In the News: 2016 State of American Business | U.S. Chamber of Commerce
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In the News: 2016 State of American Business

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WealthManagement.com: Chamber of Commerce to Fight DOL Fiduciary Rule

Thursday, January 14, 2016 - 5:15pm

By Megan Leonhardt

The U.S. Chamber of Commerce said Thursday it will use every tool at its disposal to challenge the Department of Labor’s proposed fiduciary rule, including a potential lawsuit and working with Congress.

“We’ve had very strong conversations with people in Labor and in the White House and what has to happen to that rule for it to be acceptable and not destructive to the retirement system of small companies and others,” said Thomas Donohue, president and CEO, in comments to reporters following his annual State of American Business address.

“If [the finalized rule] looks appropriate, we won’t have to sue. If it’s not appropriate, it’s not just suing; we now have, in the Senate and in the House, much better systems to use the appropriations and other parts of the committee process to work on this deal and we will.”

The Labor Department’s rule would require advisors overseeing retirement plans to act under a fiduciary standard, putting client interests ahead of all other considerations when making investment recommendations on accounts covered under the Employee Retirement Income Security Act.

“This rule could actually limit small businesses’ access to retirement services or lock them out of the retirement market all together,” Donohue said.

Duane Thompson, senior policy analyst for fi360, predicted in October that organizations would likely challenge the rule through lawsuits filed in the D.C. Court of Appeals. He noted at the time, at least one insurance company had already retained the counsel of Gibson, Dunn & Crutcher Partner Eugene Scalia (the son of current Supreme Court justice Antonin Scalia). He declined to specify the company, but added it was a clear signal they were prepping for a legal fight.

Roll Call: Chamber’s Donohue: ‘Loud Voices’ in 2016 ‘Politically Stupid’

Thursday, January 14, 2016 - 5:15pm

By Kate Ackley

U.S. Chamber of Commerce President Thomas Donohue took swipes Thursday at the Obama administration's regulatory agenda and the GOP's leading White House contenders, as he outlined the 2016 mission for Washington's biggest lobbying organization.

Though he didn’t mention Donald Trump or others by name, Donohue assailed the "sometimes very loud voices who talk about walling off America from talent, from trade" and proposals that target specific ethnic and religious groups — an obvious reference to Trump’s call to temporarily ban all Muslims from entering the United States amid terrorism concerns.

“This is morally wrong and politically stupid,” said Donohue, whose $300 million group doesn’t endorse presidential candidates but will weigh in on their policy proposals.

In congressional races, Donohue said, the chamber’s priority is to “protect the gains we made” in 2014 when Republicans took control of the Senate and added seats for the largest House majority since the Truman administration. Donohue also unveiled during his annual state of American business speech a legislative agenda that reflects the group’s expectation that election-year politics will consume much of Capitol Hill’s attention.

Many of the business community’s top policy priorities — passage of the Trans-Pacific Partnership trade deal and overhauls to immigration and tax laws — are unlikely to move on Capitol Hill before the November elections. But, he said, the chamber would use “all of our tools” to challenge new Obama administration labor, health, financial and environmental regulations, including using the congressional appropriations process and the courts.

“Some may ask whether the business community can expect to see any progress in Washington this year. The honest answer is not as much as we would like — but more than you may expect,” he said. He also noted, “You can be sure our litigation center will be busier than ever.”

Playing in Primaries

The chamber’s political operation also won’t have a calm year.

Donohue said the chamber has identified primaries in which it will spend money, but declined multiple times to name any. He would not say whether the group’s chosen primaries were Republican or Democratic races or in which states, but said the chamber would “soon” begin making those announcements.

He also stayed mum on dollar estimates for the chamber’s political spending in House and Senate races, though it is expected to exceed last cycle’s $70 million tab.

Senate races will take much of the chamber’s attention, but he said he isn’t taking the House for granted, either. Democrats need only a net gain of five seats to win back control of the Senate, but would need to pick up 30 House seats to knock the GOP out of power.

“We’ll play a role in the Senate side in a very aggressive way. We believe there is a value to the business community by holding the Senate,” he said during a news conference after the speech. In a presidential year, he added, “you have to pay a lot more attention to the House.”

He said the chamber would back candidates who support “pro-growth policies and a free enterprise system, and who want to come to Washington to govern and not just shut the place down.”

On its policy agenda, the chamber seems to be taking a long view, laying foundations for 2017 and beyond.

The Hill: Business Leaders Doubt Trade Vote

Thursday, January 14, 2016 - 5:15pm

By Vicki Needham

Business leaders on Thursday expressed doubt that a sweeping Pacific Rim trade agreement will come up for a vote in Congress before the November elections.

Bruce Josten, the top lobbyist for the U.S. Chamber of Commerce, said that there are several significant factors in play that will determine whether lawmakers will be ready to vote on the 12-nation Trans-Pacific Partnership by this summer.

"That means to me that it’d be pretty tight a question to see that [TPP] voted on in that time frame up until about June,” Josten told reporters during a press conference following the Chamber's State of American Business address.

"So I think that’s a bit of a push to see that happen in that time frame," he said.

But he couched his response, saying that it still might be possible to see a vote before November.

Senate Majority Leader Mitch McConnell (R-Ky.) has said a vote on the trade deal shouldn't come before the elections, though Speaker Paul Ryan (R-Wis.) has talked about wanting a vote as soon as possible.

Josten and Chamber President and CEO Tom Donohue ticked off a series of hurdles that must be cleared before the TPP can be considered by the House and the Senate.

They noted that the push by Republican leaders on Capitol Hill to pass all 12 appropriations bills could eat up critical floor time between now and the summer recess in July, when lawmakers will begin an early, extended recess for the summer nominating conventions.

Consideration of the TPP must also adhere to a strict timeline set by fast-track authority legislation.

Josten noted a that a key economic report that is due out in mid-May from the International Trade Commission also weighs heavily on the TPP timetable.

Donohue said that the Obama administration must work with congressional lawmakers to address several issues — notably pharmaceuticals and tobacco — “without opening up the agreement” and then go out and find the votes and determine the best time to take a vote on the TPP.

But they both made clear that there is a desire by Congress, the White House and business interests to pass the pact this year.

“I think everybody wants to get this done, I think everybody has to figure out how we’re going to get it done,” Josten said.

But the path toward resolving issues and figuring out the best time for a vote is still very much in flux.

Josten suggested a process of side agreements used in the past on trade deals to address concerns.

“Don’t forget this administration proposed side agreements to Colombia outside the agreement before they would send it to Congress,” he said. “There were similar efforts on other agreements, so this is not new to this agreement or any other agreement.”

Josten and Donohue also tried to quell concerns that lawmakers who were supportive of trade promotion authority (TRPA) might vote against the TPP, including Senate Finance Committee Chairman Orrin Hatch (R-Utah).

“It’s important to recognize that Sen. Hatch was a vigorous supporter of TPA and he didn’t do that because he was against trade agreements," Donohue said. "He just wants to make sure they are done right."

Josten said that it is best "not to conflate" the concerns of McConnell and Hatch who have each expressed concerns about certain provisions in the TPP agreement "because that has nothing to do with their otherwise well-ground and exceptionally strong support for trade."

"This is not unusual," Josten said.

In past agreements from the North American Free Trade Agreement to the deal with South Korea, challenges always have presented themselves and that need to be addressed after the completion of any deal.

"And that’s what everybody is saying — they want to fix something — and we also are in the same boat with them because we want to get this deal done and enacted it into law."

In his address, Donohue reaffirmed that the Chamber would aggressively pursue completion of the TPP this year as well as completing an agreement with the European Union among other trade initiatives.

In his State of the Union address on Tuesday, President Obama called on Congress to pass the TPP as an example of the United States using its powers to "mobilize the world to work with us” on issues of global concern.

 He said that the TPP will "open markets, protect workers and the environment and advance American leadership in Asia."

The Business Journals: 4 Messages For Politicians, Including Donald Trump, from America’s Biggest Business Lobby

Thursday, January 14, 2016 - 5:00pm

By Kent Hoover

American businesses see an economy “with some strengths but many weaknesses” and “know we could be doing much, much better than we are today.”

That’s the state of American business, as summed up by Tom Donohue, president and CEO of the U.S. Chamber of Commerce, in his annual address Thursday on the challenges and opportunities facing businesses, and the chamber’s proposals for addressing them.

“We can’t wave away all the factors that are holding our economy back or eliminate all uncertainty,” Donohue said. “But we can fix bad policies and remove impediments — in order to spurt investment, jobs, growth and opportunity."

Here are four messages the chamber — Washington’s most powerful business lobby — has for politicians, including Republican presidential frontrunner Donald Trump:

1. Economic growth should be a central issue in the 2016 elections

The chamber is a major player in congressional elections and state judicial elections, and will continue to play that role again in 2016. Its goal is to elect candidates “who understand that it’s the private sector, not government, that creates jobs and prosperity — and that the overriding goal must be to expand the economic pie, not simply redistribute it,” Donohue said.

“What business wants to see in this campaign is a long overdue focus on economic growth,” he said.

The chamber generally supports Republicans in congressional elections, and has played a key role in GOP primaries by backing traditional “pro-business” candidates “who want to come to Washington to govern and not just shut the place down,” in Donohue’s words.

2. Keeping Republican control of Congress is a top priority.

“We will protect advances we made in the last election,” Donohue said.

The chamber has issues with some Republicans

The chamber doesn’t endorse presidential candidates, but Donohue said it will weigh in on issues raised in the campaign.

“If candidates choose to beat up on business, they’re going to hear from us,” he said.

Although he didn’t mention them by name, that includes Democrats such as Hillary Clinton and Bernie Sanders, who are “promising to double down on the current administration’s policies — more spending, more entitlements, more taxing and more regulating,” Donohue said.

“I guess they figure that if something isn’t working, just do more of it. Does that make any sense.”

But he also had harsh words for some Republican candidates. Again, he didn’t mention any names, but it sure sounded like he had Trump in mind.

“On the other side there are voices — sometimes very loud voices — who talk about walling off America from talent and trade, and who are attacking whole groups of people based not on their conduct, but on their ethnicity or religion. This is morally wrong and politically stupid,” Donohue said.

He also took issue with Republicans who contend that the government is engaged in “crony capitalism — the notion that government spends all day every day figuring out how to help business. Really? That’s not the Washington I know, and I’ve been here a long time,” Donohue said.

In last year’s fight over the Export-Import Bank, business groups beat ideological conservatives who contended the bank was a form of crony capitalism. That’s because it became clear the bank’s lapse was costing American businesses sales opportunities overseas. Reality “caused us to get the votes we needed,” Donohue said.

3. It will fight Obama’s regulatory push in Congress and the courts

“Businesspeople at companies large and small wake up each morning and wonder what the government is going to do them today,” Donohue said.

“The current administration is on a regulatory tear — and this will continue until the day the moving van backs up to the door of the White House next January,” he said.

The chamber will work with agencies to minimize the damage these regulations will have on businesses, lobby Congress to try to block the most burdensome rules, and file lawsuits against regulations that go beyond what agencies are authorized to do, he said.

“You can be sure that our litigation center will be busier than ever in the final year of this administration,” Donohue said.

The chamber already has filed lawsuits challenging Environmental Protection Agency rules that require power plants to reduce carbon emissions, expand bodies of water subject to federal regulation, and impose stricter limits on ozone emissions.

“There will be others,” Donohue said.

These could include challenges to regulations on their way this year that would make more workers eligible for overtime pay and impose new rules on financial advisers, which could make retirement plans more expensive for small businesses.

4. Obamacare should be fixed, not repealed

The Affordable Care Act has been in place so long that fully repealing it isn’t practical, according to the chamber.

Instead, the Chamber is “trying to make this thing work,” said Bruce Josten, the organization’s top lobbyist.

That means permanently getting rid of ACA’s taxes on health insurers, medical device companies and high-value health plans, he said. The chamber also wants Congress to raise limits on health savings accounts, because these limits are hurting small businesses.

Last year business groups succeeded in blocking Obamacare’s expansion of the small group market, which would have led to higher premiums for businesses with 51 to 100 employees.

This year, Donohue said, “We’ll seek further targeted improvements to Obamacare, with the hope that major health care reforms will be considered in 2017,” Donohue said.

Financial Advisor Magazine: Lawsuit Against DOL Fiduciary Rule ‘a Possibility,’ Chamber CEO Says

Thursday, January 14, 2016 - 3:30pm

By Ted Knutson

U.S. Chamber of Commerce President and CEO Tom Donohue said Thursday a chamber legal challenge is “a possibility” when the Department of Labor’s proposed fiduciary rule for retirement plan advisors is finalized.

Donohue attacked the rule as flawed during his annual State of American Business address, claiming it could limit small businesses’ access to retirement services or lock them out of the retirement market altogether.

However, he acknowledged he hasn’t read the proposal.

Looking ahead to the new year, Donohue said the chamber will be aggressive in working for entitlement reform, labeling it as an absolute priority.

Without fixes, he said, Social Security and Medicare won’t be able to pay full benefits in 20 years.

“If we make common-sense changes soon, we can ensure the nation’s safety net remains intact for future generations,” said Donohue.

The chamber chief called the current recovery the worst since the Great Depression, noting 10 percent of workers are either out of a job or underemployed while the workforce participation rate of adults is at a four-decade low.

Washington Times: Business Chief Criticizes Anti-Immigration Rhetoric from Trump, GOP Candidates

Thursday, January 14, 2016 - 3:30pm

By Dave Boyer

The president of the U.S. Chamber of Commerce blasted presidential candidate Donald Trump’s call to build a wall along the border with Mexico Thursday, saying it is “morally wrong and politically stupid.”

Chamber CEO Thomas J. Donohue didn’t mention Mr. Trump by name, but criticized “very loud voices” in the GOP “who talk about walling off America from talent and trade and who are attacking whole groups of people based not on their conduct but on their ethnicity or religion.”

“This is morally wrong and politically stupid,” Mr. Donohue said in his annual address on the state of American business.

The chamber has been pushing, unsuccessfully, for Congress to approve comprehensive immigration reform backed by President Obama.

Mr. Donohue said the presidential race is “the most surprising and perplexing presidential campaign in modern history, and I would say, in both parties.”

On the Democratic side, he said, “we have candidates promising to double down on the current administration’s policies — more spending, more entitlements, more taxing, and more regulating.”

“I guess they figure that if something isn’t working, just do more of it. Does that make any sense?” he asked.

The head of the business community’s lobbying group said the Obama administration is crushing businesses with ever-increasing regulation.

“The current administration is on a regulatory tear — and this will continue until the day the moving van backs up to the door of the White House next January,” he said. “It has unleashed a runaway EPA that is stretching the law — and in some cases breaking it — in order to assume control over local economic development across America.”

The economic outlook for 2016 is uncertain, Mr. Donohue said, with the U.S. “stuck in the worst economic recovery since the Great Depression.”

Washington Examiner: Chamber Warns on Debt: ‘Whole House of Cards Can Collapse’

Thursday, January 14, 2016 - 3:30pm

By Joseph Lawler

The head of the country's biggest business group issued a dire warning Thursday about the future of the country's finances and economic stewardship, saying that the "whole house of cards can collapse" if government debt isn't brought under control.

U.S. Chamber of Commerce president and CEO Tom Donohue, speaking at the group's Washington headquarters, warned that the government's spending, overregulation, and harrassment of business were now at unsustainable levels.

"Governments at all levels are accumulating massive levels of debt and unfunded pensions and entitlement liabilies," he said, in a fashion that will lead to collapse without reform.

His group will "bang the drum loudly" for entitlement reform in 2016, he added.

The Chamber is the largest business lobby in Washington, backing candidates, mostly Republicans, who favor policies that aid large and small businesses.

In his "State of Business" address, Donohue sketched out a gloomy scenario for businesses, despite the relatively favorable headlines relating to economic output and job growth. The private sector, he claimed, is being "milked unmercifully" by government.

He warned specifically of the Obama administration's "regulatory tear" that business expects to continue through the last day of his tenure. He gave particular attention to the "runaway EPA that its stretching the law and, in some cases, breaking it."

Turning to the financial sector, he complained that "so many regulators have been turned loose on our financial sector that banks have been distracted from their principal purpose to provide credit and services that enable our businesses to grow and our entrepreneurs to thrive."

Morning Consult: U.S. Chamber of Commerce to Push for Dodd-Frank Changes

Thursday, January 14, 2016 - 3:30pm

By Ryan Rainey

The U.S. Chamber of Commerce in 2016 will push for comprehensive changes to the Dodd-Frank law, President Tom Donohue said Thursday.

In his annual State of American Business address today, Donohue said one of the Chamber’s main priorities will be to continue its campaign for policymakers to “fix the provisions that the law got wrong, add the provisions that the law left out and replace the provisions that we all know just don’t work.”

The Chamber will “support reforms to the Consumer Financial Protection Bureau while insisting that it goes through normal processes to make rules,” Donohue said, adding that laws the size of Dodd-Frank almost always require changes.

He also called for fixes to the Labor Department’s proposed rule on financial advisers, and he threatened to file a lawsuit if the rule isn’t changed to the Chamber’s satisfaction.

Donohue also said the group would push for congressional approval of the Trans-Pacific Partnership.

The speech omitted any strong language regarding comprehensive tax reform. But when speaking to reporters, Donohue and Chamber Executive Vice President for Government Affairs R. Bruce Josten said that although a tax overhaul is more likely in 2017, the Chamber might weigh in when Congress acts on 36 tax extenders later this year.

Donohue also said that although the Chamber could weigh in on legislation to address corporate inversions, though Josten said the more palatable solution would be for Congress to pass a comprehensive tax bill.

“The reality is, if you want to stop inversions, you’re going to have to do fundamental tax reform,” Josten said.

The Hill: Head of Business Lobby Slams Trump, GOP Candidates for Immigration Rhetoric

Thursday, January 14, 2016 - 3:30pm

By Lydia Wheeler

The leader of the U.S. Chamber of Commerce on Thursday assailed the “very loud” voices in the Republican presidential race who advocate “walling off America,” taking what appeared to be a swipe at Donald Trump. 

While Chamber President and CEO Thomas J. Donohue did not mention Trump by name, he denounced candidates who he said “are attacking whole groups of people based not on their conduct but on their ethnicity or religion.”

“This is morally wrong and politically stupid,” Donohue said in his annual State of American business address.

Donohue later denied that his remark was aimed directly at Trump, the front-runner for the Republican nomination.

"It referenced anyone in the process of the debates that chose to go in that direction," Donohue said. "It's not solely that one candidate."

Trump alone among the 2016 hopefuls has called for temporarily banning Muslims from entering the United States, a step he said is necessary to protect the country from terrorism.

The Chamber president also took aim at Democrats who he said are "promising to double down on the current administration's policies — more spending, more entitlements, more taxing and more regulating. I guess they figure that if something isn't working, just do more of it. Does that make any sense?

As it has in the past, Donohue said the Chamber will not be making an endorsement in the 2016 race, though he warned the group will not be silent.

“While we will not be participating in the presidential race, we will weigh in on presidential policy proposals,” Donohue said. “If candidates choose to beat up on business, they’re going to hear from us.”

Elsewhere in his address, Donohue pledged that the Chamber will challenge President Obama’s “regulatory tear” in the courts.

“You can be sure our litigation center will be busier than ever in the final year of this administration,” he said.

“Our law firm is already challenging the so-called Clean Power Plan, the Waters of the U.S. rule and the administration’s new ozone rule.

“There will be others,” he said.

The focus, he said will be on curbing class action abuses and reigning in overregulation.

“I can tell you that business people at companies large and small wake up each morning and wonder what the government is going to do to them today,” Donohue said. “The current administration is on a regulatory tear and this will continue until the day the moving van backs up to the door of the White House next January.”

He ticked off ObamaCare, EPA measures and Dodd-Frank regulations as the main things holding the economy back.

The address, which came less than 48 hours after the President’s State of the Union, is traditionally the Chamber’s opportunity to map out its policy agenda for the new year.

Donohue said the Chamber would work to expand American trade by vigorously supporting the Trans-Pacific Partnership agreement, advancing entitlement reform, expand American energy and supporting pro-growth candidates in key states and districts.

Wall Street Journal: U.S. Chamber Chief Warns of ‘Politically Stupid’ Voices in White House Race

Thursday, January 14, 2016 - 3:15pm

By Jeffrey Sparshott

The head of the nation’s biggest business lobby inveighed against presidential candidates singling out immigrants, ethnic or religious groups, highlighting divisions among supporters of the Republican establishment and the party’s leading candidate Donald Trump.

“There are the voices, sometimes very loud voices, who talk about walling off America from talent and trade and who are attacking whole groups of people based not on their conduct but on their ethnicity or religion,” Thomas Donohue, president of the U.S. Chamber of Commerce, said in a speech on Thursday. “This is morally wrong and politically stupid.”

When asked if the comments were specifically about Mr. Trump, Mr. Donohue said they applied to any one of the candidates from the right who “stepped over the boundary” on issues such as immigration and trade.

“They lost track of who we are and what we stand for and how we fix this economy,” he said.

But the remarks closely echo similar comments from South Carolina Gov. Nikki Haley and other Republicans who have pushed back against of Mr. Trump’s policy prescriptions on immigration and security.

Mr. Donohue and the chamber typically stay out of presidential elections but often weigh in on behalf of Republican candidates in other races. One of the group’s top priorities this year is maintaining what it calls a “pro-growth majority” in the Senate–in other words, retaining GOP control. Already last July, it had started running ads in support of four Republicans seeking to keep or win Senate seats.

Indeed, Mr. Donohue was critical of the Obama administration and Democrats who want to “double down” on spending, entitlement, tax and regulatory policies that the Chamber believes are holding back the economy.

But the presidential race, and much of the rhetoric emanating from it, have clearly given businesses pause. Mr. Donohue called the unfolding election “damn serious and sometimes a little scary.”

“We are in the middle of the most surprising and perplexing presidential campaign in modern history and I would say in both parties,” he said.

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