Thomas J. Donohue, the longtime chief executive of the U.S. Chamber of Commerce, sounded like a skeptic on income inequality at his annual State of American Business address in Washington on Wednesday.
When a reporter observed at a news conference after his 36-minute talk that he seemed to be calling the whole concept of income inequality into question, he responded with a non sequitur, applauding what the Obama administration is doing in pushing trade agreements.
“If there is inequality,’’ Donohue said, the White House is addressing it all wrong. “The view across the street,” at 1600 Pennsylvania Ave., “is that more government programs will create more jobs.’’ Which is not, of course, the view at 1615 H St. NW, where Donohue has been opposing regulation and battling environmentalists since 1997. Martin Regalia, the chamber’s chief economist, said income inequality is “not as bad as many of the statistics show — you have to use the right numbers.”
This week, everyone from President Obama to the Republicans who want to succeed him is talking about income inequality, on the 50th anniversary of President Lyndon Johnson’s famous promise to lift up America’s underclass by declaring a war on poverty.
“You may have noticed that there has been a lot of focus recently on the subject of inequality,’’ Donohue said in his talk. The gap between the wealthiest and the rest of us is wider than at any point since the 1920s, with a family in the top 1 percent having a net worth 288 times as high as the typical family. President Obama has called that disparity “the defining focus of our time.’’
But that focus is mistaken, in the view of the chamber, which routinely opposes any increase in the federal minimum wage of $7.25 an hour. Donohue also predicted Wednesday that Congress will probably extend unemployment benefits again but added that he doesn’t foresee an extension helping the jobless much.
Donohue is, however, concerned about the lack of economic mobility that’s inextricably linked to the income inequality he wouldn’t recognize: “It seems to me,’’ he said in his talk, “that what we should really be talking about is equality of opportunity. How do we give everyone a fair shot at the American Dream?”
His proposed solutions to the opportunity gap — education reform and more training — are not completely unlike Obama’s, although the president wanted to offer more directed aid to living in poverty.
“I’m telling you right now,’’ Donohue said, that if the country doesn’t vastly improve public education, 30 percent of Americans will be left behind. As many as 1.5 million manufacturing jobs could be filled right away, he said, if Americans had the skills to fill them.
“Oh, and by the way, that costs money,’’ he said of education and training, which he would propose to boost by cutting from entitlement programs. How? By increasing Medicare co-pays, for one thing. And, he added, “I hate to say this, because they always say get rid of waste, fraud and abuse, but there is a lot of that.”
Donohue is also a strong proponent of immigration reform, because American business needs both low-skilled and high-skilled workers not currently in the labor pool. His push for that reform isn’t shared by many of those congressional Republicans he’s pledging to keep in office when he says that a priority is to “protect and expand a pro-business majority in the House and advance our position in the Senate.”
But that sentiment on reform is changing, he said, in part thanks to his lobbying efforts on immigration and partnerships with unions. He pronounced himself “encouraged with a lot of the noise and soundings out of the House,” he said. “I think we’re going to get this done” this year.
LBJ’s war on poverty created the safety net as we know it — Medicare and Medicaid, Head Start and food stamps. Then, and ever since, the business lobby has been warning against these programs.
Donohue’s predecessor in the job, Richard L. Lesher, lost the support of many members over his advocacy for the Clinton administration’s proposed plan to overhaul our health-care system. But Donohue has opposed Obamacare from the start, and on Wednesday repeated that “many firms are stopping new hires and cutting workers’ hours because of the law’s mandates,’’ though data so far don’t bear that out.
He did add, however, that the law isn’t going anywhere, and that critics should stop trying to kill it and start trying to cure it: “We’re not going to get rid of the bill, so we’re going to have to devise ways to make it work.”
In his mid-70s, Donohue isn’t going anywhere, either; he told the New York Times last summer that “if you see me in a box with flowers around it, I’m only thinking about retiring.” Meanwhile, he still has the same impressive head of white hair he arrived with. His approach hasn’t changed noticeably, either.