Stellar returns through lobbying

Lobbying Washington pays off handsomely for corporate America, said The Economist. A new index reveals that the 50 companies that spend the highest percentage of their assets on political lobbying have outperformed the broader S&P 500 Index by an average of 11 percent a year since 2002. Their cumulative results are “stunning, comparable to the returns of the most blistering hedge fund.” The index tends to include companies in sectors that are highly dependent on government policies, such as defense contractors and health-care firms. One “particularly vivid” example of the unmatchable payback they can attain from spending on lobbying: An aggressive campaign in 2004 inspired Congress to allow a corporate tax holiday on repatriated earnings from overseas. That effort returned $220 for each $1 spent on lobbying the government.