Early Debate Returns: Bad for McCain

I watched the debate tonight with growing frustration at John McCain's failure to attack Obama squarely on his confiscatory economic policies. I've finally come to the conclusion that John McCain is unable (or unwilling) to promote the kind of conservative economic message that I think much of this country is wanting to hear.  Instead, he's splitting hairs with Barack Obama on the economy -- and losing in the process. I'm always interested in the views of Steven Hayes at the Weekly Standard -- he's a smart, reasonable writer who I read frequently.  His review of the debate is that Obama won. Here's part of what he had to say:

"John McCain had a very strong debate tonight. It’s too bad for him that it came on a night when Barack Obama was nearly flawless.

The debate began with questions on the economy and for thirty minutes Obama answered those questions with the kind of substance that I suspect anxious voters wanted to hear and with exactly the right tone – empathic, aggravated and determined. Most important, he spoke to voters in their own language. In his first answer, in response to a question about things the government can do to help average Americans through these tough economic times, Obama spoke of a $400,000 junket that AIG executives took after the government bailed them out. “Treasury should get that money back,” he said, “and those executives should be fired.” Sure, a little demagoguery. But it’s exactly the kind of story – in a debate that included back-and-forth accusations and lots of statistics – that voters will remember and talk about tomorrow with their neighbors.

McCain took that first question and he turned immediately to energy. “Americans are angry, they’re upset and they’re a little fearful. And it’s our job to fix the problem. Now, I have a plan to fix this problem and it’s got to do with energy independence.  It didn’t work. Two months ago, when gas prices were nearing $5 and the cost of oil dominated the headlines, the McCain campaign deftly used anxieties about energy as a proxy for anxieties about the economy. So when McCain proposed to lift the ban on offshore drilling, voters responded positively and the polling reflected their enthusiasm."

This is what I was afraid of: McCain being unable to clearly articulate why Obama and the Democrat-controlled Congress is a danger to our economy. The reflexive return of McCain and Palin to the energy issue is a comfort zone and understandable -- but not good enough in this economy. McCain seems unable to explain to the American people that Obama's tax policies and his liberal record will be a poison pill to an economy that needs liquidity. It needs low taxes to fuel growth -- something that simply isn't possible with Obama's tax-and-spend plan.

Even worse, McCain's populist instincts are taking him down the wrong path. Rather than returning to a free-market solution to what should be a free market problem, his instinct is to increase regulation and government control -- exactly what Obama and the Democrats want to do. He again misses a chance at differentiation. Here's Hayes again:

"But while energy issues remain important and cannot be separated from the broader economic picture, the convulsions in world markets over the past two weeks and the need for a $700 billion federal bailout have rendered worries about gas prices and energy independence to second-tier status. It’s not that these issues don’t matter, it’s just that they matter less now than they did over the summer. He later broadened his answer to include spending, tax cuts and his jaw-dropping plan to have the federal government buy up “the bad home loan mortgages in America” to “let people make those payments and stay in their homes.” So bigger government is bad, quasi-governmental entities Fannie Mae and Freddie Mac “ignited” the current economic crisis, too much government spending is leaving us broke and we want the U.S. Treasury to renegotiate individual home mortgages? Seriously? No thanks."

No thanks is right. The correct and powerful answer here is to reignite the economy through lower taxes to stimulate jobs and growth so people can pay their mortgages -- NOT to have the government take over that role. This mess in the housing market is partly an issue of personal behavior -- not simply predatory lending. I, for one, am not interested in my tax dollars going to bail out people who made bad decisions. I think many Americans would agree with that. Unfortunately, McCain's instincts don't lead him down that path. He's still in the "Wall Street greed" mode.

I hate to throw in the towel here, but...it is now clear that the issues that many conservatives have with McCain are legitimate and real. That despite his great personal story, his maverick personality often betrays a message that would greatly appeal to a great swath of America. He's actually give people less of a choice by co-opting the position of Obama on so many issues.

My guess is that the polls are not going to be good for McCain after this performance tonight. In a debate where he really needed to help himself, I'm afraid he's come up short.

We'll see.

Set Sarah free!

I mostly listened to the Vice Presidential debate on radio, though I did get to see some of it on TV. Palin held her own and well exceeded the low expectations that the media had set for her. She was confident, poised and articulate -- even as she faced off against the verbosity machine that is Joe Biden. Biden was...Biden. He spoke quickly with an authority that is designed to make his statements seem like fact -- even when they aren't. Palin took him on effectively, and wasn't afraid to confront Biden's frequent exaggerations. I thought that had John McCain done that well last week against Obama the Republicans would be in better shape today.

Palin missed some chances tonight, specifically to refute the Obama-Biden claim that McCain was responsible for deregulation which got us into this mess. That's clearly only part of the story; Congress has been a big part of the problem by forcing too much regulation on Fannie and Freddie. If Fannie and Freddie had been forced to react to market risks on loans, they would never have made the vast number of sub-prime loans that they did.

Palin also missed a big chance to wack Biden on the War in Iraq -- specifically on his claim that Obama supports the same withdrawal plan that Maliki and Bush are negotiating about. Hello? The only reason anyone is talking about a withdrawal now is because of the surge that John McCain supported and Biden and Obama opposed. I wish that Palin had hit him over the head with that.

One thing that I didn't like about Palin's performance tonight: her consistent use of "corruption" and "greed" to describe Wall Street.  Certainly, some corruption always exists at the nexus of money and public policy -- but to make blanket statements that tar and feather an entire sector of our economy is populism worthy of John Edwards, not the Republican Veep candidate.  The mess we are in is more about the corruption of Capitol Hill and the lax interest rate policies of the Fed than it is any systemic disease on Wall Street.  Banks took advantage of the rules and pushed the limits to make money.  With risk comes reward -- and often failure. 

Also, I would have liked to hear Palin say also that the behavior of  borrowers played a role in this mess, too -- and that it wasn't just the responsibility of "predatory lenders".  People have to take personal responsibility for their decisions, and if this is not a theme promoted by McCain-Palin then they become nothing more than the victim-baiters that Obama-Biden are. 

In any event, my suggestion to John McCain is this: Set Sarah Free!

Let her go. Let her be spontaneous. Let her be the maverick, fun woman that she is. She's the only candidate who can relate to the American people as a real person. It is something that helps to differentiate the McCain-Palin ticket from Obama (effete, Chicago intellectual) and Biden (career Senator). It's what turned on the Republican base and got independents excited about McCain after the Convention. He needs to let her work her magic.

McCain's campaign -- and thus his chances to be president -- are in bad shape at this point. All polls in the battleground states are now leaning for Obama. He needs to do something dramatic to turn this around.

The Howard Beal election

It's hard to turn on the TV these days. The news and images from Washington are like a train wreck. The height of hypocrisy: the crooks who made this mess posturing for a bailout on the backs of the taxpayer... looking stern and serious while they sit in gilded offices paid for by the investment banks and mortgage firms -- those that provided them with cheap loans to their poor constituents, while profiting handsomely from complex, opaque financial instruments that no one understands. While Washington slept the market ran wild, fueled by impossibly cheap money and overabundant credit. The Wall Street Journal ran a picture of J.P. Morgan the other day. He looks like a banker: stern, serious, practical. I wonder if he'd have given people $400,000 stated income loans; not a piece of paper to prove their earning or their ability to pay it back. That's what we did in the hyper-fueled lending world of Freddie and Fannie. You need to buy a house. Can't afford it? No problem, we'll cover you. Can you imagine J.P. Morgan doing anything so stupid?

And now comes the final indignity: the "bail out". The House yesterday decided not to pass a $700 billion bailout bill. They did so to prove that we are still a free market. They did so to save their reelection chances. They did so to protest the Bush Administration and their total mishandling of this crisis from start to finish. Whatever the reason: it failed. And rightly so.Does anyone really think that the Bush, Paulson or Bernanke have any idea what is really going on here? Fortune Magazine reported last week that the $700 billion number that Paulson chose has no analysis behind it:

"It's not based on any particular data point," a Treasury spokeswoman told Forbes.com Tuesday. "We just wanted to choose a really large number."

Wow. How comforting is that? We know that markets operate on psychology, and that the large number is designed to provide confidence in the market that the government has a big enough solution to take care of the problem. I understand that.

But I also understand something that George W. Bush and his team have never understood: this is also a political issue during a presidential election. The Bush Administration remains totally tone deaf to the concerns of the American people. While the $700 billion number may calm financial markets, it has shocked, dismayed and infuriated the American taxpayer.

Hello? Is anyone out there? Does George Bush really want Barack Obama to become president? It sure looks that way.

In fact, Bush's handling of this issue looks a lot like the war in Iraq before General Petraeus went to Baghdad. It looks incompetent, poorly planned and poorly executed. It looks just like the mess that Gens. Casey and Abizaid got us into, with American soldiers dying daily amid violence and chaos on the television. Total mis-management. The American people lost confidence in Donald Rumsfeld in 2004. And what did the President do? He held his course, kept Rummy on and took a beating in the 2006 midterm elections. Bush was shocked to take such a shellacking. He didn't understand the level of discontent among the voters then -- and he doesn't understand it now. Americans in vast numbers are angry at Washington. Mad as hell, as Howard Beale famously yelled out the window in the movie Network. And they aren't going to take it anymore.

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Who will pay the ultimate price for this debacle? John McCain. He's been swallowed whole by this mess and his campaign will never recover. Yes, he miscalculated -- the whole "suspending his campaign" gambit backfired. Frankly, his instincts on the bailout were wrong; his behavior showed him as a legislator. A compromiser. Not as an executive who had to make a tough call in a crisis. He temporized and vacillated.

In fact, McCain missed a golden opportunity: He could have taken the momentum and initiative away from Obama and come out forcefully against the bailout from the beginning. He could have stood up in the debate and said:

I'm against this because I don't believe in taxpayers footing the bill for what is essentially a $700 billion entitlement program. Yes, I know the situation is serious and that we need to provide relief to the credit markets. But there is a better, less-intrusive way to do this: change the "market-based" accounting rules so that firms can revalue their portfolios to something that reflects their true intrinsic value. Provide loans and guarantees that the firms will pay interest on, etc. etc. etc.

But McCain didn't do that. He didn't see the opportunity for bold action and decisive decision-making. He could have put Obama in a corner. And with public opinion running 2:1 against the bailout, the polls would have been on his side.

In the end, this is the kind of crisis that either makes or breaks a candidate. The odds were against McCain from the beginning, but his handling of this issue has fallen short. He was dealt a bad hand by Bush and his bumbling lieutenants; in this case, running against Bush would have been smart for McCain. But it was the kind of "game changing" opportunity that comes about only once in a campaign. If you seize it, you win. If you don't, you lose.

So far, McCain hasn't seized it, and unless Palin pulls out a miracle against Biden and McCain can rally in the last two debates, the Republicans will lose on November 4.

Honor the 9/11 fallen by winning

The further we get from September 11, the harder it is to write about. Of course, we continue to honor the first responders who gave their all - and many their lives - on that day. We honor the heroes on United 93 who took the most effective action that day. We honor the air traffic control staff who may well have prevented additional attacks that day. And we honor those in the military who fight overseas so we don't have to fight at home. But even those risk becoming pro-forma announcements, as the immediacy of the moment fades. At the time, like many others, I compared the attacks to Pearl Harbor. I don't think we experience the same difficulty surrounding Pearl Harbor, Nicholson Baker and Pat Buchanan notwithstanding. Pearl Harbor resulted in a war which, in retrospect, had clearly-defined beginnings and endings, conducted by governments. It resulted in the destruction of those governments, the reduction of their countries to rubble, and their occupation and reconstruction along lines less likely to produce genocidal imperialism.

By any rational accounting, we've done extremely well in the past years in our fight. The Islamists have refrained from further attacks on the US homeland, but have also found themselves stripped of much of their capability to plan and carry out such attacks. Our worldwide presence has allowed us to police against Islamist cells in remote areas, and helped train local governments to defend themselves. The size and effectiveness of their attacks on civilians have steadily shrunk, and they have found themselves routed out and crushed in their self-declared "central front" in Iraq.

Still, there is an unease, and a sense that this isn't over yet by a long shot. September 11 has instead resulted in a new Cold War, in many ways. We engage and decisively defeat the Islamists on many fronts, but sadly have allowed their control of certain countries to last long enough for them to form effective counter-strategies. The Iranian threat is real, and has acquired a major ally in Russia, and this thing could go very badly, very quickly unless we continue to act.

Let's remember that the purpose of this war isn't to buy time, but to win. And anything less than winning will be a betrayal of those that we're honoring today.

Are you flying the flag today?

A large American flag, worn and grimy, now folded into a neat triangle, is displayed in my office. I'm looking at it as I write this. It's the one that was flying over the Colorado State Capitol on September 11, 2001. State troopers gave it to me when it was retired from service some weeks later. I was serving as Senate Minority Leader. Another flag, similarly folded, is in my study at home, presented to our family by the Secretary of Defense at my father's passing a decade ago, as is done for all veterans. He had served at sea in wartime, like his father before him.

We used to fly the flag on our front porch in Centennial only on national holidays. But we have been flying it continously, day and night (appropriately lighted), except in foul weather, for seven years since September 12, the day following the radical Islamist air attacks on New York, Washington, and Pennsylvania.

On 9/11, America was plunged into war against as deadly an enemy as we have faced in our history. We remain at war today not only on the battlefields in Iraq and Afghanistan, but also on a dozen other shadowy fronts, some of them utterly new to us and all the more potentially dangerous for that reason -- above all, the front that is everywhere and nowhere, the struggle to prevent Al Qaeda from detonating a nuclear device somewhere in our homeland.

The flag will continue to fly at our house as long as this war continues. Not because I'm a conservative and like war -- I abhor it -- or because I'm a Christian and our enemies are jihadist Muslims. I fly the flag because the 9/11 attacks represented the first of what those enemies intend as a series of death blows against America's very existence as a free society, a world leader for liberty and a beacon of hope to mankind.

It's one small gesture of defiance to those who seek our destruction. They will not prevail. We will not falter, as President Bush said, and we will not fail. If some call me a flag-waver, I'll take it as a compliment.