NYT
>
> March 18, 2001
>
> Corporate Power in Overdrive
>
> By ROBERT B. REICH
>
> [C]AMBRIDGE, Mass. — With last week's reversal of his campaign pledge to limit
>power plants' emissions of carbon dioxide, a key contributor to global warming,
>President Bush surrendered to coal companies and utilities dependent on coal. He had
>little choice. It's payback time, and every industry and trade association is busily
>cashing in.
>
> There's no longer any countervailing power in Washington. Business is in complete
>control of the machinery of government. The House, the Senate and the White House are
>all run by business-friendly Republicans who are deeply indebted to American business
>for their electoral victories. If corporate America understood its long-term
>interest, it would use this unique moment to establish in the public's mind the
>principle that business can be trusted. But it's doing the opposite, and the danger
>for American business as a whole is profound.
>
> Credit-card companies are getting a bankruptcy bill that will make it harder for
>overstretched people who succumbed to these companies' blandishments ever to get out
>from under the resulting debts. Oil companies are on the way to obtaining rights to
>drill on Alaska's coastal plain. Cigarette manufacturers are confident the
>administration will drop the federal lawsuit against them. Pharmaceutical companies
>are hoping to get longer patent protections. Big, labor-intensive businesses want to
>get rules that weaken unions, and they've already killed the Labor Department's
>ergonomics rules, which would have protected workers against repetitive-stress
>injuries. Airlines with labor problems can count on White House actions to ward off
>strikes. And so on.
>
> In normal times — when business has to cope with some political resistance — its
>leaders are forced to set strict priorities. There is only a fixed amount of
>political capital to spend. The Business Roundtable, comprising the chief executives
>of large American companies, typically establishes at the start of a new Congress a
>legislative agenda reflecting what its members consider the most important issues.
>The United States Chamber of Commerce, after canvassing its mostly small and
>medium-sized member businesses to determine their priorities, also develops a
>strategy. The National Association of Manufacturers weighs in with its wish list. And
>the National Federation of Independent Business, composed of small firms, sets its
>goals.
>
> These groups do not always see eye to eye, but under normal circumstances they
>understand that legislative success requires coordination. Separately, they lack the
>political clout to overcome determined resistance in one or both houses of Congress
>or from a president at least partly dependent for his political future on organized
>labor, environmentalists and other interests besides business.
>
> The trade associations representing specific industries — coal-powered utilities,
>pharmaceuticals, hospitals, electronics, securities, oil and gas, for example —
>typically play supporting roles. Their own parochial legislative goals can't
>interfere directly with the priorities of business as a whole because the industries
>often have to depend on the larger business groups to be heard. Specific firms may
>retain their own Washington lobbyists, but they, too, have to work with others in
>order to have significant effect.
>
> Political resistance, in other words, forces the business community to decide
>what's most important to it. It thereby enables corporate America to exert some
>discipline over itself. Business leaders can prevent or at least distance themselves
>from excesses by any single company or industry that might otherwise taint business
>as a whole in the minds of the public.
>
> American business notably did not come to the aid of cigarette manufacturers when
>lawsuits against them began several years ago. Nor has corporate America as a whole
>fought on behalf of the gun lobby. Labor and environmental rules with broad
>consequences typically become high priorities for legislative attack, but not all
>such rules. In the first Clinton administration, the business community was quite
>happy to let the Labor Department target apparel manufacturers and major retailers in
>its crackdown on sweatshops. I recall a number of White House meetings in which the
>leaders of major business organizations quietly assented to the administration's
>plans to block subsidies flowing to a particular industry, or to impose new clean-air
>rules on another industry, or to move aggressively with an antitrust complaint.
>
> With political resistance gone, the business community can, paradoxically, no
>longer discipline itself. Every business lobbyist on K Street is under enormous
>pressure from clients to reap something from the new bonanza. Every trade association
>must demonstrate to its members large returns from their investments in getting an
>all-Republican business-friendly government. And the pressure only ratchets upward:
>Every time one company or one industry receives its reward, other Washington
>lobbyists, representing other firms or industries, come under even more pressure to
>score victories.
>
> Nor can the Republicans themselves provide any discipline. Washington is awash in
>corporate i.o.u.'s, all waiting to be cashed in, and George W. Bush can't argue that
>the Democrats will block the payoffs. Under these circumstances, the Bush forces are
>finding it next to impossible to maintain order. Demands for regulatory relief are
>growing louder, and most will have to be met. Corporate welfare will flow ever more
>freely. Once the tax bill is open to amendment, corporate tax breaks will blossom
>like the cherry trees.
>
> At some point — perhaps as soon as the 2002 midterm elections, surely no later than
>the next presidential election — the public will be aghast at what is happening. The
>backlash against business may be thunderous. Hence the great danger that corporate
>American confronts.
>
> Robert B. Reich, former labor secretary, is professor of economic and so- cial
>policy at Brandeis University and author of "The Future of Success."
>
>
