Tom Donahue, the 'Gang of 6' and Red America
by Matt Stoller, Wed Dec 13, 2006 at 09:22:00 AM EST
Well, it turns out that the Sunrise Senior Living scandal isn't the first time Mr. Donahue has been involved in corporate accountability problems, but I'll save that for a later post. I want to explain why I'm blogging about Tom Donahue and the US Chamber of Commerce, because it gets at the heart of the problem for the progressive movement. A substantial amount of political power in this country is controlled by a relatively small number of people. These people sit on corporate boards, they know each other, they pay each others' salaries, they go to conferences in Davos, and they fund campaigns for both parties. They are willing to invest in substantial sums - like hundreds of millions of dollars - and make alliances with right-wing Christian groups to eviscerate the power of the Federal government and progressive policies to be effective.
The 2001 tax cuts, for instance, aside from giving billions to the wealthy, destroyed the capacity of the government to do much affirmative good work. By crippling governance, these elites are pushing the public to accept private goods in lieu of what should be public services. Private schools, bottled water, health food, private and chartered travel, elite medical institutions - these are all part and parcel of building what John Edwards calls the 'Two Americas'. It really is quite stark. If you are in the business or political elite, compared to normal Americans, you live in different areas, have different crime rates, eat different food and drink different water, send your kids to different schools, travel more efficiently, are subject to a different set of laws, and have access to superior medicine. The public at large responds to this in different ways - liberals get despondent and cynical, and blue collar ethnic whites begin to rely on right-wing church networks for what had been public services.
The key to building and sustaining this reactionary America is allowing individuals like Thomas Donahue to act above the law for personal profit, while lobbying to weaken agencies that might hold them accountable. It fits perfectly into this destruction of the public sphere, and allows bad actors to profit from doing bad. We will not and cannot build a progressive America as long as we have an economy that incentivizes people like this to steal from investors and use that money to lobby against us.
I would encourage you to read this article by Jeffrey H. Birnbaum on the power of the Chamber of Commerce, and the revolution in business lobbying that Donahue helped to usher in. Long story short, the Chamber of Commerce used to be a trade association that advocated in a bipartisan manner for narrowly tailored policies to benefit its members. Since 1997 or so, it has become a fully functional part of the partisan Republican machine, with Donahue raising its budget to $150M a year from corporate chiefs satisfied with his ability to move policy through a Republican Congress.
Thomas Donahue plays extreme hardball; he has called investigations by New York state Attorney General Eliot L. Spitzer "the most egregious and unacceptable form of intimidation that we have seen in this country in modern time." He creates a climate of fear and intimidation in DC, and along with the 'Gang of Six' trade associations - the "Business Roundtable, the National Association of Manufacturers, the National Restaurant Association, NFIB and NAW" - pushes for extreme right-wing policies that don't make any sense unless you look through the lens of a greedy and unaccountable management class.
It's a formidable group and it's not going away.
The chamber eagerly deploys every weapon in the lobbying arsenal and can be counted on by the president to get things done. It has demonstrated its success repeatedly in the past four years on issues as disparate as loosening ergonomics standards and creating health-savings accounts.
Its lobbyists blanket Capitol Hill. Its Web sites and telemarketers stir up voters back home. It donates generously to political campaigns coffers, and it bankrolls multimillion-dollar ad campaigns for the politicians and policies it supports.
In the first half of last year (the latest figures available), the chamber ranked first among all organizations in lobbying expenditures, at $30 million. The chamber also contributed more than $4 million to the November Fund, a group that attacked Democratic presidential candidate John F. Kerry for choosing a former trial lawyer, John Edwards, as his running mate. Today, the chamber is solidly in the black, its $150 million annual budget triple what it was when Donohue took over. It also is staunchly Republican in most of its legislative positions and played a pivotal role in cutting the tax on dividends and approving free-trade pacts, among many other Bush priorities. Whenever the president or his people called, the chamber assembled coalitions of like-minded groups and contacted its 3 million member firms to step up political pressure and donate lobbying-related funds.
For the 2004 elections, the chamber dispersed 215 political operatives to 31 states, mailed 3.7 million letters to targeted voters, made 5.6 million phone calls and sent 30 million e-mails to persuade pro-business voters to go to the polls.
Donahue is really smart, and the Chamber isn't going away. If you read the full article, you'll see that he hired Al From, head of the DLC, to make sure that right-wing policies succeed in both parties.
The key though to understanding Donahue and the ascendance of the right-wing corrupted elites is that they don't really have a base. Local Chambers of Commerce are largely unaware of Donahue's work and record. They don't know that he was on the board of Qwest and Union Pacific when both companies faced serious legal problems due to either fraud or lack of investment in safety procedures, or that he was just caught selling shares of Sunrise Senior Living - another company on which he is a board member - in advance of the release of damaging accounting information . Local Chambers are mostly composed of businesspeople who get together in communities and are mostly ethical normal folk looking to network and support local commerce.
It is a cornerstone of Bush's ascendance, and more than that the right-wing movement that built him up, that corrupted groups like the Chamber and the 'Group of Six' can operate as arms of a partisan vicious political movement to destroy the government without the people they purport to represent knowing about it. It's a larger institutional problem of management capture, the same lack of accountability among elites that let Enron and Iraq happen.
I mean the head of the US Chamber of Commerce, a guy who's pushing to weaken every tool of the public to possibly hold corporations accountable for unethical behavior and a rabid Bush supporter, was just caught selling shares ahead of bad accounting news. That's not good for investors, for corporations, for employees, or even for profit. It's only good for Thomas Donahue. And that's what his America is all about.