Chamber's Donohue Pushes for Immigration and Entitlement Reform

Danielle Kurtzleben

The nation's largest business lobbying group today said reducing the nation's debt--now at a whopping $16 trillion--would be its top priority for helping businesses in 2013. In his annual "State of American Business" address, U.S. Chamber of Commerce President Tom Donohue introduced the 2013 American Jobs and Growth Agenda, a package of policies that includes immigration reform, boosting trade, and expanding energy production.

But its the national debt--and entitlements like Social Security and Medicare that contribute to it--that Donohue characterized as "the single biggest threat to our economic future."

"The entitlement programs written and designed for an earlier era must be revised," he said during his 2013 State of American Business address. "We're not talking about cuts in absolute terms. We're simply talking about slowing the rate of increase."

Along with debt and deficit reduction, Donohue also advocated for immigration reform, expanded energy production, boosting trade, and a reduction in regulations that the Chamber believes hamper businesses. Though the agenda is a new initiative, none of the broad ideas contained within it are departures from prior Chamber policy.

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Among his deficit reduction proposals, Donohue focused on cuts to spending, particularly entitlements.

In a press conference after the speech, Donohue mentioned as possible fixes "modest copayments" for Medicare and instituting the chained CPI, an alternate measure of inflation, for determining cost of living increases for entitlement programs. Opponents of chained CPI say the tactic will hurt beneficiaries too much, particularly the oldest beneficiaries.

Donohue also advocated for comprehensive tax reform as a way to "turbocharge" economic growth, but was quick to point out that any tax reform must be accompanied by spending cuts. "Make no mistake. While there are solid economic and competitive reasons to pursue it, tax reform cannot be seen as a substitute for spending restraint."

While it is nonpartisan, the Chamber tends to be more conservative in its policies. The chamber's stance on deficit reduction likewise tends to more closely align with that of Republicans on Capitol Hill, who tend to prioritize spending cuts.

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While tax reform and spending cuts are the most popular solutions for cutting deficits, Donohue pointed to boosted energy production as the "third bucket" of deficit reduction and also cited it as a way to reduce the trade deficit. In a 2012 study, the Chamber's Institute for 21st Century Energy estimated that "unconventional oil and natural gas production" from sources like shale would account for $2.5 trillion in tax revenues between 2012 and 2035, or an average of around $109 billion per year. Altogether, the government took in an estimated $2.5 trillion in revenue in fiscal year 2012.

Immigration reform also took a prominent place in Donohue's remarks, with the Chamber president emphasizing the need for skilled workers to help stave off outsourcing. He advocated guest visas for lower-skilled workers and expanding the caps on high-skilled visas, as well as helping foreigners who earn advanced degrees in the U.S. to stay.

"Even with high unemployment, we have millions of job openings that go unfilled," he said. "Either the workers come here to fill those jobs or the companies take all of their jobs somewhere else."

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President Obama has spoken of immigration reform as one of his priorities for his second term. Donohue said that he has spoken with senators, as well as AFL-CIO President Richard Trumka, about the potential for overhauling the nation's immigration laws.

"I have an optimistic feeling about this," said Donohue, pointing to bipartisan support for reform. But he acknowledged that support for immigration reform is not unanimous.