Study: Campaign Cash Brings Tax Benefits On Capitol Hill

December 2, 2014

A new analysis takes aim at one of political science’s evergreen topics: What do donors get in exchange for their campaign contributions?

The answer, according to three researchers at Arizona State University’s W.P. Casey School of Business, is that “investments in on-going access to policymakers are associated with future tax benefits.”

In other words, when corporations deployed lobbyists and made contributions from their political action committees to tax-writing committees, they got tangible benefits.

“Overall, we saw that donating companies experienced lower and more consistent effective tax rates in the long run,” said Casey School Assistant Professor Jennifer Brown in a written statement.

The study, which looks at the Senate Finance and House Ways and Means committees, calls lobbying and contributing complementary tactics — and the effects come over the long term. It says the political marketplace “is more subtle,” not a “spot market” of contributions bringing immediate favors, which would be closer to a TV show or a prosecutable quid pro quo relationship.

Scholars have tackled this question repeatedly over the years, with increasing sophistication. Twenty years ago, political scientists found no connection between campaign contributions and floor votes – not much of a surprise, since lobbyists’ greatest impact is likely to come when a bill is being drafted, not months later when it hits the House or Senate floor.

Academic findings are mixed on whether political contributions correlate with corporate performance. Lobbyists, lawmakers and others on the Hill generally say contributions buy access but not results.

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