Lobbying Advice for Business Owners
How Much Is Spent on Lobbying?
Everyone knows that lobbying is big business in the U.S. But how much is actually spent on lobbying each year? And what does that mean for American business owners?
It's no surprise that political lobbying is a major industry in the U.S.
Large corporations and special interests spend millions on paid lobbying firms that are capable of delivering access to lawmakers in Washington and in state capitols throughout the nation.
The amount of money that is spent on lobbying each year is staggering. But exorbitant lobbying expenditures confirm the fact that lobbying is an effective strategy for promoting business interests in government. Although small businesses would appear to be at a disadvantage, small companies are recognizing the importance of lobbying and are devising creative strategies to influence lawmakers.
One of the interesting things about lobbying expenditures is that the recession seems to have had little effect on the amount of cash organizations are willing to dole out for professional lobbyists. This could be partially attributed to multi-year lobbying contracts, but it's more likely an indication of the business community's perception that government plays a primary role in economic recovery and expansion.
Federal lobbying expenditures are steadily increasing.
In 2009, the total amount spent on federal lobbying activities was $3.4 billion (statistics provided by Open Secrets Center for Responsive Politics). Given the recession and the lingering effects of a down economy, you would expect that figure to decrease in 2010. Not a chance. Lobbying expenditures for 2010 are on track to exceed 2009 expenditures by $200 million for a total of $3.6 billion – more than double the amount that was spent on federal lobbying a decade ago.
The number of federal lobbyists is decreasing.
While the amount spent on lobbying activities is increasing, the number of lobbyists is decreasing. From 2009 to 2010, the number of federal lobbyists decreased from 13,700 to 12,500. For business owners, that means the competition for paid lobbyists is becoming more intense. Expect to pay more for contract lobbyists in 2011.
U.S. Chamber of Commerce is top spender.
Whether they know it or not, small businesses already have a lobbying presence in Washington. The top spender for federal lobbying activities continues to be the U.S. Chamber of Commerce. Through July, this organization spent more than $80 million on lobbying in 2010, a figure that is almost double the second biggest spender, PG&E energy group.
Business associations rank among the top five spenders by industry.
Backed by the spending power of the U.S. Chamber of Commerce, business association rank fifth in spending by industry following, (1) pharmaceuticals, (2) electric utilities, (3) insurance, and (4) oil & gas companies.
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