1. The Third House:
Lobbyists, Money, and
Power in Sacramento
Jay Michael and Dan Walters, with Dan Weintraub

2. Ch. 1: Who are these people?
 Lobbyists are a key player in the “three-
legged stool” of effective political action:
 Money
 Grassroots Action
 Lobbying Expertise
 These interact to generate policy success

3. Lobbyist Power
 Thousands of interest groups are affected
by state decisions every day
 Lobbyists represent affected groups,
working to craft legislation and regulations
that benefit their clients
 “Cream of the crop” of elite lobbyists calls the
shots on most government decisions

4. Southern Pacific
 Monopoly on transportation by Southern
Pacific Railroad in the late 19th century led
to reforms of 1911
 Public Utilities Commission
 Direct Democracy

5. 1930s growth of state government
 Transformation from agrarian to
manufacturing economy
 Motion pictures
 Oil
 Expansion of New Deal policies
 Artie Samish and the “select and elect”
system

6. Artie Samish
 The Secret Boss of
California pushed
regulations that
protected his clients
from competition
and/or ensured their
ability to set prices
(e.g. “fair trade” liquor
laws)

7. 1940s-50s: Two Capitols?
 Samish focused on minute but lucrative
issues affecting his clients
 Governor Earl Warren and legislators took
the high road on major issues such as
highways, colleges, parks and government
services

8. Still Two Capitols?
 Most people know that California state
legislators are making big decisions on
major issues such as the budget, taxes,
and high-speed rail
 They are also making decisions on minor
issues such as pet microchips, the sale of
shark fins, surface mining and outdoor
advertising

9. Jesse Unruh
 Unruh took control of
the “select and elect”
system and brought it
inside
 Legislative leaders
now decided how the
money was collected
and spent

10. 1960s-1980s
 1961: Unruh elected speaker
 1964: SC ends “federal system” in Senate
 Shifts power from rural areas to cities
 1966: Legislature made full-time and
professional
 Increasing centralization and control under
Unruh and then Willie Brown (1980)

11. 1980s & Willie Brown
 Flow of legislative
campaign money
escalated
 Intense pressure on
lobbyists to contribute
 Issues kept alive year
after year to milk system
 Booted using term limits

12. Reform & Expansion
 Increased growth of lobbyists as CA shifted
to postindustrial economy
 Medical care, high tech
 Prop 13
 Regulatory Activism

13. Ch. 2: Who Hires Lobbyists?
 Potential every day for
serious consequences of
decisions made in the
Capitol
 “Mushroom Bills”
 Blatant grabs for power,
money, or both that can
only be enacted if virtually
no one knows they exist

14. Government Lobbyists
 Proposition 13 made the state the primary
source of funds for local agencies
 Cities and Counties
 School Boards
 Foreign governments
 Indian tribes

15. Health Care Lobbyists
 Health care is now California’s largest
single industry, leading to turf wars and
struggles between providers and lawyers
 The Ankle War (podiatrists vs. orthopedic
surgeons)
 Dog Teeth (veterinarians vs. dog groomers)
 Colonics (doctors and clinics)

16. How much does it cost?
 http://cal-access.sos.ca.gov/Lobbying/
 PG&E spent $2 million in 2009-2010
 http://cal-access.sos.ca.gov/Lobbying/Employers/Detail.aspx?id=1146888&view=activity&session=2009
 Atherton spent $58K, trying to influence the high
speed rail issue
 http://cal-access.sos.ca.gov/Lobbying/Employers/Detail.aspx?id=1325474&view=activity&session=2009
 Google spent $400,000 on tax issues, internet
policies, and telephone number privacy
 http://cal-access.sos.ca.gov/Lobbying/Employers/Detail.aspx?id=1265187&view=activity&session=2009

17. Who are these lobbyists?
 Former elected officials & legislative
staffers
 Expertise and personal contacts
 One-year ban on “revolving door” not a serious
impediment
 Former political campaign aids
 Goo-goos