Interest groups are organizations like the AFL-CIO that represent labor unions; the U.S. Chamber of Commerce represents business interests; and others ranging from different political ideologies and agenda: the National Rifle Association (NRA); the National Association for the Advancement of Colored People (NAACP), and many more. These groups are formal organizations seeking to influence policy through political channels using methods I will discuss shortly. The U.S. has so many interest groups, the true number of interest groups are unknown. The most well-known groups like the ones mentioned above are highly organized. The current debate over gun reform speaks to this, as do other important issues like corporate subsidies and tariffs.
Minority interests often win out over the majority in democratic politics. The reason for this is the ability to organize, and in the current US system the ability to make endless campaign donations. The early 20th century sociologist Robert Michels developed the "iron law of oligarchy" (oligarchy being a Greek word meaning "rule by the few"). The "law" states as organizations grow and become more complex, control of the organization is placed in the hands of those who have superior technical and organizational skills. Important Supreme Court cases that opened the way unlimited campaign donations were Buckley v. Valeo in 1976, and Citizens United v. FEC in 2010.
In the 1960s, economist Mancur Olson Jr. developed what he called the "logic of collective action." Collective action refers to combined efforts pursuing goals, obviously, political action is collective actions. Olson argues you can separate "diffuse interests," the majority, from "concentrated interests," minority interests. For example, trade policy is made interest groups, lobbying the government for tariffs on imports from foreign countries. This would result in higher prices on these items. A majority of people might be opposed to this, but since the minority interests are more concentrated, they will work harder to lobby the government. The majority interests are diffuse and not organized. This sharply contrasts with Madison's notion of politics, constitutional government, and checks and balances to reduce the influence of the majority. Is it possible that the U.S. Constitution is overly guarded against the will of the majority? If it is true that minority interests often are better organized than the majority and are able to translate that into political policy, then it is very likely to be true.
Related to the idea of diffuse v. concentrated interests is what Olson calls the "free-rider problem." A free rider is someone who benefits from a public service, but contributes nothing to maintaining this benefit. Olson argues it is rational to be a free-rider. If rationality is the ability to figure out what is in your best interest, then Olson argues it is rational to free-ride since you get the benefit without doing any work. This leads to a paradox, if everyone free rides than no one will do the work needed to maintain the benefit, for example a clean public park, or well run schools. How, then, can you solve the free-rider problem? Olson argues four solutions:1) keep the size of the group small enough so people get a feeling of friendship or solidarity, that you do not get in a large organization, this however, will limit the effectiveness of the group; 2) create "selective benefits" that are only given if you participate in the group; 3) use coercion to force people to participate; 4) someone takes it upon themselves to provide the cost of the benefit. This explains the often hierarchical structure of many interest groups, hardly run in democratic fashion, whether they are business associations or unions, or other groups. However some critics argue that Olson and Michels are pessimistic and narrowly focused on individual groups. While it might be true that all organizations degenerate over time even as they grow larger, if you take a step back and look at the larger society there are always more groups forming to replace older organizations. Of course this is not an easy process and often there is intense struggle and conflict for newer groups to replace older ones. Still it offers one possible solution for the "iron law of oligarchy," even though it has to be a perpetual process.
You also have to consider the different tactics used by groups to influence policy.
- Most common is lobbying which refers to meeting directly with legislators and trying to influence their decisions on voting for laws. Lobbyists are not missionaries trying to convert people, but looking for people who think the same way on most issues. Political parties provide a political identity that interest groups can use to determine who to approach, helping establish connections between interest groups and candidates. Lobbyists have direct access to key policy-makers in government and is usually reserved for the most influential groups.
- Campaign contributions to finance election campaigns, something every politician is looking for.
- Economically well-connected groups can use the threat of moving as a way to influence policy, by effectively leaving or exiting the political arena. Sports teams have used this tactic to influence local governments to vote for tax breaks or other concessions.
- Outside lobbying refers to large groups who write or phone legislators in order to influence their vote. This is seen as more of a "grass-roots" approach to lobbying.
- Voting against a candidate. Many groups opposing tax increases on the rich have used this tactic against Republicans in the House of Representatives, making sure they do not vote for tax increases. Those who do not comply are voted out of office, even in the primary, during the next election.
- Demonstrations and boycotts. This tactic is probably most famous for being used during the early civil movements like the Montgomery Bus Boycott organized by Martin Luther King Jr.
- Litigation is another tactic used by the civil rights movement as in Brown v. Board of Ed. To litigate means to bring your issue to court in the form of a lawsuit.
- Forming coalitions or alliances with other groups.
- Control over information. Many areas for law makers are highly technical (e.g. science and medicine) and depend on interest groups for relevant information.
- Public information campaigns are directed towards voters to motivate them to lobby legislators. The flow of information is from interest groups to the broader public.
- Sometimes violence is used even by formally organized groups, (e.g. employers have been known to use violent means to disperse striking workers) but usually this tactic is associated with social movements.
Before moving on to social movements, there are two main ways to classify interest group politics: pluralist or corporatist
The U.S. system is pluralist. Pluralism refers to large groups acting independently of each other, trying to pursue their own interests. Germany is an example of a corporatist system, with a smaller number of groups: government, business, and labor. In a pluralist system groups like business and labor act as separate, and often antagonistic interests, while in a corporatist system business and labor are brought together in an institutional environment to create cooperation between these groups, characterized by large trade associations with close ties to the government. Economists Peter Hall and David Soskice argue there are six crucial areas that distinguishes a pluralist system (or in their terms a liberal-market economy, LME) from a corporatist system (coordinated market economy, CME).
- Finance: Businesses in pluralist systems finance their activities through capital markets (banks) and are publicly traded on stock exchanges relative to their "market value." In a corporatist systems, business firms are self-financed in cooperation with other firms in the same industry, or rely on financing from the state.
- Industrial relations: pluralist systems make business and labor adversaries. Wage contracts are negotiated between business and labor representatives. In a corporatist system wages are decided by institutions representing business and labor, union officials even serve on corporations' board of directors
- Skill formation: In a pluralist system workers invest in their own skills through education. Employers have little incentive to invest in worker training since workers leave often and find new jobs. Corporatist systems usually have better job training programs, funded by unions and employers, employment at firms is longer.
- Product markets: In a pluralist system businesses have to compete against each other for a share or a piece of a certain market. Marketing and advertising campaigns are common ways of increasing market share. A corporatist system divides markets between firms, that negotiate for a share of the market
- Inter-firm relations: In a pluralist system, technology is shared by firms through paid licensing. A corporatist system allows for technology sharing in a more cooperative setting.
- Firm-employee relations: In a pluralist system corporate managers have much more freedom and power than they do in a corporatist system.
Hall and Soskice argue that in a "liberal-market economy" like the U.S. or a "coordinated market economy" like Germany these six areas will complement and reinforce each other.
Social movements are basically protest groups like the civil rights movement or the labor movement, and differ from interest groups mainly by level of organization, although most social movements have some organization, it is usually not as institutionalized. This has various advantages and disadvantages. Lack of formal organization gives social movements greater flexibility than interest groups, however they often lack the resources of organized interests. At the same time interest groups might have closer ties to government, but often lack the popular support social movements have. Social movements are not necessarily good while interest groups are bad. Social movements can range from anything from the civil rights movement to the rise of fascism in Europe in the 1930s (and now again). Many social movements use the tactics of interest groups, like bus boycotts for example, but often social movements can use violence as well.
Theorists of social movements like Doug McAdam argue there is a structure for how social movements operate, and must take into account three factors:
- The political opportunity structure: meaning what are the options for political action given by the political system. An authoritarian government will have a more restricted opportunity structure than a democratic government. Political opportunities are also created outside of national boundaries by global social movements and international organizations
- Mobilization structure: refers to how the movement is able to generate collective action by mobilizing its supporters. The growth of communication technology and social media has greatly increased the ability to mobilize people.
- Framing: refers to how the goals of the movement are articulated. Ideology is important as well because a belief system which ties supporters together and gives them a way of framing or interpreting the goals of the movement.
There is a logic to social movements, bringing up the same problems of collective action, namely the free-rider problem. People have an incentive to free-ride as well, if civil rights legislation is passed it will benefit all minority groups affected, but there is still a tendency not to contribute assistance and to allow someone else to do the work of providing this benefit.
Another approach to the logic of collective actions is given by Albert Hirschman, who argues there are three primary responses from a group or individual to a declining institution: exit, voice, or loyalty. Hirschman developed his analysis originally by looking at the responses of consumers to businesses but then argues this model can be used for politics as well. The most common response of a consumer to a product they do not like anymore, is to exit, meaning to take their business elsewhere, but in a political sense this can be done as well, for example sports teams which threaten to leave a city, or even people threatening to leave a country (e.g. various celebrities vowing to move out of the country—of course no one ever leaves). However, the idea of threatening to leave, or exit leads to the second response, voice, to express your discontent with the institution and desire to change or reform it. So when confronted by a situation one does not like, one can either exit the situation, or voice their discontent and try to change the situation. What then determines the influence of voice? There are many factors involved like resources and connections, but also the threat of exit has to be considered as well. Simply put, if I am threatening to leave you but you do not take this threat seriously then you are less likely to give in to my threat, however if you do believe I might actually leave you might be more willing to make concessions. For example, if an employer feels that a union's threat to strike (exit) is credible, it is more likely to give in to demands. Counter-culture groups that refuse to participate in mainstream society is also a kind of "exit" tactic. Finally, there is loyalty, which means you do nothing and wait for things to change. The level of loyalty influences the threat of exit. If I am loyal, I am less likely to leave. Hirschman's goal was then to specify in real situations the values of exit, voice, and loyalty and to predict the likelihood groups would use these responses in situations. Hirschman's logic like Olson's can be used for both interest groups and social movements.
To sum up, the goals of interest groups and social movements can be very similar, as are the problems that limit their effectiveness.The tactics chosen by interest groups and social movements are related to their level of organization and ability to mobilize people, and these tactics can be thought of in terms of exit, voice, and loyalty as possible responses. Many social movements as they become more formalized over time become more like interest groups (or in some case change into political parties). In many ways, the more successful a social movement, the more it risks losing what makes it effective.
Assignment: Choose a passage from the reading by Olson. Write it out, explain what it means and why you chose this passage.
Assignment: Choose a passage from the reading by Olson. Write it out, explain what it means and why you chose this passage.