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The Federal Regulation of Lobbying Act

  • Belle Zeller (a1)

Although the need for such action had long been apparent in Washington, it was not until 1946 that a federal statute was enacted for the regulation of general lobbying activities. Prior to that year, Congress had, on a number of occasions, investigated lobbying practices, and as a result had enacted measures which reached a limited number of groups engaged in them. The Public Utility Holding Company Act of 1935, the congressional act in 1936 affecting the shipping interests, and the Foreign Agents Registration Act of 1938 were important regulatory measures, but they reached only a few of the groups exerting direct and continuous influence in Washington. The Federal Regulation of Lobbying Act of August 2, 1946, is more general in its coverage; and it has been in force long enough for its effectiveness to be tested.

In this article, it is my purpose (1) to supply a brief historical background for the measure referred to; (2) to examine the statute's provisions; (3) to appraise the objections raised to it; (4) to examine the actual administration of the act and point out the difficulties of enforcement, particularly during its first year; and (5) to offer recommendations for strengthening the law.

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1 S. 1095, 70th Cong., 1st Sess.

2 Senate Report 342, 70th Cong., 1st Sess., 1928, pp. 2, 3.

3 House Report 2081, 74th Cong., 2nd Sess, p. 3. An earlier investigation of lobbying practices in which the National Association of Manufacturers figured prominently occurred in 1913. Cf. House Report 113, 63rd Cong., 2nd Sess.

4 House Report 2925, June 2, 1936.

5 U. S. Code, 1940, title 15, ch. 2C, secs. 79(h) and 79(i). See also Forms U-12(1)—A and B of the Securities and Exchange Commission.

6 See U. S. Code, title 46, sec. 1225; U. S. Maritime Commission General Order No. 9, July 13, 1937; and Forms 807–1 and 807–2, together with accompanying instructions for such forms.

7 U. S. Code, title 22, secs. 611–621; Executive Order No. 9176, Federal Register, Vol. 7, June, 1942, p. 4127. See Report of Attorney-General to the Congress of the United States on the Administration of the Foreign Agents Registration Act of 1938 as amended for the period from June 28, 1942, to December 31, 1944 (June, 1945). Also Ettinger, Karl E., “Foreign Propaganda in America,” Public Opinion Quarterly, Vol. 10 (Fall, 1946), pp. 329342.

8 U. S. Code, title 18, sec. 241a, approved January 13, 1940.

9 A fuller story of the state lobby laws has been told elsewhere. See especially Logan, E. B., “Lobbying,” Supplement to the Annals of the American Academy of Political and Social Science, July, 1929; Zeller, Belle, “State Regulation of Lobbying,” in The Book of the States, 1948–49, pp. 124130; Zeller, Belle, Pressure Politics in New York (1937), pp. 251262, for detailed examination of the administration of the New York State lobbying law.

10 New York Times, Mar. 24, 1946.

11 Brewer, F. M., “Congressional Lobbying,” Editorial Research Reports, Vol. 1, No. 18 (May 8, 1946), p. 320.

12 Cong. Rec., Vol. 92, p. 2156.

13 This resolution, H. Res. 557, and another similar in purpose, H. Res. 416, introduced earlier by Representative Smith of Maine, did not pass.

14 The Reorganization of Congress; A Report of the Committee on Congress of the American Political Science Association (1945), p. 80.

15 Hearings before the Joint Committee on the Organization of Congress, 4 parts, 79th Cong., 1st Sess., March 13, 1945, to June 29, 1945. See especially helpful comments of George H. E. Smith, research assistant to the Senate minority leader at page 411 of these hearings. After the close of the hearings, the writer submitted to the Joint Committee, upon request, a memorandum on the subject of “Federal Regulation of Lobbies.” For the text of this memorandum, see Print of Joint Committee on the Organization of Congress, June, 1946, pp. 65–69, and Galloway, George B., Congress at the Crossroads (1946), pp. 302307.

16 Senate Report 1011, 79th Cong., 2nd Sess, p. 27.

17 Public Law 601 (Senate Bill 2177), 79th Cong., 2nd Sess.

18 Senate Report No. 1400, 79th Cong., 2nd Sess., May 31, 1946, p. 27.

19 Cong. Rec., Vol. 80, p. 9751.

20 Screws v. United States, 325 U. S. 91, at p. 136: “It is axiomatic, of course, that a criminal statute must give a clear and unmistakable warning as to the acts which will subject one to criminal punishment. And courts are without power to supply that which Congress has left vague.”

21 Senate Report No. 1400, 79th Cong., 2nd Sess., p. 28.

22 For an examination and interpretation of the provisions of the Federal Lobbying Act, see the brief filed on January 28, 1948, by the National Association of Manufacturers in the District Court of the United States for the District of Columbia. See also Columbia Law Review, Vol. 47, Jan. 1947, pp. 98–109; Yale Law Journal, Vol. 56, Jan. 1947, pp. 304–332.

23 Cong. Rec., Vol. 92, July 25, 1946, p. 10138; on June 17, 1936, Representative Smith said: “It [the lobbying bill] does not apply to organizations formed for other purposes whose efforts to influence legislation are merely incidental to the purposes for which formed….” (Cf. Cong. Rec., Vol. 80, p. 9751.)

24 Contrast this language with that of Representative Smith, who sponsored lobbying legislation ten years earlier: “The amendment proposes to change that language by striking out the words ‘in whole or in part’ and by inserting the word ‘principally.’ The reason for that amendment is, it was brought to my attention, and I think to the attention of other members of the committee, that there were many organizations of national scope who have large memberships of thousands and some of millions of members organized principally for other purposes than affecting legislation, but many of those organizations do from time to time become interested in legislation, and they undertake to do something about it. It was not thought necessary or proper that that class of organization, because a minor part of its funds were devoted to purposes of influencing legislation, should be required to report all of the dues of their hundreds of thousands of members, and for that reason this amendment is proposed so that it would not apply except where the money is collected for the principal purpose of undertaking to influence legislation or the election of Federal officers….” Cf. Cong. Rec., Vol. 80, March 27, 1936, p. 4535.

Unlike the bills sponsored by Senator Caraway in the 70th Congress and Senator Black in the 74th Congress, the lobbying act of 1946 does not specifically define lobbying. It may, of course, be construed that the acts and practices under the Statutes that require the filing of statements may be called lobbying. In Senate bill 1095 of the 70th Congress: “A lobbyist, within the meaning of this act, is one who shall engage, for pay, to attempt to influence legislation, or to prevent legislation, by the National Congress.” In Senate bill 2512 of the 74th Congress: “Lobbying … shall consist of any effort to influence the action of Congress upon any matter coming before it, whether it be by distributing literature, appearing before committees of Congress, or interviewing or seeking to interview individual members of either House of Representatives or the Senate.”

These definitions were patterned after the broader one in the House report of 1913, which defined lobbying as the “activities of a person or a body of persons seeking to influence Congress in any way whatever.” Cf. House Report 113, 63rd Cong., 2nd Sess., 1913, p. 15.

25 Senate Report 1400, 79th Cong., 2nd Sess., May 31, 1946, p. 27.

26 Senate Report 1011, 79th Cong., 2nd Sess., Mar. 4, 1946, pp. 26–27.

27 Senate Report 1400, 79th Cong., 2nd Sess., p. 5.

28 Memorandum dated Aug. 28, 1946, p. 6.

29 Cong. Rec., Vol. 93, Jan. 3, 1947, p. 52.

30 However, subsequently Paul Richman filed under Form B and stated that he was employed by the Anti-Defamation League of B'nai B'rith and that he “devotes less than five per cent of his time, if any, to activity within the terms of the statute.” Cf. Cong. Rec., Vol. 93, May 12, 1947, p. 5210.

31 F. E. Lee to Donald Kirkpatrick, Nov. 26, 1946. The American Farm Bureau Federation filed quarterly A reports in 1947, and four individuals, including the president, filed B reports, indicating annual salaries totalling $37,000. Each of these four representatives also filed quarterly expense statements under Form C.

32 H.R. 11223 and H.R. 11663 and S. 2512, all 74th Cong. See House Reports 2081 and 2925, 74th Cong., 2nd Sess., and Cong. Rec., Vol. 80, p. 4535.

33 The term “render” appeared in the bill read to the House of Representatives. Cf. Cong. Rec., July 25, 1946, p. 10137. “Render” also appears in section 3 of H.R. 11223 (74th Cong.) and H.R. 11663 (74th Cong.).

34 Aug. 10, 1946.

35 Aug. 13, 1946.

36 See also New York Times, Oct. 18, 1946, and Philadelphia Inquirer, Oct. 21 1946. E. H. Cary, chairman of the National Physicians Committee, testified on April 19, 1946, before the Senate Committee on Education and Labor that his group had spent $905,359 on various forms of educational work during the last five years. The Committee reported expenditures of $200,541.63 for the first nine months of 1947 under the Federal Lobbying Act.

37 First memorandum on Regulation of Lobbying Act, p. 3, probably late August, 1946. The Committee for Constitutional Government reported under the Lobbying Act expenditures of $465,080.97 for the period August 2, 1946, through June 30, 1947, but gave no information on contributors.

38 Memoranda on “Regulations of Lobbying Act” of the Committee on Constitutional Government, p. 3 of the first memorandum, and p. 4 of the second.

39 Cases cited in the two memorandums prepared for the Committee for Constitutional Government include Boyd v. United States (1886), 116 U. S. 616; Kilbourn v. Thompson (1881), 103 U. S. 168; Sinclair v. United States (1929), 279 U. S. 263; Interstate Commerce Commission v. Brimson (1894), 154 U. S. 447; Federal Trade Commission v. American Tobacco Company (1924), 264 U. S. 298; Hale v. Henkel (1906), 201 U. S. 43; McGrain v. Daugherty (1927), 273 U. S. 135; Jones v. Securities and Exchange Commission (1936), 298 U. S. 1. The brief filed by the National Association of Manufacturers in the United States Federal Court in Washington, D. C. on January 28, 1948, also holds that the lobbying title is in conflict with the Constitution.

40 Senator McClellan, who preferred a lobbying bill limited to professional lobbyists, viewed the lobbying title before passage as a possible violation of civil liberties: “… I should not be willing to pursue that purpose so far as to prevent the president of the Federal Farm Bureau, or the president of the C.I.O., or the president of the A. F. of L., or the president of the Farmers Union, or the secretary of the Chamber of Commerce,… from coming to Washington and conferring with their congressional delegation unless they agreed to register and to report as professional lobbyists. I do not think the legislation should go that far … I think it is probably an abridgment of the civil rights of our citizens and our constituents, when and if the law does go that far … I do not think we have a right to say to any citizen of our State that, as a citizen of the State, he cannot, without becoming a criminal because of violation of this proposed law, contact his Senator or his Representative in Congress and discuss with him legislation in which he or his organization is interested, unless he registers and acknowledges himself to be a lobbyist.” Cf. Cong. Rec., Vol. 92, June 10, 1946, p. 6678.

41 Kansas, Maryland, Massachusetts, North Dakota, Rhode Island, South Dakota, Wisconsin. See Zeller, Belle, “State Regulation of Lobbying,” The Book of the States, 1948–49, pp. 129, 130.

42 That the latter was also the intention of the Joint Committee on the Organization of Congress may be seen from its report, Senate Report 1400, 79th Cong., 2nd Sess., p. 5.

43 Aug. 26, 1946.

44 New York Times, Aug. 10, 1946.

45 New York Herald Tribune, Aug. 4, 1946.

46 St. Louis Post Dispatch, Sept. 22, 1946.

47 Journal Gazette, Fort Wayne, Ind., Oct. 10, 1946.

48 Chicago Times, Sept. 13, 1946.

49 The writer has had opportunity to examine, periodically, the reports filed under the provisions of the Lobbying title with the clerk of the House of Representatives and the secretary of the Senate, to talk directly with persons in these offices and with those responsible for the drafting of the legislation, to examine the memorandums of interpretation and advice prepared by counsel for a number of organizations affected by the legislation, to communicate by telephone and letter with some of the counsel and with a larger number of the Washington lobbyists themselves, to examine the press coverage from coast to coast on this Lobbying title, and in some instances to talk directly with the Washington press correspondents.

50 New York Times, Aug. 10, 1946. Unlike other titles in the Legislative Reorganization Act, Title III provided no specific date on which it was to take effect.

51 In this connection, counsel for the American Farm Bureau Federation commented: “The simplification which the Secretary and the Clerk have thus undertaken is advantageous to persons required to register under the Act, except that Form A, which is for use by organizations, states that it is filed under section 307, thus implying that any organization filing it is engaged principally in lobbying.” Cf. letter of F. P. Lee to Donald Kirkpatrick, Nov. 26, 1946.

52 Interview with H. Newlin Megill, acting clerk of the House of Representatives, Dec. 6, 1946; United States News, Vol. 31, Sept. 6, 1947, p. 70.

53 It was disclosed on December 25, 1947, that the United States Attorney-General had earlier appointed Irving R. Kaufman as his special assistant to conduct an investigation of lobbying activities. Cf. New York Times, Dec. 26, 1947, and interview with Irving R. Kaufman, Jan. 2, 1948. On. Jan. 14, the Attorney-General announced that he had given Mr. Kaufman written authorization to appear before the grand jury in cases warranting prosecution; and on March 23, it was disclosed that a grand jury in Washington, D. C., had started receiving evidence from the Department of Justice on alleged violations of the Lobbying Act. Cf. New York Herald Tribune, March 24, 1948. On March 30, 1948, this grand jury indicted the United States Savings and Loan League. Cf. New York Times, March 31, 1948. On January 28, 1948, the National Association of Manufacturers followed what appears an unusual course when it appealed to the federal district court in a civil action for an injunction to enjoin enforcement of the Federal Lobbying Act, which is a criminal statute.

54 Clerk to Edward A. Rumely of the Committee for Constitutional Government, Inc., Oct. 10, 1946. The same advice was repeated subsequently by the clerk to officers of the organization. On July 8, 1947, Mr. Rumely wrote the clerk “… I protest that I am not under any legal obligation to file reports under said Act, and again request a ruling on this question for future guidance.”

55 South Trimble, clerk of the House of Representatives to Charles E. Sands, Nov. 20, 1946.

56 By January 31, 1948, an additional twenty-one “persons” filed under Form A.

57 Among such organizations were the National Farmers Union, the United Fresh Fruit and Vegetable Association, the Institute of Cooking and Heating Appliance Manufacturers, and the United Health League.

58 For example, J. Byron Wilson, chairman of the legislative committee of the National Wool Growers Association, filed no B or C statements. He is reported to be one of the best known lobbyists on the Hill. The National Wool Growers Association, however, did report on its Form A, filed on July 9, 1947, that Mr. Wilson spent a total of $2,457.22 during the first two quarters of 1947, but made no mention of his annual salary, His colleague, J. M. Jones, secretary of the Association, did file under B and C.

59 However, the American Library Association listed its expenditures but not its contributions on its four quarterly Forms A. Letter of Carl H. Milam, executive secretary, to Leslie F. Biffle, secretary of the Senate, Oct. 10, 1946.

60 See Cong. Rec., Vol. 93, Jan. 3, 1947, Feb. 5, 1947, May 12, 1947, Aug. 15, 1947.

61 Although by January, 1948, a thousand lobbyists had registered, they represented a total of about 750 employer organizations and individuals. See Cong. Rec., Vol. 93, Nov. 17, 1947; Vol. 94, Jan. 29, 1948.

62 It is possible that among these 74 registrants are some who terminated their services with one organization before being employed by another. This may apply to those who filed at different times under Form B. A specific statement of termination of employment should be required on Form C.

63 On Form A, the Townsend National Recovery Plan, Inc., reported for 1946 contributions of $216,146.34 and expenditures of $584,833.47.

64 House Joint Resolution 227, 70th Cong., undertook to prohibit former members of Congress from engaging in the practice of lobbying, but the resolution did not pass.

65 Former congressmen were Albert E. Carter, employed by the Pacific Gas and Electric Company at $12,000 per annum; John A. Danaher of Connecticut, Revere Copper and Brass, Inc., at $25,000 per year; Wesley E. Disney of Oklahoma, National Gas Association of America, at $10,000 per year plus legal fees from other groups; Winder R. Harris of Virginia, Shipbuilders Council of America, at $15,000 per annum; Fritz G. Lanham of Texas, National Patent Council, State Rights Association, and others, at a total of $16,000 per year; Robert Ramspeck of Georgia, Air Transport Association of America, at $25,000 per year; H. Jerry Voorhis of California, Coöperative League of the United States of America, at $7,500 per year; Clifton A. Woodrum of Virginia, American Plant Food Council, Inc., at $36,000 per annum.

Prominent among the other former public officials were Samuel Rosenman, employed by the Associated Fur Coat and Trimming Manufacturers, Inc., at $40,000 per year; and William P. MacCracken, Jr. employed by Remington Rand, Inc., at $12,000 per year, while his services to the American Optometric Association are paid for from time to time, the amount depending upon the nature of the work and the time involved.

66 These salaries are paid, respectively, to Margaret K. Taylor by the National Coöperative Milk Producers Federation and Hilda W. Smith by the Committee for the Extension of Labor Legislation.

67 In addition to the list published in the Congressional Record, see New York Herald Tribune, May 15, 1947.

68 Cong. Rec., Vol. 93, Jan. 3, 1947, p. 54.

69 Representatives of the Association of American Railroads and the United States Beet Sugar Association are each paid annual salaries of $40,000.

70 One Jostus R. Moll recorded that he received “no money or other valuable consideration” from the Frisco System Board of Adjustment, except the payment of his annual dues, and he even paid his own expenses. He added: “In addition to said consideration, I hope to receive as other ‘consideration’ mentioned in the statute, the continued loyalty and gratitude of the membership of Frisco System Board of Adjustment (or any other bona-fide labor union) in return for my efforts.”

71 Apr. 8, 1947. It is evident that it would be well if some provision were made on Form C specifically calling for a statement of resignation or cancellation.

72 Cong. Rec., Vol. 93, Jan. 3, 1947, p. 49.

73 Cong. Rec., Vol. 93, May 12, 1947, p. 5209.

74 The last two quarters covered the first six months of the 80th Congress. By the end of Jan., 1948, 2,592 filed on Form C.

75 For example, this was done by Charles E. Saltzman, who represented the New York Stock Exchange until he resigned in July, 1947, to become Assistant Secretary of State.

76 Entries for Booth, Herman M. Jr., in Cong. Rec., Vol. 93, May 12, 1947, p. 5216, and Aug. 15, 1947, p. A4468.

77 Cong. Rec., Vol. 93, Aug. 15, 1947, p. A4492.

78 Cong. Rec., Vol. 93, Aug. 15, 1947, p. A4493.

79 New York Times, June 1, 1947.

80 Washington Post, July 25, 1947, reprinted in Cong. Rec., Vol. 93, July 25, 1947, p. A4067.

81 New York Times, July 1, 1947.

82 Washington Daily News, July 21, 1947, reprinted in Cong. Rec., Vol. 93, July 25, 1947, p. 10353.

83 On Mar. 30, 1948, the federal grand jury in Washington, D. C., indicted the United States Savings and Loan League for its failure to file under Form A of the Lobbying Law. Three of its legislative representatives did file under Form B. When a federal grand jury brought an indictment against the National Association of Real Estate Boards and the Washington Real Estate Board on grounds of conspiring to fix commission rates for real estate dealers, the president of the National Association saw in this action a reprisal for disagreement with the Administration on housing. Cf. New York Times, Aug. 29, 1947.

84 Aug. 4, 1947.

85 Cong. Rec., Vol. 93, June 23, 1947, p. 7716. Neither Mr. Murray nor Mr. Green has registered under the lobbying act.

86 For the period April 23, 1947, through December 31, 1947, receipts were $1,046,478.02 and expenditures $834,565.38.

87 Judkins, C. J., Trade and Professional Associations of the United States (Washington, D. C., 1942), U. S. Department of Commerce, Bureau of Foreign and Domestic Commerce. The associations are broken down as follows: 1,900 trade associations (business competitors in one industry); 300 other “business associations” (not trade associations, but composed largely of business men); 600 other organizations (the activities of these are of special interest to business, such as the American Farm Bureau Federation, American Federation of Labor, American Medical Association); 300 additional associations. The National Association of Manufacturers states that there are about 1,500 national or regional trade associations of commercial or industrial enterprises.

88 T.N.E.C. Report, No. 26, pp. 197–201.

89 Omaha World-Herald, Oct. 9, 1946.

90 See footnote 53 above. The Justice Department holds that the phrase “principal purpose” in section 307 means any purpose which is not incidental to the activities of the “person” in question, that any other interpretation would be meaningless and would clearly defeat the expressed intention of Congress. See testimony of Irving R. Kaufman before the Senate Committee on Expenditures in the Executive Departments, Feb. 17, 1948. See footnotes 53 and 83 above.

91 The Senate Committee on Expenditures in the Executive Departments has already held such hearings, in which the writer participated on Feb. 17, 1948. New York Times, Feb. 18, 1948.

92 Hearings before the Joint Committee on the Organization of Congress, 79th Cong., 1st Sess., Part 4, p. 1007.

93 For example, the chairman of the National Legislative Committee of the American Federation of Labor, in order to support his statement “that the legislative expenses of our organization is a very minute proportion of its activities,” points to the annual report of the Federation for the year ending August 31, 1946, in which the total expenditures of the Federation were given at more than two and a half million dollars and legislative salaries and expenses amounted to $16,441.57. Cf. letter of W. C. Husking, Dec. 6, 1946, and Report of the Executive Council of the American Federation of Labor, 1946, pp. 2–3. For the year ending Aug. 31, 1947, although the total expenditures of the Federation exceeded five million dollars, legislative salaries and expenses were $22,474.00. These figures do not include the sums spent in the Federation's campaign to defeat the Taft-Hartley Bill.

94 For membership of the Press, Radio, and Periodical Press Galleries, see Congressional Directory, Jan., 1948, pp. 731–783.

95 Senate bill 2512, 74th Cong., introduced by Senator Black, made such provision.

96 This prohibition is found in many of the state lobbying laws. Contingent payments may tend to encourage questionable practices. A registrant, in answering question 4 on Form B, “how much he is paid and is to receive,” stated: “$10,000 per annum as a retainer as Washington counsel on all matters affecting the economic and legal welfare of the [fur] industry, plus a fee of $15,000 in the event excise tax on furs is cut from twenty per cent to ten per cent, plus an additional fee of $25,000 in the event the entire excise tax on furs is repealed on or before July 1, 1948.” Cf. Cong. Rec., Vol. 94, Jan. 29, 1948, p. 741.

97 See U. S. Code, title 26, sec. 101(6), 1938.

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