COOPERATION AND COLLUSION: THE SOCIAL AMBIVALENCE OF LOBBYING IN AMERICA A Dissertation Presented to the Faculty of the Graduate School of Cornell University in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy by John C. Scott August 2008 © 2008 John C. Scott COOPERATION AND COLLUSION: THE SOCIAL AMBIVALENCE OF LOBBYING IN AMERICA John C. Scott, Ph.D. Cornell University 2008 Social embeddedness 1 and social norms have been shown to matter in a host of situations: the garment industry (Uzzi 1996), corporate finance (Uzzi and Gillespie 2002), North African bazaars (Geertz 1978), rotating credit associations (Anthony 2005), the Sicilian mafia (Gambetta 1993), natural resource management (Ostrom 1990), and cattle ranching (Ellickson 1991), to name a few. Embeddedness and social norms in these situations provide actors with better information and reduce an actor’s exposure to opportunism. The policy process also can be thought of as a collective action problem for which one solution is the use of trust-based norms of cooperation and reciprocity (Heckathorn 1996; Anthony 2005). Gaps in the formal institutions of government provide ample opportunity for informal interaction (Amenta et al., 1992). As a result, a significant portion of lobbying is informal in nature. Lobbyists provide a variety of informal resources and services, including information, feedback, and “kitchen cabinet” activities (e.g., drafting of legislative and regulatory language). This research project makes two claims regarding informal lobbying. First, embedded social relationships and trust-based social norms enable and underpin everyday policy interactions among lobbyists and politicians. Second, these same social relationships and norms inhibit participation in the political process by outside actors. This research focuses on the role of trust-based social norms that govern 1 By embeddedness, I mean an actor’s position of durable long-lasting social ties to other actors. informal interactions within networked communities of lobbyists: 2 that such networks of trust are neither all good nor all bad but are ambiguous in that they can improve policy making and fuel collusion. I study a particular policy domain of 392 lobbying organizations over a seven-year time period using quantitative data, network measures, and interviews with lobbyists, activists, and policymakers. In summary, I find that a policy domain can be characterized by a set of durable and ‘thick’ relations that provide benefits in everyday lobbying activity, particularly with regard to joint activity and perceived influence. However, these same embedded relations are often perceived as collusive by outsiders, and outsiders incorporate these perceptions in the policy claims that they make. The study concludes with a note on the influence on risk perceptions and the social ambivalence of lobbying. 2 The discussion focuses primarily on lobbying organizations and their personnel as opposed to independent lobbyists who hold themselves out as the proverbial ‘guns-for-hire.’ BIOGRAPHICAL SKETCH John C. Scott received a Bachelor of Arts in Economics from Swarthmore College in 1985 and a Juris Doctor from the Dickinson School of Law of the Pennsylvania State University in 1989. Prior to coming to Cornell, he obtained a Master of Arts in Sociology from the University of Maryland, College Park in 2003. After receiving his license to practice law in the Commonwealth of Pennsylvania, Mr. Scott was an attorney in tax and employee benefits law in private practice as well as in-house for financial service firms. From 1999 through 2003, he worked as Director of Retirement Policy for the American Benefits Council in Washington, D.C., a trade association representing employers and financial service providers. iii To Meredith, with love iv ACKNOWLDEGEMENTS As this dissertation nears completion, I think of the old saying about success having many fathers, and the cliché is true in this case. A number of persons and organizations provided assistance and encouragement along the way. The availability of resources for financing an academic research project can exert a tremendous influence on the final shape of the result, and I was fortunate in receiving substantial financial support. My dissertation research was supported by a National Science Foundation Doctoral Dissertation Improvement Grant program (SES-0602388). I also received two important seed grants from the Center for the Study of Economy and Society at Cornell University that proved very helpful in securing basic equipment and materials. The Graduate School at Cornell, the American Sociological Association, the American Political Science Association, and the Graduate School of Business at the University of Chicago also provided funding for travel to academic conferences. My special committee has been truly outstanding in terms of their guidance and support. My chair, Victor Nee, first suggested that I pursue a project on the social relations among lobbyists, and he has been a consistent booster, adviser, and source of support during the entire process. Sid Tarrow inspired me to come to Cornell. His insights and high standards have resulted in a vastly improved product, and he has been a fountain of knowledge for many topics ranging from the dissertation to the job market. Richard Swedberg has been a good friend as well as mentor, and his comments produced new perspectives that substantially enriched this research and broadened my intellectual perspective generally. Doug Heckathorn has made timely contributions along the way, and despite his immense workload, he has always found time to chat with me about this project. v A number of people inside and outside of Cornell have also been great sources for ideas, encouragement, and resources. They include Fred Boehmke, Dan Gitterman, Michael Heaney, Ed Lawler, Michael Macy, Steve Morgan, Roger Porter, Sarah Soule, David Strang, and Charles Tilly. The staffs at the Cornell University Library and the Legislative Resource Center at the U.S. Congress were been most helpful. A number of graduate students at Cornell were very helpful, particularly during the Political Sociology Seminar and the Graduate Student Association “Brown Bag” and Mini-Conference sessions at which I presented parts of this work. I want to particularly acknowledge Ed Carberry, Nicolas Eilbaum, Jen Hadden, Jenny Todd, and Chris Yenkey for their comments and friendship. The staff at the Department of Sociology gave tremendously of their time and often provided live-saving services for this project. Diane Masters, Sue Meyer, Alice Murdock, and Sharon Sandlan helped me with grants, proposal design, exam scheduling, TA responsibilities, office supplies, and food. Not only that, they are simply wonderful people and I will miss them very much. Family and friends are just as important as the academic resources in completing this project. My wife and I have been blessed to have gotten to know a number of wonderful people since we arrived in Ithaca/Trumansburg, and we love you all. I want to particularly mention Jonathon Russell-Agnelli and Katherine McComas, who arrived in Ithaca at the same time as we did, whose children played with ours, and with whom we shared many a glass of single malt. Cheers! To my mother, Nancy Parrish Scott, who set the bar high for all of us – I miss you much. To my father, Thomas Walter Scott, Emeritus Professor of Agronomy, who must be glad that one of his children finally went into the family business. My dad was nothing but positive about my return to graduate school, and he welcomed my vi family into his house, babysat my kids, kept our wine rack stocked, and was always there when we needed a loan or a ride. I can only hope to do for my children a portion of what he has done for me. To my children, Rosslyn Reagan McClure Scott and John Lincoln McClure Scott - Thank you for keeping my feet on the ground. Finally, and most importantly, to my wife, Meredith Clark McClure-Scott – I could not have done this unless she bought into the whole project, which included leaving a nice existence in suburban Washington, D.C., to move to central New York State. She manned the home front during many research, conference, and job interviewing trips. Meredith has been a sounding board, cheerleader, motivator, partner, fantastic mother, and loving wife. This dissertation and the doctorate is as much hers as it is mine. Thank you for your patience and love. vii TABLE OF CONTENTS Biographical Sketch iii Dedication iv Acknowledgements v Table of Contents viii List of Figures ix List of Illustrations xi List of Tables xii Chapter 1: Introduction 1 Chapter 2: Lobbying in Washington, D.C. 41 Chapter 3: The Research Site, Data, and Methods 91 Chapter 4: The Policy Domain and Coalitions 149 Chapter 5: Influence 181 Chapter 6: Cooperative Norms 213 Chapter 7: Insiders and Outsiders 257 Chapter 8: Concluding Summary and Extensions 292 Technical Appendix 307 References 323 viii LIST OF FIGURES Figure 1.1: The Structure of Relationships for Lobbyists 11 Figure 1.2: Model of the Choice between Coalitional Lobbying versus Lobbying Alone 25 Figure 2.1: Total Business Associations and Washington-based Associations, 1865-1961 63 Figure 2.2: Federal Government Outlays (in nominal billions of dollars), 1901-1945 69 Figure 2.3: Growth of Pages in the Code of Federal Regulations, 1936- 1946 70 Figure 2.4: New Business Associations per Year, in Washington, D.C., and outside of Washington, D.C., 1870-1960 72 Figure 2.5: Ratio of Washington-based