Business Fights Back

Tom Donohue By KIMBERLEY A. STRASSEL
'One thing I can tell you: They can go out and chase me and chase the Chamber and put stuff in the newspaper. It only . . . drives more and more support. . . . You think we are going to blink because a couple of people are out shooting at us? Tell 'em to put their damn helmets on."
Them's fighting words, all the more so when delivered in the feisty, New York accent of U.S. Chamber of Commerce President Tom Donohue. The 71-year-old was recruited 12 years ago in order to revitalize a drifting business lobby. And the gregarious chief hasn't disappointed: He's grown the Chamber's membership, tripled its budget, transformed its lobby shop, and increasingly thrust it into the political fray. Most recently he's ginned up opposition to union "card check," the Environmental Protection Agency's (EPA) plans to regulate carbon emissions, and parts of the proposed financial overhaul.
The Obama administration's response has been to treat the Chamber like it has Fox News Channel: with brass knuckles. It has launched a campaign to undermine the organization by making CEOs think twice about associating with it. President Obama has openly criticized the Chamber, while adviser Valerie Jarrett has dismissed it as "old school" and acknowledged that the White House is bypassing it to work individually with CEOs.
When several major companies—including Exelon, Apple and Nike—ostentatiously quit the Chamber several weeks ago, provoking a flurry of unflattering headlines, it seemed no coincidence. Mr. Obama's allies in the unions, the trial bar and green lobbies have targeted the Chamber, some of its members, and Mr. Donohue personally.
For a man who prides himself on working both sides of the aisle, the Chamber these days is not a fun place for Mr. Donohue. Then again, he has an Irish temper and doesn't shrink from a brawl. At least for now, he's showing no signs of muting the Chamber's message.
"I did an interview a couple of week ago, and somebody said, 'Well, the White House says that you've become Dr. No and you are going to lose your seat at the table.' And I said, 'The White House doesn't give out the seats at the table. The seats at the table go to the people who have a rational policy, who have strong people to advance that policy, that have a strong grass-roots system, that have the assets to support their program, and that are willing to play in the political process," Mr. Donohue remarks, sitting in his office, which looks across Lafayette Park to the White House.
"The bottom line is you can't do this job if you are squeaky about all that stuff. My job is to represent the American business community in an honorable way, to present their interests in a way that I really think is good for them and good for this country. And," he adds with a pointed look, "I plan to keep doing it."
One irony of the Obama administration's demonization campaign is that Mr. Donohue is hardly a right-wing ideologue. There was a day, in the 1970s and 1980s, when the Chamber fought for limited government. But starting in the 1990s, the group became more interested in using Washington to forward a narrower corporate self-interest.
Mr. Donohue, who spent 13 years at the head of the American Trucking Association, also points out that the Chamber has done plenty to help the current administration. It supported last year's bailout funds ("we had to stabilize the banks"); the stimulus ("we could have gone into a real depression if there wasn't some confidence, some belief we could get over the next hump"); the auto bailouts ("this was a bellwether of the American company"), and even cash for clunkers.
The Chamber, Mr. Donohue says unapologetically, has "built a great deal of goodwill . . . by representing companies on the broad issues that we have defined, and working real hard to come to a common benefit where most people benefit more than 80%." He continues: "People have criticized us for helping industries or individual companies. What the hell do you think we do? That's our business!" If health-care and climate-change legislation do pass, Mr. Donohue argues, they will be "much, much, much better than they ever would have been if we had sat here on our hands."

What really seems to bother the White House is less Chamber ideology than its effectiveness. "They are going to have to go after somebody, right? Of course they are going after the individual ones, the bankers, and the insurers—and that's after they made deals with them. But who would you go after? Companies can't do this themselves . . . When it gets tougher, we get in."
Going after the Chamber is nonetheless a risk. The lobby works with a lot of Congressional Democrats from swing districts. Those pols face tough races next year, and Chamber support can help them raise money and protect against GOP attacks. The White House campaign gives GOP candidates an opening to point out how much Democrats dislike business.
The Obama team has already had one bruising experience with the Chamber's power over card check, Big Labor's priority of getting rid of secret ballots in union elections. The Chamber launched a full-scale campaign against the union-backed bill with the Orwellian name, the "Employee Free Choice Act."
Mr. Donohue is blunt, singling out the SEIU, the Teamsters and other unions: "What they are trying to do is change the rules." Why? "They want a hell of a lot more members, so they can have a hell of a lot more political influence, so they can change the way this country runs."
He takes some credit for the fact that swing-state Democrats have backed away from that vote. "The labor unions spent $240 million . . . and they figured, well, we got the Senate, and we got the House, and we got the presidency, let's go do this thing. What they forgot were 300 million Americans and all kinds of people in this town who represent them, and that a lot of members were elected in red states as Democrats and have got to go back and run again there. So we got into this deal, spent some money—by the way, good manners, high integrity, very aggressive—and it's stuck against the wall right now. Some people are walking around about a compromise. There ain't gonna be a compromise! There's not the votes for that thing."
The Chamber has also irked the White House with its ads against the Consumer Financial Protection Agency, taking on the proposed agency's powers to regulate any business that extends credit to consumers—including butchers and bakers. Mr. Obama denounced the Chamber by name and called the ads "false."
Mr. Donohue says he recently talked to Mr. Obama's economic adviser Larry Summers in Colorado, who was upset about the ads as well. "I looked at those ads, they weren't disingenuous. Maybe they picked out a few things here and highlighted them that weren't the most important things. But those things are gone out of the bill now. When you are in a debate you don't always like what the other guy says."
Where the fight has become especially rough is over climate change. While supporting cap-and-trade legislation, the Chamber opposes the EPA's "endangerment" finding, which would allow the agency to unilaterally regulatecarbon.
The Chamber thinks it bad precedent to allow the EPA to stretch the Clean Air Act to encompass carbon. "It would put them in charge of every major construction and rehab project, every road, every bridge, every port, every big building. I mean, you wanna put people out of work?" Mr. Donohue says. "They'd have to hire an army—which they'd probably unionize—to do the permits."
Last year, the Chamber asked the EPA to hold a hearing on "endangerment." The goal was not to debate overall climate science, but to force the EPA to demonstrate, as a matter of law, that carbon is dangerous. Then in September, the Chamber's senior vice president for environment, Bill Kovacs, made the mistake of suggesting the hearing might be like a "Scopes monkey trial" on the science.
"My first inclination was to cut his head off, but then I remembered that I run my mouth on a regular basis. So I said, we owe you a few, forget it, now shut up and don't say that again. Because we lost the focus on why we are doing this."
The comment gave several companies an excuse to bail. Does he worry others will leave? "Give me a break, will you? We have 300,000 members. We can legally represent three million people," he retorts. "Now, I've been here for 12 years, and we lose four members every week! And we sign up six."
He also notes that the idea that every member is always going to agree on every policy is ludicrous. "Bring 10 people to Thanksgiving dinner. Can you agree on anything? You try to take, let's just say for the hell of it, one thousand core members. Let's get them to agree on where to go to lunch, what day it is, how we should approach global warming or medical care. Holy (bleep)! So we have a system here and it works. And sometimes people aren't always happy, but most companies look at this and say 'Okay, I've got seven major issues. So I have a little disagreement on this one, but I'm getting along well on those.'"
He doesn't dwell on it, but Mr. Donohue has himself been a target, including by the National Resources Defense Council, which has accused him of a conflict of interest because of his seat on the board of directors of Union Pacific, a company that would be affected by climate-change legislation. He thinks "personal attacks" are out of order, vowing "I won't do it to them. We could. I won't."
The White House's war on the Chamber has come just as the group is launching a new $100 million campaign promoting free enterprise.
"We want to encourage and promote and educate and get a bunch of enthusiasm behind . . . the free enterprise system with free capital markets and free trade and the ability to fail and fall right on your ass and get up and do it again!" he says.
The belief in that system, Mr. Donohue says, has been eroded by the recession and subsequent criticism of the free market. "The purpose of this is to get out of the doldrums! Quit sulking and worrying." He hopes the campaign will remind Americans that "We created 20 million jobs in the '90s, we can do it again. We don't have to do it exactly like that—Adam Smith didn't have a BlackBerry—but we ought to pay attention to what made it work."

Some Democrats who have been demagoguing business view the campaign as a poke in the eye, and the White House's Ms. Jarrett has criticized it. "It's not an attack on anyone," he insists. "We're just asking Americans of every form, shape, size, weight and responsibility to take a look at it. If this . . . system works so well, why don't we think about how we could use it to our benefit now."
The Chamber is three years away from its 100th anniversary, and the "Dream Big" campaign is aimed in part at ensuring that birthday is worth celebrating. "The people that started this thing and came here and did it, they left a legacy that can be seen in the American economy and American achievement and I'm not going to screw it up."
He ends our meeting with a grin and cheerful warning: "This is a great place. If you walk on our lawn, we're going to turn on the sprinklers." —Ms. Strassel writes the Journal's Potomac Watch column.