News & Politics

Lobbying is Ridiculously Profitable, Enraging Study Says


Lobbyists who grease the wheels of government can sleep well at night: A study shows that businesses that use intense lobbying get a return on their investment that is “comparable to the returns of the most blistering hedge fund.” They also probably can sleep well because they own nice, expensive matresses. The Economist reports that an investment-research firm created an index to track how profitable the act of lobbying is compared to broader markets. The so-called “Lobbyist Index” has outpaced the “S&P500 by 11% a year since 2002.” The good news is that this proves government can make people rich. The bad news is that the government can only make people who hire lobbyists rich.

According to one study that influenced the index, the return on lobbying costs “was $220 for each $1 spent.” What is intriguing about this index is that different places lobby for different reasons. Tim Worstall of Forbes points out that “one sector, one company, might be lobbying in order to gain an advantage whilst others may well be lobbying in order to avoid having a disadvantage placed upon them. I’d certainly put the tobacco companies in that second class, while perhaps solar cell manufacturers could be in the first.” What they have in common is a high return on their investment.

How can normal people use this information to their advantage? If you think about it, taxpayers are essentially lobbyists who have no choice but to lobby. Despite this, normal Americans hardly see any return on their investment, let alone $220 for every dollar spent. It’s because we’re doing it wrong. This upcoming April 15th, pay your taxes over a nice steak dinner with your congressperson. If you have access to a boat, take them out for deep sea fishing. Really lobby the hell out of ’em. Hopefully, in their confusion, they’ll treat your money like it was coming from a special interest group and actually pass some legislation that works in your favor.

Money and politics: Ask what your country can do for you [Economist via Forbes]

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