October 1, 2008

Washington, D.C.

October 1, 2008

Political Update

 

            Five weeks to go… just 35 days until the big election.  It seems like the campaign has lasted for ever, but it is hard to believe that the big day is just weeks away. 

 

            At this juncture, Sen. Barack Obama seems to be pulling ahead of Sen. John McCain, but with the economic crisis and other big happenings becoming routine, who knows what these weeks will bring.  Nothing should surprise us by now.  We have had a continuing series of unexpected important events interrupting the normal pattern of the campaigns. 

 

            The overriding issue now is the economy – specifically, the credit crunch that has prompted President George W. Bush, his Treasury Secretary Henry M. Paulson, Jr.  and the Chairman of the Federal Reserve Ben S. Bernanke to declare a financial emergency and push the Congress to immediately pass legislation to provide 700 billion dollars and extraordinary oversight and power to the Treasury to keep the American financial system functioning. 

 

            That remedy quickly became known as “Paulson’s Bail-out Bill for Wall Street†and the games began.  Following a week of round-the-clock negotiating, consultation and wrangling, the administration team and Congressional leaders brought forward 110 pages of legislation designed to end the financial industry crisis and assuage worried markets and citizens.  Congressmen were being asked to vote for a bill that raises enormous philosophic questions and distributes enormous funds to Wall Street.  It has many things in it that almost every Congressman does not like.

 

            Then after a week-end of traumatic efforts to make enough changes in their bill to win passage, the bill came to the floor and flopped.  It was a terrible moment for the Congress, for its leaders and for the Bush Administration.  The vote was 228 Nays to 205 Yeas.  140 Democrats voted Yea and 95 voted Nay; 133 Republicans opposed the measure, while 65 approved.

 

            The vote demonstrates the impotence of American political leadership in this last year of the Bush Administration.  The President had worked the vote as hard as he could and made repeated public pleas to the Congress to pass the bill.  Just 20% of the Republican Members from Texas supported their President on this vote.  Minority Leader John Boehner had a similar experience…He lost all but two of his fellow Ohio Republicans.  Speaker Nancy Pelosi had defections from a third of her Democrats from California.  A majority of the Black Caucus voted Nay.  Fifteen of the twenty-three Hispanic Members voted Nay. 

 

            The two Presidential Candidates had very little influence on the vote – though when he thought it would pass, John McCain began to claim credit for his leadership role. None of the eight Members of the House from Arizona voted for the measure.  Obama’s Illinois delegation was split – ten Nays and nine Yeas.

 

            The Paulson team is back at work with the leaders of the Congress and they hope to have a bill that has been tweaked enough to win the requisite votes ready for the House to vote on Thursday.  We are blessed by the fact that observance of the Jewish Holidays gave the team a couple of extra days to work out the problems.

 

The Candidates’ Reactions

 

            This has been a peculiar situation.  The two men in America with the most at stake are really at a loss to have a major impact on the outcome of the matter.  Both are Senators and will have an opportunity to vote on the legislation if and when it comes to the Senate floor.  But beyond that… there is little for them to do… but they have to at least look busy – the voters are watching very closely.

Nearly every American is paying attention to this continuing saga… and most are worried about the impact of the failure of the bailout on their personal fortunes.  In polling released by the Washington Post and ABC News yesterday, more than nine in ten voters said they were worried that the failure of the bill could cause even more serious economic problems down the line.  Obama and McCain understand this very well and they realize that the voters are looking at their actions and waiting to hear their solutions.

John McCain gets the award for trying hardest to look like he was involved.  Curtailing his campaign and returning to Washington for a couple of days to work the phones and hang out “looking busy.â€Â  His threat to cancel the first candidate debate was called and he proceeded to Mississippi without making much of a dent in the eventual outcome of the legislation.  It was not McCain’s finest hour… He looked a bit foolish.

            Barack Obama did less show business and possibly more actual engagement in the exercise… Since it was all behind closed doors and on phones, it is tough to tell what he really did do.  But a couple of the ideas he surfaced eventually got into the bill and it looked like he was really involved, though not bragging about it.

 

            Then after the defeat of the bill, both men were quick to react.  Barack Obama was quickly on the air the morning after with a two-pronged approach: he offered a new proposal to increase the cap on federally insured bank deposits from $100,000 to $250,000 and he aired a new television commercial seeking to make the case that he, and not John McCain, is ready and able to lead the country out of its current financial morass.

McCain came up with a few new proposals of his own including: the same increase on FDIC insurance on deposits proposed by Obama, and activating a number of existing authorities that the Treasury has to shore up financial institutions and to start buying bad mortgages in hopes of turning the corner on the current crisis.

The Debates

            The first of the four scheduled debates took place on schedule last week on the campus of Ole Miss, and it was a good one.  The two candidates used little pyrotechnics and had a reasonably serious discussion of real issues.  Booked as a debate on foreign policy, moderator Jim Lehrer wisely used the first third of the time to discuss the emerging issue of the failing financial system. 

            There were no knock-out punches and no especially memorable lines in the hour and half discussion.  Both did what they needed to do…they fulfilled their respective “must do lists.â€Â  Obama looked serious, informed, and fully in command on the subject of foreign affairs where he is seen as the weaker candidate.  McCain was polished and crisp and fully in command of the subject and related trivia. 

            The audience was expected to be enormous… but it turned out to be the least watched televised debate in modern history, according to Nielsen Media Research.  Maybe Friday night is just a bad night for political television.  The debate attracted only 52.4 million people. The second lowest was the 1976 debate between Gerald Ford and Jimmy Carter—and even they pulled in 62.7 million viewers. The highest audience was the 1980 debate between Ronald Reagan and Jimmy Carter with 80.6 million viewers. Nielsen says 31.6 percent of U.S. homes were watching the debate. That’s only about half as many as the 61 percent who tuned into the third Nixon-Kennedy debate in 1960.

The most awaited and anticipated debate of this campaign is probably the next one… the single vice-presidential debate between Gov. Sarah Palin and Sen. Joe Biden on Thursday night at Washington University in St. Louis.  The much maligned Governor of Alaska is coming in with as low expectations as is possible.  Her infrequent interviews have become her trademark… not for clarity and wisdom, but for their lack of cohesion and valid content.  One poll shows that 45% of registered voters think Biden will have a better night while 36% think Palin will be the winner.  On content, 61%, said Biden will demonstrate a greater understanding of policy issues while 28% said Palin would.   The Alaska governor, however, is expected to be the most likable with 65% expecting her to win the charm award.  Only 23% think Biden will.

The State of Play with 35 Days Left

The Presidential Race

                                    Obama             McCain           Spread 

National Average        48.8%              44.0 %             Obama +4.8%

Favorable Ratings       +18.1               +12.0               Obama +6.1

Electoral College         249                  163                  Obama +86

EC (No toss-ups)        301                  237                  Obama  +64

Battleground States

            Michigan         48.9                 42.3                 Obama  +6.6

            Ohio                45.3                 46.3                 McCain +1.0

            Pennsylvania   48.7                 43.2                 Obama  +5.5

            Virginia           49.0                 46.0                 Obama  +3.0

            Colorado         50.0                 45.0                 Obama  +5.0

            Florida             47.0                 47.3                 McCain +0.3

The Congress

 

I would not begin to trust numbers in the Congressional races.  The tumult in the consideration of the emergency financial legislation is such that it is likely to have huge impacts on the Congressional races… Many of the votes made on Monday were reflections of that feeling by the Members who looked for the “safe†vote which seemed to be “Nayâ€. 

 

Anyway, here is the latest generic vote for Congress… “If the election were today would you vote for the Democratic candidate  48.5%,

    or the Republican candidate  39.2%

 

Schedule

Thursday, October 2 – Vice presidential debate: Washington University in St. Louis, MO Tuesday, October 7 – Second presidential debate: Belmont University, Nashville, TN Wednesday, October 15 – Third presidential debate: Hofstra University, Hempstead, NY Tuesday, November 4 – Election Day

 

 

Meanwhile, In Iraq

 

            Lest we forget, Americans keep dying and keep being injured in Iraq and Afghanistan.   The official count as of September 30, 2008, of the dead in Iraq since our involvement began on March 23, 2003 is 4,177.  There have been 606 Americans killed in Afghanistan since that war was begun in 2001. The Department of Defense says that more than 35,000 American service personnel have been wounded in these two theaters.

During the debate last week, the two candidates effectively defended their very different opinions on the War in Iraq…  Obama taking the position that it was wrong from the start and that we need to develop an exit strategy to get our combat forces out of Iraq within 18 months.  McCain suggesting that his support of the surge  had turned the tide of war and that we are winning… and only need additional time to allow for the Iraq forces to replace our soldiers.

Once upon a time, we thought this campaign would turn on these points.  We thought the war would be the principal issue between whomever the Democrats and Republicans nominated.  Now, with the most dovish Democrat as the nominee against the most hawkish Republican, the War is not the principal difference between them.  I don’t think we have forgotten the war, nor have we slackened our thinking about it… but we see other trouble spots – like Afghanistan – as important venues – and the whole question of foreign affairs has been subsumed by the enormous economic challenges that have been discovered.  The war has been surpassed by important domestic issues.     

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Robert J. Keefe

Principal – Meridian Strategies, LLC

1920 L Street, NW, Suite 410 – Washington, D. C. 20036

Telephone: 202 223-8839 – Cell: 202 255-8161 – E mail: rkeefe@verizon.net