regulatory capture is often just a rational response from a corporation once it gets to a certain size. the value add of $1 dollar of lobbying/capture efforts goes farther than $1 in R&D or whatever after a certain point.
If that was true, companies wouldn’t spend so much on R&D and so little on lobbying. Boeing is one of the top lobbying companies. Last year it spent $15 million on lobbying. It spent $5 billion on R&D. (It probably spent more on office entertainment, Christmas parties, retirement parties, etc., than lobbying.)
1. I really appreciate when people try reality check claims. Thanks!
2. I have to think that a lot more money and effort is expended trying to influence regulations than what shows up in the formal lobbying accounting.
One thing companies do is make sure to have major employment centers in as many states and congressional districts as possible, in order to get a good base of votes in any matters that may come up. This must cost a fair amount, but would never show up in the lobbying budget. Just as an example.
It's very much how special-interest economics works. Boeing is effectively a monopoly, its counterparty interest is the public at large, who are too diffuse to counter it.
Mancur Olsen, The Logic of Collective Action. Seminal economics text.
Boeing does a ton of defense contracting. Why is the counter party not Lockheed, Rockwell, etc?
Also, companies don’t need to be direct competitors to have adverse interests. For example, Google lobbied heavily on copyright issues because it wants to commoditize a downstream product input to its own services. That places Google at odds with media companies, even though the companies don’t compete directly.
In civil aviation, Boeing has no domestic competition, though it may oppose competing transport modes such as high-speed rail. (I don't know that it has, though other avaiation interests, famously Southwest Airlines, have.)
In defence, Beoing and other MIC firms are generally better served by fighting for a larger pie, than over their share of it. The fight is over defence vs. nondefence (mostly social services) spending. See for example; https://www.sourcewatch.org/index.php/Boeing
And I'd asked what your data are. Got any, or do you prefer asking to answering questions?
> And I'd asked what your data are. Got any, or do you prefer asking to answering questions?
You're the one supporting the assertion that "the value add of $1 dollar of lobbying/capture efforts goes farther than $1 in R&D or whatever after a certain point." It seems like that's the assertion that requires supporting data. My point simply is that, in the absence of data, we can look at what we would naturally expect to happen if your premise were true--prices would get bid up. The fact that lobbying prices aren't getting bid up suggests your premise is false.
You can add further layers of speculation to explain that unexpected result, but now you're really going out on a limb. I think a simpler explanation is that your premise is simply false. Lobbying has low expected ROI--that's why companies spend so little on it. (In particular, I suspect that lobbying just isn't very effective, so the expected value of a very favorable law or policy, weighted by the incremental increase in probability of that coming to pass through lobbying, is low.) That hypothesis explains the data, without resorting to additional handwaving.
Increases in Defense spending are good for all defense contractors. I don't think the lobbies are particular to help Boeing beat Lockheed to a job, but to increase funding for xyz project, that both Boeing and Lockheed have roles in and are making money on.
that's a good point. i should have said that at a certain size it makes sense for a corporation to "invest" in lobbying as a form of increasing profits instead of, say, using that amount to increase R&D.
it may be that the required amount of lobbying money necessary for a larger corp is in relative terms tiny but in absolute terms somewhat large (e.g. $15mil gets you 80% of the way there, whereas $150mil only 85%; but a smaller corp can't chalk up the $15mil required for pareto or whatever distribution)
Books are cooked and I'm sure that Boeing spent more on "lobbying" or "lobbying and backroom deals" than 15 million. Id expect a difference of at least a factor of 10 but it's not easy to prove as they have a vested interest to keep that money out of the public eye.
https://en.wikipedia.org/wiki/Regulatory_capture