President Obama came to office with a lot of support from the nation's business leaders. Some of the most famous CEOs in Silicon Valley, on Wall Street and in the media were big donors to his campaign.
But 19 months later, that support has weakened, says Jeffrey Sonnenfeld of the Yale School of Management. "The relationship has been deteriorating both in public ... and backstage," he says.
Part of the resentment business leaders feel has to do with rhetoric. Political pundits have faulted the president for not showing more anger toward companies like BP and Goldman Sachs. But as business groups like the U.S. Chamber of Commerce see it, the president's tone has often betrayed an animosity toward business — as in an attack on the Bush administration's regulatory policies last month.
"If you're a Wall Street bank or an insurance company or an oil company," the president said then, "you pretty much get to play by your own rules, regardless of the consequences for everybody else."
'Tsunami Of New Regulations'
Recently, the Business Roundtable sent the administration a 54-page list of issues it said are impeding economic growth. Some of the issues cited have been on the table for years — like the fact that the government taxes U.S. companies on money made overseas. But some of the concerns are new.
"Now we're looking at this tsunami of new regulations that are going to be emanating from the administration over the next period of months and years," says Stan Anderson of the U.S. Chamber of Commerce, which will hold a summit Wednesday on ways that Washington can encourage private-sector job growth.
Some of the Democrats' biggest legislative accomplishments, like the health care overhaul and the financial reform bill, have left some business groups quietly seething.
So, too, have more popular initiatives like the ban on deep-water oil drilling. And lobbying groups have faulted the president for not pushing free-trade agreements more aggressively.
Administration Says It's Ready To Listen
But U.S. Commerce Secretary Gary Locke notes that the president has been a strong advocate of export growth, and he rejects the notion that Obama is anti-business.
"He has repeatedly said to the business leaders and to the members of the Cabinet that we want American businesses to succeed because they are the source of the private-sector jobs," Locke says, "and if the business community succeeds and hires people, then America succeeds."
Locke says the administration is ready to listen to business leaders' ideas about reviving the economy — though some, like a cut in corporate taxes, are probably off the table.
"Let me just say that we can't, on the one hand, simply just lower taxes because the business community is also very concerned about the rising deficits," he says.
Locke also notes that Obama has done something that should be applauded by business leaders: his policies have begun turning the economy around — though not, Locke concedes, as fast as the administration would like.
Yale's Sonnenfeld agrees. He also says many CEOs aren't as extreme in their views as lobbying groups like the Chamber of Commerce, and the president can still repair his relations with business leaders.
One thing he can do, Sonnenfeld says, is bring more people from the business world into his inner circle. "This administration has been surrounded by lawyers, economists and policy analysts, not people who have actually been general managers."
But doing so carries clear risks for the president. Any move to reach out to the business world would alienate liberal voters, who already see the president as too quick to compromise on core values. The challenge the president faces will be to appease his critics without alienating his base any further.