Interest Groups
GOV310L - Brendan Apfeld
March 24, 2017
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Current Events
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AHCA Fails
Figure 1:
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Senate Intelligence Committee
Figure 2:
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Today’s Class
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Today’s Puzzles
• Most people hate on interest groups in Washington, D.C., but these groups
are very effective at recruiting members. So if we keep joining them, do we
really hate them?
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My Arguments Today
• Not all interest groups are evil
• Interest groups play an important role in American politics
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Today’s Outline
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IGs and lobbying — an introduction
IGs and collective action dilemmas
Pluralism in America
Lobbying — should we be worried?
IGs and Elections
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Interest Groups and Lobbying
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A few definitions
• An interest group is an organization of people seeking to influence
government and public policy
• There are lots of these around
• Examples on the right: The NRA, The Heritage Foundation
• Example on the left: Greenpeace, The Brookings Institute
• Example that’s nonpartisan: AARP
• Lobbying is any political activity that aims to influence public policy
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Lobbying — The Negative View
Figure 3:
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Lobbying — The Positive View
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Kinds of Interest Groups
Figure 4:
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Public vs. Private
• Private interests benefit individuals or select groups
• E.g., AFL-CIO, Chamber of Commerce, American Medical Association,
American Political Science Association
• Public interests benefit the whole
• E.g., The Sierra Club, AARP, NAACP, Children’s Defense Fund, Bike Austin
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How do IGs Differ from Parties?
• Parties run candidates for office and coordinate the activities of elected
officials; IGs do not
• Elected partisans have a direct effect on government action; IGs have, at
best, an indirect influence
• Parties are broad-based; IGs are narrowly focused
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How do IGs Differ from Social Movements?
• Social movements are groups that use population participation to influence
the government
• Not formal organizations
• Can be made up of many interest groups
• Develop when groups feel excluded from the political process
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Collective Action Dilemmas and
Interest Groups
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How Do Interest Groups Form?
It is not in fact true that…groups will act in their self interest follows
logically from the premise of rational and self-interested behavior. —
Mancur Olson
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IGs and Collective Action
• Many IGs pursue public goods
• Public goods are those that are enjoyed simultaneously by a group
• They’re sometimes described as non-rivalrous and non-excludable
• But they have a problem with free-riders
• Free-riders are those who attempt to benefit from a collective effort without
working towards its achievement
• Smaller, more organized groups are better able to solve their collective
action problems
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Political Entrepreneurs
• Political entrepreneurs are individuals who try to organize people with a
shared interest to take collective action
• Motivated by
• Commitment
• Ambition
• The big challenge: how to get others interested?
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Solution 1 — Selective Benefits
• Selective Benefits
• Club goods
• These are non-rivalrous but excludable
• Private goods
• These are rivalrous and excludable
• Selective benefits come in a variety of flavors
• Material: rewards carrying monetary value
• Solidary: social advantages, like networking, friendship, and community
• Purposive: gratification that comes from working toward a desired goal
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Example of Selective Benefits — Bike Austin
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$20 gift certificate to a local bike shop
JuiceLand Discounts/Gift Cards
Discounts at lots of local bike shops
Free coffee
Discounts with a variety of other local businesses (e.g. Compost Peddlars,
Sustainable Well-Being, Go Local Austin)
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Solution 2 — Coercion
• Coercion is a method of eliminating free riding by requiring participation
• E.g. many unions
• Many states have so-called “right to work” laws
• Prohibit employers from requiring union membership as a condition of
employment
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Pluralism
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Do Interest Groups represent Americans?
• Pluralism is the idea that all politics is the clash of groups that represent
all important interests in society that check and balance each other
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Do Interest Groups represent Americans?
• Pluralism is the idea that all politics is the clash of groups that represent
all important interests in society that check and balance each other
• But, some groups are better able to organize and overcome their collective
action problems
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Representation Strategies — Direct
• Some IGs (sometimes) engage directly with politicians and the political
process to achieve their policy goals
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Direct lobbying
Research, drafting legislation
Testimony
Litigation, as parties to a case or amicus curiae
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Representation Strategies — Indirect
• Some IGs (sometimes) work around politicians to achieve their policy goals
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Grassroots lobbying, astroturf lobbying
Mobilizing public opinion
Electioneering, trying to influence outcome of election
Media
As watchdogs — they monitor government activity (police patrol function)
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Lobbying
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What is lobbying?
• Lobbying is attempting to influence the policy process through persuasion
of government officials
• Approximately $4 billion per year is spent on lobbying at the federal and
state level
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Who are the biggest lobbies?
Figure 5:
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How does lobbying work?
• Three theories
1. Vote buying — members are vessels and will vote with the side that pours
more money into their bank account
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Vote Buying
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How does lobbying work?
• Three theories
1. Vote buying — members are vessels and will vote with the side that pours
more money into their bank account
2. Persuasion — lobbyists use money to encourage members to spend time on
their causes
3. Legislative subsidy — members have lots of demands and lots of interests;
lobbyists provide members with policy and political expertise
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Lobbying Congress
• Provide information to MoC
• Testify on behalf of clients at hearings
• Direct members’ campaign contributions
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Lobbying the Executive Branch
• Continue to lobby after laws are passed
• Comment period on new rules is frequently used by lobbyists
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Using Courts to Lobby
• Bring suits directly
• Finance suits brought by individuals
• Filing amicus curiae briefs
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Public Opinion and Grassroots Lobbying
• IGs can go public
• Lots of advertising
• Direct mail and email
• Increasingly prevalent
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Regulations on lobbying
• Lobbyists have to register with the government and disclose what they lobby
on
• Business can’t deduct lobbying costs from taxes
• Associations must report percent of membership dues that goes to lobbying
• Limitation of gifts to MoC
• $50, no more than $100 annually
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Concerns About Lobbying
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The “Iron Triangle”
Figure 6:
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An Unfair Advantage?
• Gilens (and Page) argue that Congress tends to side with the wealthy
• But do the wealthy have different preferences than other people?
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An Unfair Advantage?
Figure 7:
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An Unfair Advantage?
Figure 8:
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The Consequences
• Institutionalization of private influence over public policy
• Huge costs to the taxpayers
• E.g. cotton growers subsidized by $2b, but earnings of US cotton were less
than $2b
• “Good” interest groups produce positive public outcomes
• E.g. MADD have lobbied for the passage of over 2,300 new laws, alcohol
related traffic deaths dropped by over 50% over the past three decades
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Interest Groups and Elections
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How Much Lobbying?
Figure 9:
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Federal Election Costs
Figure 10:
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Federal Election Campaign Act (1971, 1974)
• Main Provisions
• Effects
• Loopholes
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Federal Election Campaign Act (1971, 1974)
• Main Provisions:
1. Limits on individual contributions
• $1,000 per election per campaign
2. Limits on candidate expenditures
• Ruled unconstitutional in Buckley v. Valeo, 1976
3. Definition and regulation of Political Action Committees (PACs)
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Federal Election Campaign Act (1971, 1974)
• Main Provisions:
4. Disclosure requirements for candidates and parties in federal elections
5. Establishment of Federal Election Commission (FEC)
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Federal Election Campaign Act (1971, 1974)
• Effects
• Huge increase in the number of interest groups (PACs)
• Huge increase in money in election campaigns
• Soft money funneled through the political parties
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Federal Election Campaign Act (1971, 1974)
• Loopholes
• Soft money
• Independent expenditures
• Bundling
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Bipartisan Campaign Reform Act (2002)
• Main Provisions:
1. Increase in individual contribution levels
• $2,000 per candidate per campaign, indexed for inflation
• $2,700 for 2017-2018
2. Outlaws soft money to national, state, and local parties
3. Limits soft money spent by PACs and outside interest groups
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Bipartisan Campaign Reform Act (2002)
• Effects:
1. Increase in money in politics
2. Increase in 527 groups
• Tax exempt organizations organized under Section 527 of the U.S. IRS Code
• A 527 group is created primarily to influence the selection, nomination,
election, appointment or defeat of candidates to federal, state, or local public
office
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Citizens United, 2010
• Background:
• A non-profit, Citizens United, wanted to air a film critical of Hillary Clinton
• Appeared to violate the BCRA
• The Decision:
• SCOTUS decided, 5-4, that portions of the BCRA limiting groups from
spending money in political campaigns violated the First Amendment
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The Current State of Affairs
• Groups can spend as much as they want on election campaigns
• Limited by economic constraints
• Off-set by individual contributions and new ways of soliciting contributions
(online targeting)
• Rise of “Super PACs” and “c4s”
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Super PACs
• Independent expenditure only committees, or “Super PACs” may not make
contributions to candidate campagins or parties
• May engage in unlimited political spending
• Must be independent of the campaigns
• Unlike traditional PACs, they can raise funds from individuals, corporations,
unions and other groups, without any legal limit on donation size
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501(c)(4)
• Section 501(c)(4) of the IRS tax code
• Tax exempt groups focused on “social welfare”
• Unlike 501(c)(3), c4s have no explicit prohibition on political activities
• Like Super PACs, cannot coordinate with campaigns
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