Some Republicans not heeding big business allies

WASHINGTON (AP) Business leaders are taking sides with Democratic President Barack Obama after failing to persuade their traditional Republican allies in Congress to avert a government shutdown.

Obama, whose health care and regulatory agenda they have vigorously opposed, is embracing the business outreach, eager to employ groups like the U.S. Chamber of Commerce and Wall Street chief executives to portray House Republicans as out of touch even with their long-established corporate and financial patrons.

Yet, the partial closing of the government and the looming confrontation over the nation's borrowing limit highlight the remarkable drop in the business community's influence among House Republicans, who increasingly respond more to tea party conservatives than to the Chamber of Commerce.

On Wednesday, Obama hosted 14 chief executives from the nation's biggest financial firms for more than an hour of meetings. Moreover, the Chamber of Commerce, a business advocacy group, has sent a letter to Congress signed by about 250 business groups urging no shutdown and warning that a debt ceiling crisis could lead to an economic disaster. They say that the policy disputes over health care and spending that are separating Democrats and Republicans should be debated later.

Summing up the Wall Street message on the White House driveway Wednesday, Lloyd Blankfein, chairman and chief executive of Goldman Sachs, said:

"You can re-litigate these policy issues in a political forum, but we shouldn't use threats of causing the U.S. to fail on its obligations to repay its debt as a cudgel."

The divide between some Republican lawmakers and the corporate groups that have helped shape the Republican agenda in the past is partly a result of a legacy of the Wall Street bailouts of 2008-09 and a changing communication and campaign finance landscape that has weakened the roles of corporate donors and of the major political parties.

Interviews with House Republicans from all regions of the country demonstrate the corporate community's waning clout. Most of these lawmakers say local business owners and chambers of commerce have not raised the potential economic downside of a government shutdown or debt default.

Rep. Ted Poe, a Republican, like many of his colleagues, said the overwhelming message he hears from business owners is their dislike of Obama's health care overhaul, which is at the center of Congress' impasse and the government shutdown. Likewise, Rep. Steve Chabot, a Republican, said he mostly hears business owners complain "about the negative effects of 'Obamacare' upon their ability to do business and hire people."

When Rep. Dana Rohrabacher, a Republican, was asked if he had heard business groups express fears of a government shutdown's economic impact, he replied: "No. And it wouldn't make any difference if I did."

Still, major business groups are raising alarms, citing the economic cost of a shutdown and warning of even more serious consequences if Congress doesn't act quickly to raise the $16.7 trillion borrowing limit, which the government is expected to hit around mid-October.

The letter circulated by the Chamber of Commerce urges lawmakers to raise the debt ceiling "in a timely manner and remove any threat to the full faith and credit of the United States government." It also acknowledges Republican fears over the unsustainable growth of major benefit programs such Medicare and Social Security and the need for a more business-friendly tax system.

But in a rejection of the tactics of House Speaker John Boehner, the letter urges Congress to pass first a short-term spending bill, then raise the debt ceiling, "and then return to work on these other vital issues."

That advice is being ignored by the Republican-led House.

"There is an element of the more independent, tea party coalition Republicans that, frankly, don't listen to very many people," said John Engler, the former Republican governor of Michigan and now president of the Business Roundtable, one of the groups that signed the chamber letter. "They are on a mission, often defined on the basis of their view of the world, and they aren't paying very much attention to what this means beyond maybe their own districts."

Concerned, the Chamber of Commerce is preparing to participate in political primaries, protecting friendly lawmakers from conservative challengers. "Clearly we're getting to a point where we need a Congress that's going to be productive, proactive and create a stable environment for economic growth and job creation," said Scott Reed, a Republican political consultant who is advising the chamber on its strategy.