If you’re a successful business in America, you either quickly open a lobbying office in Washington, or Washington makes you regret that you didn’t.
“If you want to get involved in business,” Sen. Orrin Hatch warned technology companies at a conference in 2000, “you should get involved in politics.”
Hatch was referring to the shortcomings of then-software king Microsoft, which he had spent most of the previous decade harassing from his perch as Judiciary Committee chairman. The message was clear: If you become successful, you must hire lobbyists, you must start a political action committee, and you must donate to politicians. Otherwise Washington will make your life very difficult.
Hatch’s crusade against Microsoft was a formative moment in the cozy relationship between K Street and Capitol Hill. That coziness has become a prime target of the Tea Party in recent years — and so has Orrin Hatch, who faces a primary Tuesday against conservative challenger Dan Liljenquist.
People think money drives politics. It doesn’t. Money is merely the vehicle. Power drives Washington. As Carney points out, Hatch has spent a good deal of his time on the Judiciary Committee targeting Microsoft. So he wasn’t mad that the company wasn’t giving him money—they weren’t giving to his opponents, either. Hatch was angry that the company wasn’t acknowledging that it needs Washington, that it needs people like him. He finds that offensive. So people like Hatch make companies like Google need people like Hatch.
. . . it grated on Hatch and other senators that Gates didn’t want to want to play the Washington game. Former Microsoft employee Michael Kinsley, a liberal, wrote of Gates: “He didn’t want anything special from the government, except the freedom to build and sell software. If the government would leave him alone, he would leave the government alone.”
This was a mistake. One lobbyist fumed about Gates to author Gary Rivlin: “You look at a guy like Gates, who’s been arrogant and cheap and incredibly naive about politics. He genuinely believed that because he was creating jobs or whatever, that’d be enough.”
Gates was “cheap” because Microsoft spent only $2 million on lobbying in 1997, and its PAC contributed less than $50,000 during the 1996 election cycle.
“You can’t say, ‘We’re better than that,’ ” a Microsoft lobbyist told me on Friday. “At some point, you get too big, and you can’t just ignore Washington.”
You know what happens next . . .
After the Hatch hearings, Microsoft complied. Its PAC increased spending fivefold in each of the next two elections. In the 2010 elections, Microsoft’s PAC contributed $2.3 million to House and Senate candidates. The PAC has contributed the maximum $10,000 to each of Hatch’s last two campaigns.
Back before the antitrust case, Microsoft’s tiny lobbying contingent sat in the company’s local sales office in Chevy Chase. Since the Hatch hearings, Gates’ company has poured more than $100 million into K Street’s economy, hiring up members of congress and Capitol Hill staff, many of whom then became top fundraisers — such as Republican Jack Abramoff and Democrat Steve Elmendorf.
And of course now that Microsoft has a strong Washington presence, it uses its influence to lobby the government to harass its competitors. Like Google, which must then open its own Washington lobbying outfit in response. And the cycle starts all over again. (If you’re really on your game, you then hire the government regulators you’ve lobbied to investigate your rival to come work for you.)
A politician like Hatch will always demand that powerful people kiss his ring. It’s why people like Hatch go into politics. The proper response is Gates’ initial reaction—to tell people like Hatch to pound dirt. The problems begin—and the corruption beings— when people like Hatch have the power to force people like Gates to respect them. So long as there’s hell to pay for not respecting Washington, no “get money out of politics” law is going to rid the city of corruption.
I don’t always agree with the Tea Party. But if the group helps oust Washington dinosaurs like Hatch, that can’t be a bad thing.