Washington more open to business than usual
Pending legislation reflects the most business-friendly climate in years.
US business groups are looking for another leap forward for their agenda from Capitol policymakers - in everything from new legislation to the appointment of conservative judges and shifts at key regulatory agencies.
In what could be the most business-friendly climate since the days of President McKinley, President Bush and the GOP-controlled Congress are moving to extend corporate tax breaks, pass pension reforms, allow oil drilling in the Arctic National Wildlife Refuge, and limit lawsuits - including a settlement of asbestos litigation that has driven 70 companies into bankruptcy.
Most encouraging to business lobbyists are prospects for a less visible agenda: a lighter hand on regulation well into the future. The resignation of William Donaldson as head of the Securities and Exchange Commission, effective June 30, sent a signal to Wall Street that the post-Enron crackdown on corporate accounting tricks may be winding down. His proposed replacement, Rep. Christopher Cox (R) of California, is expected to be open to business concerns.
"On balance, this is as good as it gets for business," says John Pitney, a political scientist at the Claremont McKenna College in Claremont, Calif.
Supporters say these changes can help fuel a new economic expansion by reducing burdens on America's job creators. Critics worry about impacts that could range from rising federal deficits to weaker protections for consumers, workers, and a fragile wilderness.
The pro-business momentum is accelerating, analysts say, in part because the steps are easier to take in the lower-publicity atmosphere of a nonelection year. Another factor: The finances of ordinary Americans have become increasingly linked to corporate fortunes.
"There's been a tremendous underlying shift that's really changed the behavior of both parties - stock ownership," Mr. Pitney says. "A majority of Americans now own stock either directly or through pension funds. If you look at the electorate, it's more than two-thirds. That's much higher than it was a couple of decades ago. Increasingly, people don't see a business agenda as separate from their own well being. They see it as part of their own."
Democrats are playing a role alongside Republicans. Senate minority leader Harry Reid meets biweekly with "Democratic-leaning" business lobbyists. He backed bankruptcy reform and allowed a vote on class-action lawsuit reform, even though he opposed the bill. Democrats are sponsoring legislation to extend government-backed insurance against terrorism, set to expire at the end of this year - a move the White House has yet to decide on. After 9/11, many businesses in major cities were unable to purchase insurance for losses that might occur from attacks.
A bipartisan deal, moreover, is allowing some of Bush's long-stalled judicial nominees could also be a boon to US corporations. Janice Rogers Brown, a conservative judge from California, is slated to serve on the appeals court representing the nation's capital, where most cases that affect government regulation are heard.
"So far, so good," says Bruce Josten, top lobbyist for the US Chamber of Commerce. Much of the remaining business agenda is "ripe" to move through this session of Congress, he says.
The pending highway bill is critical to businesses locked into a "just in time" delivery of goods by truck, he adds. Conferees are working this week on a compromise between the $295 billion Senate bill and the $284 billion House version - the highest the White House says it can support.
On energy, the last time the Senate debated a comprehensive bill, the measure was pulled out of committee by Tom Daschle (D), then the Senate majority leader, and later debated on the floor until it died. This year, the energy bill comes to the floor with a bipartisan endorsement from the Energy and Natural Resources committee - a big assist in getting agreement from the full Senate. Still, passage for the subsidy-packed bill is uncertain. For example, the truce over judicial nominees could break down, affecting other matters.
Early in Bush's second term, Congress passed a law sought by banks and credit-card firms that makes it harder for individuals to declare bankruptcy. Another new law shifts most class-action lawsuits from state to federal courts, a move aimed to reduce huge verdicts against firms.
"President Bush is clearly very business oriented," says Fred Greenstein, a political scientist at Princeton University. "The first big bills in the Bush second term, bankruptcy and tort reform, are tilted toward 'Let's keep jiggering the American legal system so that this is a great country to do business in.' "
Other presidents have cut taxes more sharply. But Bush has lowered taxes every year of the his presidency. Another $70 billion in tax cuts, extending dividend and capital-gains tax cuts, are on a procedural fast track in this year's budget cycle that protects them from a filibuster.
Consumer groups say there are costs to moving a pro-business agenda that may not be obvious.
"The Bush administration wants to deregulate business finances as well as health, safety, and environmental regulation," says Joan Claybrook, president of Public Citizen, a Washington-based public interest group. "The consequences aren't always felt immediately, but whether it's big trucks that aren't regulated adequately and have more crashes or it's unclean air, the consequences will be felt."