Republican Georgia’s Senate Race Becomes Nail-Biter

Republican Georgia’s Senate Race Becomes Nail-Biter

Oct. 5 (Bloomberg View) — Michelle Nunn, the Democratic Senate candidate, stated her case cogently in Columbus, Georgia, last week: If elected, she vowed to “change Washington in a collaborative way.”

Her Republican opponent, businessman David Perdue, also is running as the “change” candidate, but he’s skipping the collaborative stuff. He says he’ll go to Washington to attack President Barack Obama and Democratic Senate leader Harry Reid.

How this argument plays out matters. An upset by Nunn in Georgia, which has been solidly Republican for more than a decade, was long considered just a bonus possibility for her party. Now Democrats have six or seven very vulnerable Senate seats in the Nov. 4 elections, and a loss of six would cost them the majority. The party needs to win in a couple of Republican-held states. Georgia, where the incumbent Republican senator, Saxby Chambliss, is retiring, is one of the two best options for a Democratic victory.

Democrats hoped to run against one of Georgia’s House incumbents. Instead, they face a political newcomer, a corporate executive and cousin of former governor Sonny Perdue.

This race is surprisingly close because of the state’s changing demographics. As recently as 2004, whites, who vote overwhelmingly Republican, accounted for 71 percent of the electorate. In 2012, they comprised a little more than 61 percent. The black vote, almost all Democratic, grew to 30 percent from less than 25 percent, and the small Hispanic vote is increasing. The Atlas Project, a Democratic organization that studies voting patterns, projects that this trend will continue.

There has been speculation that Texas, with its fast-growing Hispanic population, could turn from a reliably Republican state to a battleground or purple one. That’s likely to happen in Georgia first.

Democrats say they’re competitive in Georgia this year because of two candidates with impressive political pedigrees. Nunn is the daughter of a much-admired former senator, Sam Nunn. The Democratic gubernatorial aspirant is Jason Carter, the grandson of former president Jimmy Carter.

This year “is a gift,” says Stacy Abrams, the Democratic leader in the Georgia House of Representatives who spearheaded the registration of 120,000 new voters and will lead the turnout drive. “The demographics are not yet sufficient, but we have two strong candidates with strong names.”

The math is simple. Nunn needs close to 30 percent of the white vote — Obama got about 23 percent in Georgia in 2012 — and she needs a turnout of black voters only slightly smaller than the 30 percent level blacks represented in the 2012 presidential election. Perdue needs to get 75 percent of the white vote to at least match the share of the total electorate whites represented two years ago.

He’s running against Washington, the president and the immigration-reform bill, which he calls amnesty. He also wants to repeal the Affordable Care Act.

Nunn has a tougher tightrope to walk: She needs to appeal to the base by embracing pay equity for women, a higher minimum wage, immigration reform, and mend, not end, the Affordable Care Act. Simultaneously, she has taken as a model her father’s record as a fiscal moderate and national-security realist, promising to “reach across the aisle” to seek bipartisan accords.

She has impressive business supporters, such as Mitesh Shah, the chief executive officer of a private-equity real estate firm. A lifelong Republican, Shah says he is bothered by his party’s rightward drift on social issues such as immigration.

“I may not always agree with her, but I think Michelle is different and can make a difference in Washington,” Shah said.

Three debates will make a difference. The first, on Tuesday, will probably include a mention of Nunn’s role as the head of former President George H.W. Bush’s Points of Light foundation. Last month, Bush endorsed Perdue. Later, the Republican campaign broadcast an ad that accused Nunn of favoring amnesty for undocumented immigrants and suggested Points of Light funded organizations linked to terrorists.

Independent analysts have dismissed the charge as bogus. Nunn, sensing that the ad has backfired, pounced on it.

“This is what people are so tired of in politics,” she said in an interview. Perdue, in an interview, defended the ads. “This is about national security and border security,” he said.

Perdue has run as a job creator. On Friday, however, a nine-year-old deposition came to light in which he readily acknowledged that as a chief executive he had outsourced jobs.

Polls show a tight race, which includes a libertarian candidate expected to get 3 to 4 percent of the vote. If no candidate gets 50 percent, Georgia law requires a runoff on Jan. 6.

Both camps agree that would be a nightmare, especially if control of the Senate is at stake. Experts predict that $100 million in campaign funds would pour into Georgia during the two-month runoff.

Photo: Be The Change, Inc. via Flickr

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Ignored U.S. House Contests May Hold Surprises

Ignored U.S. House Contests May Hold Surprises

Sept. 28 (Bloomberg View) — There is a forgotten contest in this year’s U.S. midterm elections. Actually, there are 435 of them: the races for seats in the U.S. House of Representatives.

In most midterms, House elections are the barometer that measures the state of public opinion and offer a possible roadmap to the political landscape. This year, the focus is on control of the Senate and a few big gubernatorial races.

Thanks to shifting population patterns and redistricting, the Republicans start with an advantage. In 2012, Democrats received in excess of a million more votes for House candidates, but Republicans won more seats, 234 to 201. This year, only 10 percent of the districts are in play, and the incumbent-friendly campaign-financing system means that less than 5 percent of challengers will win.

Nevertheless, though they lack the dramatic narrative of the battle for the Senate majority or for the governors’ mansions in Florida or Michigan, the House elections matter, both in terms of the overall outcome and in some interesting particulars.

There are competitive House races from New Hampshire to Iowa to Arizona, but many of the closest ones are in the Democratic strongholds — California, New York and Illinois. The good news for Republicans is that a majority of these are held by Democrats, who are fighting to retain them. A bipartisan redistricting commission in California has successfully created more competitive districts.

As a result, almost no one expects the Democrats to reduce the current Republican majority, and Republican optimists see their party adding as many as 20 seats.

“It will be a victory for Democrats if they hold their losses under five,” says David Wasserman, the House expert for the Cook Political Report.

If the Democrats minimize their House losses and keep the Senate, it may make Republicans a little less confrontational, and give the House minority a shot at taking over in 2016, a presidential year. That is, if the Democrats field stronger candidates in places such as the Philadelphia suburbs or a central Wisconsin district, where state senator Glenn Grothman, the Republican candidate and probable successor of the moderate Representative Tom Petri, is described by Wasserman as “Wisconsin’s answer to Michele Bachmann.”

Conversely, Republicans will be emboldened if the party scores big gains, and it will be harder for Democrats to recruit candidates if a majority seems out of reach.

Even if the overall results aren’t a harbinger, a few individual races may offer clues. One of the most telling will be the expensive contest in the Denver suburbs — which are the battleground to winning Colorado statewide — between incumbent Republican Mike Coffman and an aggressive Democratic challenger, Andrew Romanoff.

And a handful of newcomers will be big-time political players if they win. On the Republican side, there is Barbara Comstock, a conservative activist and top congressional staffer who is running in a northern Virginia district. In upstate New York, there is Elise Sefanik, a former domestic policy advisor in the George W. Bush White House and a favorite of the Karl Rove contingent. A potential Democratic star is Gwen Graham, the daughter of former Florida governor and U.S. senator Bob Graham, who is running in that state’s panhandle.

Congress may be more unpopular than toxic dumpsites but even some of the most controversial candidates may escape a throw-the-bums-out mindset. For example, Republican Representative Michael Grimm, who represents New York’s Staten Island and is under indictment, may win re-election. As could Florida Democrat Joe Garcia, whose 2010 campaign is being investigated by federal prosecutors for voter fraud.

Then there’s Tennessee’s Scott DesJarlais, a physician who won office in 2010 as a social conservative. Court documents in his 2001 divorce proceedings that came to light last year revealed that he supported his wife’s decision to get two abortions before they were married and had sexual relationships with at least two patients, three co-workers and a drug representative . He won a primary this year and is expected to cruise to re-election Nov. 4.

Such candidates recall the insight of Louisiana’s scandal-prone former governor Edwin Edwards, who once said that the only way he would lose an election was if he was “caught in bed with a dead girl or live boy.”

Photo: Diliff via Wikimedia Commons

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Democrats Need Surge Of Women To Hold Senate

Democrats Need Surge Of Women To Hold Senate

Sept. 21 (Bloomberg View) — Democrats know that keeping control of the Senate this election year isn’t a man’s job. Success will depend on the votes of women.

A gender gap has long been evident in U.S. politics: Men more often vote Republican and women are more likely to back Democrats. Both of these trends have accelerated in recent years.

This year, it’s Democrats who are on the defensive. In the 10 most competitive Senate races, they are counting on different assets in different states: solid turnout of black voters in the South, Hispanics in Colorado and Alaskan natives.

But almost everywhere, Democrats need a big margin — at least in the double digits — with female voters.

The commercial and campaigns reflect this priority. In addition to the economy, Medicare and Social Security, the emphasis is on ending pay discrimination based on gender, making contraception readily available and covered by insurance, and, in some states, the right to abortion or stressing issues that seem more important to women — for example, education in North Carolina. Some Democratic campaigns are conducting focus groups only with women to gauge intensity and nuances.

Democratic strategists, citing polls, insist these issues are resonating in many tight Senate contests.

Republicans counter that the larger gender gap is the one Democrats have with men, and that the women’s vote is more complex. Married white women are more likely to be Republican, as are older voters. In a recent Wall Street Journal/NBC News poll, a plurality of women age 50 or older gave higher marks to Republicans on dealing with the economy. The Democrats’ advantage on gender is focused on younger singles and women of color.

A look at several crucial states underscores the centrality of gender in November:

• In Colorado, incumbent Democratic senator Mark Udall is being challenged by Republican Representative Cory Gardner. In the Senate race four years ago, Democrat Michael Bennet eked out a victory over a right-wing challenger by winning the women’s vote, 56 percent to 39 percent. Most polls show Udall with a small lead thanks to similar advantages with women.

But a Quinnipiac survey last week showed Gardner ahead, as Udall only had a 3-point advantage with women. Gardner, who recently supported a personhood measure that would have banned all abortions and some contraceptives, is trying to strike a more moderate posture; he embraces the sale of contraceptives over the counter.

Democrats say they relish this debate — other Republicans are adopting the same tack — as these Republicans no longer would require insurance companies to cover contraceptives, which would become very expensive for some women. The Udall campaign will hammer this and other appeals to women in the closing six weeks.

• In Iowa, where a woman has never been elected to the U.S. Senate or as governor, Republicans think their female candidate, state Senator Joni Ernst, will enable them to reduce the gender gap. In the last presidential election, President Barack Obama carried this swing state by 6 points, running up a 19-point margin with female voters. The two parties disagree on whether female Republican candidates generally do better with female voters; Democrats are cautiously optimistic that their candidate, Representative Bruce Braley, will prevail in November. Iowa is a good laboratory for the debate in 2014.

• Georgia may be the Democrats’ best chance of taking over a Republican-held seat, though it’s an uphill battle. The Democratic candidate is Michelle Nunn, the daughter of the popular senator, Sam Nunn. She is running against David Perdue, a businessman. And a woman’s issue is the centerpiece of her campaign: She is attacking Perdue’s record as a chief executive officer, including his tenure at Dollar General Corp., which faced pay-discrimination suits brought by several thousand female employees.

The tagline on Nunn’s commercial: “Can the women of Georgia trust David Perdue?”

Photo: Be The Change, Inc via Flickr

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‘Wacko Birds’ Cloud Republicans’ Election Euphoria

‘Wacko Birds’ Cloud Republicans’ Election Euphoria

Feb. 2 (Bloomberg) — Some Republicans envisioned a successful rope-a-dope strategy for this year’s elections: Don’t make mistakes, and let the Democrats stew in the juices of Obamacare and a strapped middle class.

That take-no-risks approach is unraveling. Congressional Republicans are offering proposals on major matters, and the party’s right wing — whose members Senator John McCain called “wacko birds” — is omnipresent in Washington and across the U.S.

Congressional Republicans have introduced initiatives on immigration, health care, and economic mobility and poverty that are creating policy and political fissures. There were four separate Republican responses to President Barack Obama’s State of the Union address last week.

House Speaker John Boehner wants his chamber to pass immigration reform. Any compromise that is acceptable to Hispanic and Asian-American groups draws fire from the party’s sizable nativist bloc and political consultants who don’t want to divert attention from their campaign against health care reform. The Speaker’s task is enormously complicated, the prospects uphill.

On health care, three leading Republican senators recently offered an alternative to the Patient Protection and Affordable Care Act, one they say is more market-centric. But fewer people would be covered, the prohibition on discriminating against people with pre-existing conditions would be weakened, and the authors already are backing away from a proposal to deny tax benefits for some employer-based plans. Many Democrats would relish a debate over the competing plan.

Florida senator Marco Rubio, a contender for the 2016 Republican presidential nomination, took on economic inequality by proposing to expand the earned income tax credit for poor people without children; Obama cited Rubio’s proposal while offering a similar one during his State of the Union address. Rubio deserves credit for trying, but he has gotten tripped up in the specifics: whether the costs should be offset by other reductions in the tax break for the working poor or whether the entire credit should be reshaped.

And the wacko birds are flocking, with a special eye on women and gays.

On women, former Arkansas governor Mike Huckabee wasn’t an outlier with his claim that Democrats believe women can’t control their libidos. Ken Buck, the right-wing Senate candidate in Colorado and a cancer survivor, inexplicably suggested pregnancy was like cancer. This is the same man who in a 2010 race — when his opponent was a woman — said people should vote for him because “I don’t wear high heels.” He also compared being gay to being an alcoholic.

Then there is the always -provocative Texas congressman Louie Gohmert, who said judges who rule in favor of same-sex marriage “need some basic plumbing lessons.” Or Randy Weber, his fellow Texas representative, who tweeted before the State of the Union that he was waiting for the “Kommandant-in-Chef,” who he called “The Socialistic dictator who’s been feeding US a line or is it ’A-Lying?’” Taxpayers pay Weber $174,000 a year.

Out in the provinces, the right-wing base is restless. The Arizona Republican Party recently censured McCain for leftist tendencies. In a few months, state party platforms will be drafted; keep your eye on Texas, where Republicans have called for the elimination of 16 federal cabinet departments or agencies and have come out against promoting “critical thinking” skills in education.

In Iowa, some activists are plotting to dump the state’s moderately conservative lieutenant governor, Kim Reynolds, at the party’s convention. Governor Terry Branstad, a Republican who is likely to be re-elected, is the longest-serving U.S. governor, and there are expectations he will leave during his next term. Unless the ultra-right-wingers have their way, Reynolds then would become the state’s first female governor (Iowans have never elected a woman to the Senate or House, either).

Democrats have their own crazies on the left, but they aren’t as prevalent or influential.

History and polling data suggest Republicans should do well in November, keeping their House majority and with an outside shot at taking control of the Senate. But some of these big issues and the wacko birds could unsettle these prospects.

(Albert R. Hunt is a Bloomberg View columnist.)

Photo: Gage Skidmore via Flickr

Five Ways Obama Can Get His Groove Back In 2014

Five Ways Obama Can Get His Groove Back In 2014

Jan. 6 (Bloomberg) — Even with no real scandal and only one demonstrable policy blunder, the health care rollout, President Barack Obama had a miserable 2013 as his public standing plummeted. History suggests it is tough for a second-term president to rebound. Here are five ways Obama could defy those odds.

Open up the wagons: Ingrained habits are hard to change, and the 52-year-old incumbent isn’t going to transform himself. Still, he may appreciate how much his insularity hurt him last year. Over the past month, there have been three important additions to the White House ranks: John Podesta, a former chief of staff in Bill Clinton’s administration, who, other than Jim Baker in Ronald Reagan’s administration, was the most effective occupant of that position; plus Phil Schiliro, as health care advisor, and Katie Fallon, who starts as congressional liaison, both with considerable credibility.

Will the president listen to them in the crunch? It will be instructive to see whether Podesta will be limited to energy and environmental matters, as the White House initially suggested, or has a wide-ranging portfolio. One encouraging sign, some Democrats say, is that White House Chief of Staff Denis McDonough realizes the value of broadening the inner circle.

Mend health care: The president and Democrats are paying a huge price for the dreadful rollout of the Affordable Care Act and The goal of 7 million enrollees by April 1 is beyond reach. There must, however, be a substantial number — say 5 million, with a quarter of those young people — to keep the support of the insurance industry and prevent an explosion in premiums.

Obama had to enlist an expert to fix the website. The critical question in 2014 will be whether a chief executive is tapped to run the entire program. If White House resistance persists, look for more problems and controversies that will make the website screwups seem tame.

Go on the offensive: On health care, the best the White House can do is to neutralize the issue. The president’s camp knows it needs to put the Republicans on the defensive elsewhere: by pushing an extension of unemployment benefits for the long-term jobless and raising the minimum wage. The president also plans to emphasize the one issue that scares mainstream Republicans, immigration reform, which House conservatives threaten to kill.

The improving economy affords the president an opportunity to challenge Republicans on income inequality. Critics will yell about class warfare. Yet the incongruity of the recovery — good for the well-to-do, not so good for the working class — is beyond dispute, as was well documented recently by Steven Rattner, a former Wall Street executive and Obama’s automobile-industry rescue czar.

Beyond the water’s edge: One of the few bright spots for Team Obama last year was Secretary of State John Kerry. Like most second-term presidents, Obama views geopolitical achievements as a way to burnish his legacy.

A nuclear deal with the Iranians would be one such success; less likely, though conceivable, is genuine progress on the Israeli-Palestinian front. Foreign policy achievements, however, rarely elevate a second-term president’s popularity. Failure with Iran or a conflict in the South China Sea could undermine him further.

Luck: Events beyond a president’s control can shape his destiny. Last year’s deal over Syria’s chemical-weapons stockpile was more due to luck, with the unexpected help of Russia, than skill. The outcome was much better than the alternatives. Obama may not be so lucky next time.

The economy, as always, will be critical. With the Republican-controlled House, the president is devoid of realistic policy options to accelerate growth. But the psychology and perceptions may matter a lot.

The odds remain against a real recovery for the president. If most of the boxes above are checked off, or if the not-so-loyal Republican opposition reverts to self-destruction, Obama’s good fortune may continue.

Albert R. Hunt is a Bloomberg View columnist.

AFP Photo/Mandel Ngan

This Congress Makes Us Yearn For ‘Do-Nothing’

This Congress Makes Us Yearn For ‘Do-Nothing’

Dec. 16 (Bloomberg) — This congressional session is historic: It’s the least productive, most unpopular in memory, and makes the 80th Congress, famously labeled “do nothing” by President Harry Truman, appear prolific.

For the first time, public approval of Congress is below 10 percent. This session, which adjourns at the end of the week, has passed fewer bills than any session since World War II — the recent deeply diluted budget measure a rare semi-significant exception — and cheap political games have dominated.

The blame is bipartisan, and the White House made some egregious errors. Still, this Congress bears a Republican stamp, with the tone and agenda often set by the right wing of the party.

The Senate-passed immigration bill languishes in the House, even though it commands support from a majority of the members. Republican leaders won’t bring it up lest they face a revolt from the party rank and file.

The farm bill is stalled. It has many flaws, but a major impediment is right-wing Republicans who insist that food stamps for the neediest must be slashed.

The recently completed budget agreement could have been a big deal, with more than $1 trillion in long-term deficit reduction through major entitlement changes and closing tax loopholes or preferences. That could have won White House support and, with pressure, a majority of reluctant congressional Democrats. It would have been a shot in the arm to business confidence and markets.

The Republican right would have gone ballistic; that deal never got on the table.

The Senate, with a few exceptions, was almost as dysfunctional as the House. Majority Leader Harry Reid’s decision to change the rules to make it easier to confirm presidential nominations is a dangerous precedent. More dangerous was the Republican minority’s willingness to abuse the rules by waging scores of filibusters against President Barack Obama’s nominations, more than all other presidents combined. Using the filibuster routinely, thus requiring a 60-vote supermajority to get anything done, is unsustainable.

Then there is serious oversight, which should be possible even in a partisan environment. Democratic senator Carl Levin of Michigan proved that with the Wall Street investigations he led with Republican colleagues such as Tom Coburn and John McCain. A decade ago, in the House, Democrat Henry Waxman and Republican Tom Davis teamed up to investigate — and reform — postal and procurement practices and whistleblower protections. Together, they investigated steroid use in baseball and the scandal involving the friendly-fire death in Afghanistan of former National Football League star Pat Tillman.

This session, Darrell Issa, the California Republican and chairman of the House Oversight Committee, has held hearings on the Internal Revenue Service, the deaths of Americans in Libya, the Affordable Care Act and Attorney General Eric Holder. These proceedings have been characterized by unsubstantiated charges, rogue staff behavior, misleading leaks of selective information and a refusal to consider anything that might prove contrary to the chairman’s objectives.

With a reckless disregard for facts, Issa calls his targets liars. He has been an embarrassment to more than a few fellow Republicans.

Correctives aren’t easy. Some advocates see reforming the partisan way House districts are drawn as the solution and are encouraged that mainstream conservative powerhouses such as Karl Rove’s money machine and the Chamber of Commerce are threatening to take on the party’s right. The former is unlikely and wouldn’t affect the Senate, the latter a paper tiger. The only right-wing incumbent targeted so far is a U.S. representative from Grand Rapids, Michigan.

Ironically, said political scientist Charles O. Jones, academics used to see more disciplined political parties as the way to encourage responsible governing. “Now, we see narrow margins encouraging tight discipline and leaving little space for cross-party negotiation,” he said, with “remarkable insensitivity to the political costs of unwavering party unity.”

The only way this spiral ends is an election that either ratifies or repudiates the Republican right.

(Albert R. Hunt is a Bloomberg View columnist.)

Photo: Republican Conference via Flickr

Imperfect Iran Deal May Be America’s Least-Bad Option

Imperfect Iran Deal May Be America’s Least-Bad Option

Nov. 23 (Bloomberg) — Critics of a deal on Iran’s nuclear program, both in the U.S Congress and the Israeli government, need to answer a question: Is there a better alternative?

Even before we know all the details of the agreement hammered out in Geneva this weekend, there’s reason to worry about an interim accord that eases a few of the painful economic sanctions imposed on Iran in return for Iran’s freezing its drive to develop nuclear weapons. The Iranian regime has been untrustworthy for decades, and the desire for a nuclear bomb is a source of national pride and a security interest.

Yet there is a much different tone since the election of President Hassan Rouhani: The International Atomic Energy Agency reports that Iran has slowed its efforts to convert nuclear power to a bomb. This is progress; it also alters the options, notes Robert Einhorn, a former top State Department policy maker on Iran and nonproliferation.

Einhorn, now at the Brookings Institution, laid this out in a speech to an Israeli research organization last month. A perfect deal, as desired by the Israelis, isn’t attainable, Einhorn said, in evaluating any interim pact; “the better test is how it compares to alternative means.”

There are three: Retain or toughen sanctions; actively work to change the regime, or use military force, war. The economic sanctions have brought Iran to the negotiating table. Its oil revenue over the next six months will be $25 billion less than three years earlier, and trade and financial transactions have been curtailed.

Congressional Action

There is considerable support in Congress for toughening the sanctions, pressuring Iran for more concessions, but there is little support elsewhere, Einhorn said. If Congress acted unilaterally, the result could be an acceleration of Iran’s nuclear program and more power for the hardliners, he added.

“Don’t think for a moment that toughening the sanctions would cause the collapse of the ayatollahs’ regime,” said Les Gelb, a former U.S. diplomat and prolific writer about foreign policy.

Regime change sounds good, and rarely works. It did succeed 60 years ago when the U.S. toppled the regime in Iran, putting in power a corrupt dictator whose brutal rule paved the way for the anti-American ayatollahs a quarter-century later.

Undertaking military strikes against Iran’s nuclear sites is the real goal of most hawks. The Israelis have threatened this option and bitterly oppose any interim agreement. But it’s unlikely that Israel would act unilaterally, preferring action by the U.S. and its greater military capabilities.

A strike, Einhorn noted, has multiple downsides: It probably would mean the end of international sanctions, the eviction of IAEA inspectors and retaliatory terrorist actions by Iran and its surrogates.

Moreover, this would be a much bigger, and dicier, operation than, say, taking out Syria’s chemical weapons. It would require subsequent actions, and the danger of more widespread conflict is genuine. This wouldn’t sit well with the war-weary U.S. public. A Washington Post-ABC News poll last week showed voters, by a 2 to 1 margin, supported a nuclear deal with Iran.

To be sure, there are huge risks. A short-term agreement might be the high watermark of Iranian cooperation. The Israelis, Einhorn said, fear it would generate a “burst of irrational enthusiasm,” and bring pressure from global business interests to end most sanctions. The rift between two longtime allies, the U.S. and Israel — already “the most significant ever,” according to the expert Aaron David Miller — will get worse.

Still, even if what Iran really wants is to be a screwdriver away from having a nuclear weapon, as one observer put it, inspections will be rigorous under the discussed temporary agreement. If the Iranians try to break out and quickly weaponize, there is sufficient time to act if there’s the political will.

As Einhorn said, it would be less than a perfect deal. But which alternative would be better?

(Albert R. Hunt is Washington editor at Bloomberg News. The opinions expressed are his own.)

AFP/Jewel Samad

Tea Party Dead? Let’s Not Be Too Hasty

Tea Party Dead? Let’s Not Be Too Hasty

Nov. 6 (Bloomberg) — There are votes still being tallied from yesterday’s election, but myths are already settling in.

New Jersey governor Chris Christie’s huge re-election is a model for Republicans nationally and makes him the party’s frontrunner for 2016; the defeat of conservative Ken Cuccinelli in the Virginia governor’s race and of a right-wing congressional candidate in Alabama signify a diminished Tea Party; the victory of Clinton family confidants in Virginia and New York City is a boost for Hillary Clinton’s presidential quest; and the election of Bill de Blasio as New York mayor suggests America is ready for a left-wing agenda.

All these judgments either overreach or are just plain wrong.

Christie’s win, with more than 60 percent of the vote, is impressive. He also enjoyed the best of all fortunes: an unknown, under-financed, mediocre opponent. A big win by a moderate Republican isn’t unprecedented in New Jersey; a quarter century ago, Tom Kean won re-election by an even bigger margin.

The governor’s national ambitions might be tempered a bit by the reality that exit polls yesterday showed he would lose his home state to Hillary Clinton in a hypothetical presidential race. And the profile of the 2013 electorate is more favorable to Christie than the likely 2016 turnout.

Cuccinelli ran as a right-wing Republican in Virginia. He, too, was a bad candidate. He still came within 3 points, which is unlikely to discourage future Tea Party aspirants.

The Republican establishment and the business community were ecstatic about their successful backing of Bradley Byrne in an Alabama special House race, where he defeated Dean Young, a Tea Party candidate. That sends a message to the party’s right wing, some claimed.

A close look at the race is much less conclusive. Byrne is a familiar figure, having run successfully as a state senator and unsuccessfully for the governorship. Young had never run and voiced views that, even by Alabama standards, were on the fringe: demanding a pledge to embrace the “Biblical condemnation of homosexuality” and to proclaim America is a “Christian nation.”

Byrne, with lots of business support, far outspent his opponent, yet won by only 5 points in what should have been a slam dunk.

Nobody is closer to the Clintons than the governor-elect of Virginia, Terry McAuliffe. And de Blasio managed Hillary Clinton’s first Senate run.

The support of a governor in presidential races ain’t what it used to be. Ask Hillary Clinton. In the 2008 Iowa caucuses, she was backed by the state’s popular governor, Tom Vilsack. She was clobbered by Barack Obama. And of all the political supporters who might help her in 2016, the mayor of New York wouldn’t make the A, B or C list.

De Blasio is an unabashed liberal. He promises to address income inequality and raise taxes on the rich to finance educational opportunities for the working class and poor. He won by an even bigger margin than Christie. His opponent, however, may have been an even worse candidate than Christie’s rival. And New York City, whatever its virtues, isn’t a bellwether of politics elsewhere.

(Albert R. Hunt is a Bloomberg View columnist.)

Photo: Bob Jagendorf via Flickr

Flawed Assumptions Plague Latest Deficit Panel

Flawed Assumptions Plague Latest Deficit Panel

Oct. 28 (Bloomberg) — The U.S. budget deficit is worse than ever. Taxes already have been raised, so efforts to narrow the shortfall should focus only on spending. The only fair deal is a straight trade: relief from the cuts under sequestration in return for reductions to entitlements. Yet there’s no incentive for Democrats to go along.

All of these statements are accepted by the public and important politicians. All are false.

History suggests the new House-Senate budget committee, due to report by December 13, will strike out. The Bowles-Simpson panel’s deficit-reduction proposals in 2010 didn’t lead anywhere, Congress’ two budget committees haven’t met in years, and a special leadership-designated “supercommittee” designed to prevent automatic cuts under sequestration reached a stalemate.

The 29-member panel that convenes this week must contend with this record of failure, a task compounded by misinformation.

A starting — and false — premise of the public, and some politicians, is that the deficit is spiraling out of control. In a national survey by Bloomberg News last month, Americans said, by a margin of 59 percent to 10 percent, the deficit was getting worse; this belief was held by 93 percent of Tea Party supporters.

In fact, the deficit, which reached a staggering $1.55 trillion in the 2009 fiscal year, has declined every year since and is less than half as big today.

There’s a need to cut the deficit, short- and long-term, Republicans say, but not by raising taxes, which were increased this year. President Barack Obama already “got his revenues,” House Speaker John Boehner said this month.

Almost $700 billion in revenue, over 10 years, was raised when the administration and Congress agreed in January not to renew the tax cuts for the wealthy enacted under President George W. Bush.

What the speaker doesn’t say is that recent measures, including the sequestration, would reduce outlays by more than $2 trillion over 10 years, or three times more than the higher taxes would generate. The Bowles-Simpson proposal envisioned a ratio of spending cuts to tax increases of less than 2-to-1.

A few Republicans, including Representative Tom Cole of Oklahoma, recognize that revenue must be on the table to get anything done on entitlements.

Other Republicans insist they can trade some easing of the sequestration for entitlement cuts. Yet the most specific suggestions — adjusting cost-of-living increases for Social Security and other programs and means-testing Medicare — have come from the White House.

Moreover, that trade isn’t an even one, substantively or politically. Long-term entitlement reductions are more valuable, and important, than cuts in discretionary programs, which can be reversed in annual appropriations. And more than a few Republicans are upset about the sequestration, which this year disproportionately crimps defense spending.

At the same time, liberals such as Senator Bernie Sanders, a Vermont independent who serves on the budget panel, are being short-sighted by insisting that entitlement changes are off the table. Trade-offs, including on revenue, are the only way to alleviate — for now — the painful cuts to domestic programs.

Entitlements are the drivers of long-term debt; delaying action, the Congressional Budget Office says, “would increase the size of the policy adjustments needed.”

The committee faces two options: Failure, as happened with the previous supercommittee, which would leave the sequestration in place, or agree to a short-term — say, two-year — package of $200 billion in entitlement cuts and new revenue that would replace much of the sequestration.

That’s achievable, though unlikely, without any violation of principles. Cracking down on indefensible tax breaks — special treatment of carried interest — and trimming a few write-offs keeps alive the chance for more radical tax reform later and wouldn’t much affect marginal rates.

Democrats could go along with the scope of entitlement cuts while altering some White House proposals. For example, Bob Reischauer, former director of the Congressional Budget Office and a hawk on entitlements, worries the cost-of-living adjustments could ultimately hurt older retirees and people with disabilities. There are remedies, he says, such as giving these senior citizens a one-time bump in payments or means-testing some benefits.

The already long odds of success become impossible if realities continue to be distorted. “Everyone is entitled to his own opinions,” the late Senator Daniel Patrick Moynihan used to say, “but not to his own facts.”

(Albert R. Hunt is a Bloomberg View columnist.)

Photo: Gage Skidmore via Flickr

Glitchy Rollout Doesn’t Mean Obamacare Is Doomed

Glitchy Rollout Doesn’t Mean Obamacare Is Doomed

Oct. 14 (Bloomberg) — The drama surrounding the government shutdown and potential debt default almost obscured the rollout of President Barack Obama’s Affordable Care Act. Both champions and critics of the measure should be grateful.

More than 8 million Americans tried to log on to federal or state exchanges, despite concerted efforts by conservatives to dissuade them. Software glitches foiled many of these inquiries and undermined supporters’ claims that the program is ready for prime time.

The confusion also underscored again that this measure is the focus of greater partisan rancor than any major U.S. legislation in recent memory. High emotion often distorts reality. The Oct. 1 rollout was interesting, instructive and not that important. Over the next year or so, there are at least four crucial benchmarks:

Dec. 15: That’s when we will know if the computer glitches have been fixed and whether the administration has adequately promoted the law in preparation for Jan. 1, when coverage of the uninsured begins.

Interested customers will come back often. With the Massachusetts plan — a model for Obamacare — there were an average of three to six inquiries before someone signed up. Young people are patient when awaiting the next iPhone or Hunger Games movie, but if the exchanges don’t eliminate the glitches, some prospective signups will be turned off.

The administration doesn’t have its act together. It has enlisted Chris Jennings, a respected expert, as point policy person. There’s a distance, however, between the White House and the Department of Health and Human Services, and the marketing efforts have been much weaker than some proponents advocated.

Celebrities such as Kerry Washington, John Legend, Katy Perry and the Pittsburgh Steelers have promoted the law. But some of the measure’s backers are calling for a far more elaborate effort involving rock stars, athletes and lots of white-coated doctors and nurses.

April 1: The Congressional Budget Office estimates that 7 million Americans will sign up in the first three months.

Achieving that goal, both sides agree, would be a good marker of early success. Failure would signal major problems. Supporters say more than one-third of the enrollees should be younger people.

A year from now: One bit of very good news is that health care costs have moderated. If that trend holds over the next year, insurance rates, which factor in risks and likely costs, would probably come down.

January 2015: More than half the states aren’t participating in a federally funded expansion of Medicaid for poorer citizens; many of these states aren’t participating in the exchanges, either. For the most part, these are heavily Republican areas, where anything associated with Obama is politically lethal.

Zeke Emanuel, a former top Obama advisor on health care who now is a vice provost at the University of Pennsylvania, said the partisan pressure may subside after the 2014 election. Some of the recalcitrant governors, and some newly elected ones, could change course.

“The money is just too good, and they’re going to look at places like California and Oregon and Colorado and see the results are so much better than in their states,” Emanuel says.

He acknowledges that his brother, Chicago mayor Rahm Emanuel, a former White House chief of staff, fears that this prediction is wrong and that ideology will continue to trump practicality.

The Republican critics are on stronger ground when they reject White House complaints that the Affordable Care Act is a settled issue. No piece of legislation is settled and safe from review, modification or elimination. President Ronald Reagan’s tax cuts and Bill Clinton’s welfare overhaul were reshaped multiple times.

Still, it was a politically frivolous and base-pandering act for House Republicans, who have a less than vigorous schedule anyway, to vote 42 times to repeal the health care law, knowing that would be unacceptable to the Senate or the president.

The Republicans offer few serious alternatives, unless they are responding to political pressures. Consider the politically potent makers of medical devices who have used a plethora of flawed contentions to persuade almost all Republicans (and quite a few Democrats) to try to repeal a small tax levied on their products.

At the same time, Republicans haven’t permitted corrections to some obvious flaws in the initial Obamacare legislation. Remedies of this kind were passed after Medicare was enacted in 1965.

“Obama is taking executive actions that may produce a lot of litigation,” says Joe Califano, who was a top advisor to President Lyndon Johnson when Medicare was passed, “because Republicans won’t allow even simple things to be fixed.”

Some of the claims made by these congressional critics are simply disingenuous, such as the assertion that people with pre-existing conditions are already allowed to keep their coverage so they don’t need Obamacare. That’s true of those who have coverage, but for those with illnesses who aren’t insured, insurance is difficult to get. Even for those who are covered, there’s little to prevent insurance companies from jacking up rates. That will change under Obamacare.

Such benefits, the moderating cost of health care and the surge of interest in the exchanges all augur well for the Affordable Care Act in these early stages. But there’s an ominous offset: The political fiascos with the government shutdown and possible debt default have, as the political right hoped, elevated cynicism about the federal government as a whole. Logic suggests that negative sentiment will also be directed at a huge new federal program such as universal health care.

(Albert R. Hunt is a Bloomberg View columnist.)

Photo: LaDawna’s Pics via Flickr

Flake’s Conservative Quest for Senate Comity

Flake’s Conservative Quest for Senate Comity

Sept. 23 (Bloomberg) — Senator Jeff Flake of Arizona likes President Barack Obama, voted to give him the authority to strike Syria, supported the comprehensive immigration legislation favored by the White House, and works comfortably with members of the opposing party.

The six-term House Republican, who is now serving his first term in the Senate, also is a rock-ribbed conservative, especially on economic and fiscal issues. He has been a darling of the Club for Growth; before going to Congress, he ran the Goldwater Institute in his home state.

As a conservative who mixes conviction and civility, he is a member of a vanishing breed. He is an antidote to the Tea Party-driven congressional Republicans who are threatening to shut down the government or risk a U.S. default by refusing to increase the debt ceiling — and don’t withhold their venom toward Obama. (Michigan representative Kerry Bentivolio, for example, delights his constituents with his relish for a presidential impeachment. His animosity runs so deep that he said he “couldn’t stand” to be in the same room with Obama.)

On most social questions, Flake is squarely on the right. He opposes abortion rights, and, unlike Arizona’s senior senator, John McCain, he refused to break with orthodoxy and support a mild background check for gun buyers. He is a Mormon — a graduate of Brigham Young University and a former missionary in Africa — and opposes same-sex marriage. But he isn’t a demagogue; in the House, he voted to repeal the military’s “don’t ask, don’t tell” restriction and to allow gays to serve openly in the armed forces.

‘Better Atmosphere’

Even though he has been attacked from the political right for defying the majority in his party with his Syria and immigration votes, he has no regrets.

“Syria was more about the presidency than the president,” he said in an interview last week outside the Senate chamber. “You’ve got to look beyond the immediate. America benefits from having a strong commander in chief.”

He was a member of the bipartisan Senate Gang of Eight, which crafted a comprehensive immigration-reform measure this year. Six years ago, he backed another effort to change immigration policies. “There’s a much better atmosphere today on immigration than there was in 2007,” he said.

As a U.S. representative, Flake’s successful libertarian-minded campaign to ban earmarks — the small spending projects that members were long allowed to direct to their districts — so annoyed party leaders that he was denied a seat on the House Appropriations Committee.

Flake acknowledged that ending earmarks also took away a tool lawmakers used to forge compromises though political horse-trading. Nonetheless, he insists that the practice perpetuated an “obscene” system. “Members of Congress used earmarks to contract out their campaign financing,” he said. “It was the currency of corruption.”

He is consistently anti-spending, anti-tax and anti-deficit. A decade ago, he was one of the few House Republicans to oppose President George W. Bush’s expanded prescription-drug benefit for senior citizens because the measure wasn’t paid for. He has favored replacing the income tax with a national sales tax.

On the economy, Obama “has been a disaster,” he said. Yet the athletic and deeply tanned Arizonan concedes that the president “has a good jump shot,” which he observed when he was invited to play in one of the president’s pickup basketball games.

Unlike some of his colleagues, he doesn’t personalize his philosophical differences with Obama. “I’ve never been able to work up the hatred that some Republicans have for the president,” Flake said. “As a person, I like him; he’s a good family man.”

Sensible Stance

The fiscal conservative believes Tea Party-inspired plans to shut down the government or to oppose an increase in the debt ceiling and risk default unless Obamacare is killed are crazy. “It’s a mistake,” said Flake. He, too, is a critic of the Patient Protection and Affordable Care Act, but he says the hardline Republican approach “won’t work, and Congress is held in pretty low regard already.”

This sensible stance has drawn the ire of a few old allies. The Senate Conservatives Fund, a political action committee, is running ads against Flake and other Republicans who refuse to hold the government hostage to repealing the health care law.

The PAC gushed over Flake during his Senate run last year, and its chairman, former Republican Senator Jim DeMint, endorsed him: “When it comes to fighting wasteful spending and parochial politics, nobody has done more to advance the cause of freedom than Jeff Flake. Nobody.”

Today, Flake shrugs off the criticism as well as the more vicious attacks on his Syria vote and his immigration stance, but he regrets the more acrimonious political climate. “The last five years or so, this has become a lot more intense,” he said. “It’s the shirts versus the skins; you can’t work with the other side on anything.”

He said he would continue to seek common ground with the other side: “There are a lot of talented, straight-shooting Democrats here.” Specifically, he cites his work with West Virginia senator Joe Manchin on regulatory matters, with Colorado senator Michael Bennet on immigration, and with a fellow freshman, Martin Heinrich of New Mexico, on questions related to public land.

Most of his closer Republican colleagues share his fiscal conservatism: Tom Coburn of OklahomaPat Toomey of Pennsylvania and Florida’s Marco Rubio, with whom he also worked on immigration. He also has high regard for — and often defers to — McCain, even though his Arizona colleague doesn’t share all his conservative views.

The breakdown in comity and increased political polarization, he said, doesn’t just stymie liberals; it’s harmful to conservative causes, too.

“As an advocate of limited government, I’m often not opposed to gridlock,” he said. But the lack of any regular order in the Senate “inhibits oversight and other responsibilities.”

The result often is destructive and mean-spirited politics: “When you engage in vitriol,” he said, “it always comes back to haunt you.”

Syria Vote May Derail Obama’s Agenda In Congress

Syria Vote May Derail Obama’s Agenda In Congress

Sept. 9 (Bloomberg) — Congress is like a seamless web where every action has an effect on those that follow, the late Richard Bolling, a longtime member of the House and a congressional scholar, used to remind young reporters.

The Barack Obama administration will confront that reality this autumn in the aftermath of its request for congressional approval for a military strike against Syria.

The outcome remains in doubt, though there may be an even chance that after a near-death experience or two, Congress will authorize a strike in a close vote.

There is little doubt, however, that this struggle, which will occupy most of September, will affect other big issues: the high-stakes deficit and debt-ceiling battle, the fate of a comprehensive immigration bill in the House — and perhaps in the Senate — and the nomination of the next chairman of the Federal Reserve.

This is mostly downside for the White House. If President Obama wins on Syria, most Republicans who supported him will want to take their distance on other issues; the party’s base is dominated by Obama haters. Getting the reluctant backing of some liberal Democrats for military action might add to the tension on the fiscal issues and the Fed pick.

Some Obama loyalists make the case that the Syria resolution, if approved, could lead to other successes. Working across party lines might prove contagious, precipitating a search for more common ground.

“It’s too early to tell what the fallout from this vote will be on other issues,” says Representative Chris Van Hollen of Maryland, the leading House Democrat on fiscal issues, but “there will be ripple effects.”

Others believe a Kumbaya moment just isn’t possible in the Washington of today: “If a Republican gives the president a vote on this, they’ll have to go back to the base on the fiscal stuff and maybe the Fed,” says former Republican Representative Tom Davis, an astute analyst of U.S. politics.

House Speaker John Boehner, who will probably be part of a distinct minority of his caucus in voting for the Syria measure, will be under enormous pressure to move right. “Coming right on the heels of Syria, House Republicans have to get something in return on debt,” Davis says.

The Democrats, who are counting on winning at least the public-opinion battle in the fiscal war, may find it harder to depict Republican leaders as partisan nihilists if those leaders have just bailed out the president on Syria.

Democrats are worried that after using all his chits to get barely enough votes for the strike resolution, Obama — whose negotiating skills are suspect to many on Capitol Hill — might then be too eager to cut a fiscal deal.

Especially worrisome would be if Republicans demanded, as the price for Syria, a rollback of the cuts to defense spending under sequestration. Liberals are adamant that any changes to the automatic reductions must apply equally to domestic and military programs.

Immigration reform, which cleared the Senate handily, already faces a tough slog in the Republican-controlled House. As with the deficit and the debt-ceiling increase, the Syria debate and vote won’t make this any easier.

Final passage of comprehensive legislation, with a pathway to citizenship for undocumented immigrants, can be achieved only with a minority of Republicans. That would force the Speaker to waive the so-called Hastert rule, which asserts that a bill only can be considered if it commands the support of a majority of the Republican caucus. Boehner will already have had to waive the rule for the Syria vote and may not be able to return to the well.

There is no rational reason the confirmation of the next Fed chairman should be affected by any of this. Congress isn’t a rational institution these days, and the president’s preferred choice for head of the central bank, former Treasury Secretary Larry Summers, is a contentious figure in a wide array of political constituencies.

Many conservative Republicans oppose Summers’s nomination because they hold him responsible for the economic stimulus and the rescue of the automobile industry, and because he served as president of Harvard University, a supposed hotbed of liberal orthodoxy. He has incurred the wrath of some Democratic liberals for spearheading financial deregulation in the late 1990s and working for Wall Street after leaving his position as director of the National Economic Council in 2010.

A top Democratic Senate strategist worries that the administration would have a hard time selling a Summers nomination to the same liberal senators — Tom Harkin, Sherrod Brown and Elizabeth Warren — it is now trying to woo on Syria.

If Summers is tapped — he’s the clear frontrunner — Obama would count on support from key Republicans such as Senator Lindsey Graham of South Carolina. Graham is fighting a primary challenge from Tea Party conservatives, who criticize him for supporting the president on immigration, Syria and for his approach to the sequestration.

The stakes for Obama on Syria are impossible to exaggerate. A loss would make his presidency appear impotent and damage the U.S.’s global standing. The president realizes this: He called skeptical senators from the Group of 20 meeting in St. Petersburg, Russia; he talked to one Democrat for more than a half-hour, the longest one-on-one conversation that lawmaker has had with him. The president is scheduled to deliver a national address from the Oval Office on September 10. Will he enlist former Secretary of State Hillary Clinton to lobby wavering Democrats?

A victory in Congress on Syria would be an important achievement. It may only be short-lived politically.

(Albert R. Hunt is a Bloomberg View columnist.)

AFP Photo/Mark Wilson

Will High Court Widen Flood Of Money In Politics?

Will High Court Widen Flood Of Money In Politics?

Aug. 26 (Bloomberg) — One of the first cases the Supreme Court will consider in its next session is whether to allow millions, perhaps billions, more dollars into the U.S. political system.

That may seem like a joke considering that more than $6 billion was pumped into last year’s elections. A flood of special-interest money, courtesy of rulings by Chief Justice John Roberts’ court, led to a campaign that many found depressing.

The issue that will be argued on October 8 is whether to remove the almost four-decade limit on the aggregate amounts any contributor can give directly to candidates and parties for federal elections in a single cycle. There are no limits now on independent expenditures or money given to political action committees, creating what critics call a system of legalized indirect bribery.

If the court decides to remove most of the limits on upfront contributions to presidential or congressional campaigns, it would no longer be indirect.

Going back to its first major campaign-finance decision in 1976, the high court has always distinguished between contributions, and majorities have ruled they can be limited to prevent corruption or the appearance thereof.

That contrasts with expenditures that the court has ruled are a form of speech. These rulings included the lifting of the ceiling on the amount of personal money a rich candidate could spend and the infamous Citizens United case, which freed corporate money to be spent on supposedly independent political expenditures.

Then a lower court gave the green light to wealthy individuals to give unlimited sums to so-called SuperPACs, which back politicians but are supposed to be distinct from the campaigns, which is a bit of a fiction.

Until now, the high court has consistently upheld limits on direct contributions to candidates for federal office or political parties. If the court reverses these precedents, the impact on campaign spending and influence-peddling would be considerable.

“The consequences could be worse than Citizen United,” says Fred Wertheimer, the president of Democracy 21, who has been a tireless advocate for campaign-finance reform for 40 years.

Critics of campaign-finance limits reply that such alarm is typical of ole Fred, who claims the sky is falling every time another dollar is thrown into politics. And, they believe, the public won’t be aroused by arcane fights over “aggregate” ceilings.

Yet Wertheimer, and the amicus brief to the Supreme Court filed by former U.S. Solicitor General Seth Waxman, is taking on big stuff.

It’s first necessary to understand that all political spending isn’t equal. Any campaign will tell you that the money it controls is far more valuable than the money spent by outside supporters. The money unleashed by Citizens United and other decisions contributed to the ugly tone of last year’s campaign, but it wasn’t as important as the money spent by President Barack Obama, former Massachusetts governor Mitt Romney and most congressional candidates.

Under current law, a rich contributor, who can spend any amount on independent efforts or SuperPACs, is limited to donations of $74,600 an election cycle to the party committees; in addition, a total of $48,600 can be given to individual candidates.

Here’s what would happen if the court strikes down these aggregate limits:

Let’s say that for 2016, a presidential candidate — Hillary Clinton, for example — set up what’s called a joint fundraising committee. She could then ask, among others, the Hollywood mogul and Democratic money man Jeffrey Katzenberg to give directly almost $1.2 million to her committee, in addition to his other political spending.

That would include the maximum allowed to her campaign, $5,200; the maximum to the three party committees, $194,400; and the maximum to all 50 state parties, $20,000 each or $1 million. Although most of this money is supposed to go to state parties or other campaign committees, the Clinton campaign would effectively control it. That adds considerable value and clout for any donor.

A similar joint fundraising committee could be established by, say, House Majority Leader Eric Cantor.

Then, Harold Simmons, the Texas billionaire with interests in mining and toxic dump sites who is always on the lookout for political favors (he doled out $27 million last year), could give Cantor’s committee directly more than $2.3 million. This would include $64,800 for the House campaign committees and the maximum of $5,200 a candidate for the 435 House candidates.

Although it’s only 10 percent of what he gave in independent spending and to PACs last year, this form of direct giving to a powerful politician is more valuable to Simmons as a political investment.

The Waxman brief argues that lifting these limits would “effectively negate” the ban on so-called soft money enacted in 2002, under the McCain-Feingold law. Ten years ago, the Supreme Court said these soft-money contributions were “likely to create actual or apparent indebtedness on the part of federal officeholders.”

A dueling brief on behalf of Senate Minority Leader Mitch McConnell, filed by the veteran campaign-finance lawyer Bobby Burchfield, argues against drawing any real distinction between expenditures and contributions. As for precedent, it said the Roberts court “has not hesitated to overrule decisions offensive to the First Amendment,” citing Citizens United.

Because the aggregate limit doesn’t preclude a politician from taking money from any contributor — it only limits the total amount that can be given — Burchfield pointed out that big money is more important than small donations. This is evidenced, he writes, by the fact that so many contributors give the maximum amounts allowed.

With these aggregate limits, anyone could give $100 to every member of Congress of his or her party and $2,000 to a presidential candidate.

That wouldn’t impress the politician or buy as much influence as several million bucks.

(Albert R. Hunt is a Bloomberg View columnist.)

North Carolina Takes Perilous Lurch To The Right

North Carolina Takes Perilous Lurch To The Right

Aug. 19 (Bloomberg) — North Carolina is channeling Alabama and South Carolina when it comes to the best economic, social and political model for a U.S. Southern state.

For more than half a century, North Carolina has been progressive on education and public investments, and pro- business — witness the celebrated Research Triangle between Raleigh, Durham and Chapel Hill and the financial center in Charlotte — with less racial strife than other Southern states.

As Republicans took full control of the state government in Raleigh, there has been a shift to the right. Taxes for the wealthy have been slashed, and spending for education and programs that benefit the poor have been cut. Abortion has been restricted, and guns rights expanded.

At the end of the legislative session in July, in a state that has enjoyed relatively good race relations — which the business community both encouraged and benefited from — voting privileges for blacks were targeted.

Governor Pat McCrory, a Republican elected last year, says the turn to the right is necessary and is paying off.

“We’re getting tremendous positive feedback from the business community,” he said in an interview. His state had “lost its focus,” and needed to be “shaken up.”

To critics, this conservative agenda — much of it orchestrated by Art Pope, the governor’s budget director and the multimillionaire retailer who is the Tar Heel State equivalent of the Koch brothers — threatens the state’s legacy.

“We’re turning back everything that made us different from other Southern states,” said Jim Goodmon, the chairman of CBC New Media Group LLC and owner of the Durham Bulls Minor League baseball team. “With this shift, economic development is broken.”

Ronnie Bryant, the chief executive officer of the Charlotte Regional Partnership, the area’s top economic development recruiter, recently complained to the Charlotte Observer that all the efforts of recent years to promote Charlotte as a business center “have been negated in the last few weeks.”

He said business leaders elsewhere are asking: “What the hell are you guys doing?”

Ann Goodnight, a powerful advocate for higher education in the state whose husband is CEO of the giant technology company SAS Institute Inc., wrote a letter to the Raleigh News and Observer charging that cuts in education funding were a “grievous mistake.”

The places that succeed in economic competitiveness, she wrote, “are investing in education and using the playbook we once embraced.”

The biggest firestorm erupted when the legislature changed voting procedures, requiring a state-issued photo ID, limiting early voting and ending same-day registration — practices used disproportionately by blacks.

“They are extremists, and are playing the race card,” said the Reverend William Barber, head of the state’s chapter of the National Association for the Advancement of Colored People, which is organizing multiracial coalitions around the state, and turning out thousands to protest these changes.

On taxes, the Republicans cut the corporate rate, ended the progressive personal income tax and eliminated the estate tax, which affected, on average, fewer than 75 families annually and will cost the state $300 million in lost revenue over the next five years. The legislature also decided not to continue the earned-income tax credit for the working poor.

North Carolina requires a balanced budget, and new expenses must be offset elsewhere.

“They put in place tax cuts that overwhelmingly benefit millionaires,” said Alexandra Sirota, director of the left-wing North Carolina Budget and Tax Center, “while choosing not to extend a tax credit for the working poor.”

The governor, who is as moderate in demeanor as his previous record as mayor of Charlotte suggests, denied that he’s been captured by the right. The tax cuts were essential, he said, because North Carolina was falling behind economic competitors such as South Carolina. He points out that spending for kindergarten through 12th grade increased (though not enough to keep up with inflation and population growth) and that funding for community colleges was cut because enrollment is down. Asked about support for the world-class University of North Carolina, the 56-year-old governor replied, “They can’t be satisfied with the status quo.”

Goodnight, he said, is a Democrat. Besides, he added, her husband supports him. When asked about the alleged voting fraud that mandated the changes in procedure, he offered no specifics: “It’s like insider trading; you don’t know until you look.”

The governor bristled at claims that Pope is the real kingmaker. “When he made Pope the budget director,” Goodmon said, McCrory “became a puppet.”

Pope’s political contributions, the governor said, are no different from Goodmon’s giving to Democrats. He depicts his budget director as a fiscal conservative, a benign libertarian with no racial animosity. Pope declined a request for an interview. The governor said he has headed off some right-wing moves, vetoing a bill subjecting welfare recipients to drug tests and killing a measure that would have created an official state religion.

Yet, Goodnight points out she’s a registered Republican. Goodmon’s contributions — mainly, though not exclusively to Democrats — pale next to the millions of family wealth that Pope has given to the Republican Party through his political action committee, foundations and personal contributions.

As for the competition with South Carolina, the two states last year had roughly identical, strong economic growth and both have jobless rates worse than the national average. Multiple surveys have long rated North Carolina’s one of the best business climates in the U.S., its higher education system is better than its neighbor’s, wages are higher and poverty less pervasive.

North Carolina, dating back to the 1960s and Terry Sanford, the country’s best one-term governor, and four terms of Jim Hunt, produced a much-envied system of higher education and community colleges, good race relations, a desirable quality of life and a healthy business climate. The debate about its usefulness today will persist. The North Carolina model, which served the region and country so well, is gone.

(Albert R. Hunt is a Bloomberg View columnist.)

Photo: Mr T in DC via

Republicans May Win The 2014 Battle, But They’re Losing The War

Republicans May Win The 2014 Battle, But They’re Losing The War

August 11 (Bloomberg) – As hundreds of U.S. lawmakers fan out to their home districts this month, there is a genuine political conundrum.

Approval ratings for Congress are at an all-time low, rivaling those of junkyard dogs. Republicans are seen as the main villains; the party’s standing with the public keeps falling.

So what’s the outlook today for next year’s congressional elections? Republicans will hold the U.S. House, conceivably even adding to their 233-to-200 majority. They seem certain to pick up U.S. Senate seats, with an outside chance to gain the half-dozen needed for control.

There are many explanations: the voter profile of the off-year electorate, the way House districts are drawn, the fact that most of the competitive 2014 Senate races don’t favor Democrats, the deteriorating enthusiasm for President Barack Obama.

Events could change those prospects. Republicans may overplay their hand by shutting down the government in a budget dispute this autumn or by undermining the U.S.’s good faith and credit in refusing to raise the debt ceiling. They overreached in 1998 with the planned impeachment of President Bill Clinton and ending up losing seats.

Voter Alternatives

Republican pollster David Winston foresees a good Republican year but warns it is far from assured: “There is an opportunity, not an outcome,” he says. “Voters aren’t looking for an opposition party; they are looking for an alternative.”

To date, on issues such as Obama’s health care measure — which House Republicans have voted to repeal or defund 40 times — they are short on alternatives. Still, Winston and others agree with the assessment of Cook Political Report’s David Wasserman that the Republicans have a “built-in midterm turnout advantage.”

Compare, as Wasserman does, the compositions of the electorate in 2010, a banner year for Republicans, and in 2012, when Obama and Democrats did well. Last year, almost 1 in 5 voters were younger than 30; two years earlier, this age cohort made up only 12 percent of the electorate. The reverse is true of those older than 65: One in 6 presidential-year voters were senior citizens; in 2010, it was 21 percent.

That makes a huge difference because more than half of young voters vote Democratic these days, and, with a few exceptions, similar percentages of senior citizens prefer Republicans. Older voters, Wasserman notes, “are less transient, have grown deeper roots in their local communities and pay much more attention to nonpresidential years.”

A similar pattern when it comes to race and religion helps Republicans in off-year contests. The electorate is more white, more evangelical, and less black and Hispanic.

Redistricting, which Republicans dominated after the last election, gives an advantage to start, as Democrats tend to congregate more heavily in fewer districts.

As a result, though Democrats won the overall popular vote for the House in 2012, they ended up 17 members shy of the majority. To pick up that many seats, according to Mark Gersh, long the party’s foremost analyst on House elections, they might have to win the popular vote by as much as three to four percentage points next year.

There are some heavily populated blue, or Democratic, states where seats are in play. Democrats, however, scored major gains last time in those states, such as New York and Illinois, picking off the low-hanging fruit.

Senate Races

The Senate isn’t affected by redistricting, but this year, the draw is bad for Democrats. After New Jersey’s special election in October, which Democrat Cory Booker is favored to win, 20 of the 34 seats that will be up next year are currently held by Democrats. Moreover, almost all the most competitive contests are in red, or Republican-dominated, states: Arkansas, Louisiana, West Virginia, South Dakota, Alaska and Montana — states that went decisively for Republican presidential nominee Mitt Romney last year.

The two Republican-held Senate seats that afford Democrats the best chance for a pickup also are in red states. In Georgia, the incumbent Republican is retiring and Michelle Nunn, the daughter of the popular former Democratic Senator Sam Nunn, is running. It isn’t improbable that a right-wing Republican congressman will emerge from the crowded primary field. There is also Kentucky, where Mitch McConnell, the Senate minority leader, faces a Tea Party challenge from the right and would likely face the state’s Democratic secretary of state in the general election. Even in the most favorable circumstances, Kentucky is a tough slog; Obama lost the state by 23 points.

Two Democratic Senate leaders, Nevada’s Harry Reid and New York’s Chuck Schumer, outsmarted themselves in one race, South Dakota, pressuring Brendan Johnson, a U.S. attorney and son of retiring incumbent senator Tim Johnson, not to run in order to clear the way for former Congresswoman Stephanie Herseth Sandlin. She didn’t run and neither did Johnson, whom top South Dakota Democrats believe would have been the stronger candidate. Now, Republicans are heavy favorites to win that seat.

Adding to the headwinds is a malaise among core Democrats. The number of people who think the country is on the wrong track is growing, as are negative attitudes about the economy. Although the president is much more popular than Republicans, his job-approval rating — in the mid-40 percent range — is the lowest for any second-term president at this juncture since Richard Nixon. That makes it hard to gin up a base next year.

“Democrats are better off only in comparison to Republicans,” says Fred Yang, a Democratic pollster.

Whatever the outcome next year, Yang says Republicans should remember that their problems are more deep-seated: “They may win some battles; they’re losing the war.”

(Albert R. Hunt is a Bloomberg View columnist.)

Photo: DonkeyHotey via

Obama, Republicans Gird For New Debt-Chicken Round

Obama, Republicans Gird For New Debt-Chicken Round

Aug. 5 (Bloomberg) — Democrats and Republicans, bracing for a game of chicken over a possible government shutdown and a debt-ceiling default, should rewatch the 1955 movie Rebel Without a Cause, starring American icon James Dean.

A thug challenges Dean’s character to race their stolen cars toward an abyss. The first driver who jumps out of his speeding vehicle is a coward. Dean leaps just as his car is about to go over the cliff; the other guy’s leather jacket gets ensnared in the door handle, and he plunges into the void.

In Washington, both sides anticipate a huge fight this autumn over the budget, the mandatory spending cuts under the so-called sequestration and the debt ceiling. They’re expecting the other guy to jump first.

House Republicans think President Barack Obama is bluffing when he says he won’t negotiate on lifting the debt ceiling. They contend that the president’s position isn’t nearly as strong as it was at the end of last year, when the tax cuts enacted under President George W. Bush were about to expire. Obama, who had lots of leverage then, got half a loaf.

The White House recalls Speaker John Boehner’s discomfort with the game House Republicans played with the debt ceiling in 2011, which hurt both the economy and their party. Privately, they say that Boehner doesn’t wish to wage that fight again when the limit is reached late this year and that his demand that any increase in the debt ceiling be matched by comparable spending reductions is a bluff. That position is unacceptable to Obama and Democrats.

The stakes are high in this game of chicken; a miscalculation could send shock waves through the economy.

The probability is that any budget deadlock, which could force a government shutdown and action on the much-discredited across-the-board sequestration cuts in defense and non-defense discretionary spending, will be postponed beyond the Oct. 1 deadline. Then, everything, perhaps including any tax reform initiative, will be thrown in with the debt-ceiling increase sometime in November.

There were plenty of private partisan and bipartisan conversations before the congressional recess, which began August 2. Some of these discussions will continue this month. No one is confident of the path, much less the outcome.

The early budgetary battle lines for the fiscal year that begins Oct. 1 have been drawn, and the two sides are almost $100 billion apart. Neither starts from a position of strength. The White House has made little progress on its insistence on additional revenue. House Republicans had to pull a spending bill containing big cuts from the floor last week for lack of votes. It is relatively easy for most Republicans to support a scaled-back budget concept; actually cutting programs is tougher.

Much of the negotiations when Congress gets back in September are likely to focus on the sequestration, which was adopted only because any agreement on regular spending measures collapsed. The sequestration is indiscriminate, makes for poor policy and is ridiculed by most members of Congress, from defense hawks to domestic policy progressives. It’s just that they can’t agree on a replacement, as House Republicans continue to pretend that the Pentagon will largely be spared.

Treasury Secretary Jack Lew made clear a week ago that any changes to the sequestration had to equally affect non-defense discretionary cuts as well as defense. There are a number of senators, from both parties, who would support such a deal.

There is a rational replacement that makes for better economic and fiscal policy and addresses top political concerns — for the Democrats, the necessity of more revenue, and for the Republicans, to start addressing entitlements. The cuts in discretionary domestic programs — which as a percentage of the economy are headed to the lowest level since the Eisenhower administration — would be replaced with cuts in entitlements, principally health care, that the White House would accept.

Higher revenue would substitute for the defense cuts. Given the political realities, that solution probably couldn’t fly for more than a year. At this stage, it’s doubtful even it could get through the House.

The cherished, elusive grand bargain — significant cutbacks in entitlements and more revenue, coupled with short- term stimulus spending on infrastructure and selected other programs — would boost the economy, increase market confidence and perhaps reduce some of the political pettiness that engulfs Washington. The partisan-inspired paralysis makes that a nonstarter.

The best hope is for a mini-bargain, building on a sequestration deal that itself may not occur. There is little good faith on either side, with many expressing disdain for one another. Republicans seem convinced Obama’s no-negotiations on the debt ceiling stance amounts to posturing. He has backed down before and, in a view shared by a number of Democrats, tough negotiating isn’t this White House’s forte.

The Republican blustering is more striking. Privately, some have suggested giving Obama a multi-year extension of the debt ceiling in return for changes in Medicare, including raising the eligibility age. Boehner continues to advance the notion that any increase in the debt ceiling must be matched dollar-for-dollar with spending reductions.

The biggest fraud is led by a few right-wingers in the Senate, principally Ted Cruz of Texas, who insist that an increase in the debt ceiling must be accompanied by the defunding of Obama’s health care measure. Cruz plans to barnstorm the country for 10 days this month to rally the faithful — and collect names and maybe money for any presidential hopes — to this illusory demand.

None of this is serious.

There are two possible outcomes. A one-year arrangement containing small, cosmetic changes that postpones bigger decisions. The other is going over the cliff, à la Rebel Without a Cause.

(Albert R. Hunt is a Bloomberg View columnist. The opinions expressed are his own.)

Photo by Talk Radio News Service/Flickr

McCain Is A Maverick Again As Obama’s Republican Ally

McCain Is A Maverick Again As Obama’s Republican Ally

July 29 (Bloomberg) — Washington being Washington, the hottest relationship in town doesn’t revolve around sex or even the next presidential election: it’s the political courtship of old antagonists, Barack Obama and John McCain.

Political relationships, especially those involving the president, are the sustenance of the American capital. Sometimes they are poisonous: President Lyndon Johnson and Robert F. Kennedy, as captured in the latest volume of Robert Caro’s biography of LBJ. At other times, they are lopsided, as when Bill Clinton dominated Newt Gingrich under the guise of working together. Every now and then, there are adversarial/symbiotic relationships that, on balance, get things done: Ronald Reagan and Tip O’Neill in the 1980s, for example.

The association between Obama and McCain is different. But it may be Washington’s most important since Reagan and O’Neill.

McCain, 76, whose political resiliency is rivaled only by such luminaries as Bill Clinton and Richard Nixon, is the most pivotal figure in the Senate today. He often is more central than the party leaders, Mitch McConnell, the Kentucky Republican, or Harry Reid, a Nevada Democrat, or the self-styled new power broker, the New York Democrat Chuck Schumer.

When McCain is with the president — on immigration and in brokering the recent deal to secure Senate approval of stalled Obama nominees — they usually can trump the political right. When he’s against him — sabotaging Obama’s plan last year to nominate Susan Rice as secretary of state — the White House rarely prevails.

Their previous strains predated 2008, when they vied for the presidency. Obama saw his Republican rival as an embittered, compromised maverick who treated him as an undeserving upstart. That was close to the mark. After he lost that election, McCain saw Obama as naïve, aloof and surrounded by too many sycophants.

In 2011, there was a move to détente after Arizona representative Gabrielle Giffords was shot. That, however, was “a false start,” McCain recalled in an interview last week.

This time, political convenience broke the ice. A re-elected president soon realized that without the support of a small core of Senate Republicans, any agenda was doomed. McCain, who moved right to fend off a Tea Party primary challenge in 2010, was itching to reclaim his maverick persona and wage a two-pronged battle: against the isolationists and political right of his own party and against the national-security left wing in the Democratic camp.

Since the January inauguration, Obama and McCain have met a dozen times. In half of those occasions, they were either alone or with only a few other principals. Although the discussions were usually about immigration policy, they invariably ranged more broadly.

There are huge tests ahead, especially the budget/debt ceiling/sequestration battles this autumn. McCain, the defense hawk, despises the across-the-board cuts to defense and discretionary domestic spending required under sequestration and wants to help forge a compromise replacement involving more taxes and cuts in entitlements.

The odds are against that happening; most House Republicans are more eager for an economy-threatening standoff than for an accord. The only slim hope is a deal, led by the White House and a small group of McCainites.

McCain also wants to help Obama fulfill his promise to close the detainee camp for terrorism suspects at Guantánamo Bay, Cuba. He says political conditions are much different from four years ago, when there was a similar effort.

“The difference between 2009 and 2013 is the administration now has a plan,” he says.

Last month, the five-term senator traveled to Guantánamo with Senate Intelligence Committee chairman Dianne Feinstein and the White House chief of staff, Denis McDonough.

McDonough, who McCain knew as a mid-level aide to former Democratic Senate Leader Tom Daschle, is a glue that binds the Republicans and the administration. He and McCain talk as often as five times a day. In addition, the Republican senator has a great fondness for Vice President Joe Biden, a good working relationship with Secretary of State John Kerry and is a fan of United Nations Ambassador-designate Samantha Power.

He’s also an unrelenting critic of much of Obama’s foreign policy. He sees the president as indecisive or soft on Syria, Egypt and Afghanistan. He has a long running feud with General Martin Dempsey, the chairman of the Joint Chiefs of Staff.

He has no regrets about torching Rice’s appointment to be secretary of state, and continues to suggest that she dissembled on the terrorist attack last year against a U.S. mission in Benghazi, Libya. But when she was tapped to head Obama’s National Security Council, McCain wrote a Twitter post saying that he’d make “every effort” to work with her. She contacted him, they had a cordial meeting and he asked her to discuss Syria with one of his confidants, retired General Jack Keane. Rice met with Keane: “I can’t ask for anything more,” McCain says.

He’s as eager to take on the Rand Paul isolationists within his party. In an April speech at the Center for a New American Security, he focused criticism on his fellow Republicans. He has disdain for much of the movement right and little regard for Senate Majority Leader McConnell.

In the interview in his Capitol hideaway office last week, the never combat-shy McCain seemed to revel in his reclaimed persona and his multifront battles. He suggests, however, that his style is changing.

“The biggest mistake I used to make was getting personal,” he says, declaring that that his role model now is the late Democratic senator Ted Kennedy, who was a friend.

One prominent Democrat, who knows both Obama and McCain well, is certain the senator genuinely wishes to work with the president. Noting that for all the assistance of McDonough or even Biden, at this level, interactions ultimately depend on principal-to-principal connections, and this politician worries that Obama doesn’t do relationships well.

Asked about that, McCain paused, then acknowledged that the president isn’t a “schmoozer” like his predecessors Clinton and Reagan.

“He’s willing to compromise but sometimes not sure he knows exactly how to do it,” McCain says. “We can help.”

(Albert R. Hunt is a Bloomberg View columnist. The opinions expressed are his own.)

Photo: Gage Skidmore via