A Simpler Solution to Address Corruption Than Elizabeth Warren's Anti-Lobbying Tax

Much like with her other policy prescriptions, Democratic presidential candidate Elizabeth Warren wants to show that she means business. It is why her unofficial campaign slogan has become "she's got a plan for that." Lobbying seems to be no exception. Earlier this week, Warren proposed an anti-corruption measure in the form of a lobbying tax. What are the tax rates? Any company that spends between $500,000 and $1 million will get hit with a 35 percent tax. If the entity spends anywhere from $1 million to $5 million, they will be levied a 60 percent tax. Anything above $5 million and they will get hit with a whopping 75 percent tax rate. Warren's goal is to ultimately curb corporate influence, especially Big Pharma, Big Oil, insurance companies, Defense contractors, electric utilities companies, and Wall Street. She wants government to work for everyone, not just the corporations.

One thing that Warren has going for her on this proposal is that lobbyists are not well-liked in this country (see Gallup polling). That would certainly explain the populist appeal for the lobbying tax. It also has the ability to bring in some revenue. Warren's own proposal estimates that there would have been $10 billion over the past ten years, which averages to $1 billion per annum (see above). It's not exactly a ton of revenue, but it seems like Warren's lobbying tax is more for deterring certain behavior than it is revenue collection.

That is where I see the benefits of Warren's lobbying tax ending. Even if it had the effect of reducing what she deems "excessive" lobbying, her tax would not just affect the corporate world. Yes, it would hit the National Rifle Association or the Chamber of Commerce, which Warren would deem adversarial. But it would also hit such organizations as Planned Parenthood and the ACLU. Her lobbying tax is such a blunt instrument, not too dissimilar to that of Trump's tariffs, that she would undermine democracy by targeting many advocacy groups.

This segues into another issue with her proposal, which is that the courts would likely deem it a violation of the First Amendment, especially that part about the right to "petition the Government for a redress of grievances." If Warren can say what is excessive petitioning, that means she would also have the right to say what is "excessive" speech or "excessive" practice of religion.

If Warren really wants to address corruption and stop "excessive" lobbying, I have a really simple solution for her that she's not going to like: shrink the size of government. AARP wouldn't feel the need to lobby if the behemoths known as Social Security and Medicaid didn't exist. Big Oil wouldn't throw as much money at lobbying if the government didn't give them subsidies and tax breaks. Blue Cross Blue Shield wouldn't care so much if they knew they could help to get such bills as Obamacare passed, which de facto acted as a subsidy to health insurance companies. In short, if government policy did not have such an overreaching and expansive role in our lives, corporations would not care nearly as much. Yet they do and here we are.

As Lord Acton once said, "Power corrupts and absolute power corrupts absolutely." The reason why "excessive" lobbying exists is that over time, we the people have allowed for the government to become too big and too powerful. The $3.4 billion that was spent on lobbying in 2018 is a drop in the bucket compared to the $4.1 trillion the federal government spent in 2018. If Warren were at all sincere about anti-corruption measures, she would be fighting to make the government smaller, not larger.