Lobbying does not have a particularly positive image in the United States, mainly because of its association with large banks and corporations, and subverting the legislative and regulatory process in favor of big business against the public interest. Lobbyists spent over a billion dollars a year at the federal level, which was more than money spent on campaign contributions. In 2009, the energy industry spent $450 million lobbying Congress and the finance, real estate and insurance industry $475 million (Wiener 2011). Academic economists and political scientists tend to be overwhelmingly negative about this type of lobbying and its effect on American democracy, and critical of rent-seeking industries, interest groups and politicians. On the other hand, the positive side of lobbying includes grassroots campaigns conducted by a wide variety of organizations, from Common Cause to the NAACP and National Organization for Woman to the Sierra Club and Environmental Defense Fund. While these may not have the financial resources of the corporate and financial giants, they do represents millions of voters and constituents whose interests cannot simply be ignored by any politicians seeking reelection. Academics who have researched lobbying over the decades have long since realized that lobbyists are most effective with legislators who share their policy preferences in any case, and they spend little time attempting to convince those who are opposed. Direct lobbying efforts are most effective with committee chairs, members and their staffs who already have certain preferences in their areas of expertise and are not likely to be convinced by arguments to the contrary. As opposed to grassroots lobbying, which is more common than ever in the age of the Internet, direct lobbyists are more likely to represent status quo interests rather than the forces of change, and grassroots campaigns are most effective once bills have left the committees for debate on the floor of Congress. Nor does the amount of money or other subsidies contributed necessarily affect policy outcomes with legislators and their constituencies when they already have strong policy preferences. In addition, the American political system has far more openness to lobbying and interests groups of all varieties than parliamentary systems in which party-voting patterns are more rigid and inflexible and party discipline stronger. In the last decades, however, party identities in the United States have actually become more rigid and ideological than perhaps at any time since the 1930s, and the opportunity to build coalitions and consensus across party lines on many major issues is no longer as common as it was in the past.
Lobbyists are well aware that their profession is a highly unpopular one, particularly in this era of severe economic recession and bailouts of large capitalist interests. Public opinion polls since the 1970s have indicated that large majorities believe that government represents mostly wealthy and powerful interests rather than the ordinary voters, and its reputation has never really recovered from the traumas of Vietnam and Watergate. Well-paid corporate lobbyists ensure that their industries receive due consideration in Congress, whether in negotiating on issues of bailouts, taxes, trade or regulation, with the Republicans generally most sympathetic to ideas of low taxes, limited government and deregulation of capitalism. On the other side, organized labor and various public interest and nonprofit organizations generally receive a more sympathetic hearing from the Democrats. At the Young Lobbyists Network in Washington, the members are mostly in their 20s and socialize by sipping wine and Pilsner beer, hoping to improve their public image. They know that they have "an unfortunate claim to being the most despised profession in town," which is why the American League of Lobbyists created this organization to "defeat the stereotype of money-grubbing, briefcase-toting, palm-greasers" (Wiener 2011). Lobbyists spent $14.6 million in 2009 on public relations for their profession, pointing out that many of them work for nonprofits and public interest groups, and also build houses with Habitat for Humanity. Although they claim that they are not overpaid, the average salary of a Washington lobbyist is $107,254, although much less for those not employed in the corporate sector.
From a theoretical viewpoint, lobbying can be considered a form of exchange or persuasion, or even a type of auction in which the highest bidder wins. Hall and Deardorff (2006) also described it as a type of subsidy or "matching grant of costly policy information, political intelligence, and labor to the enterprises of strategically selected legislators" (p. 69). Some of the earliest studies on lobbying revealed that lobbyists spent most of their time with political and policy allies, whose views they only had to reinforce rather than change. Their efforts were widely considered to be "propaganda" and they spent most of their time telling legislators exactly what they wanted to hear (Hall and Deardorff, p. 70). In his classic study The End of Liberalism (1969), Theodore Lowi described the political system that came into being in the United States in the 20th Century not as a representative democracy but as a corporatist system dominated by powerful interest groups and industries. These had become a kind of rentier class living off subsidies and contracts from the state, while politicians represented these rent-seeking interests and traded campaign contributions for votes (Stigler 1970). Stratmann (1992) analyzed the connections between money and votes, and found that lobbyists spent relatively little on average to obtain the votes of legislators on agricultural subsidies, mainly because they already knew that their constituencies favored these.
In many cases, lobbyists turned out to be superfluous since they only influenced politicians who already favored their policies in any case. Hall and Wayman (1990) also reported that lobbyists and donors merely "buy the time or activity of already sympathetic allies." Baumgartner and Leech (1998) agreed that "in general lobbyists concentrate on their allies, avoid their enemies, and lobby undecideds infrequently," and Austin-Smith and Wright (1994) wrote that they spend little time with legislators whose views they have little chance of changing. Besley and Coate (2001) determined that lobbying had little effect on actual policy since it could always be negated by the preferences of voters. It led to inefficient policy choices and created rents in holding public office. Lobbyists followed a "menu-auction" approach to politicians by offering money and favors, but citizens frequently elected candidates whose views opposed those of powerful lobbyists. Lobbying expenditures also led to "excessive entry into the race for political office" and increased competition for money and favors (bribes) as well as future employment opportunities. Lobbies also attempted to shape the preferences of voters and "candidates manipulate their stances" to attract support from them (Besley and Coate, p. 68). Policy outcomes depend on both "lobbyists' budgets and preferences and the legislators' preferences." Lobbyists compete to obtain votes, while legislators "care about how their voting records are received by their constituency, regardless of the actual outcome" (Debel et al., 2009, p. 164). Outcomes do not necessarily depend only on the budgets of lobbyists or how much they are willing to pay, and the preferences of legislators matter most when lobbyists' are operating with limited budgets. From a purely economic viewpoint, these outcomes are not necessarily optimal or efficient. Groseclose and Synder (1996) formulated a scenario in which "lobbyists move sequentially and each makes only one final offer," which favors the last bidder rather than the first. In reality, though, the structure of influence is far less formalized, and is more like an auction or "reactive bidding process" (Debel at al, p. 165). Lobbyists gradually increase their bids in competition with each other rather than offering the maximum all at once, and this ensures that their overall costs are lower.
Many Washington lobbies like the Cato Institute or Center for Science in the Public Interest and other nonprofits and think tanks do not have a mass base or large donor list. Nevertheless, legislators "regularly call them to testify, give them considerable access, or even seek access to them" (Hall and Deardorff, p. 71). This is because these lobbying organizations provide information about constituents that assist the reelection prospects of politicians, even if this is sometimes skewed or deceitful. In addition, Congressional colleagues, the party caucuses and White House staff all provide information as well, as do local leaders in their districts, while subsidies from lobbyists in the form of labor and political intelligence "are the very mechanism of their influence" (Hall and Deardorff, p. 76). Lobbying is far more effective in the U.S. Congress than in European parliaments, where party discipline and rigidity is stronger. Interest groups have far more incentive and ability to shape policy in the United States, which is why "Capitol Hill teems with lobbying organizations and lobbyists trying to influence political decisions in their favor" (Bennedsen and Feldmann, 2002, p. 919). Congressional committee chairs set policy and in the past at least attempted to form winning coalitions across party lines, although this has become far less common in the past ten years. Given the amount of money and information that lobbying organizations expend to influence Congress they would not take such risks…