A backlash against Obama's budgetBusiness is marshaling its forces. The target is the aggressive domestic agenda laid out in President Barack Obama's first budget.
Private health insurers are mobilizing to fend off Obama's plans to cut the fees they receive from Uncle Sam and create a government-subsidized rival that, they fear, would undercut them with lower-cost care for the uninsured. Multinationals are up in arms about the prospect of paying higher taxes on foreign earnings. Real estate agents want to quash efforts to lower the mortgage interest deductions for families earning more than $250,000. Small business owners -- many of whom pay personal income tax rates on their companies' profits -- fear his plans to raise income, capital-gains, and dividend taxes on those same high-end earners. Many industries accept the idea of paying a price for carbon emissions -- but not as quickly as Obama envisions. Private equity players and venture capitalists claim that the higher taxes Obama wants them to cough up will drain away innovation and investment. "There's a lot of activity as people gird their loins for these battles," says longtime Washington lobbyist Patrick E. O'Donnell, who represents defense contractors, potential bank bailout recipients, and insurance companies. Like many others on K Street, his firm, Squire, Sanders & Dempsey, is staffing up.
What's stirring up industry is not only the breadth of Obama's agenda but the strength of his position because of Democratic dominance in Congress. As Peter Orszag, Obama's budget director, puts it: "The President has the bully pulpit, he has strong public support, and these are all things he campaigned on." If Obama faces a tough fight getting his entire budget passed, business faces one, too, warns Stan Collender, a partner of Qorvis Communications, a Washington firm that represents banks, drugmakers, and defense contractors. "A lot of things that could be harmful to industries now have a better shot at being enacted," he says.
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