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Power Play Backstage at the nation's capital. 2008-05-21T15:30:47Z WordPress http://powerplay.blogs.fortune.cnn.com/feed/atom/ neaston What does Hillary want? http://fortunepowerplay.wordpress.com/?p=42 2008-05-21T15:30:47Z 2008-05-21T11:50:32Z Even after Hillary Clinton’s big win in Kentucky last night, the likely Democratic nomination remains firmly in the hands of Barack Obama, who now claims a majority of pledged delegates. All of which begs the question: What does Clinton hope to achieve by staying in the race until June 3, the end of the Democratic primary season? Likely answer: Enough [...]


Even after Hillary Clinton’s big win in Kentucky last night, the likely Democratic nomination remains firmly in the hands of Barack Obama, who now claims a majority of pledged delegates. All of which begs the question: What does Clinton hope to achieve by staying in the race until June 3, the end of the Democratic primary season?

Likely answer: Enough popular votes — and from constituencies Obama hasn’t won – to make the case that she should be No. 2 on his ticket.

Clinton campaign chair Terry McAuliffe lent credence to the vice presidency theory on Fox News last night when he tip-toed around a question about who would occupy the No. 1 and No. 2 spots on the ticket before finally saying that Clinton would be supportive of the Democratic ticket “whatever the role” she plays.

McAuliffe and his candidate continue to enjoy bragging rights over some key numbers. Since Feb. 19, for example, the date that Obama swept Wisconsin, Clinton has received more popular votes than Obama.

Just as important, Clinton brings to the ticket voters who are increasingly revealing themselves reluctant to support Obama — white, working class, lower-income seniors and non-college graduates. His 35-point Kentucky loss last night follows a 41-point trouncing by Clinton the week before in a demographically similar state, West Virginia. As expected, he won handily last night in Oregon, a state with a high education level and that “latte-liberal” sensibility that Clinton advisers insist won’t win general elections.

White, working class voters — as the Clinton campaign repeatedly asserts — are critical to picking up swing states in the fall, and with Obama heading the ticket, the Republican presumptive nominee, John McCain, will be positioned to make a make a vigorous pitch for their support.

Obama’s failure to win over substantive numbers of these voters is making some party veterans nervous. As longtime Democratic strategist Bob Beckel said Tuesday night of Obama’s poor showing in these demographics: “These numbers bother me.”

That’s where Hillary on the ticket comes in. It’s not a prospect that Obama is said to relish. But, among all the likely VP prospects (think white males like John Edwards or Sam Nunn or Ed Rendell), she is the one proven vote-getter, and a winner in major states like California, Ohio and Pennsylvania.  

Overall, each candidate ended Tuesday night — Obama winning Oregon, Clinton taking Kentucky — roughly equal in the Democratic popular vote (depending on whether one counts the disputed Michigan and Florida tallies). As Clinton asserted in her Kentucky victory speech: “More people have voted for me than anyone who has ever run for the Democratic nomination. That is more than 17 million voters.”

In her surprising presidential bid — which she began as entitled heir-apparent and ended as feisty, determined (and admired) underdog — Clinton has built a legitimate movement of loyal supporters, especially among women. Will they be just as angry if Obama turns his back on them — as his supporters would be if the superdelegates decided to take the nomination away from him?

When the Democratic nominating convention opens in August, Clinton will have nearly as many delegates as Obama. In this usually-staged event, delegates vote for VP just as they do president. By the time that happens on Wednesday night, the nominee has typically made his choice and the vote is pro-format. But Hillary’s hold on nearly half the hall could cloud the issue.

All this is likely to be settled well before the opening gavel in Denver — at least party elders hope so. But it’s a question that Obama will need to consider as his advisers gingerly approach the Clinton camp over the coming weeks to assess the question: What does Hillary want? 

6 neaston Bill’s angry adventure http://fortunepowerplay.wordpress.com/?p=41 2008-05-08T01:00:25Z 2008-05-07T17:36:41Z What genius in the Clinton campaign allowed Bill Clinton in the camera shot behind his wife last night? As he stood next to daughter Chelsea, the former president’s face - flushed, irritated, distracted - told the story best: Of his wife’s suddenly sinking prospects, of his own failure to rescue her campaign, of his now tarnished [...]


What genius in the Clinton campaign allowed Bill Clinton in the camera shot behind his wife last night?

As he stood next to daughter Chelsea, the former president’s face - flushed, irritated, distracted - told the story best: Of his wife’s suddenly sinking prospects, of his own failure to rescue her campaign, of his now tarnished image inside a political party suffering from painful racial splits that he (arguably) helped ignite.

Hillary Clinton needed a big win last night, and the 42nd president stumped his heart out at nearly 100 stops in small towns across Indiana and North Carolina to make it happen. Instead, she was trounced by 14 points in North Carolina, and barely eked out a victory - one that wasn’t called until the wee hours this morning - in Indiana.

No wonder he looked unhappy, especially when you consider that one of his premier constituencies - black voters - completely turned its back on him at the polls yesterday.

President Clinton has always taken personal pride in his strong ties to the African-American community. Author Toni Morrison once called Bill Clinton the nation’s “first black president.” And Hillary Clinton, as recently as December, enjoyed strong support among black voters.

Last night proved just how dramatically that has changed. Barack Obama sewed up more than 90 percent of the black vote in both states, leaving Bill Clinton with the job of helping his wife get-out-the-vote among rural and working class whites, her strongest bases of support. (Ironically, this is the math equation Republicans in the southern states face in general elections: The only way to win is to collect huge majorities of the white vote.)

The “latte crowd” has come to be a sure thing for Obama this primary season: Higher income, college-educated voters, often calling themselves “very liberal” in exit polls.

To come close in North Carolina or sweep Indiana, Hillary needed to regain some of the African-American vote once so loyal to the Clintons.

But rather than helping her, Bill Clinton likely set that effort back: During the South Carolina primary contest in January, he compared Obama’s campaign to Jesse Jackson’s 1988 bid, a comment that was construed as an attempt to marginalize a winning black candidate. Two months later, he launched into a lengthy tirade denouncing the Obama campaign for playing the “race card.”

Meanwhile, Hillary’s numbers with the black vote tanked. On Jan. 26, in South Carolina, she garnered 19 percent of the black vote. Last night, in neighboring North Carolina, she received only 6 percent of that vote. Part of that drop is the result of Obama’s strengthening candidacy, to be sure, and possibly even a backlash to the controversy over Obama’s relationship with Rev. Jeremiah Wright. But did Bill Clinton’s comments hurt, too?

Meanwhile, with last night’s election results, his wife’s comeback has stalled. It’s now hard to imagine a scenario in which Clinton takes the nomination from her rival. Last night, Obama expanded his lead in pledged delegates. This morning, Clinton’s advisers admitted that even if the disputed Florida and Michigan vote counts are included, she remains behind in the popular vote.

That leaves her with nothing more than a demographic argument to make before uncommitted superdelegates–that she can deliver white working class voters in key swing states next fall. Whether we call them “Humphrey Democrats” or “Reagan Democrats,” these more socially conservative whites have demonstrated a resistance to supporting Obama, just as blacks have increasingly resisted supporting her.

Her candidacy has revealed an enduring split inside the party that could be problematic for Democrats in the fall unless likely nominee Obama finds a way to reassure blue-collar workers, women, seniors and social conservatives. He took his first steps toward that last night with an uplifting speech threaded with pro-America references.

Despite last night’s disappointing results, Hillary Clinton says she is going full steam ahead toward next week’s primary in West Virginia. Facing a funding crunch, her advisers say she has now lent the campaign a total of $11.4 million, a sum that slightly exceeds income from her book and Senate salary.

Which means that at least she’s getting some financial support for her campaign from… guess who?

0 neaston Clinton wins the primary, but not the math http://fortunepowerplay.wordpress.com/?p=40 2008-04-23T12:25:36Z 2008-04-23T02:45:29Z With her nearly 10-point win in Pennsylvania tonight, Hillary Clinton strengthened her argument with the all-important superdelegates that she is the more electable candidate. But that’s about it. The race is no more settled than it was after she won Texas and Ohio six weeks ago. Watch for the Clinton campaign to make the case that [...]


With her nearly 10-point win in Pennsylvania tonight, Hillary Clinton strengthened her argument with the all-important superdelegates that she is the more electable candidate. But that’s about it. The race is no more settled than it was after she won Texas and Ohio six weeks ago.

Watch for the Clinton campaign to make the case that the New York senator has now won a majority of the popular vote in the Democratic primary. But that’s only if the contested Florida and Michigan contests are included.

And because of Democratic party rules, Obama remains solidly ahead in pledged delegates, though she nibbled at his lead, dropping it from 139 to 127.

Now the candidates head into territory less favorable for Clinton’s come-from-behind effort. In North Carolina, Obama is ahead by 15 points, according to the RealClearPolitics poll average. In Indiana, where Clinton once held a big lead, the RealClearPolitics average puts her ahead by only 2 points. Both states vote on May 6.

Obama enjoys a huge cash advantage going into those contests, but Clinton’s money problems will certainly be eased by last night’s victory and her strategists note that Pennsylvania was the last expensive media market they face.

In Pennsylvania, as in Ohio, Clinton had a lock on voters who are more culturally conservative, less educated and less well-off. She does well among “those people working hard to make it,” as her strategist Geoff Garin put it. And according to Pennsylvania exit polls, she swept the white vote among both men and women, while Obama relied on his coalition of blacks and upper-income, highly educated whites.

After Pennsylvania, it’s fair for Clinton to raise the question: Why can’t Obama seal the deal with Democratic voters? Still, does anyone really expect uncommitted super-delegates to take the nomination away from Obama if he ends the contest in early June with a lead in pledged delegates, the number of states won, and (depending on how it’s calculated) the popular vote?

6 neaston Hillary wins tonight: So what? http://fortunepowerplay.wordpress.com/?p=39 2008-04-22T21:40:25Z 2008-04-22T18:28:59Z Hillary Clinton will be the likely victor when the Democratic primary polls close in Pennsylvania late Tuesday. She could even win by a comfortable margin. She’ll get the senior citizen vote. She’ll get the struggling-family vote.  She’ll get the gun-owner vote. She’ll even get the white guy vote. And guess what? She’ll still be the loser in the race for the [...]


Hillary Clinton will be the likely victor when the Democratic primary polls close in Pennsylvania late Tuesday. She could even win by a comfortable margin.

She’ll get the senior citizen vote. She’ll get the struggling-family vote.  She’ll get the gun-owner vote. She’ll even get the white guy vote. And guess what? She’ll still be the loser in the race for the Democratic nomination.

That’s because this former First Lady, wife of one of the era’s most popular presidents, once the de facto frontrunner, can’t seem to capture the party establishment vote. And the backing of the party establishment is what Clinton desperately needs right now. 

Barack Obama is ahead in the popular vote, in the number of states won, and in pledged delegates. So Clinton needs to convince enough unallied superdelegates — elected officials, party stalwarts and the like — that she’s the safer bet to go up against John McCain in November.

For that to happen, she needs some combination of these three factors:

  1. She could catch up and surpass Obama in the popular vote by the time the Democratic primary wraps in June. That, however, would be an improbable mathematical feat. U.S. News & World Report political analyst Michael Barone has calculated she would need to win 60 percent of the vote in Pennsylvania, 45 percent in North Carolina, and 60 percent in Indiana, and current polls just don’t support those margins.
  2. She needs to convince the Democratic National Committee to reverse its decision to strip Michigan and Florida — where she won – of their delegates as punishment for violating party rules on setting primary dates. So far, she’s made no headway on this, with DNC Chair Howard Dean saying, “We are not going to change the rules in the middle of the game,” and neither state committing to a costly rerun of their primaries.
  3. She can bank on some act of self-destruction by Obama. So far, that’s proven wishful thinking. Last week was Obama’s worst on the campaign trail. He was caught deriding small-town Pennsylvanians as “bitter” folks who “cling to guns or religion or antipathy to people who aren’t like them” because of their economic plight. He was prickly and defensive in a televised debate. Clinton mocked his complaints about tough character questions as the whining of a politician ill-equipped to withstand the pressures of the White House.

           So how did Obama fare under this hailstorm? He picked up six more superdelegates, and is expected to announce a new batch after the polls close tonight. On Monday, supporters launched a website to collect $1 million in one minute (he raised $41 million in March, double Clinton’s haul). And we didn’t hear any party leaders back off their calls to wrap up the nomination by June’s end, a not-so-subtle message to Clinton that she shouldn’t expect to take her fight to the convention in August.

Recall, too, that the damage caused by the Rev. Wright controversy was contained, at least among Democratic voters, according to polls. Audio tapes showed Wright, Obama’s longtime spiritual mentor, blaming America for 9/11 and claiming the U.S. government invented the HIV virus as a means of “genocide against people of color.” But instead of running away from Obama, party leaders continued to line up at his side.

If Clinton wins comfortably in Pennsylvania, her campaign will make the case that she has won a clear majority of the nation’s most populous states — in this case, despite being outspent 2-to-1 by the Obama money machine. But she won Texas and Ohio six weeks ago, and that still didn’t change the dynamic of the race.

Instead, an increasingly divisive campaign has hurt Clinton’s image, with her attacks on Obama producing damaging blowback. As the Washington Post’s Dan Balz wrote: “Today, more Americans have an unfavorable view of her than at any time since The Post and ABC began asking the question, in 1992. Impressions of her husband, former president Bill Clinton, also have grown negative by a small margin.”

So even as the latest Gallup tracking poll shows Clinton strengthening among Democrats nationally — running neck-and-neck against Obama for the first time in a month — there are signs that Clinton fatigue is hurting her with party leaders.

Tonight won’t be a game-changer. Instead, the campaigning that led up to Pennsylvania’s vote will be best remembered for offering up juicy soundbites for Republican campaign commercials: Obama accusing Clinton of taking “different positions at different times,” and Clinton pointedly telling Obama he’s not up to the job: “If you can’t stand the heat, get out of the kitchen.”

  

   

29 neaston First NAFTA-gate, now Colombia-gate http://fortunepowerplay.wordpress.com/?p=38 2008-04-07T19:27:05Z 2008-04-07T18:39:05Z Barack Obama had NAFTA-gate. Now Hillary Clinton has Colombia-gate.  Both  of these “scandals” centered on trade agreements — a topic once considered a snoozer relegated to the business pages but which now comes close to abortion and gay marriage on the political fire scale. And both episodes serve as a reminder that — for all the populist-protectionist rhetoric on [...]


Barack Obama had NAFTA-gate. Now Hillary Clinton has Colombia-gate. 

Both  of these “scandals” centered on trade agreements — a topic once considered a snoozer relegated to the business pages but which now comes close to abortion and gay marriage on the political fire scale. And both episodes serve as a reminder that — for all the populist-protectionist rhetoric on the campaign trail this season — the Democratic Party remains of two minds on free trade.

Clinton pollster and senior strategist Mark Penn got caught helping the Colombians craft a strategy for congressional approval of its free trade pact with the United States, a deal that his candidate strongly opposes. (President Bush sent the deal to Congress today for a vote.) A few short weeks ago, Obama economic adviser Austan Goolsbee got caught trying to reassure the Canadians that his candidate’s pledge to renegotiate NAFTA was merely political posturing and that he wasn’t as protectionist as he sounded. 

On March 31, Penn attended a strategy session with the Colombians in his capacity as CEO of the public relations giant Burson-Marsteller. Penn’s insistence on keeping his CEO position at Burson while also shaping Clinton’s presidential campaign message was always an ethical time-bomb waiting to explode.  Union leaders and leftist activists have relentlessly attacked Penn for his work with Burson, which represents corporate clients and is accused by the left of being anti-union.

Penn should have followed the lead of Karl Rove, who sold his direct mail business when he took over George W. Bush’s campaign in 1999.  And it was a bizarre lapse of judgment that put Penn at last Monday’s meeting with Colombian officials (who later fired Burson after concluding that Penn’s apology demonstrated a lack of respect for their country).

Still, there’s a telling history to the political instincts that landed Penn at that meeting: The pollster  joined President Clinton’s political team after the Democrats’ 1994 election-year drubbing by Republicans, and then helped craft the strategy that moved the White House toward the political center. A signature achievement of that effort — and one of President Clinton’s proudest achievements — was congressional approval of NAFTA, which linked the U.S., Canada and Mexico in a free trade zone.

It was also an effort that put the president at odds with organized labor.  But 12 years later, union leaders — who oppose even those free trade agreements that include new labor and environmental standards and are supported by House Democratic leaders — appear to be calling the shots with the Democratic campaigns.

Penn’s departure from the Clinton campaign was preceded by vociferous calls for his resignation by union leaders who support Obama.

But their own candidate, Obama, was forced to go on the defense against Clinton’s attacks after news reports that Goolsbee had assured Canadian officials that his candidate’s pledge to renegotiate NAFTA was merely political posturing. The Obama campaign insisted that Goolsbee’s conversation was miscontrued, but a two-page memo summarizing the meeting — and obtained by Fortune — includes repeated references to Goolsbee efforts to minimize Obama’s campaign trail rhetoric as more protectionist than the candidate’s true feelings.

“As Obama continues to court the economic populist vote…we are likely to see a continuation of some of the messaging that hasn’t played in Canada’s favour, but this should continue to be viewed in the context in which it is delivered,”  the memo said.

While Penn was fired, Goolsbee kept his post and was banned from contact with the media. Yet there’s evidence that Obama’s adviser is — like Penn — not exactly a protectionist himself. In a 2007 interview with the columnist George Will  Goolsbee said globalization was responsible for only a “small fraction” of the income disparities that the Democratic candidates routinely condemn. Technology, specifically the rise of an information economy, he noted, was the main culprit.

That’s not the kind of straight talk we’re going to hear from the candidates this election season, especially with the economy in a painful slump and voters looking for someone to blame. 

1 mmmraisin Obama tries to pump up Pennsylvania http://fortunepowerplay.wordpress.com/?p=37 2008-04-07T14:33:11Z 2008-04-07T14:33:11Z Fortune writer-reporter Jia Lynn Yang writes: Barack Obama may not pump gas for his own motorcade. But he wants Pennsylvania to know that he too has noticed the rising prices. “We are paying record prices,” Obama told a capacity crowd at the Dunmore Community Center Gymansium in Scranton last week. “I don’t have to tell you: $3.50 [...]


Fortune writer-reporter Jia Lynn Yang writes:

Barack Obama may not pump gas for his own motorcade. But he wants Pennsylvania to know that he too has noticed the rising prices.

“We are paying record prices,” Obama told a capacity crowd at the Dunmore Community Center Gymansium in Scranton last week. “I don’t have to tell you: $3.50 a gallon?” The crowd starts shouting back numbers: “$3.25! $3.55!” until the whole gym sounds like a cattle auction.

Obama stands in the middle listening, allowing the crowd to vent. He pauses. “A lot,” he says, to laughs. “Meanwhile, Exxon Mobil (XOM) made $11 billion last quarter.” Cue loud booing.

Throughout Pennsylvania, especially in economically depressed former mining towns such as Scranton and Wilkes-Barre, Obama has been sounding some John Edwards-like notes about the contrast between Americans who work hard and struggle to pay for gas, and the corporate titans who make millions in bonuses.

It’s a traditional message for Democrats - Hillary Clinton’s been using it for months - but Obama’s ratcheted up the volume lately, in part because of his audience. He has to connect with
working-class voters in order to beat Clinton, not just in the April 22 primary in Pennsylvania but in Indiana, North Carolina, West Virginia, Kentucky, Montana, Oregon, and South Dakota, all states that are coming up between now and June 3. (Maybe not so much in Guam.)

So Obama has begun to weave lines like, “A CEO makes more money in 10 minutes than a worker makes in a whole year” into his stump speech. And Countrywide Financial Corp. (CFC) usually gets a mention too for awarding its CEO and president $19 million in bonuses after the mortgage lender’s sale to Bank of America.

Is the extra populist juice working? The latest polls in Pennsylvania, where Obama spent much of last week, show some gains. Quinnipiac shows Obama getting closer but still 9 points behind Clinton. Public Policy Polling has Obama creeping ahead of Clinton, though only by 2 points. Other polls have yet to come out corroborating his new lead.

As for what Obama will do exactly about gas prices, he does go out of his way to say that as president he won’t wave a magic wand that will instantly lower the cost. At a press conference staged at a gas station in Manheim, Pa., last week, he promised a three-pronged approach.

In the long term, Obama favors investing in fuel-efficient car technology and developing more alternative energy sources like cellulosic ethanol. In the short term, he wants to cut to the payroll tax for the working class, which he says will translate into $1,000 back per family.

And Exxon? You’ve been warned. Says Obama: “I think we can look at going after windfall profits in a serious way.”

4 dterry Clinton backlash isn’t about gender http://fortunepowerplay.wordpress.com/?p=36 2008-03-31T19:18:24Z 2008-03-31T16:01:04Z Fortune Editor at Large Patricia Sellers writes: Enough about sexism! The topic has made the cover of Portfolio magazine, the front page of Saturday’s Wall Street Journal, and the Letters to the Public Editor column in the New York Times this past Sunday. Charges of sexism in the presidential race are raging. And now that Hillary [...]


Fortune Editor at Large Patricia Sellers writes:

Enough about sexism! The topic has made the cover of Portfolio magazine, the front page of Saturday’s Wall Street Journal, and the Letters to the Public Editor column in the New York Times this past Sunday. Charges of sexism in the presidential race are raging. And now that Hillary Clinton’s unfavorable ratings are way up there - 48% vs. Barack Obama’s 32%, according to the latest NBC News/Wall Street Journal poll - many contend that anti-Hillary sentiment is a kind of backlash that no man would ever face.

Hold on. I’ve been studying women and power for a decade, having shepherded Fortune’s Most Powerful Women in Business cover package ever since its launch in 1998. I’ve talked with hundreds of wildly successful women - and men too - about power. And from my purview, this backlash against Hillary Clinton is about as gender-based as the backlash against Carly Fiorina. Which means, hardly at all.

Actually, Clinton is a lot like Fiorina, the former chairman and CEO of Hewlett-Packard who topped Fortune’s Power 50 list for six straight years. Both Clinton and Fiorina are bold, fearless and controversial. They are ferocious in chasing what they want (remember Carly’s hard-fought conquest of Compaq?). “My strength is my strength,” Fiorina once told me. “But it can also be a weakness.” She showed us. In 2004, the Hewlett-Packard board, dismayed by her strident leadership style and the company’s poor performance on her watch, turned on her - as the board, I’m certain, would have turned on a man under those same circumstances. Fiorina refused to quit and was fired instead. If she were not now working for John McCain (leading his fundraising efforts), I’d suspect that Fiorina is secretly counseling Clinton to never give up - until she is fired, so to speak, by the superdelegates at the Democratic convention this coming June.

Ever since Fiorina’s fall, power has been shifting to leaders with a lighter touch. The CEOs now at the top of Fortune’s Most Powerful Women list - Meg Whitman of eBay (EBAY) (retiring today and now co-chairing McCain’s campaign), Anne Mulcahy of Xerox (XRX), Irene Rosenfeld of Kraft (KFT), even our current No. 1, PepsiCo’s (PEP) Indra Nooyi - are tough but take care to show their soft side. This is not just a woman thing. America’s most admired male CEOs - guys like Jeff Immelt of General Electric (GE), A.G. Lafley of Procter & Gamble (PG), and Mark Hurd, Fiorina’s successor at HP (HPQ) - know how to take a swath to costs but also know how to exercise empathy like their predecessors never did. Even JPMorgan Chase chief executive Jamie Dimon, a swaggering guy, displayed flexibility on the Bear Stearns buyout, lifting his price from $2 a share to $10. It’s no coincidence that all these guys have women execs on Fortune’s Most Powerful Women list. They are comfortable sharing power with strong women.

So who is the presidential candidate most like these CEOs today? Seeing Obama on The View last Friday, I have to say he’s the one. There he was on the couch, surrounded by ABC’s five daytime divas. They fawned over him, shamelessly. He, in response, was deferential, even demure, and totally in control. If sexism exists, it’s in the fact that Hillary Clinton could not go on, say, This Week with George Stephanopoulos and have two guys named George, Stephanopoulos and Will, call her “sexy-looking.” In that sense, indeed, the race isn’t fair.

8 neaston Hillary’s Wal-Mart women http://powerplay.blogs.fortune.cnn.com/?p=35 2008-03-13T20:22:10Z 2008-03-13T16:12:24Z Hillary Clinton may be disliked by nearly half the voters in the country, according to most polls. And she may be the consistently most polarizing political figure in the last 16 years, in the words of Democratic pollster Peter D. Hart. But the former First Lady commands the loyalty of a block of voters that both Barack [...]


Hillary Clinton may be disliked by nearly half the voters in the country, according to most polls. And she may be the consistently most polarizing political figure in the last 16 years, in the words of Democratic pollster Peter D. Hart. But the former First Lady commands the loyalty of a block of voters that both Barack Obama and John McCain need, especially as the economy sours during this 2008 race: Wal-Mart women.

This is the label that GOP pollster Bill McInturff applies to middle- to lower-middle-class women who are struggling to make ends meet, especially as the costs of necessities like gas and healthcare soar. And it’s a literal label: 17 percent of the voters interviewed in the new McInturff-Hart poll for the Wall Street Journal/NBC News are women who regularly shop at Wal-Mart (WMT).

As McInturff’s firm has described these voters: “If Tony Soprano’s job really was in waste disposal, then his wife might be in this category. Women who shop at Wal-Mart once a week or more tend to be lower income, less well-educated, and more likely to work in hourly wage jobs or be retired than their counterparts who primarily shop at Target.” They live in both rural and suburban areas. They are also swing voters who now identify themselves as Democrats and are “extremely negative about the direction of the country,” but supported by President Bush by a 14-point margin in 2004.

Wal-Mart women are similar to the voters - in exit polls, they were described as women with a high school education - who helped Clinton claim victory in Ohio, and have helped her build her current lead in the April 22 Pennsylvania primary. To cut into Clinton’s Pennsylvania edge, said Hart, Obama “needs to talk about real issues with real people,” rather than what he calls “platform speaking” - mass rallies that draw enthusiastic throngs of mostly young people who can miss a day of work.

In a general election matchup, Clinton is beating McCain with Wal-Mart women. “Barack Obama is not,” said McInturff, who, together with Hart, discussed the new poll results with reporters this morning.

The Iraq war, which McCain supported, remains unpopular, but the economy is the biggest drag on Republican prospects in November. Hart likened this environment to what George H.W. Bush faced before his loss to Bill Clinton in 1992.

According to the McInturff-Hart poll, a plurality of voters, 43 percent, now say that their families are worse off than they were four years ago.

To be competitive with voters on the economy, McCain needs to answer the question: “What will a Republican president do to solve some of these day-to-day economic problems?” said McInturff. He also needs to regain the Republican Party’s standing with Latino voters; and McInturff argues that the Arizona senator - who routinely refers to immigrants as “God’s children - can get an unprecedented 40 percent of the Latino vote.

As previous polls have shown, voters remain deeply pessimistic about America’s ability to compete in the world economy. “People see the downside of the trade issue,” said Hart. “They don’t see the upside.”

Even a majority of Republicans, according to the Hart-McInturff poll, think trade hurts America.

5 neaston GM chief’s political reality check http://powerplay.blogs.fortune.cnn.com/?p=34 2008-03-12T15:26:30Z 2008-03-12T14:23:28Z There are a boatload of corporate sins - some real, some invented - that both Democratic presidential frontrunners intend to confront from the Oval Office. But this month - with the Ohio primary just past, Pennsylvania coming, and Michigan considering a “do-over” - there’s one that stands out: “Shipping American jobs overseas.” Obama-Clinton riffs on the [...]


There are a boatload of corporate sins - some real, some invented - that both Democratic presidential frontrunners intend to confront from the Oval Office. But this month - with the Ohio primary just past, Pennsylvania coming, and Michigan considering a “do-over” - there’s one that stands out: “Shipping American jobs overseas.”

Obama-Clinton riffs on the perils of globalization are predictable crowd pleasers in America’s manufacturing belt. And despite the cross-camp jabs at each other over the issue, the candidates’ pitches are largely interchangeable. Both blast trade deals like NAFTA; both want to use the tax code to penalize companies that profit from overseas operations. Obama offers a tax break for factories that mostly stay at home; Clinton offers an R&D credit to keep high-paying research jobs here.

Against this rousing political theater, Rick Wagoner offers a bracing dose of reality. As chairman and CEO of General Motors (GM), Wagoner is not exactly the profile of voter Clinton and Obama are courting. But his workers - 83,000 of whom are American union members - are. And their economic fortunes are tied to GM’s future survival.

Wagoner’s job is to turn around a company that last fall reported a staggering $39 billion loss in a single quarter. Looking beyond the workforce and healthcare costs the company has already slashed, Wagoner sees his company’s future in growing the sales of GM cars - from factories overseas.

Already, nearly 60 percent of the automaker’s cars are being sold overseas, and Wagoner sees huge potential in these foreign markets. “What’s new and exciting is the breath-taking growth we’re seeing in places like China and India and South America - and Russia, more recently,” Wagoner told a group of Washington reporters at a breakfast yesterday hosted by the Christian Science Monitor. “Our guess is that in 2012, 85 million units [will be] sold globally…probably about 80 percent of that in emerging, developing markets.”

With the U.S. economy - and consumer demand - stalling, he added, GM is banking on those overseas sales even more. “The biggest downside risk is that the [U.S.] economy doesn’t show sustained growth,” he said. “Every piece of data suggests that most of our growth is going to be outside of the U.S.,” he said. “So we’ve changed the structure of the company to address that…One that functions globally, responsible for revenue generation in each region.”

GM is closing plants here to keep up with shrinking sales while expanding overseas - which, conflated into political-speak, qualifies as “shipping” U.S. jobs abroad. The company, says Wagoner, has found that the only way to compete with foreign automakers is to “build where we sell. We build plants in China, we produce cars and we sell almost all of them in China. We do the same thing in Europe.”

This is not to defend GM, or Wagoner. The company’s fragile financial plight is partly of its own making, as well as the salary and benefits demands of its unionized workforce. (See Alex Taylor’s article here.) But whether we’re talking about Wagoner’s GM or Whirlpool (WHR) - famously castigated during the Iowa caucuses for closing the original Maytag plant in Iowa - or another U.S. manufacturer struggling to build sales in a competitive world economy, the question is what will support the survival of these companies going forward.

Obama has said “we can’t shy away from globalization… I don’t think Americans are afraid to compete.” Then does it make sense to castigate companies that build factories overseas in order to compete? Clinton says she wants to restore “a strong, vibrant manufacturing sector in America.” Then why call for a “time out” on trade agreements that might lower tariffs on American exports?

“The data is absolutely irrefutable that relatively more free trade is good for consumers and societies and long-term economic growth, and drives greater competitiveness of industries,” said Wagoner. “So any move by the U.S. to move back from a fairly progressive position on trade would be, long term, not good for the U.S. economy and would send a tough message to the rest of the world.”

This is a debate that needs to be played out in this year’s presidential election. It once played out inside the Democratic Party. Unfortunately, that’s not happening in this year’s primary race. Alas, we’ll have to wait for the fall - and general election season.

17 neaston Hillary: Not dead yet http://fortunepowerplay.wordpress.com/?p=33 2008-03-08T11:31:03Z 2008-03-05T14:50:25Z The political media establishment had already dressed her in black, but last night Hillary Clinton appeared at the podium, resplendent in red, to dedicate her Ohio victory to “everyone who has been counted out but refused to be knocked out.” Twice now, opinion-makers have written the eulogy for Clinton’s funeral. In this nail-biter of a presidential [...]


The political media establishment had already dressed her in black, but last night Hillary Clinton appeared at the podium, resplendent in red, to dedicate her Ohio victory to “everyone who has been counted out but refused to be knocked out.”

Twice now, opinion-makers have written the eulogy for Clinton’s funeral. In this nail-biter of a presidential primary, media underestimation of Hillary Clinton is the one constant we can count on.

First, it was New Hampshire: In the heady days after Barack Obama’s big Iowa victory, the political punditry assumed–based on his draw of huge and enthusiastic crowds, and faulty polls–that he would wrap up the nomination by sweeping the Granite State. But Clinton’s crowds were big too, and it turned out that sizable numbers of women related to the experience of being counted out. Remember the tears-in-the-diner episode?

Last night Clinton showed political life again. She had been declared dead in the water going into the Texas and Ohio primaries. Obama surrogates like Illinois Senator Dick Durbin sadly shook their heads on national TV as they suggested that Clinton should make the difficult decision to exit the race for the sake of party unity–and much of the media bought the spin.

Instead, Clinton swept Ohio and eked out a victory in the popular vote in Texas.

This is not to say, by the way, that she doesn’t still face a massive uphill climb. The Democrats’ complicated proportional system makes it hard–some insist impossible–to overcome Obama’s slim lead in pledged delegates.

As expected, Obama won the night-time caucus vote that followed the primary vote in Texas. (The caucus vote allocates one-third of the state’s delegates, but it doesn’t measure actual results because voters can–and do–vote twice, once in the primary and then again in a caucus.)

But Clinton’s popular vote victories in Ohio, Texas, and Rhode Island last night will bolster her case before the some 300 superdelegates–elected officials, party members and others who aren’t chosen in the vote–who still remain undecided.

Watch, too, for her campaign to ramp up efforts to convince the Democratic National Committee to include the votes of two states she won–Florida and Michigan–which are barred from the process because they defied party rules by moving their primary dates forward. Ohio Gov. Ted Strickland–in introducing Clinton last night–suggested as much.

There will also be calls to “rerun” these two primaries. Republican Florida Governor Charlie Crist–the self-described “people’s governor”–has said he’s happy to entertain that proposal.

Clinton won last night by stitching together the coalition that gave her victories in New Hampshire and on Super Tuesday–older voters, union households, Latinos, and — especially– women.

Exit polls show that, in Ohio, 58 percent of the women who voted chose Clinton. In Texas it was 53 percent. And Democratic women turned out in huge numbers, comprising 59 percent of the vote in Ohio and 57 percent in Texas.

Another interesting note: labor. Obama captured major union endorsements in the past week, particularly the Change to Win coalition–an alliance of six unions that includes the powerful Teamsters and Service Employees International Union, or SEIU.

Teamsters chief James P. Hoffa, whose union has 60,000 members in Ohio, campaigned alongside him. Change to Win president Anna Burger said her operation had thousands of pro-Obama soldiers on the ground. “We have so many volunteers we don’t know what to do with them,” she told reporters on a Monday conference call.

Obama’s proclamations that he wanted to change NAFTA, a trade agreement deeply unpopular in Ohio, were expected to solidify that union support. Instead, Clinton won the union vote, which comprised one-third of the Ohio electorate.

Of those voters who are union members, or part of a union household, 57 percent voted for Clinton in Ohio.

Clinton, of course, has been beating the anti-free trade agreement drum for more than a year, from her call for a “time out” on trade deals to her denunciations of NAFTA. And when Obama moved in on her territory, she pounced–accusing him of telling voters he wanted to opt out of NAFTA but letting a senior adviser tell Canadian officials otherwise.

One of her top advisers last week complained about a lack of “fighting spirit” in her campaign. Much like the fabled knight in Monty Python, she comes out of yesterday’s battle bruised and battered but not dead yet.

5 Todd Woody Trouble in Texas for Democrats http://powerplay.blogs.fortune.cnn.com/2008/03/04/trouble-in-texas-for-democrats/ 2008-03-05T02:41:20Z 2008-03-05T00:21:55Z Fortune’s David Whitford writes: FORT WORTH — It’s election day in Texas and I’ve been on the road all day, driving around the dairy country south and west of Fort Worth, chatting up voters, asking whom they like and why. I can’t tell you which Democrat will win this mighty primary, in which 228 delegates are up [...]


Fortune’s David Whitford writes:

FORT WORTH — It’s election day in Texas and I’ve been on the road all day, driving around the dairy country south and west of Fort Worth, chatting up voters, asking whom they like and why.

I can’t tell you which Democrat will win this mighty primary, in which 228 delegates are up for grabs. The polls don’t close for another few hours, and then come the caucuses; I’m guessing it’s going to be a long night. But if I’m a Democrat, already I’d be worried about November. This is starting to look ugly.

I’d be worried after talking to Kelly Mohler, 19, a ranch hand that was having lunch with two of his old high-school buddies at Reynaldo’s Mexican restaurant in Stephensville. Mohler, a Democrat, said he planned to vote for Hillary Clinton, in part because “Obama’s a Muslim,” and while he, personally, has no problem with Muslims, he doesn’t think America is ready to elect one president.

I’d be worried after talking to Mohler’s friend, Garnett, 20, who didn’t want to tell me his last name. “Obama’s not a Muslim, he’s a Christian,” Garnett interrupted, correcting that error. Garnett, on the other hand, isn’t ready to vote for a woman. “I don’t think the other countries would respect us,” he said.

And I’d be worried after talking to Marguerite Thomas, proprietor of the Billy the Kid Museum in Hico, who chose not to tell me which way she voted this morning, but did offer clues. Her views on healthcare reform, for example: “I’m not crazy about anybody’s health plan, just not crazy about it at all, because in the end I think it’s gonna cost us more money.” And her deep distrust of Barack Obama. “Only because there are things in his past that he’s not owned up to,” Thomas said, citing Obama’s “active” involvement in the Weather Underground (that’s also false, by the way); and doubts about his religion, which she says is “a little shady. We don’t know whether he’s really a Muslim. He says he’s a Christian but he’s a member of this church that sounds like it’s a little of both.” (For the record, Obama’s church is Chicago’s Trinity United Church of Christ. Protestant to the bone.)

If all that suggests ways in which Obama might be vulnerable with certain kinds of voters in the fall, it’s clear that Clinton has serious issues, too. Why else would James Wills, 46, a Republican from Austin and a McCain supporter, have voted for Clinton? Just following Rush Limbaugh’s suggestion, Wills said. They like that potential match-up even more.

5 dterry Obama’s dicey trade dance http://fortunepowerplay.wordpress.com/?p=31 2008-03-03T19:21:02Z 2008-03-03T17:37:13Z With John Edwards out of the presidential race, there’s plenty of room for the Democratic candidates to dance to the left on free trade.  And Ohio - with its Great Depression-level loss of manufacturing jobs and union households comprising a quarter of Democratic voters - provides an enticing ballroom. So over the past week, Barack Obama [...]


With John Edwards out of the presidential race, there’s plenty of room for the Democratic candidates to dance to the left on free trade.  And Ohio - with its Great Depression-level loss of manufacturing jobs and union households comprising a quarter of Democratic voters - provides an enticing ballroom.

So over the past week, Barack Obama - eager to topple Hillary Clinton in Tuesday’s primary there - has taken James P. Hoffa and his protectionist Teamsters out for a spin. Hoffa campaigned alongside Obama in Ohio and his 60,000 members in that state provide a ready bank of get-out-the-vote volunteers for the candidate. (There are 17,000 Teamsters in Texas, which votes the same day.)

But now Obama is getting a taste of the price he’ll have to pay - both as a candidate and a potential president - for his alliance with a powerful union that has never met a free trade agreement it likes. The fallout: An ugly episode about whether Obama’s chief economic adviser did in fact try to reassure nervous Canadians by telling a top official that the candidate’s anti-NAFTA position was merely political posturing. Hillary Clinton has pounced - a memo reported by the Associated Press today calls into question the campaign’s denials that the discussion ever took place.

Obama began ramping up his free trade attacks on Feb. 11 with a  statement in the Congressional Record criticizing the free trade agreement South Korea signed last year with the United States, which now awaits congressional approval.  Nine days after that, he received the Teamsters’ endorsement.  And six days after that, at a presidential debate in Cleveland, he endorsed Hillary Clinton’s promise to opt out of NAFTA unless labor and environmental standards were renegotiated. “I think we should use the hammer of a potential opt-out as leverage,” Obama said.

That threat is real. Under NAFTA’s provisions, the U.S. president can pull out of the treaty, with a six-month notification. (Also real, by the way, is the threat that Canada or Mexico would use any concessions as leverage to gain new advantages for their own industries; Mexico, for example, would love to impose tariffs on U.S. corn.)

The leaders of Canada and Mexico took this threat seriously. The question now is whether Obama’s chief economic adviser, University of Chicago’s Austan Goolsbee, tried to reassure Canada’s consul general that his candidate didn’t really intend to blow up NAFTA, despite stated promises to the contrary.

It’s still unclear what was really said in the Goolsbee meeting; the campaign says the memo took the conversation out of context. But the incident gave Clinton an opening over the weekend to issue blistering attacks on Obama, questioning his anti-NAFTA credentials and his international leadership skills. 

“I think it’s somewhat disturbing that he would say one thing in Ohio and then have his campaign send a private signal to a foreign government which is presenting exactly the opposite of what he’s saying in Ohio,” Clinton said in a statement for media consumption. “This is part of a pattern and I think it’s a pattern that deserves closer examination.”      

Let’s not forget that Hillary Clinton started the anti-free-trade game more than a year ago when she called for a “time out” on free trade agreements - even as liberal Democratic leaders in the House were cutting a deal with the Bush White House on labor and environmental standards to pave the way for new free trade agreements. Shortly thereafter, she began attacking NAFTA, one of her husband’s signature achievements.

Throughout the campaign, Obama has followed suit. But his alliance with the Teamsters and other protectionists in the labor movement raises a host of new issues should he win the nomination, and the presidency.

Obama, like Clinton, supported the free trade agreement with Peru that Congress approved on a bipartisan vote in December. The deal incorporated those same labor and environmental standards carefully negotiated by House Democratic leaders and the Bush White House.

But Teamster Hoffa denounced the Peru agreement as “NAFTA in disguise,”  and “another way for big business to escape and build sweat shops down there.” (Actually, the agreement extends the same duty-free access to Peru markets for U.S. producers that Peru enjoys here.)

The Teamsters are also labor’s chief proponents of the myth that the Bush administration is secretly plotting to build a “NAFTA superhighway,” cutting through the United States that would “allow global conglomerates to exploit cheap labor and nonexistent work rules” and avoid port security.

Right now, Obama is focused on swatting off Clinton’s attacks from the left on free trade - accusing him of being disingenuous and insufficiently committed to “fixing” NAFTA. But the Teamster alliance means that he will face pressure from union leaders to the left of Clinton who supported him at a critical moment in the primary campaign. Will President Obama be willing to stand up to the Teamsters the same way candidate Obama stood up to the auto industry by taking his call for emissions controls straight to Detroit last summer.

As the tiff over the Goolsbee episode suggested, that could put President Obama at odds with friendly foreign leaders who negotiated trade agreements in good faith - not to mention American producers (and their employees) who benefit from export markets abroad that free trade agreements open.

0 dterry McCain atones for conservative apostasy http://fortunepowerplay.wordpress.com/?p=30 2008-02-21T14:50:41Z 2008-02-21T14:50:41Z Fortune’s Telis Demos writes: It has been fascinating to watch John McCain make nice with Republicans on the single issue that many of them, especially in the business world, care about: tax cuts. What he said to Stephen Moore in a 2005 Wall Street Journal interview has been for many Exhibit A of his apostasy:  “I’m [...]


Fortune’s Telis Demos writes:

It has been fascinating to watch John McCain make nice with Republicans on the single issue that many of them, especially in the business world, care about: tax cuts. What he said to Stephen Moore in a 2005 Wall Street Journal interview has been for many Exhibit A of his apostasy:  “I’m going to be honest,” the Senator told him, “I know a lot less about economics than I do about military and foreign policy issues.” It continues:

“Even when I confront him with emphatic evidence that those tax cuts have been an economic triumph and have increased revenues, he is unrepentant and defends his “no” vote by falling back on class-warfare type thinking: “We have a wealth gap in this country, and that worries me.”

Moore was formerly head of the Club for Growth, one of the conservative firmament’s most aggressively pro-growth, anti-tax lodestars. While McCain’s crusade against pork was heartening to Moore, the Senator’s initial opposition to the Bush tax cuts because they were too generous to the rich was evidence of “the danger of the McCain view of the world.”

But fast forward to today. I checked in with Moore to see where things stood between him and the now-certain Republican presidential nominee. It turns out he has been talking to McCain on-and-off since their interview, and much more recently. (He’s one of many conservative economists that McCain loves to cold call from his favorite campaigning gadget, his Motorola RAZR. )

The result of those conversations is that Moore, who has left the think-tank world to become a full-time columnist for the Journal, has seen a change in the maverick. “I believe that McCain is really under a conversation process to supply-side economics,” said Moore. “One of the things he told me a month or two ago, he said, ‘When I opposed the Bush tax cuts I didn’t think they would work. It turns out I was wrong.’ That was really reassuring to me.” McCain now supports the permanent extension of Bush’s income tax cuts.

Since Moore’s piece, McCain has even since changed his original explanation of why he voted against the tax cuts. He told columnist Bob Novak a couple weeks ago that he voted against the cuts “because of my concerns with no commensurate restraint in spending” not because of his concerns about the wealth gap.

“I think McCain has atoned for his sins,” says Moore. “I think that he has basically become really intrigued with ideas of how we can get rates down. The first manifestation of that is when he came out for a corporate tax cut, which is now a centerpiece of his economic platform.

But on a down note for McCain, Moore says one policy disagreement that’s been obscured by—and is potentially bigger than—taxes is his belief in the immediacy of doing something about climate change: “I think his support for a cap-and-trade [carbon emissions control scheme] will end up being the most damaging to him among conservatives. I have a lot of friends calling me up with their list of grievances, and one of them is always near the top is his position on global warming.”

Given what happened with taxes, it will be interesting to watch how McCain’s climate change position evolves as he tries to solidify the Republican base behind him. Will he push his previously stated rationale, that it’s part of a national security agenda? That goes nicely with his existing strengths with voters. Or, in attempt to assuage small-government conservatives’ fears, will McCain try and sell his approach as do-no-harm to the economy, by opposing carbon taxes and giving away carbon trading permits to businesses rather than selling them? Or, might there just be another conversion in the works?

4 neaston McCain’s Veep-stakes http://fortunepowerplay.wordpress.com/?p=29 2008-02-19T12:07:15Z 2008-02-19T12:07:15Z Now that John McCain appears to be in possession of the Republican nomination, attention is turning to the question of  who is likely to fill the No. 2 spot on his ticket. There are some obvious names for a short list. Florida Governor Charlie Crist played kingmaker in his home state with an 11th hour endorsement [...]


Now that John McCain appears to be in possession of the Republican nomination, attention is turning to the question of  who is likely to fill the No. 2 spot on his ticket.

There are some obvious names for a short list. Florida Governor Charlie Crist played kingmaker in his home state with an 11th hour endorsement that - according to exit polls - helped throw this critical primary contest to McCain, thereby building unstoppable Super Tuesday momentum. Crist is a popular governor, but he’s also a staunch moderate. He told Fortune he supports a path to citizenship for illegal immigrants—not a position likely to help McCain’s already troubled standing with conservatives.

Watch for Mitt Romney’s name to surface. That’s a choice that conservatives would like — but it’s hard to imagine McCain overcoming his obvious personal antipathy toward the Massachusetts governor and presidential rival to offer him the job. True, there was no love lost between GOP nominee Ronald Reagan and VP George H.W. Bush in 1980 (Bush famously tagged Reagan’s supply-side theories as “voodoo economics” during the primaries). But at least since 1992, presidential nominees have chosen VP’s they can partner with. Other names being mentioned include presidential candidate Mike Huckabee, South Carolina Governor Mark Sanford and John Thune, the freshman senator from South Dakota. 

But I spoke with two longtime McCain intimates who offered up these names: conservative Kansas Senator Sam Brownback and Minnesota Governor Tim Pawlenty - both of whom are personally close to the Arizona senator. 

Of those two, Pawlenty is the most likely, in part because putting two senators on the same ticket is problematic; in part because Brownback’s disbelief in evolution and promotion of “intelligent design” would create all sorts of headaches in a general election campaign. 

On policy, Pawlenty is maverick, much like McCain, yet he’s also won over the hearts and minds of opinion-molding conservatives. The Weekly Standard last year praised him as a “Sam’s Club Republican,” that is, a conservative who is nevertheless conscious of the needs of today’s struggling workers.

Here’s what Weekly Standard writer Matthew Continetti had to say about Pawlenty—and why the youthful governor is worth watching.

The most important speech at the 2007 Conservative Political Action Conference, held in early March at a Washington hotel, didn’t come from any of the Republicans running for president. It came from Minnesota governor Tim Pawlenty, one of the few Republican success stories in 2006 — he was reelected with 47 percent of the vote — and a rising star in a party that’s been knocked back on its heels. Pawlenty spoke in the middle of the afternoon on the last day of the three-day event, hours before former House Speaker Newt Gingrich would address a standing-room-only crowd. The audience that listened to Pawlenty’s panel was modest in size, listless, and easily distracted. The subject was how the GOP can win back the votes of suburban and exurban voters. When Pawlenty said, “I support school choice,” the crowd applauded wanly. Then it was silent. Conservative boilerplate wasn’t going to rouse it from its stupor. And Pawlenty said, “But that ain’t enough.” A few kids in blue blazers raised an eyebrow. And Pawlenty said, “I want to push you a little bit. Indulge me.” Two older conservatives exchanged looks. And before you knew it Pawlenty took off, arguing for reimportation of prescription drugs from Canada and Mexico, for increased government subsidies for alternative energy, for more health insurance coverage, and for using government to cater to the needs of down-scale voters. At times the crowd was confused; at other times it seemed annoyed. Here was this tall, bird-like young man — Pawlenty is 46 — taking on standard conservative public policy prescriptions and saying they were lacking. He was saying they weren’t enough to return the GOP to majority status. Besides, the issues on which Pawlenty focused — education, health care, energy — sounded a little . . . Democratic, especially at a wingnut gathering such as this.

A funny thing happened, however. Once he had his audience, Pawlenty never lost them. In fact, he won some of them over. Towards the end of the talk, when Pawlenty said the United States was “funding both sides of the war on terror. We’re funding our side, and we’re funding their side by buying oil,” he got a standing ovation.

For more on Continetti’s take on Pawlenty, go to: http://www.weeklystandard.com/Content/Public/Articles/000/000/013/575ydyfr.asp

6 neaston Guess who’s “Reaganesque”? http://fortunepowerplay.wordpress.com/?p=28 2008-02-06T16:16:38Z 2008-02-06T15:35:03Z I was sitting in Fox News’ New York studio this morning, joining radio talk show host Michael Reagan - the late president’s adopted son -to analyze last night’s election results. Reagan, joining remotely from California, started gushing about a candidate speech he heard last night. It was one of the best speeches he had heard [...]


I was sitting in Fox News’ New York studio this morning, joining radio talk show host Michael Reagan - the late president’s adopted son -to analyze last night’s election results. Reagan, joining remotely from California, started gushing about a candidate speech he heard last night. It was one of the best speeches he had heard in a long time. In fact, he said, it was positively “Reaganesque.”

John McCain?

Mitt Romney?

Mick Huckabee?

No. This hardcore conservative was referring to the candidate that annoys conservatives most - Hillary Clinton.

Frankly, Reagan could have been talking (as I thought he was until he mentioned her name) about Barack Obama, who gave such a rousing speech last night in Chicago that some of his supporters looked enraptured. (One woman standing on stage behind him started weeping in ecstasy and had to be comforted.)

The point is this: Regardless of the sometimes nasty exchanges between the two Democrats, they both enjoy a massive and excited base of support that so far has eluded the Republicans. The Super Tuesday headlines hailed “record turnouts” at voting booths yesterday. In fact, this was mostly due to the Democrats. In many states, Democratic turnout dwarfed GOP turnout two-to-one.

We spend a lot of time wondering what a souring economy, or the Iraq war, or an unpopular GOP president will mean to the outcome of next November’s election. But there’s something else that the Republicans better start worrying about: The enthusiasm gap.

1 neaston The Super Tuesday surprise: No major upsets http://fortunepowerplay.wordpress.com/?p=27 2008-02-06T16:16:57Z 2008-02-06T14:32:10Z The real headline coming out of Super Tuesday was the dearth of upset victories–on a night when everyone was looking for them. Earlier in the day, there were predictions that Barack Obama would severely wound Hillary Clinton (just as there were, by the way, in the hours leading up to the New Hampshire primary, when [...]


The real headline coming out of Super Tuesday was the dearth of upset victories–on a night when everyone was looking for them. Earlier in the day, there were predictions that Barack Obama would severely wound Hillary Clinton (just as there were, by the way, in the hours leading up to the New Hampshire primary, when Clinton proved the prognosticators wrong by winning.)  “A lot of coverage was based on exit polls that turned out to be wrong,” Clinton strategist Mark Penn told reporters on a media conference call this morning.

Clinton’s own advisers were girding for a rough night. Momentum seemed to be carrying Obama in two Northeast states where she once could count on an easy sail to victory–Massachusetts and New Jersey.

In Massachusetts, Obama was basking in the warm publicity of endorsements by the Kennedy family, including the state’s senior senator, Ted Kennedy. Former presidential candidate John Kerry was behind him, as was that state’s governor, Deval Patrick. In New Jersey, Obama was gaining on Clinton, with support not only from African-Americans but also from white males. A loss in New Jersey, neighboring Clinton’s home state, would have been a blow to her to campaign.

But, once again underestimated by commentators, Clinton won handily in both states.

The other potential upset was California, where Obama had been gaining ground in the past few days, and seemingly even cutting into the Latino vote, which had been solidly with Clinton. Again, no news here: Clinton won that delegate-rich state.

None of this should take away from the Obama wins. He won Connecticut, which Clinton no doubt would have preferred to hold onto. He sewed up caucus states where he has built strong organizations–Colorado, Kansas, Minnesota, Idaho, among them. He had wins in the South–Georgia and Alabama. And, most impressive of all, he won a tight race in Missouri, considered a bellwether state, by just one point.

But the big upset Obama supporters hoped for didn’t happen. Obama’s momentum shifted in the last 24 hours, when large chunks of undecided voters in key states embraced Clinton.

The pair are neck and neck in the delegate count. That’s largely because of the complex Democratic system of dividing delegates proportionally. “It would be all but over if it were winner-take-all,” said Penn.

But the Clinton camp is pleased–and now busily portraying Obama as “the establishment candidate” for a well-funded campaign that included airtime during the Super Bowl.

On the Republican side, there was one state that really mattered as a potential upset–California–and it didn’t happen for Mitt Romney. After his loss to John McCain in Florida, Romney (literally) banked his campaign future on the state–spending serious money on TV ad buys. Polls in recent days, some of which were wildly wrong, showed the former Massachusetts governor in a tight race and even well ahead.

Instead, McCain won handily, and Romney was left to pick off his home state of Massachusetts, the heavily Mormon Utah, and five mostly western caucus states of Colorado, Montana, Alaska, North Dakota and Minnesota. McCain’s status as front-runner was sealed.

0 jimledbetter http://jimledbetter.wordpress.com/ The Democrats’ fault line http://fortunepowerplay.wordpress.com/?p=26 2008-02-06T15:41:12Z 2008-02-06T00:20:46Z David Whitford writes from Boston When I reached Massachusetts State Senator Jim Marzilli shortly after lunch on Super Tuesday, the veteran Democratic legislator was still on the fence. Obama or Hillary? Hillary or Obama? He’s no closer to deciding now than he was when this whole thing started. “I may blank this presidential primary election,” he [...]


David Whitford writes from Boston

When I reached Massachusetts State Senator Jim Marzilli shortly after lunch on Super Tuesday, the veteran Democratic legislator was still on the fence. Obama or Hillary? Hillary or Obama? He’s no closer to deciding now than he was when this whole thing started. “I may blank this presidential primary election,” he confessed, “which would be a first.”

Being undecided this late in the game feels weird to Marzilli, who was going door to door for Gene McCarthy when he was 10 years old (his mom and dad were for Nixon). He’s an embodiment of the fault line running through the Democratic establishment in this bluest of blue states. On one side you’ve got the Beacon Hill legislative crowd, most of which lined up early behind the candidate they knew best; seeing no good reason to switch, they’re sticking with Hillary. On the other, you’ve got the Washington pols, led by John Kerry and Ted Kennedy. They held out longer but lately have swarmed to Obama, impressed, as Marzilli is, “by the number of new people Obama has brought into the political process.”

That same fault line runs through the electorate. The more informed, it seems, the more confused. At day’s end, eight of ten newsroom employees at WBUR in Boston who work on the current affairs show “Here and Now” were still undecided. Two hadn’t even settled on which ballot they would ask for, Democratic or Republican, in Massachusetts’s open primary.

That’s why both Hillary and Obama spent at least part of Super Tuesday Eve in Massachusetts. I went to the Obama rally at Boston’s World Trade Center. People started arriving at 5:00, three hours before the doors opened. By 7:00, when it was cold and dark and the wind was blowing, the line was four wide and half a mile long, stretching all the way back to the Barking Crab restaurant on Fort Point Landing. My general impression of the demographics of that line? I’m pretty sure most were old enough to vote; I’m not sure most were old enough to drink.

Inside, I spoke to Luca and Edouard, two Harvard Business School students from Italy and France, respectively, who came early and brought homework. “There’s lots of interest in this election in Italy,” Luca told me. “I was very curious to see how he could inspire people.”

I was, too. First we had to hear from Kerry, though, who reminded us that it was he who gave Obama the keynote speech at the Democratic Convention in Boston four years ago. And from Massachusetts Governor (and former assistant attorney general in the Clinton administration) Deval Patrick, whose Clinton ties didn’t prevent him from endorsing Obama last fall.  And Kennedy, of course (Ted spoke, Caroline was present), so that it was past 10:00, and the crowd was growing restless, when Obama finally appeared.

It wasn’t his best performance. A little long on promises, a little short on inspiration. Certainly nothing like the transcendent speeches I watched on TV after Iowa and South Carolina. And he went on way too long, for nearly an hour, so that it was past midnight when the stragglers finally left the hall. But it didn’t matter. The crowd was with him all the way, at times silent and absorbed, as in a church, and at times delirious. I don’t think it ever got as loud as it did at the Beanpot hockey tournament (Harvard beat Northeastern), which was happening at the same time over at the Garden, but maybe it did. If only because so many college students were here this night, instead of there.

3 neaston McCain’s immigration lesson http://powerplay.blogs.fortune.cnn.com/?p=25 2008-02-05T22:10:41Z 2008-02-05T22:09:34Z “I think the revolt has tempered.” So said GOP Florida Governor Charlie Crist 24 hours before Super Tuesday polls opened. Crist was at Fortune’s office in New York, answering a question about illegal immigration and the widespread - especially Republican - dissent over John McCain’s legislation last summer to create a pathway to citizenship for some [...]


“I think the revolt has tempered.”

So said GOP Florida Governor Charlie Crist 24 hours before Super Tuesday polls opened. Crist was at Fortune’s office in New York, answering a question about illegal immigration and the widespread - especially Republican - dissent over John McCain’s legislation last summer to create a pathway to citizenship for some 12 million undocumented workers living in this country.

McCain’s bipartisan bill - combined with his support for a then-unpopular surge of troops to Iraq - nearly tanked his presidential campaign eight months ago. Now McCain is the Arizona Phoenix, cruising into Super Tuesday confident he has sewn up the GOP nomination.

Was the intra-party brawl over illegal immigration over-hyped? “It just doesn’t seem to be moving votes as much as anyone thought,” says Michael Barone, co-author of the Almanac of American Politics and Fox News polling analyst.
It’s true that since the collapse of his campaign last summer McCain has recalibrated his position, saying he learned his lesson after a grassroots GOP revolt helped killed his bipartisan bill (which was backed by the White House). McCain now stresses securing U.S. borders first, insisting that the real reason for the charged emotions over the issue is that Americans lost faith in the government for past failures to keep illegals out. He also wants to deport illegal immigrants who have committed crimes.

But on the campaign trail, McCain doesn’t offer much more in the way of tough rhetoric to placate those voters angry over the swell of illegal immigration. He supports a temporary worker program, and when asked in January if he still supports a path to citizenship, he responded “sure.” He reminds audiences that “all of these people are God’s children.”

Plenty of conservatives - including some GOP leaders in Arizona - still refuse to support McCain because of his immigration bill, and he has been booed at campaign stops. By contrast, Mitt Romney’s get-tough stance is one of the former Massachusetts governor’s biggest applause lines. [Full disclosure: My husband is a Romney adviser.]

Yet the issue so far isn’t costing McCain the nomination. Part of the reason is the primary calendar: McCain staked his candidacy on New Hampshire, where independents can vote in the GOP primary and where warm feelings toward the candidate date back to his upset victory there over George W. Bush in 2000.

In exit polls, those who voted in New Hampshire’s GOP primary ranked the economy and war well above immigration. Days later, in recession-era Michigan, where Romney beat McCain, the economy trumped everything as the No. 1 issue. Likewise in South Carolina, illegal immigration didn’t strike a chord the way it might have in more urban neighbors like Georgia or North Carolina, notes Barone.

In Florida, McCain’s immigration position actually helped him by keeping the Cuban-American vote (which tends to be pro-immigration and represents about 8 percent of the total) away from Romney in that hard-fought primary contest. And Governor Crist’s own support for a pathway to citizenship certainly hasn’t dented his popularity there.

By the time Super Tuesday arrived, McCain’s position as front-runner was sealed, the Republican establishment (such as there is anymore) was rushing to embrace him, and anger over his position on illegal immigration was mostly shunted to the right wing of the party, given voice by conservatives pundits like Rush Limbaugh.
But the primary calendar isn’t the only factor. Opinion polls have discerned complicated feelings even among voters who worry most about illegal immigration. A desire act humanely toward those already here and the business community’s reliance on this hardworking labor force competes with fears about rewarding illegal behavior, low paid workers replacing American, and so on. People oppose a pathway to citizenship - but they appear to soften that stance when they are asked if they would support it once the borders are secure. McCain capitalized on those nuances with his new message of secure-the-borders first.

But in the end, he was probably helped by something else: The plot line of a souring economy. As voters watch the subprime mortgage mess play out, affecting their own economic well-being, many are developing the view that the villains in the U.S. economy are greedy mortgage brokers and investment bankers - not illegal Salvadorans mowing the lawn.

12 jimledbetter http://jimledbetter.wordpress.com/ The Bloomberg delusion http://fortunepowerplay.wordpress.com/?p=24 2008-02-02T00:53:19Z 2008-01-28T15:37:17Z By James Ledbetter Almost no one - perhaps including Michael Bloomberg himself - can say with certainty whether or not the New York City mayor and massively successful businessman will launch an independent bid for the presidency this year. Bloomberg has to date officially denied that he is a candidate, even while crisscrossing the country [...]


By James Ledbetter

Almost no one - perhaps including Michael Bloomberg himself - can say with certainty whether or not the New York City mayor and massively successful businessman will launch an independent bid for the presidency this year. Bloomberg has to date officially denied that he is a candidate, even while crisscrossing the country making political speeches and allowing aides to effectively plot a national campaign while they draw a city paycheck.

The facts lead to a very simple conclusion: Mike Bloomberg cannot be elected president in 2008. That Bloomberg has allowed the notion of a presidential candidacy to linger this long represents an intoxicating mixture of hubris, wishful thinking and power-grabbing that ultimately constitutes a delusion.

These are the three pillars of the Bloomberg delusion:

1) The belief that Bloomberg’s much-praised mayoral performance entitles him to higher office. In a perfect political world, that might be the case, but New York City politics are anything but perfect. The divide between the political cultures of New York City and the rest of America is vast and longstanding. Have a look at the roster of past New York City mayors going back to the 17th century.These are not men who go on to be senators or governors, much less cabinet secretaries or presidents (not one ever has); they go on to be roads, bridges and an airport. The mayoralties of Cleveland, Denver and San Francisco are better launching pads for prominent political careers than New York’s.

And that’s not because New York mayors haven’t tried. John Lindsay - an urban liberal elected as a reform Republican - hoped to become president in 1972 while still serving as New York City mayor (sound familiar?). His campaign fizzled. Ed Koch, a vibrant mayor with a national profile, ran for governor in 1982; he failed. And while Rudy Giuliani may yet get elected to something, his pummeling in the early 2008 Republican contests - repeatedly finishing behind even Ron Paul - ought to send Bloomberg a wake-up call.

The problem in recent years has been that the stances needed to get elected in New York City on hot-button issues like abortion, the death penalty, immigration, gay rights and gun control are not only unpopular with the moderate-to-conservative American voter - they’re a tough sell even in upstate New York. Somewhat related to this is the city’s ethnic makeup, which is wonderful for multiculturalism but does not easily translate nationally. That is, since 1974 the mayor of New York has been either Jewish, African-American or Italian - important national voting blocs, but not ethnic groups who’ve not yet made it to the top of the ticket of either major political party.

2) The belief that getting on the ballot will be friction-free. The paper-thin margins of recent presidential elections mean that a candidate not on the ballot in all 50 states is almost certainly destined to lose. Most of the recent candidates running outside the two-party system have failed to get their names on the ballot in all states. In 2000, for example, both Pat Buchanan and Ralph Nader had to rely on write-in ballots in a few critical states.The biggest exception was Ross Perot’s 1992 campaign, and given that Bloomberg is a fellow billionaire, the assumption is that he can reproduce Perot’s ballot efforts. (In a typically coy move, Bloomberg met in January with Clay Mulford - Perot’s son-in-law who handled the candidate’s ballot access in ‘92 and ‘96 - and then insisted again that he is not a presidential candidate.)

I do not believe Bloomberg can clear all of the ridiculously onerous hurdles that states put in the way of independent candidates. Texas is notoriously difficult, requiring about 75,000 signatures in two months from Texans who’ve not voted in a primary. (There are ways to mitigate that, but it’s still a tough task.) But let’s say for the sake of argument that Bloomberg can spend his way onto all fifty ballots. His advisors say that they will do it by making alliances with state-by-state parties, who usually have the words “reform” or “independence” in their names.While almost certainly a necessary step for a politician with a limited national profile like Bloomberg’s, this is a potential minefield. Many of the people working for such parties are genuine, well-motivated reformers, but their ranks also include tricksters, kooks and bigots of various stripes.

Nader and Buchanan, for example, had to face charges that they’d gotten into bed with the New Alliance Party (NAP), a psychopolitical cult with a history of anti-Semitism. And Bloomberg himself became tangled with a NAP offshoot when planning his 2001 candidacy. The events of September 11 made that irrelevant, but the scrutiny of a presidential campaign will bring out uncomfortable eruptions over political clowns who have little to do with Bloomberg’s message. (Ron Paul recently encountered a similar dynamic when it was revealed that newsletters distributed under his name in the ’90s were filled with racist and homophobic garbage.)

3) The belief that there is a popular groundswell for a Bloomberg presidency. This is the biggest delusion of all. Put simply, Bloomberg is no Ross Perot. At this stage in the ‘92 campaign, Ross Perot’s populist, anti-incumbent message - which had been receiving tons of free TV time for nearly a year - actually put him ahead in opinion polls in large, crucial states. By the time he began gathering petition signatures in Texas, Perot was almost neck and neck with Bill Clinton in national polls.

Those were different times with different actors. No national poll has ever put support for Bloomberg any higher than the very low double digits. Even in his home state, there is thin backing for a run; a Marist poll taken in January found that a whopping 68 percent of registered New York state voters don’t want Bloomberg to run for president.Two veteran political consultants - Doug Bailey and Gerald Rafshoon - recently launched a Draft Bloomberg Web site encouraging voters to sign an online petition for a Bloomberg candidacy. The results are thus far tepid; about 1700 signatures in their best week - and since my cat is now proudly one of them, who knows if they’re even real? Anyone who’s spent time on Facebook knows that 3500 signatories after a few weeks is not a sign of a massive movement. Many Americans are tired of bipartisan bickering and attracted to the idea of managerial competence, but that in and of itself is an insufficient rationale to elect Bloomberg.

Is it possible that Bloomberg - by all accounts a very intelligent man - and the people around him see the world in such a distorted way? Sure: It’s the nature of power that it can blind the powerful to their own limitations. It’s also possible that Bloomberg would knowingly run a presidential campaign fated to lose, in order to serve some other agenda (although he should think hard about the damage such a move could do to his reputation).

But my bet is that between now and the first week of March, Bloomberg will take a sober look at the numbers and then, echoing Mario Cuomo’s non-campaign of 1992, quietly declare that he never really intended to run - and go back to being one of the best New York City mayors of recent times.

3 neaston The re-rebranding of Barack Obama http://powerplay.blogs.fortune.cnn.com/?p=23 2008-01-28T02:58:23Z 2008-01-28T02:04:54Z On Tuesday, Barack Obama goes to El Dorado, Kansas to campaign in the hometown of his white grandparents, Stanley and Madelyn Dunham. Campaign staffers call this a “community event”, but I have a different name for it: The re-rebranding of the Illinois Senator and presidential candidate. From the start of this campaign, Barack Obama [...]


On Tuesday, Barack Obama goes to El Dorado, Kansas to campaign in the hometown of his white grandparents, Stanley and Madelyn Dunham. Campaign staffers call this a “community event”, but I have a different name for it: The re-rebranding of the Illinois Senator and presidential candidate.

From the start of this campaign, Barack Obama was the first-ever black presidential candidate who seemed to effortlessly transcend the nation’s racial divide. Born to a white mother and a Kenyan father, he offered inspirational themes of hope and unity that proved a hit on the campaign trail - especially with educated and higher-income whites.

A nearly all-white electorate in Iowa handed him an upset victory over Hillary Clinton. Obama lost New Hampshire, but anyone attending his jam-packed campaign rallies had to notice his cross-over appeal. (At one event I attended, a young African-American volunteer pointed out to organizers the need for more black faces onstage: Only two of the 35 supporters arrayed behind Obama that morning at the Palace Theater were African-American.)

That all changed over the past week, when the Clinton camp - with racially-tinged attacks - succeeded in rebranding Obama as the “black” candidate. Clinton surrogates have made mention of his teen drug use and attendance (while living with his mother and stepfather in Indonesia) at a Muslim school.

Hillary Clinton compared her opponent’s inspirational oratory to that of Martin Luther King, to make the point that words are nice but it took a doer-president like LBJ to get the civil rights agenda enacted. Bill Clinton pondered whether voters might be voting by race or gender. Black voters took afront - especially to Bill Clinton’s dismissal of Obama’s description of his record as a “fairy tale” - and circled the wagons.

Eight out of 10 black voters helped hand Obama a decisive victory Saturday night in South Carolina (a state where Clinton was ahead with black voters just six weeks ago). He received only 24 percent of the white vote. That doesn’t bode well heading into Super Tuesday, when 22 states will hand out a whopping 2,075 delegates to the Democratic contenders. Clinton enjoys double-digit leads in major states with low black populations: California, where 8 percent of voters are black, has 441 delegates. New York, with 20 percent, has 281 delegates.

Without regaining his strong cross-over appeal, Obama will have to pin his hopes on southern states like Georgia (a 47 percent black vote), and few of those states vote that day. So Obama’s campaign is returning to square one: Reminding voters of his distinctive roots. The Illinois Senator was born to a white mother and raised with his Kansas born-and-bred grandparents, mostly in Hawaii.

His only contact with his Kenyan father–who left for Harvard and then back to Africa shortly after he was born–was a couple tense weeks when when “Barry” was ten years old. The elder Obama died before they could be reunited, and Barry didn’t connect with his Kenyan relatives until he was a young man in his 20s.

“Obama’s mother, Ann Dunham, was born at the military base in Ft. Leavenworth while his grandfather served in the Army during World War II,” says the campaign. Kansas votes on Feb. 5, Super Tuesday. But this is no ordinary Super Tuesday event. It’s a chance to reclaim the distinctive Obama narrative from the sludge of a sometimes nasty campaign.

17

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