The U.S. Chamber of Commerce was for decades an indomitable force in Washington with close ties to the Republican Party.
But that influence has eroded in recent years alongside its relationship with traditional GOP allies, putting the lobbying giant in a tough spot to fight tariffs and push tax priorities at the start of a second Trump administration.
As the president has launched an aggressive tariff strategy at the start of his second term, the Chamber’s objections don’t appear to be going far. And while the 2017 tax cuts were a huge victory for the business community and its advocates, the Chamber is entering lobbying efforts this year on the heels of a House investigation into donations to the Chamber’s foundation from left-leaning organizations — led by House Ways and Means Committee Chair Jason Smith.
“The Chamber isn’t in the conversation,” said a source familiar with the committee’s tax bill preparation. The source pointed to the field hearing that Ways and Means has been conducting across the country over the last two years that they said is being used as the basis of the bill, noting that while local chambers have been involved, the national organization has not.
The waning influence of the Chamber has been a source of discussion on K Street for some time, but often in hushed tones on background or off the record. The reticence to outright write off the Chamber indicates its influence has perhaps not waned beyond repair, but four more years of President Donald Trump and a Republican Party more beholden to MAGA than traditional conservative principles will undoubtedly be a challenge unlike any other in the institution’s 113-year history.
The Chamber of Commerce rejected the notion that it’s not in the tax conversation.
“Whoever said that might not be in the same rooms that we’re in,” said Neil Bradley, the Chamber’s chief policy officer. “We’re definitely in rooms with many members of the Ways and Means Committee and staff on the tax issue.”
One Republican member of the Ways and Means Committee spoke on stage with Bradley at a tax summit hosted by the Chamber on Wednesday.
“We’re all in this together,” Rep. Randy Feenstra repeatedly told the room of tax lobbyists.
Sen. Mike Crapo, who chairs the Senate Finance Committee, also acknowledged the cost hurdle in a subsequent conversation with Bradley and called the Chamber and companies in the room an “incredible ally.”
“I absolutely do see all of you and the Chamber itself as an incredible ally,” Crapo said.
“We need you to be hittin’ every single button you can to help influence this debate,” he added, saying “it will help us tremendously in the political arguments.”
In contrast to Crapo’s more traditional, business-friendly remarks, Smith is “much more populist” with “different priorities,” said Ray Beeman, a principal with Washington Council Ernst & Young, during a panel on the players and politics of the tax debate.
And tax negotiations are happening in a completely different political environment this time around. Not only are tax writers incorporating provisions including eliminating taxes on tips and overtime, but the razor-thin majority in the House means Republicans can’t afford to lose a dozen GOP votes as they did in 2017 — a major hurdle as House Freedom Caucus members threaten to defect over cost.
“This dynamic from sort of the tax committee chairman up to the leadership is going to be very, can be very different than 2017, for sure,” Beeman added.
Ultimately, the tax bill will be considered a boon for the businesses the Chamber represents. Trump has already floated further reducing the corporate tax rate from 21% to 15%, for example, and many of the provisions the Chamber praised last time around are likely to be extended.
A Ways and Means spokesperson for Smith did not respond to a request for comment on the chair’s current relationship with the Chamber. But former Rep. Rodney Davis, who joined the Chamber last summer as head of government relations, has said he has a “very good” relationship with Smith.
Davis brought in a team that included Tim Monahan, who previously worked with Speakers Kevin McCarthy and Mike Johnson. Both Davis and Monahan are widely seen as a win for the Chamber, easing relations with Republicans and opening the door to meetings with House leadership.
“I think with Rodney and Tim, they are heading in the right direction,” said a former House leadership aide who has been critical of the Chamber in the past.
A former aide to Kevin McCarthy agreed, but they still said the Chamber was a “pretty ineffective entity.”
Trump and the Chamber butted heads during his first term, particularly on tariffs and immigration. During his 2016 campaign, after the late Chamber CEO Tom Donohue criticized him in the press, Trump sent Donohue a note in his signature Sharpie that said, “Thomas, this wasn’t very nice. — DJT,” according to a source.
A White House spokesperson did not respond to requests for comment.
But the broader break came weeks before the 2020 election, when the Chamber endorsed 23 House Democrats. Even though the Chamber also endorsed 191 Republicans that cycle, the former McCarthy aide called that “the straw that broke the camel’s back.”
Donohue also called the president’s actions on Jan. 6, 2021, “absolutely unacceptable and completely inexcusable.” The Chamber initially said it would halt contributions to certain members in the wake of the riot, although it later clarified that it would not blanket apply to members who voted to not certify the 2020 election.
Last spring, Smith sent a letter to the Chamber demanding an explanation for the more than $12 million its foundation received from the Tides Foundation between 2018 and 2022. Smith argued that since Tides also funded groups that “harm the American business community,” the donations appeared to conflict with the Chamber’s mission and raised questions about its tax-exempt status.
The Chamber and its foundation argued the inquiry was a misunderstanding, and said the funds “were charitable contributions from corporations made to the donor-advised fund.” While the inquiry appeared to fizzle out following a second letter last July, it nevertheless was a marked escalation in tensions.
The Chamber announced it had hired Davis a week after the second Smith letter, and the addition of new faces with close ties to House Republican leadership has figuratively and literally opened doors in Congress. Bradley also said there has been a “respectful dialogue” — if not an Oval Office meeting — with the White House on the Chamber’s long-standing opposition to tariffs.
“It doesn’t necessarily mean that we always persuade them, but by the way, that also means that they don’t always persuade us,” Bradley added.
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Taylor Giorno is a reporter at NOTUS.