The Paper Lobby

Does The Wall Street Journal have something against lobbyists? Last month, the editorial page of The Journal took the ICBA to task for lobbying Congress to prevent Wal-Mart from entering the banking market. "We have here a textbook case of a powerful corporate lobby rushing to its pals in Congress and their regulators," the paper offered (The Wall Street Journal, Jan. 4, 2006).

But just a couple of days later (Jan. 6, 2006), in reference to the Abramoff scandal, came this observation from The WSJ: "Lobbyists per se aren't the problem; most of them are hired to protect Americans from a federal government that wants to take more of their money or freedom."

So which is it? Is the ICBA a powerful corporate lobby, or is it just protecting bankers' money? Or, can both be true?

Yes, the ICBA is a powerful corporate lobby. But let's separate the message from the messenger, because even a powerful corporate lobby can make a good point. In his response to The Wall Street Journal article, ICBA President and CEO Camden Fine responded with a pertinent question: "Would a Wal-Mart bank loan money to competing businesses?"

The answer: Sure it would, because then Wal-Mart would have privileged access to its competitors' financial records through loan documentation.

But at the same time, bankers are spearheading an incursion of their own against entrenched interests in another sector of the economy. As The WSJ later reported (Jan. 9, 2006), "The National Association of Realtors ... has backed legislation passed by Congress since 2001 that bars banks from being real-estate brokers."

So where's the editorial against the lobbyists for the real-estate brokers? Isn't the real-estate lobby merely intent on protecting its once-sacrosanct 6 percent commission from a banking industry that knows its customers better than the realtors ever can? Or are there sound public policy reasons to keep banks away from real estate that are conveniently being ignored?

My view: Let the lobbyists lobby—but keep them in the lobby and out of the kitchen.