For months, the U.S. Chamber of Commerce, which represents nearly every major company in the country, has aggressively supported the Bipartisan Infrastructure Framework (BIF). The legislation, which includes money for roads, bridges, transit, and clean water, passed the Senate in August with support from 50 Democrats and 19 Republicans.
The Chamber called the legislation "a once-in-a-generation opportunity to bring our infrastructure system into the 21st century, to put millions of Americans to work, and to improve our overall quality of life."
The organization plastered Facebook with ads supporting passage of the BIF:
For better or worse, House Speaker Nancy Pelosi pursued a strategy in line with the Chamber's priorities. She pushed for a vote in the House on the measure last week. Ultimately, Pelosi was forced to abandon that plan.
Why? Democrats hold a razor-thin majority in the House. A significant number of progressives pledged to oppose the bill unless there was an agreement to pass the larger reconciliation bill, which included funding for paid family leave, critical action on climate change, and an expanded child tax credit. Pelosi knew this but was hoping to offset progressive defections with support from House Republicans, who were involved in crafting the BIF.
That strategy was thwarted when House Minority Leader Kevin McCarthy (R-CA) whipped his caucus to oppose the legislation. In a press call last Thursday, the Chamber's Neil Bradley railed against the House GOP's opposition to the BIF. Specifically, Bradley said the bill should be judged on its merits and blasted Republicans that oppose the BIF as part of a larger political strategy:
Neil Bradley, executive vice president and chief policy officer at the U.S. Chamber of Commerce, told reporters Thursday during a conference call that some House Republicans privately admit they’d like to support the infrastructure measure, but don’t want to cross their leadership or conservative outside groups.
“If this vote today was occurring on the merits of the bill, the outcome wouldn’t be in doubt and we’d have a supermajority,” he said. “It’s not the substance that people are disagreeing with here. People decided to play politics.”
He added that House Republicans’ “willingness to shoot the hostage” would have real consequences for infrastructure policy.
Bradley added that there would be consequences for House Republicans who opposed the BIF. "[T]he U.S. Chamber, going to remember the members who put in the hard work to get us to this point, and they deserve credit," Bradley said, "And anyone who kind of stands in their way and blocks this bill, that’ll be remembered, as well."
McCarthy fired back that the Chamber had "probably changed" and was unsure whether "the [C]hamber’s an ally." Things escalated on Monday. Punchbowl News reported that the Chamber has been kicked off of strategy calls with House Republicans:
House Republican leadership has officially broken up with the U.S. Chamber of Commerce.
GOP leadership has booted the Chamber from the party’s reconciliation-related coalition strategy calls. These calls between Republicans and their allies outside the Capitol help the leadership mobilize for their priorities and against the Democrats. This move by the leadership essentially says that the Chamber is an outcast in House Republican legislative politics.
Yes, the Chamber — a purportedly non-partisan organization advancing the diverse interests of the business community — has been participating in strategy calls to advance the agenda of the House Republican leadership.
On Monday night, hours after the news broke that the Chamber was booted from the House GOP's strategy calls, the Chamber abruptly reversed its position.
In a letter to the Chamber's board of directors, Bradley said the Chamber would no longer support the BIF:
The events of the last few days make it all the more crucial that everyone across the business community does everything in our power to ensure the reconciliation bill does not pass. While the Chamber believes that passing infrastructure as a stand-alone bill prior to consideration of the reconciliation bill would have enhanced our position, that is no longer a realistic possibility.
Apparently, Bradley no longer believes that the BIF should be passed on its merits. Instead, he is recasting the Chamber's support as part of a larger political strategy to defeat the larger reconciliation bill. Since this strategy isn’t working, the Chamber is pulling its support for the bill.
In a late-night press release, the Chamber attempted to claim that Axios' report was false and the organization still supported the BIF. But this is a semantic game. The Chamber now says it only supports the BIF "as a stand-alone bill unlinked to the proposed tax and spend reconciliation bill." But, as Bradley's memo to the board acknowledged, that is "no longer a realistic possibility." Therefore, the Chamber's support is only theoretical. It now is opposed to the BIF.
The incident reveals the Chamber's priorities. It supported the BIF because it said the legislation was "a once-in-a-generation opportunity" for the country. It abandoned the legislation as soon as it damaged its relationship with the Republican party. This is an organization that is funded by dues paid by nearly every major corporation in the country.
The Chamber's hysteria on reconciliation
The Chamber says it opposes the larger reconciliation bill because it would be "economically disastrous." In 2017, the Trump tax cuts reduced the rate for corporate profits from 35% to 21%. The reconciliation bill would increase the rate back to 26.5% and close loopholes for private equity managers and wealthy heirs.
The Chamber claims increasing the corporate tax rate "would harm America’s competitiveness in a global economy and make it a less attractive place to invest." But the massive tax cut in 2017 did not spur a surge in corporate investment in America. An analysis by the Federal Reserve Bank of Cleveland found that the decrease in statutory tax rates in 2017 "held investment down rather than stimulated it." This is because most corporations pay for investments with debt and interest on the debt is deductible from profits. Lowering the corporate tax rate makes these deductions less valuable.
The Chamber also fails to account for the economic benefit of paid family leave, an expanded child tax credit, accelerating the transition to clean energy, and other measures in the reconciliation bill. Instead, it simply dismisses these new programs as a bid "to massively expand the role and reach of government."
This position places the Chamber at odds with some of its largest members. Walmart, GM, Netflix, 3M, Gap, Ford, and many others have endorsed the climate provisions of the reconciliation bill. These companies say that the climate-related provisions to speed the transition to clean energy are not only good for business but urgently needed.
Yet these companies continue to support the Chamber's multi-million dollar effort to defeat the reconciliation bill. For now, these companies value their tax cuts or their relationship with the Chamber too much to speak out.