An effective defense - government regulation of business

Nation's Business, Dec, 1994 by Laura M. Litvan

Small businesses had a stake in almost every high-profile debate on Capitol Hill this year--with health-care reform dominating the agenda, and other important issues, such as striker replacement and the environment, also coming to the fore.

Business used defensive skills more often than it pushed for bills. And in many instances, the hold-the-line maneuvers worked.

"The business community played well [on] defense," said former Rep. Bill Frenzel, R-Minn., a guest scholar at the Washington-based Brookings Institution, a public-policy think tank. "Of course," he noted, "it's always easier keeping bills from being passed than getting bills passed."

Business benefited from a voting bloc formed by Republicans and moderate Democrats that overpowered the chief goals of organized labor and environmentalists, as well as President Clinton's agenda for health-care reform.

Also aiding business was the group of independent-minded lawmakers elected in 1992. Having campaigned against Washington to win, many were set on changing Congress' eroding reputation and on improving the economic climate. That made them skeptical of proposals that might increase government spending or negatively affect the private sector--positions typically adopted by business.

Business lobbyists found many new-comers in both parties more pragmatic than ideological, says R. Bruce Josten, senior vice president for membership policy at the U.S. Chamber of Commerce. As a result, he says, many freshmen "tended to be their own man or woman rather than following a clear party line."

Meanwhile, many environmentalists and labor leaders were dismayed at how the session played out. "What we're seeing is a fundamental disconnect between what the public wants and what Congress is doing," says Diane Dulken, a spokeswoman for the Natural Resources Defense Council, in Washington, D.C.

"For the bulk of the American people, not just working people but for people all across America, it wasn't a very successful session," says Robert McGlotten, chief lobbyist for the AFL-CIO. "It was a dismal failure."

Some bills that were pushed by labor and environmentalists didn't fare well in Congress this year. Among those measures were rewrites of the Clean Water Act and the Superfund hazardous waste law, as well as an overhaul of the 1970 law that created the Occupational Safety and Health Administration.

Although environmentalists had friends in the Democratic leadership, they had problems. In committees or on the floor, their bills were loaded up with amendments from Republicans or conservative Democrats. They focused mainly on three goals that environmentalists called the "unholy trinity":

* A ban on unfunded mandates on state and local governments.

* A requirement that regulators assess the health risks their rules are supposed to reduce and analyze economic impacts.

* Compensation for property owners when their land's value is "substantially" reduced by regulations.

These issues are expected to re-emerge next year, with advocates tying them into other regulatory debates.

Meanwhile, several business-backed measures were approved and signed into law. These included a bill establishing national education standards, a measure easing the government's complex process for purchasing goods and services, and a bill extending China's most-favored-nation trading status for a year.

Following are major legislative issues considered in Congress this year:

Health-Care Reform

Although it was by far the dominant issue of the session, it was never voted on in either house. A mandate that employers pay for their workers' health care--the financing linchpin in the president's plan --met with so much opposition from the U.S. Chamber and other groups that lawmakers began retreating from comprehensive proposals, ultimately failing to agree even on scaled-down versions.

Striker Replacement

The House voted in mid-1993 to bar employers from permanently replacing employees who walk off their jobs for higher wages and other economic benefits. The focus this year shifted to the Senate, where organized labor pushed hard for a floor vote, which business fought. But labor and its allies had too few votes to cut off a filibuster. Sixty were needed, but the final tally in the Senate was 53 to 46.

Deficit Reduction

Fierce lobbying from business couldn't save an effort to amend the Constitution to require a balanced budget unless a three-fifths "supermajority" in each house agreed to an exception.

Ultimately, the amendment--which needed a two-thirds majority to pass before going to the states for ratification--failed in the House by 12 votes and in the Senate by four votes.

Crime

The $30 billion anti-crime bill approved by Congress and signed by Clinton is helping localities hire 100,000 police officers nationwide. It also funds prison construction and crime-prevention programs, and it expands the death penalty to dozens of additional offenses.

The measure also bans 19 assault weapons and requires life sentences for those found guilty under federal law of a third felony--the "three-strikes-and-you're-out" provision.