Lobbyist Influence in the 2014 Legislative Session

Note:  This blog originally appeared in Politics in Minnesota on August 28, 2014.  Please consider subscribing to that publication.

 Many of us learned about government and how it works by watching “I’m Just a Bill on Capitol Hill.”  Part of the ABC School House Rock series, it depicted the process of how a bill becomes a law in Washington, D.C.  It describes the role of citizens, members of Congress, and the president in legislating.  Yet it left out an important actor–lobbyists.  In so many ways, legislating  would be impossible–good or bad–without lobbyists, and that is equally true in Minnesota.

            Looking back at the 2014 Minnesota legislative session we know what was passed or not.  Among the notable highlights, the legislature raised the minimum wage, passed anti-bullying legislation, cut taxes, passed a massive bonding bill, enacted the Women’s Economic Security Act,  adopted smartphone theft  and medical marijuana laws.  It also debated but did not pass  the Toxic Free Kids Act, dealt with the constitutional defects in the sex offender treatment program, or do more to address the ailing state infrastructure. 

            One can catalog the what was passed or not, but the more interesting question is the why.  Why did some bills pass and others fail?  One explanation offered by political scientist David Mayhew is that it is all about the electoral connection.  One can explain why legislators do what they do by looking at whether such actions enhance their election prospects.  Yes, the quest for reelection explains the motivation for many actions, but missing from that explanation is an analysis of the structural forces that shape election prospects and motivations when legislating.  This is where lobbyists come in.

            To a large extent legislation in Minnesota is debated and shaped under the structural influence of lobbyists and the associations they represent.  Depending on how you look at it, they  perform one of two roles.  In the first lobbyists and associations like to describe themselves as simply information brokers providing valuable knowledge to legislators about bills.  They additionally represent key constituencies, insuring that legislators take them into account when acting.  The contrary role is that lobbyists and associations pollute the legislative process.  They are special interests who use personal connections, insider relationships such as friendships, and even gifts, food, and money, to affect the legislative process.  Both images are correct in Minnesota.

            First, let’s consider some basic numbers.  There are 201 Minnesota legislators who make a base salary of $31,140.  Because of per diem, some make more than that.  There are 1,316 currently lobbyists and 1,351 associations registered  in Minnesota.  This means there are approximately 6.5 lobbyists and 6.7 associations per legislator in the state.  During the 2014 session  lobbyists spent $5,404,778 to influence the legislative process, or $26,889 per legislator.  Lobbyist disbursements include gifts, meals, telephone, and other costs associated with seeking to affect legislation.  This spending does not include the salaries of lobbyists. Add these figures in and based on past trends, associations spend upwards to $40 -$50 million to affect legislation. The sheer number of lobbyists, associations, and the amount of money they spend is enormous, eclipsing the salary and number  of legislators many times.

            But not all lobbyists are equal.  This is not a level playing field where all lobbyists and associations are of equal weight and influence.  Some are more powerful than one another, giving some a greater voice.  Consider the $50,000 club.  These are the 29 lobbyists who disbursed at least $50,000 during the session.  These 29 lobbyists spent $2,609,557, or nearly 50% of what all the 1,316 lobbyists spent.  These 29 lobbyists represented 103 associations.  There are some lobbyists who work for a specific organization and only represent them, such as David Olson for the Minnesota Chamber of Commerce or Brandon Rettke for Education Minnesota.  But Ted Grindal represented 44 groups including Ebay, Microsoft, Proctor and Gamble, Mille Lacs Band of Ojibwe Indians, DaVita, and the Boys and Girls Clus Association, and Andew Kozak works for  25 groups that include the  Shakopee Mdewakanton Sioux (Dakota) Community, the University of Minnesota, OPUS, the Mayo Clinic, and AT&T.  They are part of the  mega-lobbyists, the ones who really are the major players in the legislative process.

            Consider the top ten spending lobbyists and who they worked for in the 2014 session.  These ten alone spent $1.28 million, or 24% of total lobbyist disbursements..  At the top of the list was the Minnesota Chamber of Commerce at $348,000, followed by the Associated General Contractors of Minnesota at $110,939, and then Education Minnesota at $110,178. 

            While these dollar figures tell us something about their efforts to influence legislation, they still miss a lot.  Minnesota has some of the weakest lobbyist reporting laws in the country according to the Center for Public Integrity.  Missing from the raw numbers is an ability to link directly expenditures to particular bills or legislation.  There is a transparency problem–lobbyists are not required to state whom the lobbied  or what specific bills they worked on.  One can presume that the Chamber of Commerce spent a lot of money on the minimum wage and tax bills and the Education Minnesota did the same for the anti-bullying legislation, but we cannot be sure.  It is next to impossible to connect dollars to legislation and influence based on the what the law requires to be reported.

            But there are even more problems here.  In 2013 the legislature strengthened the hand of lobbyists.  First, it weakened the gift ban law, again making it possible in some circumstances for  lobbyists to wine and dine legislators.  Second, they increased the amount of money that lobbyists may contribute to candidates while simultaneously decreasing disclosure requirements.  Put simply, lobbyists can give more money and goodies to legislators but with less transparency and accountability.

            What does all this mean?  Lobbyists have a major presence in the Minnesota legislative process.  They expend significant resources to affect law making.  The public has limited information to know what they are doing.   Some of the lobbyists and the groups that they represent are far more powerful than others, thereby creating a structural bias in terms of how legislation is debated or whose interests are considered.  The legislative process may be stacked to favor a few interests or it simply might be so engulfed by lobbyists, associations, and money that one wonders whether the public interest is actually being considered when bills are debated.  The 2014 legislative session then was yet another one where one has to ask whether and how the debates on minimum wage, taxes, and other topics were shaped by lobbyists.  To know the answer to that question is really to know how a bill becomes  a law. 

Potholes, Infrastructure, and Jim Oberstar

Among the notable shortcomings of the 2014 Minnesota legislative session was its bipartisan failure to tackle the serious infrastructure problems the state faces.
    “Infrastructure” is not a normally a sexy word. Nor is it the type of word that most of us use in everyday conversation, until a bridge in Minneapolis collapsed. Yet infrastructure—a short hand way of referring to America’s bridges, roads, highways and sewer and water pipes—is important to our every day lives.  Without the basic infrastructure of roads we would never get to work, to school, or go shopping.  Without it we could not cross rivers, drink water, or flush our toilets.  For the most part we take our infrastructure for granted, until something goes seriously wrong, as it did in Minneapolis on August 1, 2007.  There, in the middle of rush hour a major bridge—one carrying over 100,000 cars per day—fell into the Mississippi River, killing and injuring scores of people. Suddenly infrastructure became the word of the day.
    You know there is an infrastructure problem in the state.  Think of all the potholes you drive over everyday–and they are getting worse.  But don’t rely just upon you own personal experiences, the problem is real.
    Historically Minnesota’s  quality of life was due in part to its infrastructure investment, but that too has lapsed over a generation.  The 2013 American Society for Civil Engineers’ report on infrastructure lists more than $10 billion is needed in this state over the next 20 years to upgrade the fresh and wastewater treatment facilities.  The state has nearly 1,200 structurally deficit bridges along with another 423 considered structurally obsolete.  The ASCE finds 52% of the highways are rated as poor or mediocre in quality.  This does not even  include all the new potholes this spring!  Schools have nearly $3.7 billion in needed capital repairs and our park system needs $375 million in investments.  All of this is just for repairs and maintenance and it does not include  new infrastructure needs, such as bringing high speed internet access to all of Minnesota.  Those who live in the Twin Cities forget that in many parts of the state dial-up is still the only option for the internet.
    But long before a bridge collapsed in Minneapolis infrastructure was a sexy word at least to one person–Jim Oberstar who served his entire congressional career on the US House Transportation Committee .  His passing should have been a wake up call to the need to invest more in infrastructure, and to also thank him for all that he did for Minnesota and the country.
    From the days when Adam Smith first wrote the Wealth of Nations in 1776, infrastructure has been described as the skeleton that holds a country and its commerce together.  From the roads we drive on to the water we drink, a safe, secure, and reliable infrastructure is not only something we count on for convenience, but a must for national defense, commerce, industry, and entertainment.    America’s infrastructure did not just happen; it was built under the planning and leadership of the government and by enlightened political and civic leaders.  From the days of Alexander Hamilton as America’s first Secretary of Treasury, the national and state governments invested heavily in infrastructure to encourage American economic growth.  It would not be an exaggeration to say that the spectacular growth of the country was made possible by a partnership between the government and private sector, with the former making investments in infrastructure that made business development possible.  The WPA and New Deal investments in parks and the highways under FDR and bridges under Eisenhower, as well as the creation of the water systems and other parts of the infrastructure under other presidents and leaders, constitutes the greatest gift that our parents and grandparents left to  America.
    But we squandered that gift. While engineers will look to the structural reasons for the Minneapolis bridge collapse, the real causes of its demise lie in the massive political failure in Minnesota and across the nation to reinvest in our infrastructure.  The American Society for Civil Engineers (ASCE) does a periodic report on the state of American infrastructure.  For the last generation the results have not been pretty.  In its 2013 report the ASCE notes a needed investment of $3.6 trillion by 2020 to repair the decaying public infrastructure in America.  This compares to the $2.2 trillion price tag the ASCE estimated in 2009  that needed to be done by 2014. With estimates in the trillions of dollars, America’s aging roads, highways, bridges, and water systems are crumbling, airport runways are overcrowded, and mines are caving in on individuals. This is not new or something that just happened. 
    For at least twenty if not more years policy experts have documented the decaying infrastructure and our failure to reinvest in it.  Instead, we continue to live off the investments of previous eras, enjoying parks built by the New Deal, bridges and highways from the Cold War and Great Society, and other investments made by smart political leaders in the past who were willing to invest in the future documenting the cost and scope of the problem.  The anti-government, anti-tax politics that emerged in the 1970s and which blossomed during the Reagan era ushered in a policy of living off of yesterday and ignoring tomorrow, all in the interest greed and saving taxes.
    But while a nation was neglecting its infrastructure, public officials such as Jim Oberstar and to a lesser but still important extent Martin Sabo were in Congress fighting to get more money spent  on infrastructure and across the county.  Oberstar’s most famous accomplishments are the 2005 SAFETEA-LU act, a $295 billion program that funds transportation infrastructure, and the 2007 $250 million funding to replace the Minneapolis bridge.  Governor Pawlenty should thank Oberstar for the later for it might have saved his governorship.  But Oberstar’s accomplishments go beyond these two bills.  It would not be an exaggeration to say that there is not a piece of asphalt in the state of Minnesota that does not have his name on it, and nationally he is probably responsible for hundreds of billions if not more than a trillion dollars in transportation infrastructure funding over the last quarter century.
    To some, their efforts to get more money for bridges and highways reeked of pork barrel politics.  Many think of bridges to nowhere, earmarks, and old style politics when it comes to infrastructure spending.  But while it is pork to some, to others it is bringing home the bacon and it is all about jobs and economic development.  It is also about quality of life.