When Sen. Tom Daschle (D-SD) lost his reelection bid in 2004, he joined law and lobbying firm Alston & Bird as a “special policy adviser.” According to the law at the time, Daschle could not become a lobbyist until 1 year after leaving the Senate. This is perhaps what prompted Daschle to assume a role as a special policy advisor, rather than register as a lobbyist. He stuck with this role though, refusing to register as a lobbyist for a decade while insisting his job was not lobbying, but instead focused on strategic analysis of how best to get a client’s legislative goals enacted. Eventually, Daschle did formally register as a lobbyist, but his avoidance of this official registration as a lobbyist led to the naming of such maneuvering as the Daschle loophole.
Congress has attempted to fix the revolving door between government and private industry lobbying in the past, but has precious little to show for it as lobbying remains a lucrative and easily accessible industry for former government officials. Some politicians have pushed for solutions to this corruption, such as Rep. Rod Blum (R-Iowa), who proposed the No Golden Parachutes for Public Service Act to ban congressmen from ever becoming lobbyists after leaving office. This bill didn’t move anywhere in Congress. The failure of such a bill to successfully become law likely has something to do with how popular it is for former members of Congress to enter lobbying. The Center for Responsive Politics found that of the members of the 112th congress (in session 2011-2013) who had found new employment since leaving congress, roughly two-thirds had entered the lobbying industry. Officials have little incentive to make drastic changes to the process as such changes would hurt those officials.
Approaches such as Blum’s may prove politically popular with constituents and sound good at face value, but it would only prove so effective. Former government officials do not need to formally register as lobbyists if they spend less than one-fifth of their time preparing for or meeting with government officials, or make less than $5,000 a quarter lobbying, or contact only 1 government official pursuant to the Lobbying Disclosure Act. Therefore, former congressmen can and, in fact, already are avoiding restrictions on lobbying by working as unregistered lobbyists in the shadows of public knowledge by simply staying just outside the strict definitional boundaries of what constitutes lobbying according to the Lobbying Disclosure Act.
Unfortunately, many actions taken by legislators and presidents to counteract lobbying may simply be driving it underground rather than truly combating anything. The Lobbying Disclosure Act and the Daschle loophole provide a mechanism by which lobbyists can effectively avoid registration as a lobbyist. Trump has issued an executive order placing a five year ban on any appointees lobbying the executive agency they had served in. This is an alteration of a similar policy under Obama. Obama’s executive order applied almost the same ban, but lasted only two years. Trump’s order also imposes a lifetime ban on lobbying for foreign governments. Nonetheless, Trump’s efforts to further combat lobbying will likely continue the current trend of sending lobbyists underground. Former government officials will skirt past these bans through the Daschle loophole and go underground as shadow lobbyists. This shrouds lobbying activities from public scrutiny as non-registered lobbyists don’t need to publicize their activities.
How large is the lobbying industry though? Well, that depends on what we define as the lobbying industry. The number of registered lobbyists peaked at 14,822 in 2007, but has since declined to 11,143 in 2016. Lobbying is officially a three billion dollar industry, but at least one estimate on its actual size places the true value of the industry around nine billion. That is a concerning level of influence peddling going unreported and underground.
In order to fight this shadow lobbying, changes to current law may prove necessary, but there is likely little way to completely close the loophole and prevent individuals from skirting regulation. Even if the 20 percent threshold for lobbying were dramatically reduced, individuals could still claim they weren’t really lobbying or that they were still underneath the threshold. It seems that to fight this sort of evasiveness, an agency would need to be set up or tasked with preventing lobbyists from being allowed to operate while remaining unregistered. Of course, setting up such an agency or force tasked with the resources necessary for this enforcement would face stiff opposition and would obviously require funding which would require a contentious fight in congress. Perhaps the best we can do currently is to try to balance transparency goals with concerns about the corruption of the revolving door between government and lobbying. Enforce full transparency from registered lobbyists and prevent them from giving gifts to politicians, but we should reconsider the effectiveness of our current trend toward outright bans on lobbying, as it tends to result in lobbying in the shadows. Instead we should simply opt for an open and transparent lobbying system where lobbyists are not unduly punished or outright prevented from registering as lobbyists through ham-handed bans. Lobbyists should be allowed, and indeed forced, to register as lobbyists, but should also be expected to provide full disclosure documenting their interactions with government. There also needs to be meaningful enforcement of the rules guiding disclosure of lobbyist activities.