There's no longer any countervailing power in Washington. Business is incomplete control of the machinery of government. If corporate America understoodits long-term interest, it would use this unique moment to establish in thepublic's mind the principle that business can be trusted. But it's doing justthe opposite. Every industry and every major company is cashing in as fast as itcan while the good times last. The danger for business is profound.
Credit-card companies are getting a bankruptcy bill that will make it harderfor overstretched people who succumb to the companies' blandishments ever to getout from under their debts. Energy companies are on the way to obtaining rightsto drill for oil and gas on Alaska's coastal plain. Cigarette manufacturers areconfident that the administration will drop the federal lawsuit against them.Pharmaceutical companies will get longer patent protections and more federaldollars. Big labor-intensive businesses will get rules that weaken unions.They've already killed the Labor Department's "ergonomics" rule, which would haveprotected workers against repetitive-stress injuries. Airlines with laborproblems can count on White House actions to ward off strikes. And so on.
In normal times, when business has to cope with political resistance inWashington, its leaders have been forced to set priorities. There is only afixed amount of political capital to be expended. The Business Roundtable,comprising the chief executive officers of the largest blue-chip American companies, typically establishes at the start of a new Congress a legislativeagenda reflecting what its members consider to be the most important issuesfacing them. It then coordinates its strategy with that of the U.S. Chamber ofCommerce, which has canvassed its mostly small and medium-size businesses todetermine their priorities. The National Association of Manufacturers then weighs in with its wish list. And the National Federation of Independent Businesses, composed of small concerns, 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 by Democrats in one or both houses of Congress or by a Democratic president.
The trade associations representing specific industries--pharmaceuticals,hospitals, electronics, securities, oil-and-gas, for example--typically playsupporting and subordinate roles. Their own parochial legislative goals can'tinterfere directly with the priorities of business as a whole because theindustries often have to depend on the larger business groups to be heard. Withineach industry, specific firms may retain their own Washington lobbyists, butthey, too, have to work with others in order to have significant effect.
Political resistance, in other words, forces the business community to decidewhat's most important to it. Corporate America is made to exert some disciplineover itself. Business leaders are able to prevent or at least distance themselvesfrom excesses by any single company or industry that might otherwise taintbusiness as a whole in the minds of the public.
American business notably did not come to the aid of the cigarettemanufacturers when the lawsuits against them began several years ago. Nor hascorporate America as a whole fought on behalf of the drug companies or the gunlobby. Labor and environmental rules with broad consequences typically becomehigh priorities for legislative attack, but not all of them. In the firstClinton administration, the business community was quite happy to let the Labor Department target apparel manufacturers and major retailers in its crackdown onsweatshops. In fact, I recall a number of White House meetings in which theleaders of major business organizations quietly assented to the administration'splans to block subsidies flowing to a particular industry, or to impose newclean-air rules on another industry, or to move aggressively with an antitrustcomplaint.
But now that political resistance has vanished, the business community can nolonger discipline itself. Every business lobbyist on K Street is under enormouspressure from clients to reap something from the new bonanza. Every tradeassociation must demonstrate to its members large returns from their investmentin getting an all-Republican business-friendly government. And the pressure onlyratchets upward: Every time one company or one industry receives its reward,Washington lobbyists representing other firms or industries come under even morepressure to score a victory.
Washington is awash in corporate IOUs, all waiting to be cashed in, andGeorge W. can't argue that the Democrats will block the payoffs. Under thesecircumstances, the Bushies will find it next to impossible to maintain order.Demands for regulatory relief will only grow louder, and most will be met.Corporate welfare will flow ever more freely. Once the tax bill is open toamendment, corporate tax breaks will blossom like the cherry trees.
At some point--perhaps as soon as the 2002 midterm elections, and surely nolater than the next presidential election--the public will be aghast at what ishappening. The backlash against business will be thunderous.
