Death of free enterprise was greatly exaggerated

Tom Donohue, the longtime president of the U.S. Chamber of Commerce, sounded ebullient as he gave his annual report on the health of American business Wednesday.

"The economy is gaining momentum," he declared at the business lobby's marble palace across Lafayette Square from the White House.

"Investing, hiring, and consumer spending are firming up," he said in his speech, and there are "millions of new jobs. ... We've had a few good quarters of very solid growth, surprising some of the experts. ... There's no reason to think that another recession is lurking."

Donohue has reason to be upbeat: Gross domestic product and payrolls are growing by leaps and bounds, and stock markets and corporate profits have hit record highs.

So I felt like a bit of a killjoy at a news conference following the speech when I asked Donohue and the chamber's top lobbyist, Bruce Josten, about the group's previous warnings of doom.

"It seems to be hard to make the case that Obamacare and Dodd-Frank and the other policies of this administration have destroyed the free-enterprise system," I pointed out. "Do you think those warnings of yours from a few years ago were overwrought?"

"We projected the destruction of the free-enterprise system?" Josten replied, incredulously.

"Something very much like that," I said.

"You're crazy," Josten said.

Added Donohue, "You find one place that we projected the destruction of the free-enterprise system and I'll buy you lunch."

Game on, gentlemen.

Here's Thomas Bell, chairman of the board of the U.S. Chamber of Commerce, speaking at a chamber event in July 2010:

"For the first time in my 40 years of observation, our free-enterprise system is truly at risk." The then-chairman further accused Washington's leadership of a "general attack on our free-enterprise system" and said, "We're setting ourselves up to be the next Greece."

I propose that Donohue take me to lunch just around the corner from his offices, at AFL-CIO headquarters. Union officials said we're welcome at the cafeteria, which takes cash only.

The point isn't that the economy is booming because of President Obama's policies. The recovery until now had been disappointing by any standard. But if the business lobby and conservatives in Congress aren't going to give Obama any credit now that the recovery is underway, they might at least acknowledge that the sky didn't fall because of his actions, and that the socialist takeover that many on the Hill warned of has not occurred.

There was no such acknowledgment at Wednesday's State of American Business speech.

Entering through the stone pillars, walking past the Emerson Electric, 3M, and RJR Nabisco rooms, attendees listened to Donohue in a great hall bedecked with the banners of Columbus, Ponce de León, and other explorers. Donohue explored the limits of chutzpah.

After acknowledging the rather healthy state of the economy, the chamber president went right on with his complaints about the dire harm that would be caused by administration policies: "Employers are being saddled with another new health-care mandate," and, "Some 4,000 new regulations will pour out."

In his question-and-answer session following the speech, he went on about the "unprecedented regulatory onslaught" and said that "while things are improving, the current policies of tax, spend, and regulate aren't cutting it." He complained that Obama wants "to do more tax increases," and he cautioned the administration and everybody else against taking a "victory lap."

Donohue's complaints about taxes and spending would have been cleaner if he hadn't just called for full government funding for aviation, water infrastructure, highways, and mass transit. The highway bill, he said, should be paid for by raising the gas tax, er, "the federal fuels user fee." And his demand for curbing excesses in the legal system might have been more persuasive if he hadn't followed it by boasting, "We don't threaten people with lawsuits - we just sue them."

Donohue, too, might have acknowledged that the chamber is on the same page with Obama on its priorities of infrastructure spending, immigration, and trade.

Instead, Donohue tried to ride the current populist wave in American politics by propounding the dubious claim that corporate America is a populist movement. "This is the real economic populism," he said. "It's reflected in the more than 28 million businesses of all sizes. ... This is the populism that really works."

The Wall Street Journal's Elizabeth Williamson asked about Elizabeth Warren, the populist Democratic senator from Massachusetts.

"There are a lot of economic populists running around," Donohue replied, adding that "if she runs for president, I don't think the American people will share her views."

And what if Donohue turns out to be wrong in his belief that Americans will embrace corporate chieftains as the true populists? Maybe he'll deny that the chamber ever said it.