Rift between Obama and Chamber of Commerce widening - washingtonpost.com

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Health-care reform and economy are points of contention

By Michael D. Shear
Washington Post Staff Writer
Tuesday, October 20, 2009

The White House is moving aggressively to remove the U.S. Chamber of Commerce from its traditional Washington role as the chief representative for big business, the latest sign of a public feud ignited by disagreement over the administration's effort to overhaul the health-care system.

Instead of working through the Chamber, President Obama has reached out to business executives, meeting repeatedly with small groups of CEOs in his private White House dining room. He also has dispatched top aides Valerie Jarrett and Chief of Staff Rahm Emanuel to corporate boardrooms. Since the summer, the three have met with some of the biggest names in the business community, including the heads of IBM, Wal-Mart Stores, Time Warner, Eastman Kodak, Starbucks, Amazon.com and Coca-Cola.

In the process, Obama is attempting to rewrite the rules of the game in Washington, where the Chamber and other business lobbying groups have long held a highly visible, and powerful, place at the intersection of policy and politics.

"The question we have is: Does the Chamber really represent the business community the way they used to?" said Jarrett, the president's chief business liaison. "It seems as though their members are disengaging."

Meanwhile, the Chamber is fighting back with its own public relations agenda, launching multimillion-dollar ad campaigns to resist several of Obama's top priorities. Passage of the president's plan could depend in part on how this battle plays out.

R. Bruce Josten, the Chamber's longtime lobbyist, said he has less real access to Obama's chief aides than he had during any previous administration. He said the business events Obama holds at the White House are just for show.

"Going to the Reagan center with 150 people, where the president gives prepared remarks -- I'm sorry, I don't consider that a consultative outreach," Josten said. "That's an event, designed by the White House, for the White House."

Quitting in protest

The quarrel obscures that the White House and the Chamber had a relatively warm relationship when Obama took office. Disagreements about a broad swath of the president's economic agenda soured relations, though.

The Chamber of Commerce was already embroiled in controversy over its opposition to climate change legislation. In recent weeks, high-profile businesses have quit the Chamber in protest of that position, most notably Apple Inc.

Chamber officials hint that they think the White House has been encouraging the defections. Jarrett denied that vehemently, saying, "They have to be responsible for their own membership, not us."

On Monday, climate change activists orchestrated a hoax in which Chamber officials appeared to reverse their opposition to energy legislation in Congress.

The event, complete with fake handouts on Chamber letterhead, at least a couple of phony reporters and a podium adorned with the Chamber logo, broke up when a spokesman from the real Chamber burst in.

The pretend Chamber of Commerce official was a member of the activist-prankster group called the Yes Men, which has staged several hoaxes to draw attention to what it believes is slow progress in fighting climate change.

"These irresponsible tactics are a foolish distraction" from the real work to reduce greenhouse gas emissions, said Thomas J. Collamore, the Chamber's senior vice president for communications and strategy. He added that his group will ask authorities to investigate.

Obama and CEOs

Since taking office, Obama has held three private lunches with chief executives. On Oct. 8, he met with Amazon.com's Jeff Bezos. Lewis Hay III of Florida Power & Light, Antonio M. Perez of Eastman Kodak and Irene B. Rosenfeld of Kraft. The next day, before reporters in the East Room, Obama upbraided the Chamber of Commerce for its effort to defeat or water down new consumer protections.

"They're very good at this, because that's how business has been done in Washington for a very long time," he said. "In fact, over the last 10 years, the Chamber alone spent nearly half a billion dollars on lobbying -- half a billion dollars."

Josten said previous presidents sought to work with groups such as the Chamber, even when they disagreed on policy matters, in an attempt to improve legislation or neutralize potential concerns. But he said Obama's dislike of lobbyists has robbed the White House of the chance to craft legislative compromises that businesses can live with.

"Does he get some probably good input from CEOs? I'm sure he does," Josten said. "Are they going to actively go up to the Hill and lobby? I'm sure they're not."

Josten and other Chamber officials participated in more than two dozen "issue meetings" during Obama's transition, and the group backed the president's early efforts to fix the economy. They supported his economic stimulus plan and some of his first nominees for economic positions in the administration.

That goodwill ended abruptly this past summer, when the Chamber announced its opposition to a public insurance option as part of a broad health-care reform effort. The group ran ads in 20 states warning of higher taxes, inflated deficits and "government control over your health."

The Chamber followed up with public statements against the president's climate control legislation and his push for new regulation of the financial sector in the wake of the economic collapse. (Politico first reported Monday on the dispute.)

Chamber officials describe their change in attitude as a result of the president's ambitious agenda, which they said contrasts sharply with their long-standing belief in smaller government, lower taxes and less regulation. Jarrett and others in the White House say the Chamber became an all-out adversary less interested in working to find solutions.

White House officials say they remain open to meeting with the Chamber and its officials, but Jarrett said that discussions so far have been contentious.