Light on details, business community calls for action to avert ‘fiscal cliff’

The business community is visibly pressing Congress to address the fiscal cliff and strike a broad deficit deal, but is steering clear of weighing in on any of the problematic issues standing in the way of a compromise.

{mosads}One need not look far to find an industry leader airing concerns about the year-end fiscal cliff, as groups of all stripes are urging Washington to act. But when it comes to those devilish details, the groups are light on specifics, avoiding explicit stances on taxes, spending and entitlement programs.

Some in the business community say the details should be left up to policymakers. But at the same time, they would also prefer not to be seen as picking sides on hotly partisan issues before Tuesday’s election determines who will actually be in the driver’s seat.

“I don’t see this as something they feel comfortable weighing in on,” said Douglas Holtz-Eakin, the former head of the Congressional Budget Office and economic advisor to Sen. John McCain’s (R-Ariz.) 2008 presidential campaign. “They think it’s the elected officials’ job.”

Business groups have already launched multiple campaigns on the cliff and the deficit, even as they leave specifics up to lawmakers.

In October, a group of more than 80 chief executives from some of the nation’s largest companies signed on to the Campaign to Fix the Debt, a bipartisan group founded by Erskine Bowles and Alan Simpson, the former co-chairmen of the president’s fiscal commission and authors of a deficit-reduction plan that bears their names.

The campaign’s priorities include calls to reform Medicare and Medicaid, strengthen Social Security, and reform the tax code in a way that lowers rates and raises revenues.

But partisans are treating the executives’ statement as a Rorschach test for their preferred policies, with some Democrats interpreting the CEOs as endorsing a tax increase as part of their call for increased revenue.

“The public already believes that the wealthy should be paying their fair share to reduce the deficit, but since the Republicans refuse to listen to voters, maybe they will listen to corporate America because the signal they are finally sending couldn’t be any louder,” said a senior House Democratic aide after the CEOs rolled out their campaign.

But on the other side of the aisle, conservatives saw plenty of room in the campaign’s call for increased revenue to fit their preferred policy goals, as Republicans contend that economic growth that comes from lower taxes would raise revenue as well.

Grover Norquist, the anti-tax crusader, suggested that the executives working with Fix the Debt were too intent on looking sensible and too busy running their own businesses – and, because of that, they should have left the fiscal policy to their D.C.-based trade groups.

“This is like talking to the starlet instead of her agent,” Norquist told The Hill. “This allows you to go to a cocktail party and say, ‘Well, I was for a reasonable agreement.’”

Norquist, the president and founder of Americans for Tax Reform, added that, much like Simpson-Bowles, partisans on the left and right could read what they wanted into the CEO statement. The tax advocate himself said there was nothing inconsistent with his principles after the CEOs unveiled their effort.

“Republicans hear an outline of marginal tax rate reductions and spending cuts, and Democrats hear tax increase,” said Norquist, a longtime opponent of the Simpson-Bowles framework. “Each one is agreeing to half the project. They’re not fleshing out the other half.”

Others have suggested that the CEOs are hedging their bets when it comes to the fiscal cliff and more long-term fiscal issues with a high-stakes election just over the horizon.

Jade West, a senior vice president at the National Association of Wholesaler-Distributors, said she was weary of attempts to push policy forward through statements of principle or broad frameworks, like Simpson-Bowles.

“We welcome everybody to the table,” said West, who is also the spokeswoman for the Tax Relief Coalition, a group formed to push for the Bush-era tax cuts. “But at some point, there has to be actual legislation that can be debated and picked through.”

The Tax Relief Coalition, which includes groups like the Business Roundtable and the U.S. Chamber of Commerce, also responded to the executives’ work with Fix the Debt by expressing concern about the tax implications of Simpson-Bowles.

Dozens of the chief executives working with the debt campaign are actually members of the Business Roundtable, and their companies are part of the Chamber.

“There’s not enough specificity in that statement to raise opposition from any quarter,” West said about the executives. “Whether or not done by design, that’s the result.”

One challenge facing the business community is finding a way to impress on Congress the need to take action without being dragged into the partisan morass on perpetual fights.

A financial industry leader pointed out that if businesses were to staunchly come out in favor of letting tax cuts for the rich expire, as an example, they could find themselves dismissed by Republicans and their influence reduced.

“There’s a balancing line,” he said, adding that businesses also are reluctant to start laying down markers on contentious issues before Congress has really begun full-fledged work on them.

“You don’t want your advocacy to be too far out of the process,” he said. “It could be counterproductive in terms of retrenching parties.

“You will see all the sectors be far more engaged when we’re past the election and we know who the players are,” he added.

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