The U.S. Chamber of Commerce takes advantage of several widespread misconceptions about what it is and what it does. Here we debunk some of its greatest myths. The Chamber is not a part of the government, for example, nor does it represent small businesses or all local chambers of commerce. It is a highly active, secretive lobbyist and campaign spender for some of the largest corporations in the world.
- A Trade Association, Not Part of Government
- National not Local
- Shill for Big Business, Not a Small Business Advocate
The U.S. Chamber is a 501(c)(6) nonprofit trade association based in Washington, D.C. It was formed in 1912 under President William Taft after several years of organizing by a succession of secretaries of the Department of Commerce and Labor. The original intent was for it to communicate with the federal government as a single voice of industry – especially of small- and medium-size businesses. The largest corporations already had access to the high levels of government.
During the 20th century, the Chamber took a number of positions frowned upon by history – opposing things like the New Deal, American intervention against Nazi Germany, the establishment of Medicare and more.
The early Chamber of Commerce was “rigorously non-partisan,” but things have changed since then, especially under the tenure of President Tom Donohue, who took the helm of the Chamber in 1997. Under his predecessor, the Chamber cooperated with the Clinton administration on health care reform because members wanted a national law creating a level playing field, leading a young John Boehner and the Republican Party to blackball the Chamber and prompting hundreds of businesses to leave it. Things have changed – the Chamber now spends more than 90 percent of its money for Republicans or against Democrats.
Far from being part of government, the Chamber lobbies heavily to get government to do what’s best for large corporations. In July 2013, the Chamber became the “billion dollar baby” – the first group to spend over $1 billion on lobbying since 1998, when the Center for Responsive Politics first started tracking lobbying data. Not only has the Chamber spent $1.06 billion on lobbying since then, that number is more than three times the lobbying expenditures of the next most active group, the American Medical Association, at $306 million.
The Chamber’s full membership list is not public, but the majority of companies represented on its 130-person Board of Directors have yearly revenues in the billions, tens of billions or hundreds of billions, employing people in the thousands, tens of thousands and hundreds of thousands each.
The U.S. Chamber’s fundraising is dominated by a relatively small number of big spenders. In 2012, the top 43 donations to the Chamber, each of $1 million or more, accounted for $80.4 million. So the top 2.8 percent of donors accounted for 47.4 percent of the Chamber’s funding. Within that upper echelon, 17 donations of $2 million or more totaled $47,712,012.
Many local chamber heads have taken steps to separate themselves from the national Chamber. “I now have a standard e-mail saying we’re not a chapter of the U.S. Chamber that I have to send out a couple of times a week,” says Timothy Hulbert, president of the Charlottesville Regional Chamber of Commerce. Stan Kosciuszko, president of the Butler County, Pennsylvania, Chamber of Commerce, which is no longer a member of the Chamber, said, “They’ve abandoned the interests of smaller chambers like mine for their larger corporate members.”
The Chamber’s messaging is rife with claims that it represents the interests of three million firms of all sizes. But a February 2014 U.S. Chamber Watch report found that more than half of the money the Chamber raised in 2012 came from just 64 donors, and the average donation it got that year was for $111,254.
The Economist reports that “around 90% of these [businesses] are linked to it only loosely, through their membership of the 2,000 or so state and local chambers that are affiliated with it. That leaves some 5,000 regional chambers that are not, some of which decry the Chamber’s combative culture: dozens distanced themselves from it during the 2010 mid-terms.”
“In a letter to a Philip Morris executive just after he took over, Mr Donohue said that small firms ‘provide the foot soldiers, and often the political cover, for issues big companies want pursued’, because Congress listens more to them than to big business.” (The Economist, 4/21/12)
“When [U.S. Chamber President and CEO Tom Donohue] arrived,” The Economist reported, only a quarter of Fortune 1,000 companies were members, with many of them paying paltry dues. Today most are, and they part with generous sums.”
“Their stances have occasionally alienated local businesses,” said Tim Sink, president of the Greater Concord Chamber of Commerce in New Hampshire, in 2010.
In June 2014, U.S. Rep. John Fleming (R-La.) said, “I think that the Chamber has been moving away from its traditional role and that is to protect small businesses. I don’t know why.”
“Donohue told the membership department to shift away from smaller companies to larger ones who could pay larger dues and get more involved,” said Hank Kopcial, who was head of membership services for Fortune 1000 companies when he left the Chamber in 2000. “Member numbers were reduced, but revenue increased.”
“You can no longer run a huge national organization on the backs of small companies as they did many years ago,” Donohue said in 2010 of complaints that the Chamber favors large corporations.
Given the existence of national groups representing small businesses, Donohue’s statement seems to depend on what kind of national group one wants to run.