Business halls don’t need Kevin McCarthy


The U.S. Chamber of Commerce, Washington’s largest and most powerful business lobby, could not even meet with the Republican hopeful to become the next House speaker. This is certainly unusual, but the more immediate question is how this strained relationship will affect the prospects for 2023 legislation.

The answer is: not a lot.

Gridlock, not Kevin McCarthy, will dominate the next two years, with Republicans controlling the House, Democrats controlling the Senate, White House President Joe Biden and the presidential race already underway.

Legislation on the core issues that have united corporate America and the Republican establishment for decades — from tax cuts to deregulation — is impossible. That might not be such a bad thing, if it can give businesses some space while taking blows from both the populist left and the populist right.

McCarthy, for example, has been engaged in a public battle with the Chamber and its chief executive, Suzanne Clark. McCarthy has urged the Senate to fire Clark, the group’s first female chief executive. Conservative Republicans have accused the chamber of focusing on progressive causes rather than business interests. In 2020, the business lobby, once evenly matched with the Republican Party, backed 23 Democratic incumbents.

Separately, House Republicans are threatening financial firms with subpoena power and warning of hearings on their environmental, social and governance (ESG) practices. They also don’t like corporate leaders speaking out against election deniers.

So what is the business type of the mainstream chamber of commerce? Advice from those who know Washington: Keep your head down and buckle up.

Former House Speaker Paul Ryan, now vice chairman of CEO consulting firm Teneo, spoke with a group of business leaders ahead of the election. One attendee told me he predicted Republicans would take control of the House and Democrats would retain the Senate, and spoke about the conflicting pressures on corporations on issues like ESG, diversity and abortion.

Stay away from strife, he advises. Businesses cannot deftly navigate the populist forces on both sides.

Still, they will want or need to comment on the base appropriations bill and other proposed legislation, even if the latter has little chance. At this time, who can they turn to for help?

“I’m not concerned that the business community will have a hard time getting their point across to Republicans in Congress,” said Charles Dent, a former Republican member of Congress who is now executive director of the Congressional Project at the Aspen Institute. Possible chairs of powerful committees willing to listen include Cathy McMorris Rodgers of the House Energy and Commerce Committee, Vern Buchanan of the Ways and Means Committee, Kay Granger of the Appropriations Committee and Michael McCaul of the Foreign Affairs Committee.

Republican members need to remember that the business community cares deeply about a stable political environment, Dent said. Republicans may feel that the House owes them allegiance to their cool on tax, trade, labor and regulatory issues. But they should also realize that threatening to default on their debts, push for a government shutdown or vote to disqualify free and fair elections is bad for business, he said.

On the other hand, the Chamber of Commerce and other business groups have not completely abandoned the Republican Party.

Washington-based Citizens for Responsible Ethics tracks donations to election deniers and Republican lawmakers who voted against proving President Joe Biden’s 2020 victory — noting which business interests say they will reassess or suspend funding for those lawmakers political donations. Some 220 companies have made the pledge, but only 67 are still keeping it, according to Robert Maguire, the group’s director of research.

The Chamber has never made such a pledge, and Republican beneficiaries of its largesse this year include Representative Ted Budd, who benefited from $500,000 in advertising paid for by the Chamber and won his Senate run in North Carolina, and Rep. Steve Chabot of Ohio, the Chamber of Commerce spent $230,000 on advertising, but lost out.

Maguire noted that the Chamber’s political spending has dropped significantly over the past 10 years. It spent $35 million in the 2014 election cycle; $10.9 million in 2018; and just $1.8 million in 2022. The chamber noted that the figures reflect only cable or broadcast television ad spending in the weeks leading up to the election and do not include digital ad spending. It also noted that it is donating $3 million to political action committees in 2022 to support Republican U.S. Senate candidate Mehmet Oz.

This year, the chamber also donated directly to at least 16 Republican lawmakers who voted against the 2020 election. Among the donations: $5,000 to Kevin McCarthy of California.

More views from Bloomberg:

• Are Republicans and big business headed for a breakup? David A. Hopkins

• Anti-wake Republicans don’t make sense on climate: Liam Denning

• Big business can no longer rely on Republicans: Michael Strain

(Corrected last paragraph to state that the Chamber contributed to the 16 members of Congress who voted not to approve the 2020 elections. Also updated the penultimate paragraph to include details of the Chamber’s other political spending.)

This column does not necessarily reflect the views of the editorial board or Bloomberg LP and its owners.

Julianna Goldman is a Bloomberg Opinion columnist and a former Washington correspondent for CBS News and the White House correspondent for Bloomberg News and Bloomberg Television.

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