The Bush administration is quietly telling Members of Congress that it opposes efforts by House Republicans to punish French and German companies for European opposition to war in Iraq.
Separately, a set of major U.S. and foreign multinational corporations have created an informal alliance to oppose any knee-jerk measures that could lead to boycotts of foreign-made products from Michelin tires to Becks beer.
Together, the parallel efforts could spell doom for Republican attempts to cut off U.S. business with companies from countries that oppose the war in Iraq.
This week, House and Senate negotiators are expected to strip one such provision from the final version of legislation to fund the Iraq war.
That measure, backed by GOP Reps. George Nethercutt (Wash.) and Mark Kennedy (Minn.), would prohibit companies in countries such as France, German, Russia and Syria from competing for billions of dollars in U.S. contracts to rebuild war-torn Iraq.
Nethercutt said the provision should “serve as fair warning to those who would seek to profit from the sacrifice of Americans.”
Last week, however, Deputy Secretary of State Richard Armitage circulated a letter to lawmakers indicating the administration’s opposition to the language and other similar proposals.
Meanwhile, the U.S. Chamber of Commerce, National Association of Manufacturers, Organization for International Investment and the National Foreign Trade Council plan to send a letter to Members next week urging them to oppose future boycotts of foreign products.
The business lobbyists hope to persuade lawmakers that boycotting foreign products could damage U.S. jobs — and lead to a possible backlash against U.S. products around the world.
“Jacques Chirac is no more likely to change his policy if you stop buying Michelin tires than President Bush is to stopping the war because people in Berlin are dumping Coke in the gutter,” said Todd Malen, the executive director of Organization for International Investment, the Washington representative of the U.S. subsidiaries of foreign companies.
“It is very understandable that Americans and elected officials are furious with the French and German governments,” Malen added. “But from the business perspective, the boycotts only end up having an impact on American workers and are not going to be effective in changing French and German policy. So why shoot yourselves in the foot?”
The sentiment of the U.S. business community on the topic was voiced in a private meeting between the U.S. Chamber of Commerce and the newly appointed French ambassador to the United States, Jean-David Levitte.
“Introducing additional economic impediments is not something that is in the best interests even of U.S. employers,” Chamber of Commerce official Bill Miller assured Levitte in a recent meeting, according to sources. Some Republicans on the Hill, who have been sharply critical of France, privately groused about the Chamber reaching out like that.
Meanwhile, foreign-owned corporations say they have begun to see a shift in attitude on Capitol Hill in the few weeks since the U.S. backlash against their products began.
French-owned food services company Sodexho has succeeded in halting an effort by dozens of House Members to cancel a contract the company had to feed the Marines.
Last month, Rep. Jack Kingston (R-Ga.) sent a letter to Defense Secretary Donald Rumsfeld urging the Pentagon to cancel the contract.
“My colleagues and I abhor the idea of continuing to pour American dollars into a French-based firm when those dollars could be feeding our wartime economy,” Kingston wrote at the time.
But after Sodexho ran ads in Capitol Hill publications asserting that it was the 57th-largest U.S. employer, Kingston and others cooled off a bit.
In a speech on the House floor last week, Kingston said: “To the company’s credit, they have written me a letter and said, you know what, we are on the side of America in this conflict. And I tell you what, they get it.”
Leslie Aun, a spokeswoman for Sodexho, said the company has received a lot of support once it explained to Members that it employs 110,000 U.S. workers. “As with many issues, sometimes you have a perception on issues at one point in time and as you learn more you change your mind,” Aun said.
According to a poll commissioned by the Organization for International Investment, few Americans would back a boycott.
“Once people learn about the global nature of these companies — and that a boycott could cost U.S. jobs — support for a boycott falls off rather dramatically,” said Neil Newhouse, a pollster for Public Opinion Strategies.