September 7, 2016
The Canary in the Coal Mine is Dead
On September 4, Steven Pearlstein authored a piece in the Washington Post that I commend for your reading. Entitled, “How Big Business Lost Washington,” it’s an illuminative summary of the many bipartisan missteps by the business community over the past two decades. Personally, I greatly appreciated his special shout-out to Tom DeLay, whose craven, confrontationally partisan approach to governance created a cancer whose legacy metastasizes to this day. Pearlstein wrote about “the relentless pressure from Wall Street that eroded the enlightened self-interest that made it possible for executives to put the country’s interests first.” He highlighted the growing divisions within the current American business community whose earlier homogeneity around major policy matters helped amplify its’ collective voice.
Today, America’s business marketplace, in all of its’ vibrant manifestations, is under stress. The “business of doing business” is more complicated and difficult than ever resulting from challenges that range from increased engagement by government at every level, to changing demographic and social norms, to painful realities attendant to economic stagnation, income inequality, and diminished faith in the American Dream.
American business interests face a coming “High Noon” moment when it comes to doing business in the Nation’s Capital: suspicion from Democrats who largely feel ignored by its’ support for their GOP rivals; mistrust from amongst the growing ranks of populist Republicans who view Wall Street and corporate America with contempt; rising populist sentiment within both Parties that embraces the message of haves versus have nots; weakened national political parties with weakened leaders; a legislative environment that compromises brokers’ ability to make deals to get things done; the ongoing winnowing in both Chambers and both Parties of the ideological middle, and the corollary dominance in politics and the legislative process of the extremes; and a growing concern amongst bipartisan officials that the concentration of corporate power amongst ever larger interests is worthy of serious scrutiny.
My fear is that the real victim in all of this will be the pursuit of the greater good by office-holders and the supplicants who lobby them. The coarsening of public life has created many negative consequences, singularly important to me being the dumbing down of the legislative process. Textured, complex policy matters become black and white; compromise and accommodation in pursuit of a common goal have become too infrequent; the simple act of separating fact from fiction, distinguishing an evidentiary based argument from opinion, has become all too novel. Members come to most policy discussions with a considerable bias that is happily fed by their allies. “Ye shall reap what ye shall sow” is a biblical admonition that applies here. We, as increasingly estranged members of an American society most easily defined by its’ highly tribal parts, are equally accountable for this toxic environment and its’ tragic policy stagnation. The real question becomes a very urgent “Where do we go from here?”
Following the November elections, interest groups of all stripes will begin their customary efforts to win new friends and to assuage the anger of the Party they did not support. The logic of that tired kabuki dance only makes sense if, having employed a political and PAC strategy that clearly favored one side over the other, you truly believe that election results are aberrations, and that either Party might one day secure long-term political dominance. That’s just not going to happen folks, as the dismal public approval ratings for both national parties, Congress as an institution, and faith in government to solve the problems of real people, continues to trend downward. So, if betting on either Party to become dynastic, with long-term, unassailable policy reach is a chimera, then where does that leave business interests to go?
My thoughts doubtless reflect my frustration as a long-time Blue Dog Democrat, fiscally conservative and socially accepting, who often wonders what happened to common sense. For more than thirty years at Prime Policy Group and at its’ predecessor firms, I have made my living representing the private sector. From large corporations to smaller ones; from diversified trade associations to business issue coalitions; when finding common ground for franchisors and their franchisees; I have made it my goal to pursue a strategy that wins for both the near and long-terms. While I am an optimist by nature, no one has ever accused me of being a Pollyanna. So, here then are some real world recommendations for the general business community that focuses on how to build enduring bridges with my tribe, the Democrats:
- Accept that Democrats are going to act. Eight years of the Obama Administration have heightened their interest in the use of regulatory initiatives in lieu of legislating when they lack control of either or both Chambers. Democrats want to know what people think and, equally importantly, how they feel. Our rhetoric is usually aspirational, and is predicated upon the belief that government can and should leaven the marketplace to guarantee equal opportunity. You may think that approach to be crazy, but its’ in our DNA and is not likely to change anytime soon.
- Tell a Democrat that you oppose increasing the minimum wage and you’ve lost them before you get started. An alternate approach might be to discuss the size of a potential increase with potential variations for geographic application. A winning approach is to engage them in a conversation that asks why in the year 2016, we still employ a New Deal era income support mechanism to help the working poor. The largely white, male, non-portable farm and manufacturing jobs of 1938 have given way to a service sector/information workplace that looks like the face of our world. This represents job innovation and entrepreneurship that FDR never could have imagined. There’s an intriguing and legitimate debate to be had about whether or not the current minimum wage program stultifies job growth. If it does, we ought to be able to create a more contemporaneous program to benefit the working poor and the people who employ them. To facilitate that goal, Democrats would be forced to relinquish one their favorite political cudgels (“Republicans don’t care about the working poor”) in favor of creating a vibrant new approach that fits the real world in which we live.
- For years, I have lobbied Congress on behalf of much needed adjustments to the ACA. Obamacare may be a well-intentioned program but even its’ most ardent admirers would admit that it’s plagued by structural and definitional flaws (30 hours as a full-time work week?). If you want to win Democratic hearts and minds, you must accept the ACA as a reality and then tell your story. You must unite your individual policy threads into a powerful tapestry. Talk to a Democrat about compliance problems with the ACA and she hears “yadda, yada, yada”. Present yourself as a small business person/entrepreneur, the face of the American Dream in 21st Century America. Talk about the burdens of unaddressed ACA issues; providing a $15 per hour Federal minimum wage on shrinking profit margins; joint employer and overtime regulatory proposals whose very definitions make your head spin; and so much more; and your story becomes compelling. Taken individually, each and every issue mentioned can be justified/explained. Taken in the aggregate, which is how they must be presented, and your legislative concerns begin to tell a story.
- Pearlstein quotes one executive, reflecting on Washington’s dysfunctionality, “Should I go to Washington and waste my time or go to China and talk to people who can actually do something?” This reminds me of a conversation that I had a number of years ago with the CEO of one of America’s most iconic brands. I asked him why he devoted so much time making trips to DC. The answer was simple, he said. It’s because Washington is my most important customer, with its’ singular ability to make decision that could cripple my company. Business leaders no longer possess the luxury of choosing between spending time in DC or going to China; they have to do both. To bring this thought full circle, waiting for the tides of political fortune to bring your preferred party back to power isn’t an option. Avoidance isn’t a strategy, so deal with your Democratic challenges head-on.
- Being a native of New Jersey, I am forever thankful for an innate understanding that self-interest isn’t a bad thing. What can make self-interest problematic is when it is pursued to the exclusion of mutual satisfaction. Good alone, better together; you’ve got to make a living and so do I; the best deal is one that leaves all parties feeling satisfied but still hoping for more. You get the idea. The near term legislative and political landscape suggests that where successes can be achieved, they are likely to be incremental. Think of it as increasing the size of the pie instead of cannibalizing an ever shrinking pie. That dynamic applies to those who lobby as well as those who are lobbied. It is in the Democratic Party’s self-interest to broaden its’ governing coalition by growing its’ friends list and minimizing its’ enemies one. Past historical preferences by the business community for the GOP is ameliorated by the carnivorous and insatiable demand for financial and political support. Call me jaded, call me crass, but the reality is that a real opportunity exists for business to build new bridges to the Democratic Party. My strongest counsel would be that the bridges be built primarily through ideas and intellectual energy. A political contribution may help gain access, but a winning, achievable idea wins hearts and minds.
- Believe it or not, most Democrats don’t hate job creators. They value economic growth and are actually intrigued by emerging new economies like the gig and service sectors. The problem is, they don’t understand them and so don’t know how to promote an agenda that benefits them in anything other than a spasmodic way. If they understood the depth and breadth of the service sector, they wouldn’t view it as being a dead-end, minimum wage dominated workforce. Especially at the state and local level, Democrats covet the growth of their travel economies, yet largely don’t have a clue about how to nurture them. It’s up to the private sector to show the power of its’ promise, and to develop a coherent strategy for highlighting a path forward. The private sector needs to become more aspirational in its’ thinking, more compelling in its’ story-telling. One big ask set against a powerful longitudinal vision becomes a powerful weapon.
- In the small business world in which my late father labored, the dominant ethic seemed to have been the belief that when it came to doing business in America, doing good and doing well were achievable and non-conflicting goals. Far too many Democrats wonder if that ethos still dominates in the private sector. I know that it does, because of my work on its’ behalf for many decades. It has been my great privilege to have represented the National Restaurant Association for thirty-one uninterrupted years. I have learned much about this great and good industry, the nation’s second largest private sector employer. One of the things I’ve learned is to recognize a rhetorical crock when I hear it. For far too many in my Party, the industry is viewed as low wage paying employers providing dead-end jobs, largely insensitive to the needs of its’ workforce. Baloney. This is as dynamic and aspirational an industry as exists in America, with innovation of all stripes its’ hallmark. Employee satisfaction and retention remains a top priority, as only the most delusional restauranteur believes that his special meatballs alone will keep customers coming through the doors. A chat with your next server may illuminate how many of them want to work in the industry and one day own their own business. More than 50% of all food consumed in America is prepared outside the home; Food Channel ratings are soaring; and culinary tourism is on the rise. How many Democrats understand any of that? The burden is on the restaurant industry to tell its’ compelling story in ways that a Democrat can understand.
- A long-time friend and client always says, “message and messenger matter.” If the CEO isn’t a compelling advocate, then the plant manager, franchisee, or cooperative leader can be. Since I began lobbying in 1976, I have never known of a time when pairing those imperatives was more important. To identify powerful surrogates will require a level of introspection with which many organizations may be uncomfortable. “Local” and “organically sourced” have become powerful marketing tools that enhance products. The business community as a whole would be well-served to emphasize their own credible, locally connected roots.
The late paleontologist, Stephen Jay Gould, wrote that “there is nothing more dangerous than a dogmatic worldview- nothing more constraining, more blinding to innovation, more destructive of openness to novelty.” Perhaps it’s time to make 2017 a new beginning for the business community: less tribal, more aspirational, with a greater emphasis on the doing of good while doing well. A greater focus on problem solving than upon partisan preference. The American people believe that both parties have failed them. Thoughtful leadership by the private sector could go a long way towards repairing the average American’s faith in their own futures as well as in the enduring appeal of the American Dream.