Circumventing the Chamber of Commerce

CIRCUMVENTING THE CHAMBER OF COMMERCE…. The fall has not been especially kind to the U.S. Chamber of Commerce. It’s lost some high-profile corporate members; its membership ranks have been exposed as exaggerated; and its leadership has been embarrassed on national television. Eliot Spitzer called the Chamber “wrong on virtually every major public policy issue of the past decade,” and quite a few relevant players found the observation reasonable.

Matters may get worse still for the Chamber of Commerce. The White House, which has waited for the Chamber to begin playing a more constructive role, has decided to pursue a different approach going forward.

The White House and congressional Democrats are working to marginalize the Chamber of Commerce — the powerful business lobby opposed to many of President Barack Obama’s first-year priorities — by going around the group and dealing directly with the CEOs of major U.S. corporations.

Since June, senior White House officials have met directly with executives from more than 55 companies, including Chamber members Pfizer, Eastman Kodak and IBM.

“We prefer the approach — particularly in this climate — where the actual people who are on the front lines, running businesses, trying to create jobs, come and advise us on policy,” senior White House adviser Valerie Jarrett told POLITICO in a not-so-subtle effort to portray the Chamber as out of touch with business reality.

Chamber officials say the White House is scapegoating the Chamber and other trade associations as a way of dividing the business community, a move that could help the administration made headway on health care reform, climate change legislation and regulatory reform.

To a certain extent, there’s something to this — the administration does have an interest in driving a wedge within the Chamber’s membership. With many in the business community sympathetic to the White House’s agenda, and many more finding new opportunities for profit in the changing policy landscape, it only makes sense for the administration to prevent a monolithic “Big Business” from derailing its agenda. We’re already seeing this start to play out on energy policy, where producers have begun “battling one another.”

Historically, the Chamber of Commerce has served as something of a gatekeeper: if powerful policymakers wanted to make headway with business leaders, they had to go through the Chamber to get to them. The White House prefers to simply go around the gatekeeper and engage the community directly.

Since this summer, senior administration officials have held at least 11 meetings with CEOs and executives from more than 55 companies, according to data provided by the White House. The sessions usually involve half-a-dozen attendees representing companies in all different fields, from finance to pharmaceutical, soft drinks and real estate. Job creation, tax policy, climate change and health care reform are discussed.

“The intent there is simply to make sure we are getting accurate, timely feedback from the wide cross-section of the private sector and that we aren’t going to therefore rely solely on the Chamber or any other group,” explained Jarrett. “[These CEOs] are like ambassadors to other businesses.”

Instead of letting the Chamber serve as the gateway to business leaders, the administration is building gateways of its own. It is a potentially huge structural shift for the nexus of politics and business.

For its part, the Chamber has crafted a $100 million “free enterprise” campaign, which is principally about defeating regulatory reform.

Valerie Jarrett talked a bit about a conversation she had with Chamber president Tom Donohue about the campaign.

“He came in and we chatted and he said, ‘I think that, for example, your financial regulatory reform might have a chilling effect on business growth.’ So I said well you supported the Recovery Act, yes. You support the federal taxpayer subsidy going to the banks, yes. You supported the subsidy going to the auto industry, yes. So now suddenly you want the free market system? I couldn’t reconcile those two positions.”

“He said, ‘Well, I don’t think we need those checks and balances.’ And I said yes you do, we have concrete evidence that you do because without them the taxpayers ended up carrying the burden.”

Good for the White House.