The U.S. Chamber of Commerce found common cause in 2017 with President Donald Trump on tax cuts and regulatory rollbacks. This year the powerful conservative business group could part ways with the White House on two key issues: trade and immigration.
On Jan. 10, Thomas Donohue, the chamber’s president, is to deliver his annual address on American business, using it as a 2017 victory lap and as a call to strengthen growth, according to portions of his prepared remarks seen by Bloomberg.
"Economic growth remains the best way to expand opportunity, increase wealth, and restore the American Dream -- for the many, not the few," he said, according to the excerpts.
The chamber is at odds with the Trump administration over proposals to withdraw from the North American Free Trade Agreement and do away with protections for undocumented immigrants brought to the U.S. as children. Donohue also describes a “backlash against major tech companies” over size and other issues.
His speech will also touch on infrastructure and the 2018 elections, where the group, which is one of Washington’s highest-spending in both lobbying and election campaigns, is more in sync with the White House.
"We cannot build a 21st century economy on 20th century infrastructure," Donohue said in his prepared remarks.
His speech comes as congressional leaders continue to negotiate on a government spending bill before a Jan. 19 deadline. A key issue is the status of approximately 800,000 people brought to the U.S. illegally as children. The chamber is leading a coalition calling for an agreement that would protect the so-called dreamers, who face deportation under Trump’s decision to end an Obama-era program that shielded them.
The group also is likely to find itself at odds with the White House over trade. The chamber’s advocacy of free trade clashes with Trump’s threat to pull the U.S. out of major accords, including the Nafta treaty with Canada and Mexico.
"The American economy has taken several big steps forward with regulatory relief and tax reform, and the administration deserves lots of credit," according to Donohue’s remarks. "But a wrong move on NAFTA would send us five steps back."
The trade agenda will heat up early this year as Trump faces deadlines on decisions over imposing tariffs on everything from imported washing machines to steel and solar panels. Talks to renegotiate NAFTA resume in late January in Montreal, with hopes riding high for a breakthrough after months of scant progress.
In October, Donohue called the president’s position an " existential threat” to the agreement and pledged to fight “like hell” to defend NAFTA if Trump tries to pull out.
The differences on trade and immigration caused a rift between the chamber and Trump during the presidential campaign, with Donohue going so far as to predict in a December 2015 Bloomberg interview that Trump “won’t be the next president.”
Chill in Relationship
The relationship thawed after Trump’s election, however. In addition to the chamber’s aggressive support on tax and regulations, the chamber also joined Trump’s failed push to get Congress to repeal Obamacare and his successful effort to eliminate the health law’s requirement that individuals be insured.
“The chamber is going to be with the administration on taxes and regulation and against the administration on trade and immigration,” veteran Republican lobbyist John Feehery said in an email. Donohue and the Chamber, he wrote, will “have to accentuate the positive and find a way to work with the White House on the stuff where they disagree.”
Donohue will also caution about a growing “techlash,” what he describes as a “backlash against major tech companies.” In the U.S., major internet companies including Alphabet Inc.’s Google and Facebook Inc. have faced pressure from some lawmakers and over their size and role in Russia’s campaign to meddle in the 2016 election. They also face scrutiny in Europe over issues like privacy.
“Technology is not a single, all-powerful industry,” Donohue’s remarks say. “It is now a part of every industry.”
He is set to warn against "broad regulatory overreach that stifles innovation and stops positive advancements in their tracks."
The address by Donohue, who at 79 is still one of Washington’s best-paid operatives -- his compensation totaled nearly $6.6 million in 2015 -- often heralds the top political concerns of the year ahead. As he speaks from a Renaissance-style hall of the chamber’s 1925 headquarters across a small park from the White House, Donohue will continue the chamber’s push for legislation to upgrade the country’s infrastructure, which the American Society of Civil Engineers has assigned a grade of “D+.”
The effort comes as the Trump administration is preparing a set of principles for its promised $1 trillion investment plan for Congress to consider in drafting legislation.
"This year can and must be the year of major infrastructure investment," Donohue said in the remarks. "We have the political will, the bipartisan support -- and we certainly have the need."
The chamber has previously advocated for an increase in federal fuel taxes -- which haven’t been raised since 1993 -- as the simplest, fairest and most straightforward way to generate more revenue for upgrading roads, bridges and other public works.
Republican congressional leaders have flatly rejected that idea for years, but a bipartisan consensus has emerged to look at the option, said Ed Mortimer, the chamber’s executive director for transportation infrastructure. Trump administration officials have said while they’re not endorsing the idea, they’re not ruling it out.
“We have a lot of education to continue to do, but we do believe there are Republicans that are willing to step up to that plate,” Mortimer said in a December interview. “We as the business community are going to stand there and support those members of Congress that willing to do that.”
In addition to the policy issues, the chamber must confront the possibility of a wave of Democratic victories and squabbling among Republicans in November’s 2018 elections.
The president’s party often loses seats in the midterms -- an outcome made more likely by Trump’s historic unpopularity. Republican leaders also face a nascent insurgency, fueled by Trump allies, of populists who reject some of the business concerns of the chamber.
As a non-profit trade association, the chamber can raise and spend unlimited amounts of money -- including on political races -- without having to disclose its donors. Some corporate contributors become known because they voluntarily disclose their donations, but the chamber has become a discreet way for corporate America to try to influence elections without publicly picking a side that might alienate customers.
The chamber’s $29.1 million in spending in the 2016 election ranked second only to the National Rifle Association for 501(c) non-profits that aren’t required to disclose their donors, according to the Center for Responsive Politics. Virtually all of that money was spent to promote Republican candidates or oppose their Democratic challengers.
The group is also expected to spend heavily in this year’s congressional elections. Already, it has spent $2.6 million in the 2018 election cycle, with all of that total going to bolster Republicans or oppose Democrats.
Besides influencing campaigns through television advertising and campaign contributions, the chamber is also one of the top spenders on lobbying in Washington. Through the first three quarters of 2017, it spent about $42 million on lobbying and ranked first for total spending on such efforts, public records compiled by Bloomberg Government show.
By Ben Brody