Page images

The CHAIRMAN. I might say that Congress made an effort to ai lobbying above suspicion.

Mr. KAUFMAN. That is correct.

Senator FERGUSON. You said the opinion that you gave us was not in line with the opinion of the Department. In other words, the Department would say that if they had a general retainer, this does 19t apply?

Mr. KAUFMAN. No, Senator; I did not say it was not in line. I said the Department did not have a view on the point.

Senator FERGUSON. They do not have a view?

Mr. KAUFMAN. That is correct. We have been asked that question by independent counsel and refused to give them an opinion.

Senator FERGUSON. You said if they started out with the idea of the retainer being intended to cover lobbying and other work; but let us take the case where a company is normally just giving a lawyer a retainer, and there isn't any bill or anything in the legislative hall that affects them. But during the session something comes up and they say to their general counsel, “Go down to Washington and oppose that bill. Here are the reasons why you should oppose it." He comes down to Washington and spends the money lobbying and seeing Senators and Congressmen and department heads in the line of his regular activities. Is he covered?

Mr. KAUFMAN. I believe that that counsel will have to sit down and determine in his own mind whether or not it is a mere incidental function he is rendering to that plant in connection with the general retainer, or whether it is not incidental, and the moment he comes to the conclusion that it is not incidental, he will have to file.

Senator FERGUSON. Then you come back to the word "principal." He says, “I have only spent 2 weeks out of 52 weeks; therefore, it is incidental.”

The CHAIRMAN. Certainly it cannot be principal—2 weeks out of 52.

Mr. KAUFMAN. That is the very test which most of the associations apply in determining whether or not it is principal, but I don't believe you can use the time test, because I can very well see where a man might spend 1 week out of 52 when a particular piece of legislation is hot before Congress and yet it will certainly be an important service he is rendering.

Senator FERGUSON. In other words, it may be the most he has had? Mr. KAUFMAN. That is correct.

Senator FERGUSON. And if we use this strained interpretation, you really haven't any law?

Mr. KAUFMAN. That is right, sir.

The CHAIRMAN. Your work has been checking on associations, largely, up to date?

Mr. KAUFMAN. Associations, and I would say some individuals.

The CHAIRMAN. Have you seen any indication or evidence of lobbying on the part of Government agencies; and, if so, how would you class them?

Mr. KAUFMAN. I have not devoted any time whatsoever to studying lobbying by Government agencies. The ČHAIRMAN. Simply to lobbying by associations? Mr. KAUFMAN. Simply those covered under this act,

Senator FERGUSON. They are covered in the Government under another law.

Mr. KAUFMAN. That is correct; under another law.

Senator FERGUSON. They cannot use any funds for the purpose of influencing legislation.

Mr. KAUFMAN. That is right. They are exempted under this act.

Senator FERGUSON. But this applies to municipalities and States; does it not?


Senator FERGUSON. I will just take an example now. I think I have a wire on my desk saying that two men are coming to Washington in relation to the position of the State of Michigan on the tidewater bill. I think both of them are State officials. The Governor is sending them down to Washington and they will probably be here next week while the hearings are going on. They may testify. Can they be classed under this legislation as lobbyists?

Mr. KAUFMAN. Well, the difficulty with that would be that they are not really receiving pay to come to Washington. They are performing a civic duty, as I understand the case.

Senator FERGUSON. Now, suppose that the company or someone in the State should engage these people to come down here and does not pay them. Is that lobbying, under the act?

Mr. KauFMAN. I believe that has occurred recently. I observed that a registration came in recently for a representative of the State Attorney General's Association, and I believe a Mr. Johnson registered as a lobbyist in behalf of the association, and I am not sure of my memory on it, but I believe he stated he would receive $1,500 per month. Now, I believe Mr. Johnson is, or was, the attorney general of the State of Nebraska. Now, there is a case where he is being paid, so he complied with the statute by filing.

Senator FERGUSON. So it does not exempt States and municipalities as a Government agency?

Mr. KAUFMAN. I would say it exempts officials of the Government appearing in their official capacity. By "Government” I believe they mean the Federal Government.

Senator FERGUSON. The Federal Government?
Mr. KAUFMAN. That is right.
Senator FERGUSON. And not the States?

Mr. KAUFMAN. No; not under section 305, perhaps under section 308.

Senator FERGUSON. But if a person comes to Washington free gratis, without compensation, is he covered by the act?

Mr. KAUFMAN. No, sir. There is one thing that the act does not intend to do, and that is it does not deprive them of the right to petition.

Senator FERGUSON. Which is constitutionally their right, the right to petition.


Senator FERGUSON. Because they do it for themselves or do it for their community and do not receive payment for it, or furnish information to anyone else, they are not classed as lobbyists?

Mr. KAUFMAN. That is correct.

The CHAIRMAN. Suppose the Maine potato growers, a highly respectable organization, hires someone to come to Washington to call on the two Senators from the State of Maine in reference to getting, we will say, a new alcohol plant authorized by Congress. So long as that representative calls on the two senators from Maine alone, would you consider him a lobbyist?

Mr. KAUFMAN. It would all depend, Senator, upon whether they are performing a function which is not incidental.

The CHAIRMAN. They are promoting the welfare of their own State and calling only on their own Senators.

Mr. KAUFMAN. And are they being paid for it?

The CHAIRMAN. They are being paid for it, so much a day and expenses. We will put it that way. I don't want it understood that I am saying that these Maine potato growers do that, but just assuming that. I am merely using that as a means of trying to arrive at a definition or decision.

Mr. KAUFMAN. And that is all they are required to do, Senator? The CHAIRMAN. That is all

. They see only the two Senators from their State, to see if they can't get a bill through Congress authorizing the construction of an alcohol plant to take care of their surplus potatoes.

Mr. KAUFMAN. The question there would be whether or not they were receiving money to be used principally for the purpose of influencing or attempting to influence legislation.

The CHAIRMAN. Even though they saw only their own Senators, the Senators representing their own State?

Mr. KAUFMAN. That is right.

Senator FERGUSON. It doesn't make any difference how many they see or what they do when they are here?

Nr. KAUFMAN. That is right. It is merely a question of interpretation of the language of the act.

Senator McCLELLAN. The act does not differentiate between Senators of the State of their constituents and any other State?

Mr. KAUFMAN. No, sir.

Senator McCLELLAN. In other words, he is just as liable under this act if he lobbies with his own Senators as if he lobbies with all of the Senators?

Mr. KAUFMAN. That is correct.

The CHAIRMAN. Not being a lawyer, I am wondering where the right of petition leaves off and lobbying beigns.

Mr. KAUFMAN. Well, I don't see that the right of petition is infringed at all. They have a right to see their Senators and Congress


The CHAIRMAN. Does it matter whether they are paid or not? That is an element of registration.

Mr. KAUFMAN. Under the act they must receive pay.

The CHAIRMAN. If they are not paid, they would simply be exercising the right of petition? Mr. KAUFMAN. That is correct.

Senator McCLELLAN. I would like to get something clear in my mind here, along the lines of the questions the Senators have been asking We have a number of flood-control associations, river valley associations in my State. At certain times, when legislation is pend

ing, authorization bills or appropriation bills, they frequently send representatives up here to urge us to get certain projects authorized and appropriations for projects that have already been authorized. Suppose they come here and the association merely pays their expenses, actual expense, they receive no salary; are they lobbyists under the act?

Mr. KAUFMAN. I would say they are receiving compensation.

Senator McClELLAN. Are expenses compensation according to your interpretation?

Mr. KAUFMAN. Yes; they are.
Senator McCLELLAN. Do they compensate?
Mr. KAUFMAN. I believe it says "pay or any other thing of value.”

Senator McClellan. He doesn't receive any pay. He has nothing left after his expenses are paid.

Mr. KAUFMAN. The law says a person who shall engage himself for pay or for any consideration for the purpose of attempting to influence legislation.

Senator McCLELLAN. But expenses are merely reimbursement of his out-of-pocket expense, no gain. Consideration means some gain, some profit. There is no gain in reimbursement for actual expenses paid out.

Mr. KAUFMAN. I am not arguing in favor of it. I merely make this observation: Wouldn't there be a question there as to whether he received any compensation other than financial consideration?

Senator McCLELLAN. I am excluding that.

Mr. KAUFMAN. You are excluding everything except reimbursement for expenses.

Senator McCLELLAN. I am excluding everything except reimbursement of his expenses to come up here representing an association, to talk to his Senators, and to the members of the committee, to influence legislation that the association desires. I want to know if he is a lobbyist under this law? Because we have lots of that.

Mr. KAUFMAN. I would be inclined to think that the individual who came in that case would not be required to register.

Senator McCLELLAN. I don't think he should be.

Mr. KAUFMAN. However, I will say this, Senator, that I believe the association that pays the expenses would be required to file the statement under section 305, showing the payment which was made because section 305 says, "any money received or expended.” But I don't think the individual in that case would be required to file.

Senator McCLELLAN. Do you think you ought to convict the association?

Mr. KAUFMAN. I doubt whether there could be a conviction of the individual in such a case.

The CHAIRMAN. Do you have any questions, Senator Bricker?
Senator BRICKER. No questions,

The CHAIRMAN. Thank you, Mr. Kaufman, for your appearance here this afternoon, and the information you have given the committee in regard to this rather unsettled part of the Reorganization Act.

Mr. KAUFMAN. Thank you, gentlemen, for your attention.

The CHAIRMAN. Our next witness, this afternoon, is Prof. Belle Zeller, from Brooklyn College, New York. I understand, Professor Zeller, you are a teacher of political science in Brooklyn College?



The CHAIRMAN. And you have some views on this matter of lobbying to present which you think would be of interest to the committee. Professor ZELLER. Yes, sir. The CHAIRMAN. We will be very glad to hear you.

Professor ZELLER. It is a pleasure for me to be present at the invitation of your chairman and to discuss with you the Legislative Reorganization Act of 1946 with particular reference to the Federal Regulation of Lobbying Act which you know is title III of the Reorganization Act. I have recently completed for publication a rather comprehensive study of the lobbying title, which will appear in the April 1948 issue of “The American Political Science Review.” It is my intention, today, to draw briefly upon this study in order to support the recommendations for revision of the lobbying title which I plan to place before your committee.

I should like, if I may, to add to this statement from my longer manuscript at suitable points. May I say that my research in this area goes back more than 15 years when I made the first comprehensive study of pressure groups at a State level and submitted it as my doctor's dissertation at Columbia University. It was published under the title of Pressure Politics in New York,

Prior to 1946, although Congress had, on a number of occasions, investigated lobbying activities, legislation reached only a limited number of groups which exert direct and continual influence in Washington. These included holding companies and their subsidiaries, shipping interests with the requirement for registration with the United States Maritime Commission, and those to whom the Foreign Agents Registration Act applied. The Federal Regulation of Lobbying Act of 1946 is more general in its coverage. I might say that since 1907 a number of general lobbying bills have been introduced in Congress. The most prominent of these was a bill by the late Senator Caraway in 1928, Seventieth Congress, and then, after the congressional investigation of the utilities companies in 1935, the Black-Smith bills were introduced. Each passed its respective House, but after the conference committee report, the bills failed to pass.

That is just a brief history. The utilities were covered in the Utility Holding Act of 1935, when it was required that they register with the Securities and Exchange Commission or the Power Commission, depending upon which agency had jurisdiction.

During the first year after the lobbying title took effect on August 2, 1946, only 216 persons (defined as an individual, partnership, committee, association, corporation, or any other organization or group of persons) filed a total of 450 quarterly statements of their contributions and expenditures as organizations “principally" engaged in influencing legislation in accordance with sections 305 and 307. This information was supplied on the Form A, one of the three forms which had been prepared by the Clerk of the House of Representatives in consultation with the Secretary of the Senate to aid in the interpretation and compliance of the title.

Even among this small number were those who filed under protest and supplied meager or no information at all

. Quite a number filed statements that were notarized with no information in answer to the six questions, three dealing with expenditures.

« PreviousContinue »