BUSINESS BLOWS IT IN WASHINGTON
(FORTUNE Magazine) – All the business barometers in Washington are seemingly healthy: On Capitol Hill there's a Republican majority newly emboldened by a string of successes in the November off-year elections. In the White House there's a President who's often described as a moderate and who's more attentive to the bond market than any of his predecessors. The economy is strong, even robust. So how's business doing in Washington? In a word: terrible.
Business wanted President Clinton to win fast-track authority to negotiate new free-trade agreements. But support for the measure was so weak that congressional leaders didn't even dare bring it to a vote--a devastating blow to business' credibility. The Administration hoped the big business lobbies would muscle lawmakers into line, but the response was very lame. "All flab," a high-powered lobbyist told me in disgust.
That's far from business' only setback this year. Congress passed a tax bill that contained none of the goodies that business expected from the Republicans on the Hill. The GOP ran away from one of business' biggest goals, the elimination of the alternative minimum tax. The tax benefits that were passed were aimed at the middle class, not business. And though the Republican rebels didn't make good on their threat to take on corporate welfare, this fall the President did, eliminating "unwarranted corporate subsidies" for giants like 3M and Freeport-McMoRan.
This comes at a time of public skepticism about business, especially when it comes to regulation. "Business executives have to realize that they are facing a crisis in Washington," says Bruce F. Freed, who advises business leaders on Washington. "They've lost the public trust--and the government is only reflecting that."
Business crippled but didn't kill OSHA's ergonomic plan to require employers to change how machines work and how offices are furnished. The Administration wants to mandate recalls for meat and poultry, enhancing Agriculture Department and FDA authority over what is now a voluntary system. Business has fought this notion for two decades, but this fall's hamburger scare has all but drowned out the protests of the powerful meat and poultry industries.
Business opposes tougher environmental regulation; the momentum in Washington is clearly going the other way, not only in reaction to pressure from Vice President Al Gore but also in response to leading Republicans, including House Budget Chairman John Kasich. They've seen the same polls the Democrats have. One survey, taken by GOP pollster Richard Wirthlin, found that three Americans in four believe that "environmental standards cannot be too high" and that "continuing environmental improvements must be made regardless of cost."
"Overall, the Democratic Administration has put itself on the right side--for a change--of the economic growth question," Senator Joseph Lieberman (D-Conn.) told me. "People in business should feel some satisfaction that on the macro issues--fiscal responsibility, a balanced budget--the White House is with them. But on particular issues, the Administration has not knuckled under to business."
Why is business so weak? Lobbyists say that despite GOP control of Capitol Hill, they don't have enough strength to force or kill legislation. So now the Chamber of Commerce, the National Association of Manufacturers, the Business Roundtable, and the Retail Federation are girding for a new offensive aimed at next fall's midterm congressional elections. "We need to get engaged like the AFL-CIO and elect more pro-business legislators," says Bruce Josten, chief lobbyist for the Chamber.
Business wants to change Washington. It also needs to change its own image--not only inside the Beltway.
DAVID SHRIBMAN is Washington bureau chief for the Boston Globe and a Pulitzer Prize-winning political reporter.