbyists, hopefully.
It’s also the case that Abramoff’s form of corruption and Lessig’s theory of corruption do more to illuminate the workings of small issues in American politics than big ones. In that, they’re like quantum mechanics. Abramoff’s methods are fine for winning favors for small clients, and Lessig’s model goes a long ways toward explaining why politicians might listen when Hollywood signs up some high-powered lobbyists to tighten copyright protections, but neither is much of a help when it comes to the major clashes in American politics. You need a theory of general relativity to explain the big stuff. And that theory is partisan polarization.
Take any issue that you’ve actually heard a lot about. The headline clashes. The big-ticket bills. They’ve all got money on both sides. They’ve all got platoons of lobbyists swarming onto Capitol Hill. They’ve all got activists and interest groups and even ordinary Americans pestering their congressmen. And they all go the same way: the Democrats vote with the Democrats, and the Republicans vote with the Republicans.
That’s true even when the big money lines up in favor of another outcome. In 2011, the Chamber of Commerce and the AFL–CIO joined together to call for a major reinvestment in American infrastructure. None passed. In 2010, most of the health care industry was either supportive or neutral on the Affordable Care Act, and if any one of them could have swung the votes of even a few Republican senators or congressmen, the desperate Democrats would have let them write almost anything they wanted into the bill. But not one Republican budged. In 2009, the Chamber of Commerce endorsed the stimulus bill as a necessary boost to the economy. Not one House Republican voted for it. Almost every major business group has been calling for tax reform and a big, Simpson-Bowles-like deficit reduction package for years now. But Congress remains deadlocked.
Indeed, the more likely Americans are to have actually heard of the bill, the less likely money is to be the decisive factor in its fate. That’s not to say that lobbyists and interest groups don’t have a hand in the construction of these laws—before they came to a vote—and don’t have a say in the component parts. They do. The health care industry, for instance, was able to cut a slew of early deals with the Obama administration; and the industry’s power helped put out of consideration certain provisions, like a public option that would have partnered with Medicare to bargain down prices. The financial industry, disgraced as it was, managed to win a lot of battles in the Dodd-Frank financial regulation bill.
But in the end, it didn’t decide which votes ended up in the “nay” column and which ended up in the “aye” column. The leadership of the two parties did. Which is to say that while moneyed interests are decisive in passing laws and influencing provisions that few Americans care about, they’re much weaker on the issues where Americans are actually watching. But those issues are the ones that have convinced America that Washington is broken. Which suggests that as big a problem as money is in politics—and make no mistake, it is a big problem, as the rise of the Super PACs shows all too clearly—it is not the only one, and it is probably not even the worst one.
'It's Not All Money' May 10, 2012
So Much Damn Money: The Triumph of Lobbying and the Corrosion of American Government (Knopf, 2009). ↩