The U.S. Chamber of Commerce often says it speaks for 3 million members, businesses both large and small. What it doesn't promote as readily is that 19 supporters last year provided a third of the trade group's total revenue.
Documents filed with the Internal Revenue Service this month show the chamber drew its 2008 funding heavily from a small group of contributors, with each paying more than $1 million. Within that set, some gave very large sums. One company or person provided the chamber with $15.3 million last year, an amount more than 10 percent of the influence group's $147 million revenues. Another gave $8.2 million, and a third $2.9 million.
The chamber did not release the names of those supporters. A copy of the trade group's tax return obtained by E&E includes a list of contributors that the IRS requires, but with the names of those contributors removed. It is unclear whether each sum came from an active member company or a hands-off benefactor. As well, it is not possible to know whether those giving large sums are most interested in climate and energy policy, health care, taxes, or the other myriad business issues the chamber lobbies on to Congress.
The chamber said contribution levels and lobbing are not connected.
"The chamber has an open and democratic policymaking process," spokeswoman Tita Freeman said. "Policy committees meet three or four times a year and engage in a dialogue on those issues. Any chamber member can join any policy committee."
"Like other associations, we do fundraise around issues, so one company might give to our transportation and infrastructure efforts, while another might give to intellectual property," Freeman added. "A specific company's giving does not impact the position we take on an issue, though, which as I said is driven by our policy committees."
Some chamber critics, however, said contribution information puts a renewed spotlight on the group's lobbying positions and whether it favors the interests of a few companies. The chamber's membership came under scrutiny this summer when PNM Resources Inc., Exelon Corp., PG&E Corp. and Apple Inc. either left the chamber or announced plans to do so over climate policy differences with the influence group. Nike Inc. resigned from the chamber's more than 100-member board of directors but remains a member of the chamber.
"It raises questions about which companies are putting those dollars into the chamber and what do they want to get out of it," said Pete Altman, a climate campaign director at Natural Resources Defense Council, which has criticized the chamber's opposition to elements of climate legislation. "It sounds like there are a few companies that are investing a lot of money in the U.S. Chamber so the U.S. Chamber will go out and fight on their behalf."
The tax return also shows how the chamber spends at least some of its money. The trade group last year spent $23.1 million on political activism. It paid $1.2 million to a company that helped generate letters, e-mails and phone calls to Congress in support of the trade group's positions on various policies. And the chamber spent $452,450 on focus group testing.
"The chamber engaged in public activities in support of its mission, which includes advancing the interests and concerns of business, economic growth, and the free enterprise system," the association said in its tax filing. "In pursuit of these goals, the chamber spends funds directly or works with other organizations with similar missions."
The tax return also shows that chamber President Tom Donohue received $3.7 million in total compensation, which included a $2.5 million bonus.
Reasons for giving
The trade group in its IRS "schedule of contributors" reported a total $126.6 million in support. The list includes 1,439 companies or people who gave at least $5,000.
Chamber members do not pay membership "fees" but rather contribute to the association, said a chamber employee familiar with the group's tax filing who spoke on the condition he not be identified. Amounts listed on the schedule of contributors include both what a company gave for membership and any other amounts it paid for chamber activities. The companies designate what programs they want the money to go toward, the chamber official said.
The contributions are "market based," the chamber official said, with some companies giving more for chamber actions they have a greater interest in.
"It's based on their need," the chamber official said.
Altman, with NRDC, said he has spoken to chamber members who have said that membership dues are $100,000 to $200,0000.
"The companies that gave $15 million, $8 million, $3 million, they go well beyond their dues," Altman said. "Someone gives that much more because they want to have the chamber focused on driving their agenda without having their name attached to it."
On climate legislation, Altman said "it has certainly appeared that they are pursuing a position that is consistent with just a few of their members." An NRDC analysis of the chamber's board of directors, Altman said, showed that "those on record supporting climate legislation outnumber those opposed, 5-to-1."
The chamber's board of directors is very large and does not actively decide the association's position on climate legislation and other policies, said Bruce Herbert, president of Newground Social Investment, a money management firm that has been talking to companies in its fund portfolios and asking them to leave the chamber if their views on climate legislation differ from those of the trade group.
"Where the authority actually lies is in the committees and the executive director," Herbert said. "It does operate in a very narrow way. The money process just highlights that that is the case."
Herbert added, "It seems to indicate that some companies see this as a very effective means toward a specific end they are looking for. It's a pay-to-play kind of an organization. Those who give in large amounts are going to be listened to in a different way."
One political analyst, however, said that without knowing the names of the contributors, it is impossible to draw any connections between chamber policy on issues and the interests of companies.
"I don't see the fact that they receive large contributions by some set of members as suggesting that the policy positions they are taking are not representing the broader membership," said Lee Lane, resident fellow at American Enterprise Institute, a conservative think tank.
While those giving money are probably "quite interested" in something the chamber is advancing, Lane said, "the chamber lobbies on a huge range of issues. I assume that its members are interested in a very disparate set of issues." Those who have given less money might agree with those who have given more, he said.
The chamber's $23.1 million spending on political activities is not itemized in the tax document. It could include spending in state races, paying for advertisements that attack or support certain candidates, and grants made to other groups engaging in those same actions, said John Pomeranz, a partner at Harmon, Curran, Spielberg & Eisenberg LLP who represents tax-exempt organizations that complete the 990 tax form like the chamber's filing.
The $23.1 million "represents a host of activities related to the congressional elections in 2008," chamber spokeswoman Freeman said, noting that the chamber does not participate in advocacy or donations connected to the presidential election. "It's primarily our voter education advertising to raise awareness of key issues surrounding the elections."
Under federal election law, corporations are banned from paying for efforts that urge people to vote for or against a certain candidate, something called "express advocacy," Pomeranz said. But some states, such as Virginia, do not limit express advocacy in state races, Pomeranz said. In other states that prohibit direct advocacy by corporations, he said, the chamber could pay for other political ads that do not directly target or back candidates.
The chamber in the 2008 election cycle gave $248,381 directly to candidates, according to the Center for Responsive Politics.
Spending on political activism by the chamber is "a lot, but it's not unprecedented," said Lisa Gilbert, democracy advocate at U.S. Public Interest Research Group. Most in Washington, D.C., she said, know that "money is the way to influence the game."
"Every organization, including the U.S. Chamber of Commerce, knows that and uses their money to that effect," Gilbert added.
The chamber in past state elections has played a big role, said Herbert with Newground Social Investment. In 2004 in Washington state, the chamber paid for an advertising campaign targeting former Insurance Commissioner Deborah Senn, who ran unsuccessfully for attorney general. Lawsuits filed later showed that the U.S. Chamber paid $1.5 million for those ads, which claimed to be from the group "Voters Education Committee," according to a timeline from watchdog group Public Citizen.
"These large donors are probably trying to get something quite specific," Herbert said. "The effects are pernicious and powerful and hidden."
The tax return also shows that the chamber paid $1.2 million to a company that helped drive grass-roots lobbying in support of chamber positions on issues. The company, Integrated Web Strategy, or IWS, launched a new Web site called "Friends of the U.S. Chamber." The company used voter registration lists and other information sources to contact people who might be interested in contacting Congress on the chamber's behalf.
"Petitions, videos, surveys, polls, and live response feeds were all employed to engage people and convert them to 'activists,'" Integrated Web Strategy says on its Web site, describing its work for the chamber.
"When gas prices were soaring," Integrated Web Strategy adds on its Web site description, "Friends of the U.S. Chamber sent 10,000 letters to Congress. Through May of 2009, supporters have sent over 55,000 letters to Congress on behalf of the Chamber."
Chamber spokeswoman Freeman said the chamber engages in "communication pushes" with Integrated Web Strategy several times each week "on a variety of issues," including health care reform, education and transportation.
"It's regular course of business that the chamber does," Freeman said. "It's very commonplace for IWS to help with the execution of an advocacy campaign that we have under way."
Gilbert with U.S. PIRG called it problematic when grass roots is driven by "a P.R. firm paid to move people."
"More and more people are concerned that grass roots does not always mean a legitimate movement by the people," Gilbert said. "This is a pretty clear example of that."
The chamber has the right to do it, Gilbert said, but "it is worth knowing where the money comes from that reached those [lawmakers]. It is the disclosure that is important."
Most trade groups and companies have a grass-roots arm made up of their employees and their family members and community leaders, said Lane with AEI. The chamber effort sounds like an extension of that, he said.
"The purpose is to show Congress that their constituents do care about issues that the chamber and others are trying to advance," Lane said, and is a response to "the kind of grass-roots pressure that environmental groups and labor unions bring."
Environmental groups, Lane said "are doing the exact same thing." Lawmakers know when they receive a call or e-mail whether it came from an organized campaign, Lane said, adding "there isn't any question that those sort of mass-produced communications are sort of discounted."
But the businesses do it, Lane said, "because they believe it has some impact."
"When they put that kind of money into it," Lane added, "they absolutely think it's effective."