Businesses boost engagement efforts amid GOP House gains

The business community plans to focus on education and engagement with policymakers in Washington following the wealth of Republican successes in November's midterm elections.

The business community plans to focus on education and engagement with policymakers in Washington following the wealth of Republican successes in November's midterm elections.

The first half of the Obama administration was a boon for the public affairs sector, as companies hired firms to handle corporate crises, bailouts, and unprecedented legislative and regulatory action.

"The outcome of the midterms creates a divided Congress and White House, which by and large is viewed as a plus for business," says Doug Pinkham, president of the Public Affairs Council.

While legislative and regulatory action might slow with a GOP-led House, the need for companies to stay active in Washington remains vital.

"Virtually every business must engage, particularly if it's under regulatory or legislative scrutiny," says Paul Johnson, CEO of business consultancy* K-global. "The focus will be more on deficit reduction and less on spending."

Johanna Schneider, executive director of external relations at the Business Roundtable, says CEOs who work with her organization are more engaged with the roundtable and its activities in Washington than in the past decade.

"There's an unprecedented level of government intrusion in the business sector," she notes, "so the response has been and will continue to be direct CEO involvement with policymakers."

The Roundtable was viewed as a strong Obama supporter until the last year, when it publicly called for the administration to address top-line issues for the business community, including private-sector job creation and taxes.

Schneider says with so many new members in Congress - Republicans gained 61 seats (with some still undecided at press time) in the House and six in the Senate - her organization will need to expand its education efforts relating to business issues in the US and globally.

"Within the White House, there is not a business voice," she adds. "The president has identified a number of industry sectors and has been pretty harsh in his rhetoric about those industries. That has slowed down the ability to partner with the White House."

Business groups have also criticized this White House because it does not count a business leader as part of the senior staff. Past administrations ensured at least one member of the Cabinet represented business.

Chance to educate

For agencies, the ability to educate policymakers and their staffs is considered a growth area.

"When you look at the core issues we have to deal with - whether it's energy reform, execution of healthcare, or budget deficits - our problems don't lend themselves to quick fixes," says K-global's Johnson. "There's a huge business opportunity in trying to help companies navigate."

In its two years, the Obama administration and a Democratic Congress ushered in a sweeping billion-dollar stimulus, healthcare reform legislation, and financial reform regulation, while also trying to address the worst US recession since the 1930s.

"Healthcare had a huge impact on the midterms because people didn't think it was a priority," says Johnson. "By pushing healthcare at almost any price, it reinforced the idea that the administration wasn't as focused as it should have been on the financial crisis."

Yet Pinkham notes the remaining uncertainly over how Obama's term will play out.

"I could paint a scenario where things could flip in the other direction in two years," he says. "A lot depends on how the economy responds and how Republicans conduct themselves."

Election day was also good for...

Healthcare insurers

Republicans made it clear that one of their first orders of business will be to repeal or chip away at President Obama's healthcare insurance overhaul

Wall Street

Many top recipients of Wall Street dollars won on November 2. Moreover, Boehner, likely to be the next Speaker of the House, is known to have good relationships with financial lobbyists

High income groups

The GOP victories certainly make it more likely the Bush-era tax cuts would be renewed for all income groups, not just the lower and middle class

*CORRECTION: An earlier version of this story incorrectly described K-Global. It is a business consultancy. We regret the error.

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