Despite Business Ties, Daley Struggled In Debt Talks

William Daley, shown with President Obama when he was named White House chief of staff in January. i i

hide captionWilliam Daley, shown with President Obama when he was named White House chief of staff in January.

Jewel Samad/AFP/Getty Images
William Daley, shown with President Obama when he was named White House chief of staff in January.

William Daley, shown with President Obama when he was named White House chief of staff in January.

Jewel Samad/AFP/Getty Images

When White House Chief of Staff Bill Daley joined President Obama's team at the beginning of the year, he was expected to bring stability and a centrist approach to managing a sometimes chaotic White House.

His close connection to the business world was one of the strongest selling points as chief of staff. Daley built close friendships with business leaders during his years at JPMorgan Chase, and the White House hoped he could undo some of the bad blood that developed between Obama and business leaders during the first two years of the term.

So it was a bit awkward when, in an interview on Morning Edition last week, NPR's Steve Inskeep broke it to Daley that the Chamber of Commerce supported House Republicans' bill to raise the debt ceiling, over White House objections.

When faced with the disappointing news, Daley remained cool as always. "I spoke with [Tom] Donahue who runs the Chamber of Commerce ... and he indicated to me that he was sending a letter to all the Congress encouraging them to bring this to some resolution," Daley told Inskeep. "He did not indicate to me that he was supportive of Speaker Boehner's plan at all. So I've not seen the letter, but in my discussion with him, he sure did not indicate that to me." Daley then referred to it as the plan Donahue "allegedly has endorsed."

A powerful association of CEOs called the Business Roundtable took the same position as the Chamber of Commerce. "Bill Daley understands business. He reaches out to business. He asks questions. He wants to know our views," says Johanna Schneider, the group's executive director for external relations.

Despite Daley's business cred, when it came to one of the biggest crises of the Obama presidency to date, the business community did not have Obama's back.

Political scientist Ross Baker of Rutgers says that's not necessarily Daley's fault. "There are no permanent allies, there are only permanent interests," says Baker. "Personal friendship or appeals from the chief of staff of the White House [aren't] going to make a big difference."

Daley spent the last month deep in negotiations with Republicans in Congress over the debt ceiling. People had high expectations for his performance in the talks. As Commerce Secretary in the 1990s, Daley helped President Clinton push the North American Free Trade Agreement through a Republican Congress.

This time he got a deal through, but it looked nothing like the goal Daley described last week on Morning Edition when he said, "There ought to be a balanced approach, including revenue."

There is no revenue in the debt-ceiling bill — only cuts. Tom Fiedler of Boston University's College of Communications sees parallels with Daley's performance a decade ago. Fiedler wrote the Almanac of Florida Politics, which includes a section about the Bush v. Gore court case that put President George W. Bush in the White House. Daley was Al Gore's presidential campaign chairman back then, and Fiedler says Daley always seemed conciliatory.

"The Gore campaign was completely out-maneuvered by the Bush campaign," he says. They "put themselves in a position where they were constantly on the defensive and having to respond, and ultimately that position failed."

But Jon Cowan of the centrist Democratic group Third Way says there's no way Daley or any chief of staff could have won more concessions on the debt-ceiling deal from Republicans who were riding a wave of Tea Party enthusiasm.

"I think Daley is going to go down as one of the more effective chiefs of staff in a highly polarized moment in American politics, who got substantial things done, got some very big offers on the table that broke with Democratic orthodoxy, and helped reposition the president in the center of American politics for his re-election," says Cowan. (Daley served on Third Way's board of trustees.)

Repositioning in the center and breaking with Democratic orthodoxy look like strengths to Cowan, but to activists on the left, they are a sign of betrayal. One of those liberal critics, New York Times columnist Paul Krugman, posted a video by the band Portishead on his blog this week. One of the lines in the song: "How can it feel this wrong?"

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