The analysis was conducted at the request of and in collaboration with This American Life and Planet Money public radio programs. It is featured on the March 31, 2012 episode of This American Life.

When it comes to fundraising potential, not all committee assignments in the U.S. House are created equal. A new Sunlight analysis of House fundraising patterns  from the 103^rd to 111^th Congress finds that three committees – Ways and Means, Financial Services, and Energy and Commerce – stand out as being particularly lucrative. Others – most notably Judiciary, House Administration, and Natural Resources, appear to be fundraising duds.

Table 1 shows are the estimated committee “bonuses” for individual member itemized and PAC fundraising totals. Relationships that are statistically significant are in bold.

Table 1. Estimated committee assignment “bonuses”

These estimates come from a multivariate regression that compares all members across multiple sessions of congress, controlling for seniority, majority status, and session of congress, with fundraising totals adjusted for inflation. The complete regression results can be found here. See below for a more complete explanation for how we came to these results.

Committee switches

Another way to evaluate the value of committees is to look at  patterns of incumbent switching. Table 2 looks at what assignments incumbent House members selected (or were given) from the 104^th through 111^th Congress.

Table 2. Incumbent committee switches

Certain committees are clearly more popular than others. Over almost two decades, Ways and Means had 53 incumbents join, but only four leave. Energy and Commerce had 76 incumbents join, but only 10 leave, and Appropriations had 62 incumbents join, but only 11 leave.

Other committees have different flows. Judging by members’ behaviors, the least desirable committee to be on is Small Business – only 18 incumbents joined, while 100 left. Agriculture and Veterans’ Affairs are also committees that incumbents leave far more often than they join.

This way of ranking committees generally correlates with the fundraising prowess of the committees (Table 1). Ways and Means tops both lists, and Energy and Commerce is in the top three of both lists. However, Financial Services is a net loser among incumbents. Perhaps this is because many members find the subject matter too complicated or boring for their tastes. And Judiciary, which is associated with lower fundraising flows, is just about in the middle when it comes to the balance of incumbent leavers and joiners.

It is important to recognize that members may care about more than just raising money, and may have genuine policy interests. Also, members who are in relatively safe districts and have fewer ambitions to rise up in the party may be quite happy to serve on committees with less fundraising potential.

Methodology: How we got these results

The estimates for committee fundraising “bonuses” (Table 1) come from the results of regressions that estimate different aspects of individual member fundraising as a function of members’ committee assignments and ranking on those committees, controlling for majority party, seniority, and different congresses. We’ve adjusted for inflation so that all fundraising totals are in 2012 dollars.

The complete results of this series of regressions are published here: https://data.sunlightlabs.com/dataset/Regression-1-Effects-Of-Committee-Assignments-On-C/dk8x-utgd

The results report four different sets of columns. The first set of columns estimates the effect of committee assignments on the total itemized contributions. The second set of columns estimates the effect on individual itemized contributions. The third column estimates the effect on PAC contributions. The fourth estimates itemized out-of-state contributions. Essentially, what we have done is compared all members to all other members across multiple Congresses, trying to isolate the statistical relationship of committee assignments and fundraising totals.

For each set of columns, the predicted effect of different assignments and control variables are in the first column, the standard error in the second, and the t-stat (the effect divided by the standard error, a measure of statistical significance) in the third.

So, for example, being on the Ways and Means committee is associated with $258,924 more in total itemized contributions, as compared to not being on the committee, all else being equal. The standard error for this estimate is $63,543, so we can think of $258,924 +/- $63,543 as being the predicted fundraising advantage of a seat on the Ways and Means committee. The t-statistic is 4.07, which means that it’s a statistically significant relationship. Statisticians use 1.96 as the cut-off low point for clearly significant statistical relationships. Generally, a t-stat of 1.64 is considered the lower bound for  statistical significance.

The row at the bottom, “adjusted R-squared” is a measure of how much variation each model explains. The regression estimating total itemized contributions explains 20.8% of the variation across members. This means that about 79% of the variation across members is explained by factors we didn’t include in the model (such as unique member and district characteristics). The higher the R-squared, the more variation we’ve explained. The lower the R-squared, the more variables we are probably missing.

If we wanted to estimate predicted fundraising for a particular member, we first would get the baseline fundraising for each category for each member by starting at the intercept. Then we add an additional bonus for the congress we are in, multiply the number of years in the chamber by the value in the seniority row, and add an extra bonus for the majority row. Then we add the value for each committee assignment. If we are looking at a chair or a ranking member, we add an extra bonus on top of the already predicted value for being on the committee.

So, for example, if we had a fourth-term Democratic member in the 111^th Congress serving on the Ways and Means Committee, we could estimate predicted PAC contributions by starting with the intercept of $309,723, adding an extra $266,056 for the 111^th Congress, less $28,834 ($7,096 * 4 terms) for  seniority + $66,877 for being in the majority. So we are at $613,3822 in PAC contributions baseline. Now we’d add an extra $295,774 for being on Ways and Means. So the predicted PAC fundraising total would be $909,596.

Now the caveats.

These numbers measure statistical patterns, but they don’t directly show causality. These numbers tell us that members on certain committees raise more or less than their peers on other committees. But it may be the case that better fundraisers get rewarded with better committee assignments. As always, one must be careful confusing correlation with causality.

Still, there are some good reasons to infer some causal relations. One big reason is that the fundraising bonuses on the big money committees come primarily in the form of PAC contributions, which mostly come from corporations and are more likely to have committee-specific interests. Both Ways and Means and Energy and Commerce are associated with less individual fundraising than your average member. Financial Services is associated with more individual giving, which makes sense since individuals who work in the financial sector are major donors. But still, two-thirds of the Financial Services committee “bonus” comes from PAC contributions. Also, all three committees are associated with significantly more out-of-state funding than your average member.

Another way to get at causality is to estimate a time series regression, where we explain member fundraising as a function of prior fundraising efforts (controlling again for majority status, seniority, congress), and then look at the effect of committee switches on fundraising.

The results of these estimates can be found here: https://data.sunlightlabs.com/dataset/Regression-2-Effects-Of-Changing-Committees-On-Can/j3sk-hyqf

These estimates do a better job of explaining variation across members (notice the higher R-squared values) because they effectively take into account the differences across members, including their district characteristics and fundraising prowess.

The only statistically significant results for changing committee assignments involve transferring to Ways and Means, Financial Services, and Energy and Commerce.

Getting on Ways and Means boosts your PAC fundraising levels by $208,315, your out-of-state itemized fundraising totals by $233,742, and your total itemized fundraising totals by $220,598, all in statistically significant ways.

Joining Financial Services produces boost of $101,695 to PAC contributions and a boost of $140,334 to your out-of-state contributions, both statistically significant.

Joining Energy and Commerce yields a statistically significant boost of $72,933 to your PAC contributions.

These results should give us even more confidence that Ways and Means, Financial Services, and Energy and Commerce provide genuine fundraising bonuses to members.

There are probably two reasons why we don’t see any statistically significant results for the effect of joining a dud fundraising committee.

One is that there are only a limited number of cases where incumbent members switch onto the dud fundraising committees, and with only a limited number of cases, it is hard to get statistical significance because it is harder to distinguish patterns from chance.

The second reason is that if everybody knows which committees are dud fundraising committees, those who join those committees are members who are probably less likely to be concerned about fundraising, perhaps because they have safe seats. Moreover, if members are joining a dud fundraising committee, it’s more likely to be from another dud fundraising committee. In this case, it’s less likely to alter fundraising.

Conclusion

Overall, these results confirm that some House committees are better for member fundraising than others. In particular, Ways and Means, Financial Services, and Energy and Commerce are very good fundraising committees. And for good reason: Ways and Means has jurisdiction over tax policy, Financial Services over securities and banking policy, and Energy and Commerce over energy policy. In all three policy areas, a substantial number of corporations care very much about how policy gets made, and their employees are willing to contribute substantial sums – both through their PACs and individually – to make sure that they have access.

Thomas Hoenig, the president of the Federal Reserve Bank of Kansas City, recently penned an op-ed in the New York Times questioning how the biggest financial firms that survived the financial crisis had grown 20 percent larger than they were prior. How could Washington, in its financial reforms, allow too big to fail to continue?

Hoenig answered this himself:

How is it possible that post-crisis legislation leaves large financial institutions still in control of our country’s economic destiny? One answer is that they have even greater political influence than they had before the crisis. During the past decade, the four largest financial firms spent tens of millions of dollars on lobbying. A member of Congress from the Midwest reluctantly confirmed for me that any candidate who runs for national office must go to New York City, home of the big banks, to raise money.

There is no bigger contributor to political campaigns than the financial sector. Since 1999 the financial sector has contributed more than $1.8 billion to federal candidates for election. As Hoenig notes, much of that sector is located in New York City.

Overall, over the past six election cycles, New York state residents employed in the finance, insurance and real estate sector have sent more than $50 million to congressional candidates running for office in a state other than New York, according to data from the Center for Responsive Politics. This is a crucial source of money for congressional candidates, particularly those in high-cost Senate races. (The animated map linked in the image below shows where those contributions went over time.)

Out of state Democrats accounted for over half of the money contributed by individuals in the New York State financial sector. Democrats received over $30 million to the slightly more than $16 million received by Republicans. The Independent candidacy of Connecticut Sen. Joe Lieberman pulled in more than $11 million.

The Sunlight Foundation's Party Time database of political fundraisers shows a total of 37 fundraisers held in New York City for congressmen and senators who do not represent New York State. (These numbers are incomplete and the number of fundraisers is almost certainly higher.)

There are 12 fundraisers listed in 2010, including a recent one for Rep. Charlie Dent (R-PA). In October Rep.-elect Mike Fizpatrick (R-PA) held a fundraiser with incoming Financial Services Committee chairman Spencer Bachus (R-AL). (Bachus raised nearly 63% of his 2010 contributions from the finance sector.) Other fundraisers are for lawmakers from California, Oklahoma, Kentucky and various other states spanning the country. (View all 37 of these Party Time fundraisers here.)

Hoenig's example of fundraising in New York is just one anecdote in the larger story of the financial sector's influence in Washington. Since the 1998 election cycle the finance sector has spent nearly $2 billion on campaign contributions to federal political candidates. Over the same period of time the sector has spent more than $4.2 billion on lobbying in Washington.

This leads to a total of more than $6.2 billion spent by the finance sector over a thirteen year period to influence outcomes in Washington. The finance sector has spent almost $1 billion more than any other economic sector on federal campaign contributions and lobbying combined. (The motion chart on the right shows the accumulation of contributions and lobbying over time. The green dot is the finance, insurance and real estate sector.)

Former IMF economist Simon Johnson in an article for The Atlantic last year explained that Wall Street "gained political power by amassing a kind of cultural capital--a belief system." People in Washington believed that those in Wall Street knew what they were doing and believed that the accumulation of wealth in the financial sector was a national good, Johnson argues.

That belief system was aided by the $6.2 billion investment that Wall Street made in Washington. The sector invested in staffing agencies and congressional committees and in financing the increasingly costly campaigns. Those investments were then cashed out as staffers and lawmakers flocked to lobbying firms and cushy Wall Street gigs.

The New York Times wrote in April that “more than 125 former Congressional aides and lawmakers are now working for financial firms as part of a multibillion-dollar effort to shape, and often scale back, federal regulatory power, data shows.” These included former Rep. Michael Oxley, the most recent former chairman of the Financial Services Committee, and former Rep. Richard Baker, who previously chaired the Financial Services Subcommittee on Capital Markets.

Other powerful former lawmakers recently registered to lobby for the financial sector include Senate Majority Leaders Trent Lott and Bob Dole, House Majority Leaders Dick Gephardt and Dick Armey and Speaker of the House Dennis Hastert.

The particular target of Hoenig's ire in his above quoted NYT op-ed is the 1999 passage of the Gramm-Leach-Bliley Act, which tore down the wall between investment and commercial banking. The bill was named after its three main cosponsors: Sen. Phil Gramm, Rep. Jim Leach and Rep. Thomas Bliley. Since retiring from Congress, Gramm went on to become the president of the Swiss bank UBS AG and Bliley works as a registered lobbyist, often for financial interests. (Leach serves under President Obama as the Chairman of the National Endowment for the Humanities.)

Now, recently departed Office of Management and Budget head Peter Orszag is jumping ship to Wall Street. Orszag, following in the footsteps of former Treasury Secretary Bob Rubin, is slated to join Citigroup as a high level executive with a multimillion dollar salary. Recently, President Obama's counsel Greg Craig left the White House and joined Goldman Sachs. It is unclear if either of them will register as a lobbyist.

Even without Orszag and Craig registering to lobby, the industry has more than enough clout. The Center Responsive Politics reports 1,390 former government employees working as lobbyists for the financial sector.

Another prime spot for investment by the financial sector has been the House Financial Services Committee.

The majority party in the House of Representatives often puts favored freshmen and sophomore lawmakers on the House Financial Services Committee, the committee that oversees the financial sector, so that they can raise piles of money from Wall Street.

The Huffington Post's Ryan Grim and Arthur Delaney explained how this worked under the outgoing Democratic majority:

The banking committee is the second-largest in Congress -- the Transportation and Infrastructure Committee has three more members -- and is known as a "money committee" because joining it makes fundraising, especially from donors with financial interests litigated by the panel, significantly easier. The Democratic leadership chose to embrace this concept, setting up the committee as an ATM for vulnerable rookies. Eleven freshman representatives from conservative-leaning districts, designated as "frontline" members, have been given precious spots on the committee. They have individually raised an average of $1.09 million for their 2010 campaigns, according to the Center for Responsive Politics; by contrast, the average House member has raised less than half of that amount.

Meanwhile lawmakers and staffers keep cycling in between the financial sector and Washington. Delaney and Grim showed that, as of the end of 2009, “almost half of the 126 people who [left the Financial Services Committee] registered as lobbyists, mostly for the financial services industry.” Also, “[s]ixteen of the committee's 86 current staffers -- including a good chunk of the senior staff -- worked as lobbyists before coming to the committee.”

The committee will soon be headed by a lawmaker, Rep. Spencer Bachus, who received nearly 63 percent of his campaign and political action committee contributions from the finance sector. Bachus recently stated his philosophy for governing the committee, "In Washington, the view is that the banks are to be regulated, and my view is that Washington and the regulators are there to serve the banks."

The freshmen congressmen appointed to the committee include the largest recipient of finance sector contributions among freshmen and a former bank lobbyist.

Meanwhile, the Senate Banking Committee is set to be chaired by Sen. Tim Johnson, whose state of South Dakota is home to the credit card industry. Johnson recently hired Dwight Fettig, a lobbyist for the American Bankers Association, JPMorgan Chase and Freddie Mac, as a senior adviser. Fettig will likely become the next staff director for the Banking Committee.

The entirety of this enterprise—the doling out of campaign contributions, revolving in between the public and private sector, spending money to influence policy-makers—is entirely legal. That system, however legal it is, is structurally unjust and unsound. As James Fallows notes in a post bemoaning Orszag's revolving door spin, "When we notice similar patterns in other countries -- for instance, how many offspring and in-laws of senior Chinese Communist officials have become very, very rich -- we are quick to draw conclusions about structural injustices."

The intense amount of organized money and human capital has succeeded in making Washington captive to the financial sector. All of this at a low cost when compared to the soaring profits they enjoyed at the height of the boom and the trillions of dollars in aid they received when the bottom fell out.

Ultimately, the $6 billion investment in Washington was the least risky one that the financial sector made over the past twelve years. The firms that survived the storm are bigger than ever and ready to spend billions more to keep their investment afloat.

Eight of the twelve new members chosen to take seats on the House Financial Services Committee can count the finance, insurance and real estate sector as the top contributor to their election.

Incoming Rep. Robert Dold is the top recipient of money from the finance, insurance and real estate sector among all freshmen elected in November's midterm elections. Dold, who raised $554,024 from the sector, according to the Center for Responsive Politics, is one of ten freshmen appointed to the committee overseeing the financial sector.

Another new member of the committee, Rep.-elect Steve Stivers, previously worked as a lobbyist for Bank One, which is now owned by JPMorgan Chase. Stivers received $294,105 from the finance sector.

In July 2010, Stivers came to Washington for a fundraiser thrown by financial lobbyists in Washington and hosted by incoming Financial Services Committee chairman Spencer Bachus. Bachus received nearly 63% of his 2010 campaign contributions from financial interests.  Bachus recently stated his philosophy for governing the committee, "In Washington, the view is that the banks are to be regulated, and my view is that Washington and the regulators are there to serve the banks."

Bachus also hosted a fundraiser for incoming committee member Michael Fitzpatrick. Fitzpatrick, who this year reclaimed the Philadelphia suburbs seat he lost in 2006, raised $122,250 from the finance sector.

Two freshmen from the nation's financial capital, New York, were appointed to the committee as well. Rep.-elect Michael Grimm, who won election from Staten Island, raised $222,350 from the finance sector. This amounted to 24 percent of the total money that he raised for his campaign, the largest percentage from the finance sector of all newly appointed members. Grimm defeated Democrat Michael McMahon, who also sat on the Financial Services Committee. Rep.-elect Nan Hayworth, hailing from upstate New York, raised $204,215 from the finance sector.

The Financial Services Committee has always been a coveted spot for lawmakers facing tough reelection races in expensive districts. These lawmakers are in need of large campaign contributions and the finance sector is the biggest contributing industry of all. Since 1998 the finance sector has contributed nearly $2 billion to federal election campaigns.

Most recently, the Democrats appointed eleven of their "frontline" freshmen lawmakers to the committee to help them raise money for reelection. According to the Huffington Post's Ryan Grim and Arthur Delaney the committee is "known as a "money committee" because joining it makes fundraising, especially from donors with financial interests litigated by the panel, significantly easier."

Nearly all of the freshmen appointed to the committee are likely to face tough reelection races in either 2012 or 2014.

Dold's North Shore district went heavily for Barack Obama in 2008. Fitzpatrick's district is a classic swing district won by Barack Obama and John Kerry in recent elections. Sean Duffy represents a Wisconsin district that was held by Democrat David Obey for 40 years and won by both John Kerry and Barack Obama. Quico Canseco won by a small margin in a Texas border district that narrowly went for Barack Obama in 2008. Robert Hurt barely won election over freshman Democrat Tom Perriello in a Virginia district that John McCain won by a couple of points in 2008. Stivers, Hayworth and Grimm could all face challenges in a different climate come 2012.

See below for all new members and the amount raised from the finance, insurance and real estate (FIRE) sector. All data provided by the Center for Responsive Politics.