The Chamber of Commerce of the United States of America (often shortened to U.S. Chamber of Commerce, Chamber of Commerce, or U.S. Chamber) is the world’s largest business federation. The Chamber is the largest lobbying group in the country and generally supports right-of-center policies, though during the Trump and Biden administrations it increasingly aligned with Democrats.
The Chamber is often mistakenly believed to be a government agency, but it is actually a private nonprofit business leagues. Donations to the Chamber are not tax-deductible under Section 501(c)(6) of the tax code.
On February 5, 2021, Chamber CEO Suzanne Clark succeeded longtime Chamber CEO Tom Donohue. Donohue was a controversial leader who drove the Chamber to be more politically aggressive and conservative, most notably by opposing increased government control over healthcare and government attempts to combat climate change. Under his tenure, there was a dramatic increase in the Chamber’s fundraising, as well as in its expenditures on political contributions and lobbying. Clark, Donohue’s former aide, is considered to be one of his close allies and is expected to continue his policies. [1]
During the 2020 election, the Chamber gave unusual support to Democrats, likely due to animosity toward former President Donald Trump. The Chamber backed the re-election bids of 23 freshman Democratic U.S. Representatives including those who had supported legislation to strengthen the political and economic position of organized labor[2] and co-led a bipartisan initiative to ensure that election results would be upheld in the case of election challenges by then-President Trump. [3]
History
In 1911, Republican President William Howard Taft called for the formation of a national group to organize commercial affairs throughout the United States. The following year, 700 delegates from major American companies formed the Chamber of Commerce of the United States of America. [4] Left-wing historians have characterized Taft as seeking to create a business-based counterbalance to the emerging labor union movement at the time. [5]
The Chamber was Republican leaning but open to supporting liberal Democratic initiatives from its foundation. It strongly supported Republican President Herbert Hoover at the beginning of the Great Depression but also supported the New Deal economic recovery initiatives implemented under Democratic President Franklin Roosevelt. In the 1970s, the Chamber supported liberalizing trade with the Soviet Union and Cuba but opposed President Nixon’s health care policies which pushed for federal control over Medicare and formed health maintenance organizations (HMOs). The Chamber was especially active in the 1980s and 90s when it supported President Ronald Reagan’s tax cuts and President Bill Clinton’s negotiation of the North American Free Trade Agreement (NAFTA). [6]
In 1994, then-Chamber president Richard Leshner sided with the minority of Democratic members of the Chamber by cooperating with then-President Clinton, endorsing his proposed government-controlled health care plan. Then-U.S. Representative John Boehner (R-OH) responded by leading a campaign to encourage hundreds of conservative-run businesses to leave the Chamber, greatly weakening the organization. [7]
Donohue Era
In 1997, Tom Donohue became the president and CEO of the Chamber of Commerce of the United States of America. Donohue was formerly CEO of the American Trucking Association. Upon Donohue’s departure from the Trucking Association, his successor launched an investigation into its finances on suspicion that Donohue may have committed fraud and embezzlement, but no charges were filed against him. [8]
Donohue’s leadership of the Chamber marked a decisive shift in the organization’s goals and tactics, making it more conservative and politically aggressive. [9] Lobbying and political contribution expenditures exploded in the five years after Donohue took office. [10] [11] At least as of 2010, Donohue served on the corporate boards of many of the Chamber’s top donors, including Union Pacific, which gave the Chamber $500,000 from 2006 to 2010. [12]
Donohue aligned the Chamber with the Republican Party by reversing the organization’s support for government-controlled health care programs in favor of free-market health care policies. The Chamber also opposed many domestic and international governmental efforts to combat climate change, including the Kyoto Protocol and the Paris Accords. This position caused many major companies to leave the Chamber, including Apple, Starbucks, Unilever, Costco, and General Mills. In 2009, Nike left the Chamber’s board and issued a public statement condemning its stance on climate change but nonetheless remained a member of the Chamber. [13][14]
In 2004, the Chamber successfully sued the Securities and Exchange Commission (SEC) to overturn a rule which required mutual funds to maintain boards with 75% of their members independent from invested entities. [15]
Also in 2009, in response to the Chamber’s policies on climate change and healthcare, radical left-wing activist group Velvet Revolution posted a $100,000 bounty for anyone to reveal information that led to the arrest and conviction of Donohue. The bounty was later increased to $200,000, but never claimed. [16]
The Chamber under Donahue opposed much of the Obama administration’s, particularly the Affordable Care Act, the Dodd-Frank Act, and the establishment of the Consumer Financial Protection Bureau (CFPB). President Obama criticized the Chamber for allegedly spreading misinformation through ads targeting the CFPB. In October 2009, the Chamber announced a $100 million campaign to promote free market policies. [17] In 2012, the Chamber and three other industry groups sued the SEC for implementing a section of the Dodd-Frank Act that required natural resource companies to publicly disclose all payments of $100,000 or more to domestic or foreign governments. [18]
The Chamber did, however, support the Obama administration’s 2009 American Recovery and Reinvestment Act, which most Republicans opposed. [19]
In 2015, CVS left the Chamber after it lobbied to reduce restrictions on tobacco sales. [20]
The Chamber had a mixed relationship with President Donald Trump. Shortly after the 2016 election, President Trump refused to shake the hand of a top Chamber advisor claiming, “You guys did everything to stop me, I haven’t forgotten.” [21] The Hill called the Chamber “the big loser” of the 2016 election for refusing to support President Trump in his presidential campaign. [22] During the Trump administration, the Chamber generally supported President Trump’s policies on economic regulations, but opposed his protectionist trade policies and stance on immigration. In 2017, the Chamber publicly opposed President Trump’s executive order ending the Deferred Action for Childhood Arrivals (DACA) program. [23][24]
In January 2021, after the storming of the Capitol by supporters of President Trump, Donahue called the president’s behavior “inexcusable” and said the Chamber was open to supporting the removal of President Trump from office with the 25th Amendment. Another Chamber official said the organization would limit donations to U.S. Representatives who voted against President Trump’s second impeachment. [25]
Suzanne P. Clark
In 2019, Suzanne P. Clark succeeded Tom Donohue as president of the Chamber of Commerce. In February 2021, Clark also succeeded Donohue as CEO after he spent 24 years in the position. Donohue intended to stay as CEO for another year, but once the Chamber board named Clark as his successor, he left early. [26]
Clark founded the Potomac Research Group and was formerly the president of the National Journal Group. She started working at the Chamber in 1997 as an aide to Donohue when he became president and CEO. She rose to become the Chamber’s chief operating officer and executive vice president before becoming president. [27][28]
2020 Election
In the 2020 election cycle, the Chamber of Commerce took an unusual turn to the left, likely as a reaction to President Trump, spearheaded by Tom Donohue, Suzanne Clark, and executive vice president Neil Bradley. [29] The Chamber endorsed 23 first-year Democratic U.S. representatives, the most in at least a decade. The endorsed Democrats were predominantly center-left individuals with track records of supporting pro-business policies, like the U.S.-Mexico-Canada Agreement (USMCA) which replaced NAFTA in 2018, though many had also supported the Protecting the Right to Organize (PRO) Act to strengthen organized labor. [30] 14 of the Democrats endorsed by the Chamber ran in districts won by President Trump in 2016. The Chamber endorsed 29 first-term Republican U.S. representatives. [31]
The Chamber’s endorsements have received pushback from conservative members, some of which have threatened to limit donations as a result. President Chad Warmington of the Oklahoma Chamber of Commerce wrote a letter to the national Chamber condemning its endorsement of former U.S. Representative Kendra Horn (D-OK) for her record on energy legislation. Other members have pointed out that many of the endorsed Democrats supported the implementation of a $15 federal minimum wage. [32]
On February 4, 2021, Time reported that dozens of major companies, advocacy groups, electoral officials, and other influential individuals on the left and right engaged in a “conspiracy” to ensure that President Trump would accept the 2020 election results if defeated. The “pact” was led by the Chamber and the AFL-CIO, though the concept was originally envisioned by Michael Podhorzer, the political director of the AFL-CIO. The coalition consisted mainly of left-of-center organizations, including Planned Parenthood, Greenpeace, Indivisible Civics, MoveOn.org, the Protect Democracy Project, the Working Families Party, the Chan Zuckerberg Initiative, Voting Rights Lab, and the National Council on Election Integrity. [33]
On election day, Donohue and AFL-CIO president Richard Trumka released a joint statement calling for trust in the electoral process. Behind the scenes, the two groups coordinated efforts to ensure high voting rates and electoral transparency, including overhauling the American voting process during the COVID-19 pandemic by promoting absentee ballots, providing mail-in ballots, and providing equipment for polling sanitation. The group also encouraged technology companies to increase the moderation of digital content to prevent the spread of alleged misinformation and promoted get-out-the-vote campaigns. [34]
Membership
The Chamber of Commerce of the United States of America does not publicly list its members. Its number of members has been a point of controversy with journalists who have accused the organization of inflating its numbers. [35]
In 1997, two weeks before Tom Donohue succeeded Richard Lesher as Chamber president, the Chamber’s publicly stated membership rose from 200,000 businesses to 3 million. According to a 2009 investigation by left-of-center magazine Mother Jones, the 3 million figure came from the Chamber including all the members of its 7,000 regional Chambers of Commerce throughout the United States. While these regional groups are all members of the national Chamber, the members of these groups are not officially connected to the national group in any meaningful way. In 2006, the national Chamber offered membership to any members of local Chambers for free, and only 354 out of 7,000 local Chambers made the commitment. [36]
The Chamber responded to Mother Jones’s expose by admitting that its true membership was 300,000. [37]
Finances
In 2018, the Chamber of Commerce raised $168 million in revenue, with $152 million coming from grants and contributions. [38] The Chamber receives its revenue through private donations and membership dues, though sources differ on whether the Chamber receives any government funding. The Chamber does not publicly reveal donors or membership dues. [39][40][41]
Chamber funding rapidly increased under Donohue’s leadership. From his first year as president in 1997 until 2001, Chamber revenue more than doubled to about $100 million annually. [42] Revenue continued to climb throughout his tenure. [43] However, Donohue also rapidly spent money, and within the first two years of his presidency, the Chamber had burned through a sizeable cash surplus. In 2001, the Chamber took out a $31 million line of credit on its offices in Washington, D.C. In 2008, the Chamber was $29 million in debt,[44] and as of 2018, the Chamber was still over $26 million in debt. [45]
According to a 2016 study by the left-wing Public Citizen, the vast majority of the Chamber’s members pay no dues, while 74 businesses, nonprofits, and individuals accounted for 60% of the Chamber’s funding, and 18 donors accounted for 31% of funding. In 2014, the Chamber received 1,536 donations of more than $5,000, with the average donor giving $122,995. [46] According to sources within the Chamber, Donohue intentionally developed this dependence on large donors by courting the largest Chamber members. [47]
Political Contributions
For most its history, the Chamber of Commerce and its employees sparingly donated to political parties or candidates. The Chamber largely performed advocacy through reports and its cable network, Biz-Net. Throughout the early 1990s, it gave thousands of dollars annually, until Tom Donohue became the Chamber’s president in 1997. Political spending amounted to over $70,000 in the 1998 election cycle, and then well over $500,000 in the 2000 election cycle. Since then, the Chamber and its employees have always contributed hundreds of thousands of dollars each cycle, peaking at $3.2 million in the 2004 cycle. [48]
The Chamber and its employees have historically donated primarily to Republicans. Of reported giving, the Chamber has typically given 75-90% of its funds to Republicans since 1998, though prior to the 1998 election cycle, it gave a larger percentage to Democrats. The 2020 and 2008 elections also showed unusually low Chamber support for Republicans, with the percentage of contributions to Republicans being 72.81% and 69.72% respectively. The 2014 election was unusually pro-Republican, with 99.6% of Chamber contributions going to Republicans. [49]
In the 2020 election cycle, the Chamber’s political committees and individuals associated with the organization gave $857,190 in total, with $638,000 going to PACs, $101,000 to parties, and $119,000 to candidates. The largest recipient was the Standing with Conservatives PAC, followed by U.S. Senator Mitch McConnell (R-KY) and President Joe Biden. The Chamber never contributed to President Trump or affiliated PACs. President Trump received $74 from a single Chamber employee in the 2020 election, and $870 in the 2016 cycle. [50]
Lobbying
As a 501(c)(6) nonprofit, the Chamber of Commerce of the United States of America is permitted to engage in lobbying for its organizational purpose. All lobbying activity must be publicly reported, or the Chamber must face proxy taxes. [51]
Over the last 22 years, the Chamber has spent $1,665,280,680 on lobbying, more than any other organization in the United States. The second highest spender, the National Association of Realtors, spent $670 million. [52] As with political spending, lobbying expenditure increased substantially in the early 2000s under president Tom Donohue, rising from $17 million in 1998 to $41.6 million in 2002. Annual lobbying spending peaked in 2009 at $144.6 million. [53]
In 2020, the Chamber spent $81.9 million on lobbying, the second largest sum of any organization, behind the National Association of Realtors. The Chamber lobbied on 601 bills, with the most focus on opposing the U.S. House and Senate versions of the Forced Arbitration Injustice Repeal Act (FAIR Act),[54] which would prohibit the enforcement of pre-dispute forced arbitration agreements in contracts. The Chamber has argued that the bill would incentivize the use of class action lawsuits, which would raise business expenses and primarily benefit attorneys. [55]
The Chamber also devoted substantial lobbying resources to support the Litigation Funding Transparency Act, which would require public disclosure of any enterprise that will receive funds in the event of a payout following a class action lawsuit. [56] Critics of the bill say it would increase legal costs for plaintiffs as more complexity is added to class action suits, thereby discouraging suits against companies. [57]
Criticism
In 2001, the Wall Street Journal accused the Chamber of Commerce for facilitating companies in anonymously lobbying for unpopular political policies. For instance, the Chamber allegedly led lobbying efforts to defeat a bill that would have tightened regulations on overseas corporate expansion at the behest of billionaire Qwest Diagnostics CEO Philip Anschutz. The Chamber even established special bank accounts to handle grants from particular companies which then forwarded the funds to lobbying efforts. The Journal claimed this initiative was spearheaded by Chamber president Tom Donohue as a means of raising Chamber revenue. [58]
The liberal magazine Washington Monthly criticized Donohue for placing undue emphasis on fundraising and allegedly explicitly selling the organization’s policy priorities for donations. According to one source inside the Chamber, Donohue was fundamentally apolitical and pursued whatever policies would result in the most funding. He even allegedly took money from the federal government for the Chamber’s Center for International Private Enterprise. [59]
Washington Monthly alleged that Donahue’s salary, which tripled between 1997 and the early 2010s, was mostly based on the Chamber’s revenue. [60]
The Chamber under Donohue’s leadership has been criticized for lobbying too aggressively and jeopardizing a more cooperative relationship between businesses and Congress. Hilary Rosen, the Democratic lobbyist and former CEO of the Recording Industry Association of America (RIAA), accused the Chamber of becoming a “brick wall to government action.” [61]
The Chamber has been criticized for claiming to represent small businesses, but instead representing large corporate interests. In 2010, the Chamber claimed that 96% of its members were small businesses, but its board consisted of representatives of six small businesses and 111 large companies. [62]