WEALTH TAXES, INTEREST GROUPS AND OTHER EVILS OF PROGRESSIVISM, AS PROPOSED
BY BOTH ELIZABETH WARREN AND BERNIE SANDERS
COMPILATION AND COMMENTARY
BY LUCY WARNER
OCTOBER 2, 2019
INTEREST GROUPS*
FOR THIS QUOTATION, GO TO NYT'S ARTICLE BELOW ON THE WARREN AND SANDERS'
"WEALTH TAXES" RATHER THAN, OR IN ADDITION TO, AN "INCOME
TAX." THE WEALTHY DON'T WANT ANYTHING TO DO WITH ONE OF THOSE FOR OBVIOUS
REASONS. IT'S BECAUSE THE MONEY IS COMING OUT OF THEIR POCKETS, RATHER THAN "JUST" BECAUSE THEY THINK
THAT THE GOVERNMENT WILL "WASTE IT" BY GIVING SOME OF IT TO "DO
GOODERS" LIKE THE "INTEREST GROUPS," ESPECIALLY THOSE THAT HELP
HUMAN BEINGS OR WORK TO SAVE OUR EARTHLY HOME.
“I know a lot of wealthy people who would be happy to pay more in taxes;
they just think it’ll be wasted and be given to interest groups* and stuff like
that,” Mr. Dimon said."
Democrats’ Plans to Tax Wealth Would Reshape U.S. Economy
FIRST OF ALL, THIS STATEMENT IS ENTIRELY UNTRUE AND RIDICULOUS. THOSE
WHO ALREADY HAVE TOO MUCH MONEY AND POWER ALWAYS WANT MORE. NOTICE THAT USE OF
A PERFECTLY GOOD CONCEPT AS A PEJORATIVE. IT ANNOYS ME BECAUSE THAT PARTICULAR
PHRASEOLOGY IS USED A GREAT DEAL. IT'S AS IF MY OWN SET OF GROUPS ARE NOT
"INTEREST GROUPS," OR EVEN "SPECIAL INTEREST GROUPS." THE
NRA IS NOT AN "INTEREST GROUP, I SUPPOSE."
THE DISABLED HAVE FOR YEARS BEEN HIDDEN AWAY IN HOMES, LIKE THE MENTALLY
ILL, UNTIL THESE LAST FEW DECADES. NOW, AFTER SOME OF THOSE "SPECIAL
INTEREST GROUPS" HAVE BEEN PERSISTENTLY PRESSURIZING LEGISLATORS, WE HAVE
WHEEL CHAIR RAMPS GOING INTO BUSES AND BUILDINGS, BRAILLE FOR THE BLIND IN AND
AROUND ELEVATORS, AND MORE.
I CALL THOSE CHANGES PROGRESS, BUT THERE IS A CERTAIN KIND OF HOSTILE
PERSONALITY WHICH CAUSES PEOPLE TO BE ANGRY AT THE POOR, THE DISABLED AND THE
HOMELESS. WHEN THEY ARE NO LONGER LEGALLY ALLOWED TO BE ABUSIVE TO THEM, THEY
CALL IT "PC," "POLITICALLY CORRECT" OR SOMETIMES MUCH WORSE
THINGS. JUST GO TO THE INTERNET AND LOOK AT READER COMMENTS ON SOME STORIES AND
CHAT SITES. PERSONALLY, I'M NOT ON ANY CHAT SITES, AND AS FOR TWITTER, THAT'S
JUST ANOTHER PASSWORD TO LEARN. ALSO I HAVEN'T YET LEARNED TO LEAVE IT AT 144
CHARACTERS OR WHATEVER THAT NUMBER IS. THE ONLY REASON I'LL COUNT SYLLABLES IN
A POEM IS THAT I REALLY DO LIKE THAT PUNCH IN THE STOMACH IMPACT OF THE HAIKU
FORM.
I HAVE NOTICED FOR YEARS THAT THE TERM "INTEREST GROUPS" IS
USED BY ONE PARTY TO DOWNGRADE THE POWER AND MASK THE GENUINE NEEDS OF THE
OTHER. IT IS NEVER USED IN A POSITIVE WAY. INTEREST GROUPS ARE NECESSARY FOR
THE NEEDS OF ORDINARY PEOPLE TO BE ADVANCED AND PRESENTED TO THE GOVERNMENT FOR
NEEDED CHANGE OR REDRESS.
THE TERM "LOBBYIST" IS ALSO A NEGATIVE WORD. THEY'RE BOTH
NECESSARY EVILS, BUT IF THE COVERT EXCHANGES OF MONEY, WHICH ARE ESSENTIALLY
BRIBES, WERE TO BE SUCCESSFULLY CRIMINALIZED AND SUCH WHITE COLLAR CRIMES ACTUALLY
PUNISHED, I THINK THEY WOULD TAKE THEIR PROPER PLACE IN THE FABRIC OF
GOVERNMENT INTERACTIONS. INTEREST GROUPS ARE ORGANIZERS OF PEOPLE WHO OTHERWISE
WOULD HAVE NO WAY TO MAKE THEIR CASE HEARD.
HAVING READ THIS ARTICLE FROM THE ENCYCLOPEDIA BRITANNICA TO SEE HOW "INTEREST
GROUP" IS ACTUALLY DEFINED, IT IS CLEAR THAT THE UNIONS, PROFESSIONAL
ORGANIZATIONS, AND ANY GROUP THAT IS CENTERED AROUND TRYING TO EFFECT CHANGE,
NO MATTER HOW IMPORTANT THE CHANGE IS, WILL BE MALIGNED BY THE PROPAGANDISTS OF
THE OTHER SIDE. THAT IS ALL THE MORE REASON TO SUPPORT THE INTEREST GROUPS THAT
BENEFIT US, AND KEEP VOTING THE CLOSED MINDED, CLOSED FISTED OUT OF OFFICE WHEN
WE CAN.
Democrats’ Plans to Tax Wealth Would Reshape U.S. Economy
Proposals from Elizabeth Warren and Bernie Sanders have raised concerns
from economists and business leaders who fear the plans would sap
economic growth.
By Alan Rappeport and Thomas Kaplan
Oct. 1, 2019 Updated 2:37
p.m. ET
Image -- Senator Elizabeth Warren of Massachusetts has proposed a wealth
tax that would apply to households worth over $50
million. CreditCreditTravis Dove for The New York Times
WASHINGTON — Progressive Democrats are advocating the most drastic shift
in tax policy in over a century as they look to redistribute wealth and chip
away at the economic power of the superrich with new taxes that could
fundamentally reshape the United States economy.
As they compete for the Democratic presidential nomination,
Senators Elizabeth Warren of Massachusetts and Bernie Sanders of
Vermont have proposed wealth taxes that
would shrink the fortunes of the richest Americans. Their plans envision an
enormous transfer of money from the wealthy to ordinary people, with
revenue from the wealth tax used to finance new social programs like
tuition-free college, universal child care and “Medicare for all.”
The wealth taxes under discussion would deal a major blow to the balance
sheets of American plutocrats like Jeff Bezos, Bill Gates and Warren Buffett.
If the tax that Ms. Warren has called for had been in place since 1982, the net
worth of the 15 richest Americans in 2018 would have been half as much,
according to two economists who helped develop her plan. The Sanders wealth
tax, which was released last week, would have eroded their fortunes
even further, to barely one-fifth of their 2018 total.
The idea of a wealth tax has become an animating issue for the
Democratic Party, which sees it as a solution to long-festering concerns about
inequality and the rapid concentration of economic power among wealthy
Americans. Its emergence is also an antidote to the policies of President
Trump, whose $1.5 trillion tax cut largely benefited rich Americans and
corporations while leaving future generations with the bill.
“We are living in the second Gilded Age,” said Bruce Ackerman, a
professor of law and political science at Yale University, referring to the
stark wealth gap produced by the Industrial Revolution. “What we have once
again is people both on the right and the left being provoked by the perception
they are being left behind.”
[Bernie
Sanders raised $25.3 million in
the most recent fund-raising quarter, reflecting his continued strength with
small-dollar donors.]
But the idea of redistributing wealth by targeting billionaires is
stirring fierce debates at the highest ranks of academia and business, with
opponents arguing it would cripple economic growth, sap the motivation of
entrepreneurs who aspire to be multimillionaires and set off a search for
loopholes.“You’re going to completely disincentivize capital investment, which
is going to be very, very bad for economic growth,” Treasury Secretary Steven
Mnuchin said in an interview in September. “Taxing capital is not a good
thing for creating economic growth, and if anything we should be looking at how
we create more incentives for economic growth.”
Income inequality has surged in the United States in the last 50 years,
with the top 0.1 percent now controlling about a fifth of the nation’s wealth.
That concentration of wealth has coincided with stagnant wages, rising college
costs and the lingering effects of the Great Recession, which erased trillions
of dollars in household wealth, ravaging the middle class. New figures from the
Census Bureau released last week show that income inequality in
the United States reached its highest level last year since the government
began tracking it in
1967.
Image -- PHOTOGRAPH -- Senator Bernie Sanders of Vermont has said he
does not think billionaires should exist in the United States.CreditHilary
Swift for The New York Times
The dueling policy proposals from Ms. Warren and Mr. Sanders come as
they compete intensely for support among the same universe of liberal voters
and activists. Their tax proposals are seen as critical to galvanizing and
building support on the left, but their ideas will also provide fodder for
Republicans eager to paint them in a general election as tax-happy and too far
to the left.
Polls have found widespread support for the idea of taxing wealth.
A poll conducted for The New York Times by
the internet research firm SurveyMonkey this summer found that two-thirds of
Americans, including a majority of Republicans, supported a 2 percent tax
on households worth over $50 million, which is the heart of Ms. Warren’s plan.
The proposals for a wealth tax are among a variety of ideas for collecting
more tax revenue that Democratic presidential candidates have put forward. On
Monday, Mr. Sanders proposed a new tax on corporations that
have a huge gap between what they pay their chief executive and their median
worker. Jared Bernstein, who was chief economist for Vice President Joseph R.
Biden Jr. from 2009 to 2011, said he has discussed with the Biden campaign a
proposal to tax financial transactions.
[The latest
data and analysis to
keep track of who’s leading the race to be the Democratic nominee.]
On the campaign trail, Ms. Warren explains the concept of a wealth tax
by putting it in familiar terms, likening it to the property taxes that many
Americans pay on their homes. For the superrich, she said in South
Carolina on Saturday, “how about we include in yours not only your real estate,
but also your stock portfolio, the diamonds, the Rembrandt and the yacht?”
Mr. Sanders is blunt about his desire to reduce the size of America’s
biggest fortunes, even highlighting how much individual billionaires would have
to pay in taxes under his proposal. He said last week that he did not believe
billionaires should exist in the United States.
“There’s no question to my mind that the United States is moving toward
an oligarchy,” Mr. Sanders said. “This is an issue that has to be addressed,
and this wealth tax begins to do that.”
The United States largely taxes individuals based on the income they
earn through their jobs and investments. Wealth taxes impose annual levies on
an individual’s accumulated assets, everything from vacation homes and art
collections to stakes in companies and family heirlooms.
The tax proposed by Ms. Warren would apply to households worth over $50
million. She would impose a 2 percent tax on net worth above $50 million, and a
3 percent tax on net worth above $1 billion.
The plan from Mr. Sanders would apply to a larger number of households,
and it would be particularly aggressive on billionaires. His tax would start
out at 1 percent on net worth from $32 million to $50 million, and it would top
out at 8 percent on net worth over $10 billion.
Emmanuel Saez and Gabriel Zucman, the two University of California,
Berkeley, economists who helped Ms. Warren and Mr. Sanders develop their plans,
project that Ms. Warren’s proposal would hit about 70,000 households and
generate $2.6 trillion in revenue for the federal government over a decade.
They project that Mr. Sanders’s proposal would apply
to 180,000 households and raise $4.35 trillion over 10 years.
Mr. Zucman said in an interview that he believes a wealth tax would have
a modest but positive impact on growth. By reducing the power of the
wealthiest, he argued, it would make markets more competitive and spur
innovation.
[Who’s in? Who’s out? Keep up
with the 2020 field with our candidate tracker.]
But redirecting such vast sums could have unintended effects on the
United States economy that go beyond promulgating economic fairness. While Ms.
Warren ticks off the social programs that can be funded if the richest
Americans pay just 2 cents on every dollar they have above $50
million — a number that is unimaginable to most Americans — skeptics warn
of economic stagnation, depressed business confidence and a legal battle that
would go to the Supreme Court.
At a conference sponsored by the Brookings Institution in September, N.
Gregory Mankiw, a Harvard economist, debated Mr. Saez and Mr. Zucman about the merits
of taxing wealth. Mr. Mankiw, the former head of President George W.
Bush’s Council of Economic Advisers, offered a searing critique, arguing that a
wealth tax would skew incentives that could alter when the superrich make
investments, how they give to charity and even potentially spur a wave of
divorces for tax purposes. He also noted that billionaires, with their legions
of lawyers and accountants, have proven to be experts at gaming the system to
avoid even the most onerous taxes.
“On the one hand it’s a bad policy, and then the other thing is it’s a
feckless policy,” Mr. Mankiw said.
Image -- Lawrence Summers, the former Treasury secretary, speaking at an
Economic Club of New York event in New York last year.CreditMark
Kauzlarich/Bloomberg
KXR
Left-leaning economists have expressed their own doubts about a wealth tax. Earlier this year,
Lawrence Summers, who was President Bill Clinton’s Treasury secretary, warned
in an article with Natasha Sarin, a law professor at the University of
Pennsylvania, that wealth taxes
would sap innovation by putting new burdens on
entrepreneurial businesses while they are starting up. In their view, a country
with more millionaires is a sign of economic vibrancy.
“Turning the tax code into a vehicle for confronting what some call
‘oligarchic drift’ would undermine business confidence, reduce investment,
degrade economic efficiency and punish success in ways unlikely to be good for
the country or even to be appealing to most Americans,” they wrote.
Corporate America has also come out against a wealth tax. At a recent
briefing by the Business Roundtable, a lobbying group for large companies,
Jamie Dimon, the chief executive of JPMorgan Chase, said he feared that the
federal government would squander the additional revenue.
“I know a lot of wealthy people who would be happy to pay more in taxes;
they just think it’ll be wasted and be given to interest groups* and stuff like
that,” Mr. Dimon said.
Other obstacles that often raise concern about wealth taxes are how
to value assets like art and private businesses when determining wealth,
and the potential impact on stock markets if rich shareholders suddenly have
to liquidate their holdings to pay their tax bills.
Despite the many obstacles, a wealth tax in the United States could
prove to be a political winner for Democrats and serve as a rejoinder to Mr.
Trump, who has allowed deficits to swell by cutting taxes without curbing
spending.
Ms. Warren makes a point of stressing she is not looking to punish the
rich, and she presents the tax as quite modest: just 2 cents on every dollar
over $50 million in net worth. That 2-cent tax — which rises to 3 cents on net
worth over $1 billion — amounts to a golden key that unlocks other policy
plans, covering the cost of proposals like student debt cancellation, free
public college and universal child care.
Ms. Warren’s White House bid is the rare political campaign where a tax
rate has become a catchy slogan: Crowds have broken out into chants of “2
cents!” and at a recent political event in Iowa, two of her campaign staffers
dressed up as pennies.
“I think that what she does really brilliantly is takes a policy that’s
really cumbersome and makes it really simple and straightforward,” Victoria
Farris, 38, said after Ms. Warren gave a speech in New York in September.
“You don’t have to be an economist, you don’t have to have an advanced degree
— 2 cents is 2 cents.”
Nelson D. Schwartz contributed reporting from New York.
Alan Rappeport is an economic policy reporter, based in Washington. He
covers the Treasury Department and writes about taxes, trade and fiscal matters
in the era of President Trump. He previously worked for The Financial Times and
The Economist. @arappeport
Thomas Kaplan is a political reporter based in Washington. He previously
covered Congress, the 2016 presidential campaign and New York state
government. @thomaskaplan
THIS ARTICLE FROM BRITANNICA.COM GOES INTO THE TERM "INTEREST
GROUPS" IN A MUCH MORE SCHOLARLY AND EXHAUSTIVE WAY THAN I CAN, OF COURSE,
AND IT'S ALSO VERY INTERESTING IN THESE TIMES OF LOW PAY AND NOT ENOUGH JOBS.
WE NEED SOME "INTEREST GROUPS" TO HELP PUSH FOR CHANGE.
INTEREST GROUP
POLITICAL SCIENCE
WRITTEN BY:
Alternative Titles: pressure group, special interest
group
Interest group, also called special interest group or pressure
group, any association of individuals or organizations, usually formally
organized, that, on the basis of one or more shared concerns, attempts to
influence public policy in its favour.
All interest groups share a desire to affect government policy to benefit
themselves or their causes. Their goal could be a policy that exclusively
benefits group members or one segment of society (e.g., government subsidies
for farmers) or a policy that advances a broader public purpose (e.g.,
improving air quality). They attempt to achieve their goals by lobbying—that is, by attempting to bring
pressure to bear on policy makers to gain policy outcomes in their favour.
Interest groups are a natural
outgrowth of the communities of
interest that exist in all societies, from narrow groups such as the Japan
Eraser Manufacturers Association to broad groups such as the American Federation of Labor–Congress
of Industrial Organizations (AFL–CIO) and to even broader
organizations such as the military. Politics and interests are inseparable.
Interests are a prevalent, permanent, and essential aspect of all political
systems—democratic, authoritarian, and
totalitarian regimes alike. Furthermore, interest groups exist at all levels of
government—national, state, provincial, and local—and increasingly they have
occupied an important role in international affairs.
The common goals and sources of
interest groups obscure, however, the fact that they vary widely in their form
and lobbying strategies both within and across political systems. This article
provides a broad overview that explains these differences and the role that
interest groups play in society.
Definition
As defined above, an interest group is
usually a formally organized association that seeks to influence public policy.
This broad definition, increasingly used by scholars, contrasts with older,
narrower ones that include only private associations that have a
distinct, formal organization, such
as Italy’s Confindustria (General Confederation of Industry), the United States’s National Education Association,
and Guatemala’s Mutual Support Group (human rights organization). One problem
with such a narrow definition is that many formally organized entities are not
private. The most important lobbying forces in any society are the various
entities of government: national, regional, and local government agencies and
institutions such as the military. Another reason to opt for a broad definition
is that in all societies there are many informal groups that are, in effect,
interest groups but would not be covered by the narrower definition. For
example, in all political systems there are influential groups of political and
professional elites that may not be recognized as formal groups but are
nonetheless crucial in informally influencing public policy.
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Some interest groups consist of
individuals such as ranchers or fruit growers who may form farm commodity
organizations. In other instances, an interest group consists not of
individuals but of organizations or businesses, such as the Histadrut (General Federation of Labour)
in Israel and the
Andean-Amazon Working Group, which includes environmental and indigenous organizations
in several South American countries. These types of organizations are
called peak associations, as they are, in effect, the major groups in
their area of interest in a country.
The term interest rather
than interest group is
often used to denote broad or less-formalized political constituencies, such as the
agricultural interest and the environmental interest—segments of society that
may include many formal interest groups. Similarly, interest is often used when
considering government entities working to influence other governments (e.g., a
local government seeking to secure funding from the national government). In
authoritarian and developing societies, where formal interest groups are
restricted or not as well developed, interest is often used to designate broader groupings such
as government elites and tribal leaders.
Interest group
QUICK FACTS
KEY PEOPLE
RELATED TOPICS
- Political system
- Public opinion
- Multiculturalism
- Lobbying
- Pluralism
- Peak association
- Policy
- Institutional interest
- Economic interest group
- Interest
Types Of Interests And Interest Groups
Interests and interest groups in all
types of political systems can be placed broadly in five categories: economic
interests, cause groups, public interests, private and public institutional
interests, and non-associational groups and interests.
Economic interest groups are ubiquitous and the
most prominent in all countries. There are literally thousands of them with
offices in national capitals from London to Ottawa to New Delhi to Canberra. There are several
different kinds of economic interests: business groups (e.g., the Canadian
Federation of Independent Business, the Confederation of British Industry, and
the Nestlé Corporation, headquartered in Switzerland and with operations
throughout the world), labour groups (e.g., IG Metall in Germany, the Trades Union Congress in
the United Kingdom, and the AFL–CIO in the United States), farm groups (e.g.,
the Irish Farmers’ Association in the republic of Ireland
and the American Farm Bureau Federation),
and professional groups (e.g., the American Bar Association and
the Czech Chamber of Doctors).
Cause groups are those that represent a
segment of society but whose primary purpose is noneconomic and usually focused
on promoting a particular cause or value. This category is wide-ranging,
including churches and religious organizations (e.g., Catholic Action in Italy),
veterans’ groups (e.g., the Union Française des Associations d’Anciens
Combattants et Victimes de Guerre [French Union of Associations of Combatants
and Victims of War]), and groups supporting the rights of people with
disabilities (e.g., the Spanish National Organisation for the Blind (ONCE) and
Cure Autism Now in the United States). Some cause groups are single-issue
groups, focusing very narrowly on their issue to the exclusion of all
others—such as those favouring or opposing abortion rights or
foxhunting—though most cause groups are more broadly based.
Whereas economic interests and most
cause groups benefit a narrow constituency, public interest groups
promote issues of general public concern (e.g., environmental protection, human rights, and consumer rights). Many
public interest groups operate in a single country (e.g., the Federal
Association of Citizen-Action Groups for Environmental Protection in Germany).
Others, such as the Sierra Club, which has
chapters in the United States and
Canada, may operate in only a few countries. Increasingly, however, many public
interest groups have a much broader international presence, with activities in
many countries (e.g., Amnesty International and
the International Campaign to Ban
Landmines).
Private and public institutional
interests constitute another
important category. These are not membership groups (hence, they are
termed interests as
opposed to interest groups)
but private organizations such as businesses or public entities such as
government departments. However, similar to interest groups, they attempt to
affect public policy in their favour. Private institutional interests include
think tanks such as the Brookings Institution in
the United States and the Adam Smith Institute in the United
Kingdom; private universities; and various forms of news media, particularly
newspapers, that advocate on behalf of a particular issue or philosophy. But by
far the largest component of this category is government in its many forms. At the national
level, government agencies, such as the British Department for Environment, Food and Rural
Affairs, lobby on their own behalf to secure funding or to prioritize certain
issues; at the regional level, public universities lobby the appropriate
government (e.g., provincial governments in Canada and state governments in the
United States) for funding or legislation that benefits them; at the local
level, school boards may lobby the local government for money for a new school
gymnasium or for more funding for educational programs. At the international
level, the United Nations may
lobby its members to pay their outstanding contributions to the organization or
to carry out Security Council resolutions.
Governmental institutional interests
are often the most important interests in authoritarian regimes,
where private interest groups are severely restricted or banned. In communist
countries (both before and since the fall of the Soviet Union and its satellites in
eastern Europe), such governmental interests have included economic planning and
agricultural agencies and the secret police. In some Muslim countries (e.g.,
Iran and Saudi Arabia), religious institutions are prominent interests.
Although formally organized
associations play a predominant role in traditional lobbying efforts, non-associational
groups and interests often have an important influence. Such interests lack
a formal organization or
permanent structure. They include spontaneous protest movements formed in
reaction to a particular policy or event and informal groups of citizens and
officials of public or private organizations. For example, French farmers have
sometimes held up traffic in Paris to protest government agricultural policy.
Elsewhere protesters have mounted large-scale demonstrations against the World Trade Organization (WTO),
such as those in Seattle, Wash., in 1999; some Catholic bishops have worked
in Latin America to
promote human rights; and large landowners in India have utilized their
personal ties with local assemblies and state and national political party organizations to
protect against major land reforms.
Political systems at different levels
of development and with different types of regimes manifest different
combinations and varying ranges of these five types of interest groups. In
western Europe, Canada, the United States, and Japan, for example, each of the
five types of interests are represented in large numbers and have developed
sophisticated strategies and tactics. In developing countries and
in those with authoritarian regimes,
there is a much narrower range of economic groups, very few—if any—public
interest and cause groups, and some government interests. In these regimes,
informal interests are generally the most important and the most numerous.
Common Characteristics And The
Importance Of Interest Groups
Most interest groups are not formed
for political purposes. They usually develop to promote programs and disseminate information
to enhance the
professional, business, social, or avocational interests of their members. Much
of this activity is nonpolitical, as when the American Association of University
Professors (AAUP) provides low-cost life insurance for its members or when
the American Automobile Association negotiates discounts with service providers
for its members. But many such interest groups enter the political arena when
they believe there is no other way to protect their interests or because they
want to secure government funding.
In their nonpolitical role, interest
groups may have several functions, but, when they become enmeshed in the
political sphere, they have one overriding goal: to gain favourable outcomes
from public policy decisions. In the political realm, interest groups perform
important functions, particularly in a democracy but also in an authoritarian
regime. These include aggregating and
representing the interests of groups of individuals in a way that a single
individual would not be able to do, helping to facilitate government
by providing policy makers with information that is essential to making laws,
and educating their members on issues and perhaps giving them political
experience for entering politics. In addition to providing this political
experience, groups sometimes actively recruit candidates for public office,
with the hope that once elected these individuals will support their cause.
Interest groups in most democracies are also a
source of financial support for election campaigns. In the United
States the development of political action committees (PACs)
after World War II was
geared to providing money to candidates running for public office. In western
Europe, campaign funding is provided by many interest groups, particularly
trade unions for social democratic parties as in Sweden and Germany. Mass
parties in authoritarian regimes also often rely on interest groups for
support. For example, in Argentina Juan Perón used the General Confederation
of Labour (CGT), the trade union peak
association, to gain and maintain the presidency of that country from 1946 to
1955. In addition to financial resources, members of interest groups are
important resources for grassroots campaigning, such as operating telephone
banks to call prospective voters, canvassing neighbourhoods door-to-door, and
organizing get-out-the-vote efforts on election day.
SIMILAR TOPICS
- Political party
- International relations
- Think tank
- State
- Nonprofit organization
- Nongovernmental organization
- International organization
- Political machine
- Academy
- Coalition
Factors Shaping Interest Group Systems
Various factors shape the environment in which
interest groups operate and provide a foundation for understanding similarities
and differences in types of interest group systems around the world.
The level of socioeconomic development
within a society usually can inform observers about how highly developed and
represented society’s interests are. In more economically prosperous societies,
the number of interest groups and the people belonging to them is usually quite
extensive. By contrast, in less affluent countries,
the number of interest groups is usually quite limited, and their level of
sophistication is usually lower. In democracies, lobbying is more formalized and
wide-ranging than in authoritarian and
developing countries, where it is largely informal, with only a small segment
of society having access to government.
In democratic systems, interest groups
are generally free to operate, though the acceptance of the scope of their
activity by the general public and politicians may vary. Even in democracies,
many may consider interest groups detrimental to the
operation of society and government (in general, however, there is a
broad consensus in most
democracies that interest groups play a vital and necessary role in political
and economic life). In postcommunist Lithuania, for example, there has been skepticism of interest
groups both among the public (a hangover of the fear of belonging to banned
groups in the former communist regime) and among some politicians who believe
such groups acted as an impediment in the transition to democracy by promoting their special
interests over that of society. In contrast to democracies, authoritarian
regimes often restrict and may even ban group formation and lobbying.
A country’s political culture—the
characteristic shared values of the citizens upon which government is based and
upon which certain political activities are considered acceptable or not—varies
from country to country. In all political systems, be they democratic or
authoritarian, the ideological underpinnings of society influence the pattern
of interest group involvement in the political process—including, potentially,
their exclusion from the process entirely. In Sweden, for example, where there exists a
broad social democratic consensus that believes all interests should be taken
into account in the policy-making process, the government actually organizes
and funds groups (e.g., immigrant workers) that might not form otherwise. In
contrast, the official ideology of communist
regimes has not generally officially recognized the rights of interests to
organize; thus, they have tended to operate unofficially and subject to
potential legal action by the government.
The location of political power in the political system determines
the access points and methods of influence used by interest groups. In
authoritarian regimes, power usually lies with the dictator or a small cadre of
officials. Thus, any interest group activity in such systems will be narrowly
directed at these officials. In democracies, power is more diffused. In
parliamentary systems, such as Canada and New Zealand, the executive is chosen from
the legislature, and, because
of party discipline, power tends to
be concentrated in the executive, which therefore becomes the focus of
lobbying. In presidential systems, particularly the United States, where there is a separation of powers between
the executive and legislative branches, a lobbying strategy must focus on
both branches of government. In addition, in some countries, power is divided
among multiple layers of government. In unitary systems, where central
government is the locus of policy making, lobbying efforts can concentrate on
that level of government. By contrast, in federal systems (e.g., the United
States, Australia, and Germany), interest groups often find it necessary to
mount simultaneous campaigns at both the national and state levels.
Which party or party coalition controls the government
influences the relative importance and impact of interest groups within
society. For example, in a democracy, if a left or
centre-left government is in office, it is most likely that allied groups
(e.g., labour unions and environmental groups) would have more influence on and
be consulted more often by the government, whereas business groups usually have
wider access and importance when a conservative government
is in office. Even in authoritarian regimes, changes in the executive can bring
about the increased success of some groups at the expense of others. For
example, the shift from a civilian to a military dictatorship or vice versa in
a host of African, Asian, and Latin American countries in the period from the
1930s to the 1980s changed the configuration of interest groups and interest
influence.
The Role Of Interest Groups In Public
Policy Making: Pluralist And Neo-Corporatist Theories
Pluralism and
neo-corporatism are the two primary theories that have been put forward to
explain interest group influence on public policy. Pluralists argue that the
most realistic description of politics and policy making is a marketplace with
more or less perfect competition. In theory, in this political marketplace many
(or plural) perspectives—as represented by individuals, political parties, and interest groups
and interests—compete to have their views heard by government and their
favoured policies enacted. According to this conception, because of
competition between the varied and diverse interests, no
single interest is likely to have its views win consistently over others. The
United States is invariably cited by scholars as the country coming closest to
this model in practice, though other democracies also qualify, particularly
those in the Anglo-American tradition such as Canada and Australia.
In practice, however, pluralism is
often less than an ideal system of representation for
achieving policy changes. First, different groups have different resources;
some interests, such as those representing businesses or affluent professions,
are well-organized and well-financed, while others, such as those for the poor
or for immigrant workers, are not. Such disparities may serve to tilt the
balance of policy influence in favour of better-organized and better-financed
groups. Second, the government is rarely neutral in the conflict-resolution
process: it often favours some groups over others because it depends on them.
For example, a government may rely on a major industry (e.g., tourism) or a
particular service, such as that provided by doctors, and so these interests
will have more sway over that government than those it does not rely upon
(e.g., welfare recipients or groups for the arts). These concerns have led to
modifications of the pluralist model; an elitist perspective, such as that
advanced by American political scientist Theodore Lowi, considers groups,
interests, and individuals that are well-connected to government policy makers
and well-financed as prime movers in interest-group activity and policy making.
The advantage of such elites is enhanced in many
Western democracies because of the advent of hyperpluralism—a development of
the late 20th century, particularly in the United States. As so many groups
have entered the lobby game, the competition for the attention of policy makers
has become intense, and those groups with resources and connections—the elite
groups—have an advantage in the fight to be heard by policy makers.
Neo-corporatism and state corporatism
Neo-corporatism is a much more
structured theory of interest group activity than pluralism. It is a modern
version of state corporatism, which emerged
in the late 19th century in authoritarian systems and had several manifestations in the
first half of the 20th century—for example, in Adolf Hitler’s Germany
and Francisco Franco’s Spain.
In this system, society is seen as a corporate—that is, united and
hierarchical—body in which the government dominates and all sectors of society
(e.g., business, the military, and labour) are required to work for the public
interest as defined by the government.
Whereas state corporatism is coercive,
neo-corporatism is, in theory, based on voluntary agreement between government and
labour and business interests. The goal is primarily economic; the
neo-corporatist model focuses on keeping costs and inflation in check so that
the country can be competitive in international trade and
maintain and enhance the
domestic standard of living. To be
able to establish and maintain a neo-corporatist interest group system, a
country has to have peak associations that are able to enforce the agreements
between business, labour, and the government. Consequently, in Scandinavia,
Germany, Austria, and Switzerland, for example, where there are major peak
associations that dominate their respective economic sectors, neo-corporatism
can best explain major interest group activity.
Neo-corporatist theory also has its
critics. Some argue that it is not a distinct interest group system at all but
rather just another form of pluralism. This is because it still functions
within a pluralist political environment and only major groups are involved in
this special relationship with government; all other groups and interests
compete in the same way that they would in a pluralist system such as the
United States. In addition, critics also claim that neo-corporatism is so
varied in actual practice as to lack distinct core characteristics. The
Scandinavian countries are highly neo-corporatist, but countries such as France
and Belgium are much less so; and the form of neo-corporatism practiced in
Japan does not incorporate labour. Similar to pluralism, neo-corporatism
operates differently in different countries depending on sociopolitical and
historical circumstances. In fact, it is best to understand the interest group
system in democratic countries as existing along a scale with highly pluralist
countries such as the United States (with no dominant peak associations) at one
end; countries such as New Zealand, which combines elements of pluralism and
neo-corporatism, in the middle; and predominantly neo-corporatist systems, such
as those of Scandinavia, at the other end of the scale.
Theories of interest group activity in
non-pluralist regimes are less all-embracing because of the wide variety of
such regimes. State corporatism helps explain group activity in some countries
(e.g., Cuba); in former communist countries (e.g., those in eastern Europe),
the leaders of groups were simply tools of the party elite; in authoritarian
countries in the developing world (e.g., the monarchies of Saudi Arabia and Tonga), it is the elite
cliques close to the royal family that hold the most sway.
Lobbying Strategies And Tactics
As discussed above, lobbying involves
working to bring pressure to bear on policy makers to gain favourable policy
outcomes. In order to accomplish their goals, interest groups develop a strategy or plan of
action and execute it through specific tactics. The particular strategies developed
and the specific tactics used, however, vary widely both among and within
political systems.
Three factors are of particular
importance in shaping lobbying strategies and tactics. One is whether the political system is
democratic or authoritarian. Because
there generally are few restrictions on interest groups in democratic
societies, they have more options available (e.g., hiring lobbyists, using the
press, and staging public demonstrations). Thus, strategies and tactics are
more formalized and open than in authoritarian societies, where they must be
more ad hoc and less publicly visible.
A second factor is the structure of
the policy process. As
indicated above, in democratic parliamentary systems, where the executive is
drawn from the major political party or party coalition in the parliament (e.g.,
Finland, India, and the republic of Ireland),
the legislative branch is less important than the prime minister and the cabinet in policy
making. In contrast, because of the power placed in the U.S. Congress and state
legislatures, the United States is one
of the few countries in which legislative lobbying is a major strategy of
interest groups. The courts in most parliamentary systems also play a minor
role in policy making. Again, in contrast, in the United States the
separation-of-powers system has provided the courts, which have the power to
invalidate legislation, with a major role in policy making, and, as a result,
litigation strategies are often vital to American interest groups.
A third factor is political culture as
it relates to group activity and lobbying. In the United States, for example,
the use of contract lobbyists—those hired by contract specifically to lobby
government—is much more accepted than in most other Western democracies, including
those of the European Union, where
public officials usually prefer to deal directly with the members of the
concerned group, organization, or business.
Three major factors can also be
identified to explain why lobbying strategies and tactics vary within a
political system. One is the nature of the group and its resources. “Insider”
groups—those older and more traditional business, labour, and professional
groups with extensive resources, including money and established access to
public officials—are more able to pursue “insider tactics,” utilizing their
close friends and associates in government to promote their goals, and
generally have many more options available to them than do “outsider” groups.
Such outsider groups tend to be newer and sometimes promote radical causes;
they usually lack key contacts with policy makers and major financial
resources, and they often focus their energy on grassroots efforts, which may
include letter writing or Internet campaigns or public demonstrations to gain
media coverage (insider groups may also use such methods). Second, whether the
purpose is to promote or defeat a legislative proposal helps to explain
variations in strategies and tactics across different political systems. For
instance, in the United States, a system that was designed by its founders to
prevent government action, the so-called “advantage of the defense” operates.
All an interest has to do to stop a proposal is to get a sympathetic committee
chair in the legislature to oppose
it or a president or governor to veto it. To get a proposal enacted requires
that it clear hurdles in both houses of the legislature and be signed by the
executive. In contrast, in parliamentary systems, with power concentrated in an
executive committed to the platform of the major party or party coalition in
parliament, it is much harder to defeat something if it has been agreed upon by
the party beforehand. Third, a country’s political climate influences
strategies taken by interest groups. Which party is in power (such as one
favourably disposed to an interest group’s agenda), the major issues facing the
government, and the country’s budget circumstances will influence the types of
strategies an interest group uses. For example, the National Education Association (NEA)
in the United States pursues a different strategy when the Republicans are in
power in Washington, D.C., and in the states than when the Democrats are in
power. The NEA has “insider status” with the Democrats but generally not with
the Republicans.
Although strategies and tactics vary
between and within political systems, there is one aspect of lobbying that is
common in all systems, whether democratic or authoritarian: building close
personal contacts between group representatives and public officials to foster
trust and credibility and to persuade the government that it needs the group.
In democracies, tactics are usually broad-ranging, but building relationships
is universal regardless of the type of democratic system. In authoritarian and
developing political systems, personal contacts between political elites within
and outside of government are often the major tactic (and sometimes the only
tactic available). For example, patron-client networks, which are modern manifestations of
court cliques in traditional monarchies, are based not on a shared interest (as
set out in the definition of an interest group above) but on the personal benefit
of the patron and clients. However, patron-client connections can work to
represent and gain benefits for a group, such as merchants or landowners.
Among democracies, it is in the United
States that interest group activity is most accepted and displays the widest
range of tactics. The lobbying profession, both at the federal and the state
level (and increasingly at the local government level), is highly developed. In
regard to lobbyists in Washington, D.C., in newspapers and other popular
writings, they are often talked about in connection with the terms “K Street”
and “Gucci gulch,” as it is on K Street that many of the contract lobbying
firms are located, and the corridors in the Capitol where lobbyists congregate
have been nicknamed for the expensive shoes and garments they often wear.
Increasingly, however, American-style tactics have been adopted in other
democracies and in transitional systems as ideology, and the
centralization of the policy process has been eroded. In the United Kingdom and
other countries of the European Union, Australia, and Canada, lobbyists are
becoming increasingly important (they are usually known by other designations such as
political consultants or government-affairs or public-affairs representatives),
and there also has been more use of the media and increased campaign
contributions.
Influence Of Interest Groups
Research conducted in the United
States provides major insights into the factors that determine interest group
influence. Money is important in explaining the influence (or lack thereof) of
interest groups, but, contrary to what might be believed by the public, it is
not simply money that determines political clout. Factors determining the
influence of individual interest groups include the group’s financial
resources, the managerial and political skills of its leaders, the size and
cohesiveness of its membership, and political timing—presenting an issue when
the political climate is right. Three factors appear to be of particular
importance:
How much influence a group has depends on the extent to which government officials need the group. The more elected or appointed public officials who rely on an interest, business, or organization, the greater its leverage will be over government. Some corporations may have a presence in many districts throughout the country, and decisions that affect them will affect employment in those districts, thus making it likely that members of the legislature from those districts will be favourably predisposed to legislation that the group supports. Moreover, many interest groups provide major financial backing to political campaigns; the more widely dispersed its funds are in a country, state, or local jurisdiction, the more likely that legislators will listen to the concerns of that group.- Lobbyist–policy-maker relations are also important in explaining
the relative power of an interest group, since it is at this point that
the demands of the group are conveyed to government. The more skillful the
lobbyists are in forging personal contact with government officials, the
more successful the group is likely to be. As noted earlier, this is the
case in both democratic and authoritarian systems alike. In the United
States, political scientists have identified phenomena known as “iron
triangles” and “policy niches” in regard to lobbyist–policy-maker
relations. In such cases, lobbyists, members of the legislature, and, in
particular, members of the key committees work together to get policy
enacted. These arrangements typify a form of elitism with privileged
access leading to established lobbyist–policy-maker relationships that
gives “insiders” an upper hand in influencing public policy.
- The relative level of organized opposition to a group is essential
to understanding the success or failure of that group. The more intense
the opposition to a group’s cause, the more difficult it will be to
achieve its goals. Some groups have natural political enemies (e.g.,
environmentalists versus developers and corporations versus labour
unions). Other interests, such as those advocating stricter laws
against domestic violence and child abuse, have
little opposition, though such groups may be limited by the other factors
that determine influence, such as a lack of financial resources.
Interest Groups In International
Politics
Interest groups have long been active
in international affairs, but the level of that activity has increased
significantly since World War II and
particularly since the late 1960s. A confluence of factors
accounts for the explosion in international lobbying activities. These include: the
increasing importance of international organizations,
such as the United Nations (UN)
and its various agencies, and regional organizations, such as the European Union (EU), with jurisdictions
that extend beyond national borders; the fact that many issues (e.g.,
environmental protection, wildlife management, and the fight against the child
prostitution trade) require an international approach; and increasing awareness
of issues because of advances in communications and the adoption of many
international causes in Western democracies (where
most international interests originate and operate) by an increasingly affluent middle class.
According to American political scientist Howard Tolley, an authority on
international interest groups, without political parties and elections to voice
concerns at the international level, nongovernmental pressure groups are even
more vital in world politics than interest groups are at the domestic level.
There are thousands of international
lobbies, but four broad categories constitute the vast
majority.
- Foreign governments and international organizations.
Countries maintain a wide array of embassies and consulates in foreign
countries, and they often use these and hired lobbyists to work for such
benefits as foreign aid and
military support, as well as to boost the country’s image abroad.
International organizations (e.g., UNESCO, Asia-Pacific Economic Cooperation,
the Arab League, and
the Organization of American States)
use their resources in manners similar to governments.
- Multinational corporations (e.g.,
McDonald’s, Coca Cola, Honda, Volvo, and Procter & Gamble) and
business trade associations (e.g., the International Chamber of Commerce
and the European Association of Manufacturers of Business Machines and
Information Technology). These often have extensive global or regional
reach. Their major concerns in lobbying relate to similar issues that they
have within individual countries and include ensuring favourable labour
codes and tax structures, making trade as free as possible, ensuring
favourable laws regarding government regulation of their product (e.g.,
food and drink) or service (e.g., telecommunications), and trying to
minimize added costs such as those involving environmental regulations.
Because of their extensive resources and the fact that the government
relies on the economic advantages provided by these multinational
corporations, they are often successful in achieving their lobbying goals.
- Special interest and cause groups. These
include the World Council of Churches,
the Baptist World Alliance,
the Anglican Communion,
international networks of gay-rights groups, and the Inuit Circumpolar
Conference, an organization of indigenous peoples
of the Arctic and subarctic regions of North America, Europe,
and Asia. Such groups and organizations are involved in international
lobbying for a variety of reasons and with mixed success. Some, such as
churches, often lobby simply for the right to operate in a country and on
behalf of human and civil rights and
the poor. Others, such as indigenous groups, lobby for the rights of their
compatriots in terms of preserving their customs and language and
repatriating artifacts that
may have been taken to other countries and are now housed in museums
around the world (particularly in countries that were former colonizers).
- International public interest groups (nongovernmental organizations [NGOs]).
NGOs embrace a wide range of groups that focus on issues of broad public
concern, such as human rights, child welfare, and the
status of women, as opposed to the specific interests of particular
businesses or sectors of society, such as automobile manufacturers and
physicians. At the meeting in 1945 in San Francisco that drew up the UN
charter, some 1,200 NGOs were in attendance. Though there is no current,
reliable count of NGOs, they mushroomed in the period after World War II
and may number as many as 10,000; in Latin America alone
it is estimated that there are some 2,000 NGOs, many of which work in
several countries. Significant among the multitude of NGOs operating in
world politics today are Human Rights Watch, Oxfam International, CARE, Greenpeace, the World Wildlife Fund, Earth First!, and
the Women’s International League for
Peace and Freedom. NGOs enjoy mixed success in their political
activities, partly because governments rarely rely on these groups to
maintain themselves in office. Most operate far from public view, and
their successes may receive little publicity. Some, however, such as
Greenpeace, receive major publicity for their campaigns.
The Regulation Of Interest Groups
Even though interest groups are
indispensable to the operation of government in both democracies and authoritarian systems,
they have the potential to promote the interests of a small segment of society
at the expense of society as a whole. Consequently, there is criticism of interest
group activity in both democracies and authoritarian regimes.
However, views of the negative effects of interest groups and ways of
attempting to deal with them are different in democracies and authoritarian
systems.
In pluralist systems there is a great
degree of concern with how interest groups might undermine democracy. Groups in such systems often claim
to pursue an agenda that is “in the public interest,” but in practice they
often serve rather narrow interests. In non-pluralist systems it is sometimes
feared that interest groups will undermine the national interest or major
government plans and commitments that are often expressed by a country’s
official ideology or through
the statements of national officials.
To deal with potential problems of
interest group activity, many democratic governments and all authoritarian
regimes adopt some form of regulation (control in authoritarian
systems) on interest groups. In all systems, the goal of regulation is to
promote the public interest, however defined, over that of the narrow segments
of society represented by interest groups. In its specific form, however,
regulation varies considerably in scope, focus, and form between democratic and
authoritarian regimes.
Regulations in authoritarian systems
are usually quite wide-ranging and are focused on controlling group formation
and channeling the modes of activity that groups can pursue. In such systems,
activity by particular interest groups may be prohibited (e.g., in communist
systems in eastern Europe during the Cold War, nearly all private associations were
banned), or groups may be allowed to form and participate but be co-opted and
have their activities heavily circumscribed by the government.
In democracies the underlying
principle of the regulation of interest groups is that it enhances democracy. However, few, if
any, restrictions are placed on group formation and the right to lobby
government. Indeed, these are rights guaranteed in many national constitutions.
Instead, democracies attempt to address perceived ethical questions
surrounding lobbying, such as a normative desire to create a somewhat-level
playing field for groups in terms of access and influence. Most often this is
attempted through public disclosure or the monitoring of interest group
activity by requiring interest groups and their lobbyists to register with
public authorities and to declare their objects of lobbying as well as their
income and expenditures. Even so, the extent of regulation varies widely across
democracies. The United States has a
long history of fairly extensive regulation, whereas the countries of western
Europe generally have far less regulation; Australia attempted to implement a system of
regulation in the early 1980s but abandoned it in the mid-1990s in favour of
self-regulation by interest groups and lobbyists.
The Future Of Interest Groups And
Interest Group Systems
As long as human beings engage in
politics, interest groups will be a part of the political process. Moreover,
interest group activity will almost definitely increase in all political
systems in the future for a couple reasons. First, government activity is
likely to expand and affect existing interests more extensively and new
interests in various ways, thereby forcing individuals and organizations to
become politically active to protect or promote their interests. Second, globalization will
likely increase international interest group activity and result in an
increasing interdependence between many domestic and international interests.
This expansion, and particularly the internationalization of interest group
activity, will produce some homogenization in the organization of interests and
the techniques they use to gain access and exert influence. However, specific
governmental structures, political culture,
deep-rooted ideology, historical
practice, and short-term political circumstances will likely always work to
give interest group activity many unique elements in each country.
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