White House accused of urging businesses to quit Chamber of Commerce

Since taking office nearly two years ago, President Obama has frequently clashed with the U.S. Chamber of Commerce, a major business group that has plowed millions of dollars into opposing his plans to overhaul healthcare and impose new regulations on Wall Street.

Obama and his aides have criticized the group publicly. But the administration’s campaign to neutralize the group went further, according to a source involved in the dispute.

Over the last year the White House has hosted meetings with business leaders to discuss policy, and in some of those sessions asked that they persuade the chamber to cancel TV ads aimed at defeating Obama’s healthcare plan, said a business lobbyist familiar with the matter.

Illustrating the depth of the dispute, the White House also asked corporate executives to drop their membership in the chamber, said the lobbyist, who spoke on condition of anonymity to avoid becoming personally entangled in the conflict. Another source said there had been discussions at the chamber regarding the White House urging resignations.

Last fall, the chamber received reports that the White House — including senior advisor Valerie Jarrett — had spoken to some executives about resigning from the chamber, the business lobbyist said.

Through a spokeswoman, Jarrett said Thursday that she did not ask any companies to leave the chamber. The chamber has not publicly accused the White House of urging resignations, nor has any company said publicly that it has been pressured to leave.

Defections from the chamber carry the potential to damage the institution in two ways: Cutting off dues money and stirring up bad publicity.

Since the midterm election there have been signs of a thaw. Obama is considering a speech to the group’s members as soon as next month and the chamber is pledging not to push for his defeat in the 2012 election.

But relations were under intense strains last year. Several companies quit the chamber during that period, citing differences with the organization over the issue of climate change. They included electric utilities PNM and Exelon, Pacific Gas & Electric Co. and Apple. Nike remained in the fold but stepped down from the chamber’s board of directors.

Asked about the resignations at the time, Energy Secretary Steven Chu said, “I think it’s wonderful.”

The White House would not make Jarrett available for an interview. White House spokeswoman Amy Brundage released a statement instead:

“Decisions by individual companies over a year ago to end their membership with the Chamber of Commerce over climate change were made by the individual companies alone. The administration obviously spoke out publicly about our opposition to the funding of ads against the healthcare and the financial reform bills and we stand by that.”

In interviews, officials with Exelon, PG&E and PNM said they were not asked by the White House to leave the chamber. Officials with Nike said they did not talk to the White House about their decision.

An Apple spokeswoman said the company would not comment on whether the White House asked it to leave the chamber. She referred to the resignation letter that Apple sent to chamber President Thomas Donohue in October 2009, which objected to “the chamber’s recent comments opposing the EPA’s effort to limit greenhouse gas emissions.”

Within the White House, Jarrett is the main link to the business community. A close friend of Obama, she heads a public outreach office that has courted other business groups, though not necessarily the chamber. A special focus of White House outreach has been another group called the Business Roundtable, an association of chief executive officers.

Jarrett explained the administration’s approach in an interview last year. “Our strategy is to reach out directly to the business community,” she said. “This is a shift. Previously, the chamber had served as the sole intermediary for business. That’s not our approach.”

Since his party’s losses in the midterm election on Nov.2, Obama has indicated he is eager to rebuild his frayed relationships with business interests, the chamber included. The two sides are trying to find a date in January when Obama can address chamber members.

But the feud has taken on a personal tone. The chamber endorsed some of Obama’s most controversial policy goals, including the $800-billion stimulus program, the auto company rescue plan and education improvement programs.

Yet when it came to the make-or-break issue of the Obama presidency — a healthcare overhaul — the chamber proved a formidable opponent.

As the healthcare bill was nearing a crucial vote in the U.S. House this year, the chamber led a coalition of business interests that purchased millions of dollars in TV ads aimed at persuading lawmakers to vote against the healthcare bill.

In the end, the bill passed and Obama signed it into law.

In campaign stops during the midterm election season, Obama at one point devoted part of his stump speech to a claim that the chamber was relying on foreign money to pay for TV ads meant to influence the vote. He later dropped that argument amid fact-checks that showed the evidence was scanty.

But Obama has found the chamber to be a useful foil.

Speaking at a Democratic fundraising event in Atlanta over the summer, he mentioned that the chamber supported a bill aimed at helping get loans to small businesses.

“It’s been praised by groups like the Chamber of Commerce,” the president said. “They never praise me.”

peter.nicholas@latimes.com