Lobbying has become one of the most important and criticized industry in the United States. Firms spend an incredible amount of time and money, and therefore resources, to make sure that Capitol Hill has their best interest at heart. This is time and money that could have been spent on producing output. In fact, this may be the most obvious example of rent seeking that we see today. Unfortunately, this problem may become much worse in the coming months.
According to a recent article, lobbying groups may face more challenges if a "blue wave" occurs. A Biden victory would bring new aides, administrative officials, and, since most people vote straight ticket, congresspeople into Washington. Given their lack of experience in the national political arena, these newcomers may be less receptive and cooperative with lobbying groups than the current lawmakers in power. Lobbying groups have already had to put in extra resources since the onset of pandemic; instead of meeting in-person, meetings must take place over Zoom. It is often harder to make a personal connection over a virtual platform than in person. Impressing newcomer politicians over Zoom will be an incredibly time consuming and expensive process, and we can expect more resources to be spent on these efforts. Since more money will be spent on rent, rent dissipation will increase.
This will also have another negative effect. It is rational to assume that political outsiders try to get elected so they too can enjoy the economic benefits from doing business with these special interest groups. If lobbyists are spending more time and money on this endeavor, these outsiders will spend more time and effort on winning federal elections to gain access to these resources. This, combined with the initial effect, may result in a considerable deadweight loss.
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