Obama says businesses must hire, invest to grow economy

By Brady Dennis
Washington Post Staff Writer
Monday, February 7, 2011; 8:42 PM

President Obama on Monday pledged to make government an ally of companies as they emerge from the bleak downturn of recent years, even as he challenged executives to do their part to help resurrect the economy.

"We can, and we must, work together," Obama told an audience at the U.S. Chamber of Commerce, his most overt effort yet to mend ties with the nation's business community. "Whatever differences we may have, I know that all of us share a deep, abiding belief in this country, a belief in our people, a belief in the principles that have made America's economy the envy of the world."

His administration will "help lay the foundation for you to grow and innovate," Obama said, vowing new investment in infrastructure and education and a focus on removing "barriers that make it harder for you to compete - from the tax code to the regulatory system."

But even as he vowed to push hard on initiatives ranging from trade deals to corporate tax reform, Obama challenged business leaders to ramp up their hiring, bring jobs back from overseas and quit sitting on such large stockpiles of cash.

"Many of your own economists and salespeople are now forecasting a healthy increase in demand. So I want to encourage you to get in the game," Obama said, noting the tax credits the administration recently negotiated to spur new investments. "As you all know, it is investments made now that will pay off as the economy rebounds. And as you hire, you know that more Americans working means more sales, greater demand and higher profits for your companies. We can create a virtuous cycle."

The president also defended his health-care law and urged the business community to refrain from challenging regulations.

"Not every regulation is bad; not every regulation is burdensome on business," he said. "Moreover, the perils of too much regulation are matched by the dangers of too little."

Obama made the short walk from White House across Lafayette Park for the much-anticipated speech to the Chamber, which has hosted nearly every president during the past century. The visit, months in the making, came as the administration and the Chamber - one of the nation's most powerful lobbying groups - have tried to thaw their often-chilly connection.

Both have reasons to seek common ground. The White House is eager to improve relations with centrist voters, corporate donors and the new Republican House majority ahead of the 2012 presidential election. The Chamber stands to benefit if it can work in a bipartisan way on initiatives it sees as beneficial to the nation's businesses.

The relationship between the Chamber and the White House has been a turbulent one for the past two years. The Chamber spent tens of millions of dollars fighting Obama's signature health-care overhaul, opposing key elements of the financial regulation law and helping to deliver the House majority to the Republicans last fall.

In turn, Obama recently said the group may have used foreign money to fund ads attacking Democrats - an assertion the group denied - and a senior aide called the Chamber's political tactics a "threat to our democracy."

Early in his speech, Obama joked about the tensions between the two sides. "I'm here in the interest of being more neighborly," he said. "Maybe we would have gotten off on a better foot if I had brought over a fruitcake when we first moved in. But I'm going to make up for it."

Since his party's crushing defeat in the November congressional elections, Obama has tried to build bridges with the business community. One bridge was the appointment of former Chamber board member and J.P. Morgan Chase executive William M. Daley as his new chief of staff.

That appointment came on the heels of a tax deal with Republicans in December in which Democrats agreed to extend for two years the George W. Bush-era cuts for every income level, including the wealthiest Americans. Last month, Obama also ordered a broad review of environmental, health and safety regulations to weed out those that might hinder job creation, a move that won praise from Chamber officials.

The new director of Obama's National Economic Council, Gene Sperling, made a point of visiting the Chamber last month for lunch with Thomas Donohue, the organization's outspoken president.

Obama recently named General Electric chief executive Jeffrey Immelt to lead a new economic advisory panel focused on job creation, another signal that he intends to work with the corporate world on issues.

On Monday, Obama also pledged to do whatever possible to help expand the global market for the country's exports.

"I will go anywhere anytime to be a booster for American businesses, American workers and American products," he said, adding "and I don't charge a commission."

Administration officials are closely coordinating with the Chamber on a lobbying strategy to win congressional support for the South Korean trade agreement. The effort will include orchestrated events in the home states and districts of undecided lawmakers.

Chamber officials, too, have tempered some of their earlier criticism.

In a speech last month, Donohue insisted that the group's disagreements with the administration have "never been personal." He took note of the "new tone" at the White House and praised the appointment of Daley, even as he vowed to continue fighting against regulations that the Chamber views as excessive and burdensome to businesses.

On Monday, they gave the president a warm welcome. Donohue opened the event by expressing the Chamber's "absolute commitment" to working with the White House on turning around the economy and creating new jobs.

"Our focus is finding common ground to ensure America's greatness in the 21st century," he said. "America works best when we work together."

But how long the recent truce between the White House and the Chamber will last remains uncertain. The window for major legislative initiatives likely will narrow as the 2012 election cycle gains steam later this year. And Donohue recently warned that businesses were up against a "regulatory tsunami" because of new rules pushed by the Obama administration.

That wave of new regulations, he said, poses "the single biggest challenge to jobs, our global competitiveness and the future of American enterprise."

Monday's visit did not sit as well with some liberal groups, who have argued that Obama's efforts to reconcile with the Chamber embolden an organization that has most stridently undermined his key policies.

"Two weeks ago, the president promised that he would work to rebuild people's faith in government," Erica Payne, founder of the New York-based Agenda Project, said in a statement. "Meeting with the biggest lobbyists in the country is hardly a step in the right direction."

Executives who crowded the ornate Hall of Flags on Monday generally gave Obama positive reviews, saying they remained cautiously optimistic that he will continue the recent business-friendly push.

Matthew Shay, president of the National Retail Federation, said after the speech that the president "did a really remarkable job of reaching out to the [business] community, expressing the right tone and the right willingness to collaborate. . . . The question will be how we work on the details."

View all comments that have been posted about this article.

© 2011 The Washington Post Company