NCPA - National Center for Policy Analysis

Lobbying Efforts Outweigh Campaign Contributions

May 30, 2001

In popular opinion, contributions to candidates by Political Action Committees (PACs) are corrupting -- in effect, equivalent to bribes. Although PACs may be formed by labor unions and individuals, those formed by executives of particular corporations or industries are seen as particularly suspicious. Corporations may also make direct contributions to political parties. These so-called soft money contributions are unlimited.

The authors of a recent study reasoned that if PAC contributions were an attempt to sway legislators, one might expect the maximum amount possible ($5,000) would be donated, and that it would tend to be given to secure officeholders.

  • However, they found that few PACs make the maximum contribution allowed by law -- on average, labor PACs donate $1,500, trade PACs donate $1,300 and corporate PACs donate only $700.
  • Moreover, a disproportionate share of PAC contributions are made to those running for election, compared to seated politicians; for example, senators up for election raised three times more PAC money than the remaining 66 incumbents.

Specifically, looking at political contributions by five influential industries -- tobacco, pharmaceuticals and medical products, telephone utilities, defense aerospace and computers -- the researchers found lobbying expenses far exceeded PAC contributions, and even more was allocated toward philanthropy.

  • During the 1998 election cycle, PAC contributions and soft money expenditures each totaled roughly $220 million, whereas spending on lobbying and philanthropic efforts reached $2.3 billion and $17.4 billion, respectively.
  • Pharmaceutical firms as a group, for example, spent $148 million on lobbying, compared to less than $5 million in either soft money or contributions from affiliated PACs.
  • And individual pharmaceutical firms spent at least 100 times more on corporate philanthropy than soft money and affiliated PAC contributions combined ($100 million vs. $1 million.)

Source: Jeffrey Milyo, David Primo and Timothy Groseclose, "Corporate PAC Campaign Contributions in Perspective," Harris Graduate School of Public Policy Studies, University of Chicago; Business and Politics, Autumn 2000.


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