A Brand New Brand.

June 22, 2008

A Brand New Brand.

Sunday, June 22, 2008

Every Sunday CUIP’s president Jacqueline Salit and strategist and philosopher Fred Newman watch the political talk shows and discuss them. Here are excerpts from their dialogue on Sunday, June 22, 2008 after watching “The Chris Matthews Show” and “This Week with George Stephanopoulos.”

Salit: Obama announced on Thursday that he is going to forego public financing in the general election. There’s been commentary on whether it’s a good move for him politically, whether he pays a price for it in terms of damaging his “brand,” what’s the impact on campaign finance reform and public financing programs over the long term, etc. On the Stephanopoulos show, the discussants tried to analyze how it impacts his campaign. Perhaps the two positions can be summed up as follows: It’s a flip flop and a departure from his political brand as a reformer and while, to use Matthew Dowd’s term, it’s not “lethal,” it is a “brand problem” for him. The other side: It’s a risky move, says Donna Brazile, but it’s also a smart move. The level of resources that he’ll be able to deploy by making this shift will enable him to expand the electoral map and to contest for the presidency in all 50 states. Smart move or problem for Obama?

Newman: I’m not convinced by the argument that it undermines his brand. I think that’s a misreading of Obama’s brand. The American public, at least a significant portion of it, currently sees this public financing as just another government giveaway. What Obama is saying, and I think that it’s totally consistent with his brand, is: ‘I don’t need a government giveaway program. I have the support of the people. The people will pay for this campaign because they honestly support this campaign.’ I don’t think it undermines his brand. And he’s laughing all the way to the bank. He’s got all kinds of money and will bring in more money. He’ll use that to his advantage. I don’t think there is a big downside. There is a pundit “talkside,” so they’ll talk about it. But the main thing to say is that it’s still June. My opinion, as you know, is that the election is basically a party election, Democrats vs. Republicans, and the Democrats are in a tremendously advantageous position. Add to that Obama’s personal charisma and intellectual capacities, and the Democrats look even stronger. To say that shift on financing his campaign undermines his brand is a product of the fact that the pundits desperately need something to talk about in June…because there ain’t much to talk about.

Salit: I agree with what you’re saying about Obama’s brand. The fact is general election funding is a regressive financial rewards program. It’s based on the past performance of a political party. Unlike the primary matching funds program, which is more open and more progressive in the sense that it does foster a little bit more opportunity for competition, the general election funding program is just a huge taxpayer giveaway to the major parties. So, from a reform point of view and public policy point of view, you can make the argument that it’s much more progressive to have the American people give their personal money to fund a presidential candidacy than to have government money to the tune of $84 million go to fund a political party. I was glad about the decision. And I hope it contributes to breaking down the idea that campaign finance reform is the “cure,” the key to reforming politics. Independents are interested in reforms that have more to do with opening up the political process and bringing people in, leveling the playing field, taking partisanship out of the election process and all of that.

Newman: Everyone said that Bloomberg would be discredited because he wouldn’t participate in the New York City campaign finance program. That didn’t happen. Americans are quite used to inequality of money. We’ve been living with that inequality for a very long time, so if you have a candidate who has something going for her or him, people quickly forget about who’s paying for the campaign. I don’t think that that critique can be effectively used against Obama by McCain, because the American people will say: What’s your point? You’re saying he’s got more money than you? That’s OK with me. He seems to be doing something. If he’s spending his money, that’s helping the economy. And he has a right to spend more money because he’s got more money. He’s raised more money. I don’t think the American people feel that strongly about public financing of campaigns. I think Americans do care about the issues you mention about fairness. But Americans don’t care about equalizing the amount of money that people have. If they did, we’d have a very different kind of economy, wouldn’t we?

Salit: We would. After talking about how this was a flip flop for Obama because he had made a pledge that he was going to accept general election public funding, there was a moment when Sam Donaldson said: ‘Well, Obama has solidified his base. Democrats are united. But McCain hasn’t been able to do that on the Republican side.’ I was struck by this because to me it was such a flip flop, by the commentators! They’ve spent the last four weeks hammering at how divided the Democratic Party is between Obama and Clinton, and are the Clinton voters going to come together with Obama? Is the Democratic Party going to unify? Now, suddenly – and inexplicably – that’s over.

Newman: There was never an issue there. Everybody knows that it’s not the Democratic Party that’s split. The Democratic Party has the presidency virtually in hand. It’s the Republican Party that’s split.

Salit: On The Chris Matthews Show, Chris focused on how McCain has one line to run against Obama which is that Obama’s going to raise taxes. Jim Cramer, the rather likable host of Mad Money, says that if Obama’s elected, Wall Street will be happy and the stock market will go up the day after he wins. Andrew Sullivan says the best argument is that the economy is in trouble and if you raise taxes, which Obama will do by repealing the Bush tax cuts on people in the highest income brackets, it’s not a good time to do that because the economy is too fragile.

Newman: There’s a kind of circularity there since I thought the reason that there’s a debate on tax policy is the fragility of the economy. So you can’t say we shouldn’t raise taxes because the economy’s too fragile. What we’re trying to do is deal with the fact that the economy already is fragile. If Obama were talking completely straight, in my opinion, he would say to the Republicans, You favor lower taxes for the rich. I favor the rich paying higher taxes. Now one might want to argue that we’re better off giving breaks to the rich because that helps the economy. But the empirical evidence doesn’t hold up. It hasn’t helped the economy this time. The rich might be making bundles of money, but they’re not investing it in what the people of the country need. The claim was that if we gave them tax breaks, they would re-invest it in the country. They haven’t. So, I don’t think it’s complicated to clarify that and I think that’s what Obama will do. He’s already begun, as he did in a recent appearance where he said quite clearly, ‘You’re hearing it from me. If you’re making less than $250,000 a year, your taxes won’t go up. If you’re making more than that, they will.’

Salit: Speaking of investment, there was also a panel discussion about energy policy. I’ll tell you my reaction to the beginning of it. Ed Markey, a Democratic Congressman, says ‘Oil dependence has been caused by the GOP. We’re the technical giant, but the Republicans won’t unleash that technical revolution.’ And then Kay Bailey Hutchison, a Republican Senator, says ‘We’ve been trying to create a coherent energy policy to deal with all of these issues, but the Democrats have thwarted us at every turn.’ This is how the opening of the discussion went. My reaction at that point was: OK, why don’t you all go home? Because obviously you can’t work together to solve this problem. That said, the Bush administration has pursued a policy which has been highly favorable to oil interests to the detriment of a coherent American energy policy. And the situation is also about the failure/inability of political leadership across the board to respond to a public consensus for policy changes and innovations that need to be brought into the picture. Is there more to say about it than that?

Newman: Maybe a little more. Making a push to introduce creative approaches to energy is risky. There’s a conservatism on the part of both the Democrats and Republicans to stay with the status quo, to stay with the particular oil interests that they are already allied with. They would probably call this laissez faire energy. And it is, in a way, that’s accurate. How do you get out of that bind? I guess the way they say you do it is by re-writing regulations so as to make it easier for new players to invest. But, again, there is a hesitancy to do that because they want to protect those who are already players in the energy industry.

Salit: Wall Street hasn’t invested because the regulatory process is too complicated. It’s not clear that it’s going to be sufficiently profitable for them to invest. That’s another bind, another logjam.

Newman: Yes. Look at the Internet. It’s been highly unregulated. It’s a huge boom industry that changes a whole lot of things in this country, including the politics, including the ways in which it contributed mightily to the ascension of Obama, and the bringing down of the Democratic Party old guard. Big changes tied, in part, to commercial innovation. Energy alternatives on a large scale require massive capital investment but also political risks. The old guard wants to maintain the status quo. New things are dangerous for people who are in power.

Salit: To what extent do you think changing the political climate and trying to create a political process that’s less dependent on the dictates of special interests is a way of breaking through that conservatism?

Newman: That’s the only way of breaking through that conservatism. That requires innovative activity on the part of the people. Look at the Obama campaign. It’s been innovative. He wins the primary with innovation, with new concepts. But now, he will win the election with the Democratic Party. That has to be his game plan.

Salit: That’s where he’s sitting right now.

Newman: Exactly. Everyone agreed from the outset – Hillary, Barack, Kucinich, everybody – that the Democrats were likely to win this year. The question was who was going to be the particular Democrat who was the beneficiary of that. Barack reaps the benefits of having won the primary, using extraordinary innovation. And now it’s a Democratic Party campaign.

Salit: Thanks, Fred.