Bribery vs. Lobbying: An Overview
Bribery and lobbying are often conjoined in the public mind: Critics of lobbying suggest that it's bribery in a suit. While both seek a favorable outcome, the two remain distinct practices. Bribery is considered an effort to buy power—paying to guarantee a certain result; lobbying is considered an effort to influence power, often by offering contributions. The main difference: Bribery is considered illegal, while lobbying is not.
- Lobbying is the organizing of a group of like-minded people, industries, or entities to influence an authoritative body or lawmaking individual, often through financial contributions.
- Bribery involves the payment of something—either money or goods or an intangible favor—in subersion of normal practices, for gain or special treatment, or in order to get an advantage.
- In the U.S., lobbying is legal, while bribery is not.
- Bribery is an effort to buy power, while lobbying is just an effort to influence it—but admittedly, the distinction between the two can be opaque.
Lobbyists try to shape laws, legislation, and public policy to the benefit of the group or entity that employs them. Their campaigns (which are legal) can sometimes be public ones (or fed to the media to influence the public), but they more typically target politicians, elected officials, legislators, and government agency employees—the movers and shakers on Capitol Hill and in state capitals too.
Lobbyists are required to register with the Secretary of the Senate and the Clerk of the House, and to file disclosures of their activities and expenditures, according to the Lobbying Disclosure Act of 1995.
Lobbyists—the term refers to both individuals or organizations—have existed as long as governments; they traditionally have been considered "information givers," a valuable source of facts and data, though admittedly in support of their cause or industry. Lobbyists systematically build up support for their causes, over years and decades. Often, they fund a study or survey or research that might sway a politician's opinion—or their constituency's opinion.
More often, though, they act more directly: by giving money. Increasingly, lobbyists are ensuring contributions are made from the grass roots up to influence decision makers at all stages. These contributions aren't directly paid to any official or lawmaker. But they might go to that person's election or re-election campaign— purchase advertising, finance a fundraiser—or to a politician's favorite cause or charity or hometown/state project. There's a tacit understanding, if not an outright quid pro quo: We supported you and your interests; in return, you support us and ours—by voting for (or against) this bill, by funding that subsidy, by extending this exemption, by loosening that regulation….
But if they have existed forever, why are lobbyists reaping such scorn of late? It's partly due to their higher profile. In the past, they tended to operate quietly, behind the scenes and away from the public eye. In the last few decades, however, they have become bigger and bolder, operating quite openly as a profession. (in Washington D.C., "K Street" is shorthand for the lobbying field, since so many are centered there, the way "Wall Street" in NYC symbolizes the finance industry). Not a month goes by without the public announcement of some ex-statesman or -woman joining a lobbying firm, leveraging their knowledge of how the government machine works.
And the money involved—both what lobbyists make and what they disburse—just keeps increasing. The total spending on lobbying has grown from $1.44 billion in 1998 to $3.53 billion in 2020. The top three spenders in 2020, according to OpenSecrets.org, were the National Association of Realtors ($84.1 million), U.S. Chamber of Commerce ($81.9 million), and the Pharmaceutical Research & Manufacturers of America ($25.9 million).
How Lobbyists Work
For example, cigar lobbyists have campaigned for cigars not to be grouped with cigarettes. They lobbied for years to avoid government scrutiny and to propagate an image that cigars were not harmful, when in fact cigars are as dangerous as cigarettes.
Or take the financial sector. Securities and investment firms spent $104 million in 2020. This amount is in line with prior years. In the aftermath of the Great Recession, 2010 and 2011, this sector was spending $103 million annually. Most of this money was spent to ensure that the government did not regulate the hedge fund industry.
The impact of lobbying is massive. It affects policy by influencing policy makers and therefore citizens, rather than just individuals. Whether made directly by entities or through professional lobbying firms, the contributions—this "special interest money" as it's imaginatively known—that causes lobbying to be associated with bribery.
In contrast, a bribe usually occurs on an individual level. And it is anything but public. A bribe giver usually gives an offer of money "under the table" in order to subvert standard processes. This could be paying a tax officer to clear reports with under-reported revenue or sending goods without an invoice.
The bribe may be in the form of a donation or favor in kind. A company's purchase manager may award an order to a supplier in return for undue favor in the form of money, against his company's policy of awarding orders based on criteria of quality and price. Public officers are offered bribes to enable evasion of taxes and the corresponding liabilities at an individual or company level.
However it's done, a bribe—along with its cousin, the kickback—results in an unfair advantage for the bribe giver. Bribes may seem like small amounts compared to lobbying contributions, but therein lies the problem: They often cannot be accounted for.
Bribery is the first step of subversion of the economic system. Slowly but steadily, a corrupt, parallel system is formed. It creates inefficiencies and obstacles in the short term; over time, it erodes the economic foundation of the country, hurting the most vulnerable members of the society and filling the middle class with a sense of hopelessness and cynicism.
If bribe-based corruption becomes endemic, it can be at the heart of the systemic failure in some countries. In a World Bank report, "Does Grease Money Speed Up The Wheels of Commerce?," the relationship between bribe payments and a variety of measures of official harassment (management time wasted with bureaucracy, regulatory burdens, and cost of capital) was studied. The evidence suggests that there is no support for the "efficient grease" hypothesis—that bribery can be an effective tool that leads to better business practices. In fact, a consistent pattern is that bribery and measures of official harassment are positively correlated across firms. It also increases the cost of doing business.
Real-Life Examples of Corporate Bribery
Walmart has been accused of bribing government officials in Mexico to obtain new permits faster in order to open stores sooner.
In 2011, Johnson & Johnson agreed to pay $70 million in civil and criminal fines to settle a Justice Dept. complaint against it, brought under the Foreign Corrupt Practices Act (FCPA). The SEC had charged Johnson & Johnson and its subsidiaries with bribing government doctors in Greece who selected J&J surgical implants; hospital administrators in Poland in return for contracts; and Romanian public doctors to prescribe J&J pharmaceutical products. J&J subsidiaries also paid kickbacks to Iraq to obtain 19 contracts under the United Nations Oil for Food program, the SEC charged.
Bribery seems to have no morally redeeming features at all: It is a direct purchase of favor or advantage. Lobbying, on the other hand, is also used by civil rights and environmental support groups in their battles against commercial and for-profit interests. In that sense, lobbying becomes a critical and important tool in influencing public policy—and evening the scales between different groups.
But all too often, the broder where lobbying's influencing ends, and outright bribery begins, can be hard to fathom.