Analyzing Business Influence on Government vs. Other Interest Groups

This essay explores the extent to which business holds more influence on government than other interest groups, using the U.S. Chamber of Commerce and the Business Council of Australia as case studies. It analyzes the impact of financial resources, lobbying efforts, and the ability of various groups to mobilize support for or against specific policies. The essay considers that while businesses often possess significant material resources and access to policymakers, their influence is not always guaranteed, especially when issues mobilize rival groups or the public. It concludes that business indeed has substantial influence due to its role in revenue generation and market shaping, while acknowledging that the nature of the issue and the competitiveness of lobbying processes also play crucial roles in determining policy outcomes. Access more essays and study resources on Desklib.

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Does Business have far more influence on government than any other interest group’ Do you agree?
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Abstract
There are numerous popular accounts showing how interest group are able to influence
the policy making process. They are based on organizational expenditure and campaign
donations with the assertion that it is these resources that influence outcomes preferable to
“special” interest groups. However, attempts by assessments as well as researches carried out by
scholars on this influence, are yet to yield a conclusive report – there are times resources may
influence outcomes, and other times where the same variables fail to have any significant impact
or none at all.
Introduction
In addressing the question of whether ‘Business has far more influence on government
than any other interest group’ I looked into two countries premier corporate lobby groups giving
the reader a conclusive comparison. There is the use of data that is based on financial might by
group type in the U.S context which was my primary focus on U.S. Chamber of Commerce. The
secondary focus being Australia where we get to look at Business council of Australia’s dealings
as a complementary for this study. After analyzing various scholarly articles, I found that when
there is a consideration of resources on the basis of group type, business organizations tend to
have a clear advantage, most notable when it comes to material resources. However, upon
conducting an analysis on the basis of issues, I found that material resources (which are enjoyed
by business organizations) tend give an equal probability on each of the two issues in both
countries. Ordinary citizen groups usually work together with “special” (financially powerful)
interest groups, which uses financial incentives to sway citizen groups and utilize their
membership numbers and public opinion to legitimize things in what is referred to as soft power.
They may also choose to stiffen their grip through direct approach laying down their claims

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while still offering financial incentives in what is called hard power. Business organizations
which enjoy financial might were no more likely than financially dwarfed organizations to be on
the winning or losing side of a policy debate.
A lot has been said and documented on the influence money has on politics. In this article
paper I will take a careful look at the impact of monetary resources in influencing government
policies. In obvious sense the richer the group, the more the government advantages. But the
activities of the government in policymaking is a process that is continuous, comprising of many
issues that have already been settled in previous stages. Could the rich simply continue to
accumulate more money and policy advantage, taking home the prize every time? Does the
political class always consider their issue, and continue to expand the distance between the rich
and the poor? echoing questions that were raised by Schlozman and Tierney, (1996) In this paper
I show that the proverbial “the rich get richer” narrative also has major complications in relation
to the policy making process using the U.S context to showcase where backing it up with and
Australian context.

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Resource by group type
By looking at previous surveys of interest groups in both Australia and the U.S I saw that
occupational interests, most notably businesses related associations, are the richest in terms of
material wealth sufficiently spearheaded by lobbying staff.
Table 1 comparison of interest groups average spending and hired lobbyist (Wilson,2003)
Group type Hired
Lobbyist (%)
Average
spending on
lobbying
Business corporations 77 $1,040,105
Unions 46 $490,987
It was also identified that the more the corporations employed external lobbying firms the
more these corporate class have friends in senior government offices. Unions which represent the
interests of workers were seen to be the least likely to enjoys such high government status
friends. On average, businesses were seen to employ up to six times the number of covered
Officials compared to labor unions. By taking a look at lobbying expenditures one can clearly
see the level of imbalance in terms of resources favoring business: lobbying expenditures
averaging $1about million double that of labor unions. So far, we see that business corporations
on top of having control over a substantial amount of material resources also has easier access
and better grip on policy makers (Wilson,2003).

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Beyond the Financial Incentive
Based on popular accounts, the interest-group as a system mostly focuses on monetary
resources: their strong point and influence tactic on the government being campaign
contributions whereby they get one of their own elected in political seats. Dr. Li Ji’s 2013 where
she explains the terms soft and hard power which is seen in play. As opposed to the U.S which
spends to a tune of about $500 million in every election year via campaign contributions,
Australia can be said to be more inclined on soft ball technique with its lobby group is more
focused on promoting the interests of its members with an annual revenue estimated to average
$11.4 million (Beder, S. and Cahill,2005). However, this inherent and most common relationship
that we see between money and politics is not as simple as it seems. This is mainly because
where huge sums of money are put forward on one side, the other end often rise up in numbers
mobilizing themselves as well (though clearly not always the case) (Beder, S. and Cahill,2005).
They showed that businesses make up more of the registrants in Australia’s Advocacy
community compared. But at the end of the day based on how pressing the issues are trade
unions in Australia usually effectively mobilizes and utilizes their strength which is in numbers
through channels such as strikes or go slow effectively cutting off the corporations’ money hence
power (Beder, S. and Cahill,2005).
There is no doubt that money is power and that the rich and wealthy have more
opportunities to utilize their access to policymakers and politicians than other interest groups in
society. However, very few officials in government have the unilateral authority of producing the
policy changes the elite business class might try to push through by lobbying. This is where the
ordinary citizen through their groups may decide to flex their muscle (McCormick, 1991).

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Why Resources May Appear Not to Matter
Looking at the U.S which is the direction Australia seems to be taking very fast Smith++
++ Alesina, (2009) carried out an in-depth study of the impact of policies by the U.S. Chamber
of Commerce, a powerhouse business organization in American politics. His startling conclusion
was that the Chamber often did not that which it wanted. The reason for this as demonstrated by
Smith was based on the selection of issues it extensively lobbied on. Being comprised of diverse
members which include large and small businesses across different industries, the issues it could
unilaterally pass were all encompassing such as matters pertaining to cost of health-care and
labor issues (McCormick,1981). All in all, based on the observed trends it can be said that an
issue that could unite and mobilize a business community in its entirety is also likely to have the
same mobilizing effect on rival groups most notably consumers. Basically, these are the big and
high-profile matters. Of course, having more wealth and resources is a bonus but even a
powerhouse such as the U.S. Chamber of Commerce which spends millions in lobbying cannot
be guaranteed of a win the moment the said issue brings together a pool of powerful
organizations each bringing in its own resources as is often demonstrated in Australia.
Conclusion
As demonstrated above, the bottom line is money is power and matters a lot in the business
sector and politics. The relationship has been identified in different aspects but one can
conclusively say, different agendas within any government are mostly fueled by business ideas.
Most of the government ideas and policy implementation forums are based on generating
revenue which is channeled to different business projects within a country. The businesses end
up developing and dictating the market. This form of control lays down a road map of hat the
government is expected to achieve. Therefore, one can agree that business has far more

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influence on government than any other interest group. However, also in answering the question,
it is important to consider that it strongly depends on the nature of the underscored issue as well
as the competitiveness of the lobbying processes.
References

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Alesina, A., 1989. Politics and business cycles in industrial democracies. Economic policy, 4(8),
pp.55-98.
Barry, N.P., 1983. The new liberalism. British Journal of Political Science, 13(1), pp.93-123.
Beder, S. and Cahill, D., 2005. Regulating the power shift: the state, capital and electricity
privatization in Australia. Journal of Australian Political Economy, The, (55), p.5.
McCormick, R.L., 1981. The discovery that business corrupts politics: A reappraisal of the
origins of progressivism. The American Historical Review, pp.247-274.
Pfeffer, J., 1994. Managing with power: Politics and influence in organizations. Harvard
Business Press
Schlozman, K.L. and Tierney, J.T., 1986. Organized interests and American democracy.
Harpercollins College Div.
Yackee, J.W. and Yackee, S.W., 2006. A bias towards business? Assessing interest group
influence on the US bureaucracy. The Journal of Politics, 68(1), pp.128-139.
Wilson, G.K., 2003. Business and politics: A comparative introduction. CQ Press.