That Used to Be Us_ How America Fell Behind in thted and How We Can Come Back - Friedman, Thomas L. & Mandelbaum, Michael [142]
The House of Representatives set off a sudden collapse of the stock market by voting against the first version of the “bailout” legislation that had been hurriedly written to try to stabilize American banks and other financial institutions. Supporters of the bailout scrambled to change the legislation in ways that would win support for it from a majority of Congressmen. In a matter of days new provisions were added: extension of an excise-tax rebate for makers of Puerto Rican rum (cost to the Treasury, $192 million); extension of a special tax break for the owners of stock car racing tracks (cost, $100 million); a tax break for makers of movies within the borders of the United States (cost over ten years, $478 million) and more. These “sweeteners”—a revealing bit of Washington jargon—did the trick. Days after rejecting the $750 billion bailout, the House approved it.
While there is so much work and money for lobbyists today because of the big, complex, and steadily growing government we have chosen to have, the proliferation of lobbyists can take a toll on a country’s rate of growth—and is already taking a toll on ours. In 1982, the economist Mancur Olson published a book entitled The Rise and Decline of Nations, in which he noted the universal tendency of interest groups to form and to lobby on their own behalf, especially in democracies, where they are free to do so. Olson called these groups “distributional coalitions” because they are “overwhelmingly oriented to struggle over the distribution of income and wealth rather than to the production of additional output.” They concentrate, that is, on gaining larger shares of the economic pie for themselves, not on making the pie bigger.
Over time such groups, in Olson’s words, “slow down a society’s capacity to adopt new technologies and to reallocate resources in response to changing conditions.” That is why special interests pose such a threat to America’s future. Adopting new technologies and reallocating resources in response to changing conditions is precisely what America needs to do.
The fossil fuel lobby (aka Big Oil and Big Coal) has consistently opposed the clean-energy policies needed to respond to the challenges of climate change and America’s oil addiction. The most important such policy is the imposition of a higher price on carbon-based fuels—through a tax on carbon—so that non-carbon sources of energy can become commercially competitive with them. This would hasten the transition from fossil fuels to clean-power technologies and, by weakening our oilexporting adversaries, would make America stronger and more secure internationally. But the oil, coal, and natural gas industries, as well as the U.S. Chamber of Commerce and the National Association of Manufacturers, employ platoons of lobbyists to fight any increase in taxes or clean-air regulations on their fuels, which they say would harm their businesses.
The website ClimateProgress.Org reported (October 3, 2010) that “the oil, gas, and coal industries have spent over $2 billion lobbying Congress since 1999. These three industries combined spent a whopping $543 million on lobbying in 2009 and the first two quarters of 2010. Meanwhile, alternative energy companies spent less than $32 million on lobbying efforts in 2009, and have only spent $14.8 million this year.”
The lobbyists are so effective that their backers can essentially order up a particular policy or change in regulations and the lobbyists will deliver it. An analysis by ProPublica, the nonpartisan investigative news service, about the oil and gas money received by members of the Natural Gas Caucus (January 4, 2011) found that they received “19 times more money from the oil and gas industry between 2009 and 2010” on average than members of Congress who