Tom Donahue, the 'Gang of 6' and Red America

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.

Tags: Chamber of Commerce, Thomas Donahue (all tags)

Comments

12 Comments

This Guy....

Should be tracked and every time he makes an appearance he should be mocked and held up to public ridicule.  Let's use some shame on this guy.

by Arthurkc 2006-12-13 09:27AM | 0 recs
Further: Distributed Activism

If it is announced that he will be speaking at some event in Dayton or Dallas, I suspect the local netroots could organize a street event to welcome him, and generate some good local media.  Shame on him!

by Arthurkc 2006-12-13 09:29AM | 0 recs
Re: Tom Donahue, the 'Gang of 6' and Red America

Local Chambers of Commerce are largely unaware of Donahue's work and record.

Maybe it is time someone told them.

by Alice Marshall 2006-12-13 09:52AM | 0 recs
Re: Tom Donahue, the 'Gang of 6' and Red America

    Now that's BS. Make things clear Matt Stoller. Economics is not ideologica. It is simply a matter of self interest. If I am a steel worker and you are a billionaire, we have different interests. That does not mean I am leftwing or you are right wing. If I am pro-life and you are pro-choice, that is an ideological difference. Clear? As for the local chambers of commerce stuff, thats a copout. Either you think businesses are corrupt to the bone, in which case we should nationalize them and get rid of the evils of private property, or we should live and let live. Thats what you seem to be implying here.

by alexsycara 2006-12-13 10:43AM | 0 recs
huh?

What I took away from this is that Donahue is corrupt and needs to resign and that the six organizations are run by those who are more interested in class warfare than business innovation.

by Alice Marshall 2006-12-13 10:49AM | 0 recs
Re: Tom Donahue, the 'Gang of 6' and Red America

Either you think businesses are corrupt to the bone, in which case we should nationalize them and get rid of the evils of private property, or we should live and let live.

MyDD is a business.

by Matt Stoller 2006-12-13 11:09AM | 0 recs
A Profound Misunderstanding Of Ideology

Make things clear Matt Stoller. Economics is not ideologica. It is simply a matter of self interest. If I am a steel worker and you are a billionaire, we have different interests. That does not mean I am leftwing or you are right wing.
So, the last 230 years or so has just been one big misunderstanding?  Well, I'm glad we cleared that up!  All those silly folks who thought that ideology expressed differences in self-interest were just, what? Smoking crack?  FDR and the whole New Deal, just a pipe dream, right?

The fact that someone can post such a ludicrous claim on site like this is indicative of what great job the rightwing propaganda machine has done over the past 30+ years.  Of course, they had a long head start on this.  Denying class is as American as apple pie futures.

In the real world, liberals are committed to egalitarianism, expanding freedom for all, abolishing traditional barriers, and promoting social progress.  Conservatives are committed to hierarchy, elite rule, restricting power to a chosen few, and retarding or reversing social progress.

On a very pragmatic scale, the premier students of American legislative voting history, Keith Poole & colleagues (see DW-NOMINATE [Congressional Roll Call] Scores) think otherwise, as explained in the book, Polarized America:

Polarized America
The Dance of Ideology and Unequal Riches

Nolan McCarty, Keith T. Poole and Howard Rosenthal

The idea of America as politically polarized--that there is an unbridgeable divide between right and left, red and blue states--has become a cliché. What commentators miss, however, is that increasing polarization in recent decades has been closely accompanied by fundamental social and economic changes--most notably, a parallel rise in income inequality. In Polarized America, Nolan McCarty, Keith Poole, and Howard Rosenthal examine the relationships of polarization, wealth disparity, immigration, and other forces, characterizing it as a dance of give and take and back and forth causality.

Using NOMINATE (a quantitative procedure that, like interest group ratings, scores politicians on the basis of their roll call voting records) to measure polarization in Congress and public opinion, census data and Federal Election Commission finance records to measure polarization among the public, the authors find that polarization and income inequality fell in tandem from 1913 to 1957 and rose together dramatically from 1977 on; they trace a parallel rise in immigration beginning in the 1970s. They show that Republicans have moved right, away from redistributive policies that would reduce income inequality. Immigration, meanwhile, has facilitated the move to the right: non-citizens, a larger share of the population and disproportionately poor, cannot vote; thus there is less political pressure from the bottom for redistribution than there is from the top against it. In "the choreography of American politics" inequality feeds directly into political polarization, and polarization in turn creates policies that further increase inequality.

Nah! Economics has noting to do with ideology.  Only someone who's reality-based could think like that!

by Paul Rosenberg 2006-12-13 11:45AM | 0 recs
Just to add...
CoCs are membership organizations with committees and boards of directors made up of volunteers from within the membership.
This is where the issue of "management capture" comes up, and progressive business people should realize that management capture is a two-way street. Chambers are often begging and cajoling members to step up and help the Chamber committees and boards do their work, and those members who become active have more influence over policy and decision-making.
In other words, if you are a progressive business person who chooses to be a member of a chamber, there are ways you can become involved and advocate from within to make the organization more representative and less partisan.
Caveat: Boards of directors will always be weighted with deep-pocket members, as it is received board-development wisdom in the US nonprofit world to ensure one portion of the board is comprised of supporters wealthy enough to bale the organization out if it ever gets into financial trouble.
Still, the idea that a CoC is failing to serve its members (and a consequent loss of membership) is potent enough to cause chamber leadership to moderate their behavior. Chambers get part of their power from their claim to represent the business community, and a shriveling membership undermines that power.
Similiarly, at the national level, I think Matt is right on to amplify the idea that the Chamber does not represent the business community well. It will be much easier for policy makers to ignore the Chamber if their claim to representation can be delegitimized.
by johnalive 2006-12-13 01:16PM | 0 recs
The lobbies need working on!

I think Matt has opened up a pretty important area for the lefty sphere to develop knowledge and expertise about.

My queries commenting on his earlier piece were directed at how sensible it was to concentrate on Donahue the man.

On the power of the USCC and other business lobbies, I think we'd be absolutely right to focus. (I say that having failed to focus on them until Matt waved them under our noses!)

The Birnbaum piece is certainly required reading (I find after Matt points me in its direction). I had no idea, for instance, that the USCC had backed Hillarycare. Or that the NAM was a smaller operation than the USCC. Or that it had a new head that Donahue feels able to patronize by proxy!

I still think that Donahue's share dealings and the way his company does its business are secondary issues: but the business lobbies are not.

For instance, I'd be fairly sure that all these organizations have taken on Dems in the last few months, and have been making nice to Dem MCs on an industrial scale.

Perhaps - one line of inquiry - that may give the NAM (less implicated in the Bush project) an opportunity to use the USCC's Bush links to get closer to top Dems.

Are there any blogs which specialize in dogging lobbies like the USCC?

by skeptic06 2006-12-13 01:44PM | 0 recs
Re: Tom Donahue, the 'Gang of 6' and Red America
We need to make sure certain members of congress and senate are on this and will take some kind of action.  
Clinton is up to her eyeballs in DLC.
But, Reid and co. would not be.  There has to be a way to take them down.  No one is so powerful that someone cannot find a way to take them down.
The mafia was taken down when CW was that couldn't be done.  And these guys are like a mafia against the public and the average person.
by vwcat 2006-12-13 05:13PM | 0 recs
Re: Tom Donahue, the 'Gang of 6' and Red America
Most people do not realize how bad Tom Donahue is
for the working man or woman.  During the first
term of GW, Donahue spent much of his time and efforts running aroung the USA giving speechs to the local C of C groups explaining and encouraging
the business owners to move their operations overseas, this is no shit.  Backed by the Mfgrs.
Assoc., the obvious reasons were to break as many unions as possible.  If there are no jobs at a Company, then there is no union, and they had decided after moving many operations to Mexico only to be followed by the union workers going down there, they collaborated with the investment
community to pull out of Mexico and go to China
where they could pay .30 per hr versus 3.00per hr.
in Mexico. Even though many efficiency experts
said it wasn't worth the effort to move activities
overseas, the C of C, the Amer Mfgr Assoc, and
Donahue kept up the drumbeat.
by tommi 2006-12-14 03:28AM | 0 recs
Re: Tom Donahue, the 'Gang of 6' and Red America

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by juanjuanmak 2007-04-02 12:41AM | 0 recs

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