ripon forum winter 2010

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Winter 2010Volume 44, No. 1

Will 2010 be another 1994?Joe Gaylord on Scott brown’s victory

and GoP prospects this year

the neW horizon

John Kasich and rob Portman stand poised to lead a republican comeback in ohio

Plus: Utah Senator bob bennett on why he supports health carereform but is opposed to what the Democrats are trying to do

and: new York Congressman Peter King on why terroristsshould be treated as enemy combatants, not common criminals

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“Ideas that matter,since 1965.“

Volume 44, No. 1, Winter 2010

Articles

4 Reality Check by Bob Bennett The Utah Senator says that health care needs to be reformed, but what the Democrats are trying to do would make things worse.

6 Status Report by Buck McKeon The top Republican on the House Armed ServicesCommitteediscussestheconflictin Afghanistan and the ongoing war on terror.

8 Dangerous Decision by Peter King The GOP leader of the Homeland Security Committeewritesthatterroristsareenemy combatants, not common criminals.

10 A Necessary Step by Dan Lungren In light of the failed bombing of a jet on Christmas, the California Congressman pushes to keep our airlines more secure.

12 Getting it Right by Phillip Swagel Ournation’sfinancialregulatorylaws need to be strengthened, but in a way that emphasizes good policy, not populism.

Cover Story

14 The New Horizon By Michael G. Oxley The former Congressman from Ohio writes about the political climate in the Buckeye State and how John Kasich and Rob Portman stand poised to lead a Republican comeback.

Cover Story (cont’d.)

16 The Winter of Ohio’s Discontent By William Binning According to this leading political expert in the Buckeye State, Ohio is facing an economic crisis that is causing voters to give Republicans another look.

Politics & Perspective 19 Will the 2010 Elections be a Replay of 1994? by Joe Gaylord A top strategist from the Republican Revolution 16 years ago provides the GOP advice on how to win the majority this year.

21 The Real State of the Union by John Feehery According to this communications pro, the GOP’s response to the President’s address should stress one theme -- balance.

24 The Blue Dogs: Are They all Bark and No Bite? by Burdett Loomis Theyreceivealotofattentioninthe media. But have the Blue Dogs achieved anything beyond the headlines?

26 The Archie Manning of American Politics by Lou Zickar With independents abandoning the Democrats, the President is proving to be the one star on an otherwise hapless team.

Sections

3 In this Edition

28 Ripon Profile of Jo Ann Emerson

RIPON FORUM Winter 2010

cover portrait by Deb Hoeffner

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In this EditionFor a generation of Americans, the phrase Morning in America and the presidency

of Ronald Reagan will forever be linked. The phrase represented not just the dawning of a new day for our Nation, but the

dawning of a new era for the GOP. Today, Republicans are looking for a similar phrase that captures the mood of the country at this time and sets the tone for the mid-term elections this fall.

Surely, the wind is at the party’s back. And certainly, Democrats are in as vulnerable a position as Jimmy Carter was in 1980. But if the picture at this point remains unclear about the party’s electoral prospects in November, an image of the electoral landscape is becoming sharper everyday. It is a landscape that presents Republicans with something they haven’t seen in a very long time:

A New Horizon.It is a horizon that looks completely different than the one Republicans faced in

November of 2008. Then, the GOP was coming off one of its worst defeats in recent history, as Democrats recaptured the White House and added to their majorities on Capitol Hill. The horizon today is much brighter. It is one shaped as much by the missteps of the Obama Administration as it is by the victories of Scott Brown, Bob McDonnell, and Chris Christie over the past few months. It is also one that presents Republicans with both opportunities and challenges.

In this edition of the Forum, we examine some of these opportunities and challenges. We begin by focusing on the political environment in Ohio. The state has trended blue in recent years, electing a Democrat as Governor and to the U.S. Senate and supporting Barack Obama for President. But as former Congressman Mike Oxley explains in our lead essay, Obama’s “soaring start has stalled and is now more of a freefall, as Ohioans increasingly disapprove of the broad direction on mega-issues like the economy, health care, energy cap-and-trade, government spending, and security/terrorism.” As a result, Republicans have been presented with a new horizon in the Buckeye State, with John Kasich and Rob Portman leading the effort to reclaim the electoral ground that has been lost in recent years.

Similar opportunities await Republicans elsewhere in the country as well. In fact, as Contract with America strategist Joe Gaylord writes, the horizon facing the GOP in 2010 is very similar to the one the party faced in 1994, the year it took control of Congress. But Gaylord also notes that there are differences, too, not the least of which is the fact that the party has not yet gotten behind a Contract-like slate of solutions that would tell people what Republicans are for, not just against.

One important area where the GOP has no shortage of solutions is national security. In light of the failed bombing of an airliner on Christmas Day, these solutions have been receiving not just more attention, but a greater sense of urgency as well. We look at some of these solutions with Representatives Peter King, Buck McKeon, and Dan Lungren, three leaders in Congress who are working to keep America secure.

And finally, to the extent that the health care debate is at a crossroads (or, depending on your perspective, in a ditch), we feature a terrific essay by Utah Senator Bob Bennett explaining why he supports reforming the current system but is opposed to what the Democrats are trying to do.

We hope you enjoy this edition and encourage you to write at [email protected] with any thoughts or comments you may have.

Lou Zickar Editor The ripon Forum


Articles

BOB BENNETT

In a desperate attempt by Senate Democrats to “make history” a health care bill was crafted behind closed doors. The voices of the people were ignored. Backroom deals were cut to buy last minute votes, and a bill was jammed through on Christmas Eve as if Americans wouldn’t notice. The Senate Democrats certainly made history; they made a mistake of historic proportions. As a result, Americans still have a broken health care system and rapidly disintegrating faith that Congress can fix it. I believe we can achieve health care reform, but only if we start over and focus on reducing the costs, improving quality and not adding to the nation’s debt.

Obama’s health care plan would restructure one-sixth of the economy and drastically shape the future of America. Something of this magnitude should never be constructed on a partisan basis and should never exclude the voices of the people. I voted against the Senate bill because it would increase insurance premiums and taxes, slash Medicare benefits and essentially create a new entitlement program during a time when mandatory spending is strangling the country’s financial health.

The health care debate has proven to be an emotionally charged issue causing frustrations to grow among Americans as we witnessed the Obama administration break promise after promise. In a September speech before Congress, President Obama pledged

to oppose any bill that would add to the federal deficit. However, he later applauded the passage of both the House and Senate bills despite the fact that the federal deficit would increase dramatically under either proposal. The president also promised a bipartisan approach with a transparent process

where negotiations would be broadcast over C-SPAN and the final bill would be available online for all to read 72 hours before a vote. Neither occurred. Instead, the bill was created by a select few and without any input from Republicans.

What’s more, because none of the promised broadcasts appeared, the American public never witnessed any of the negotiations. Not even the senators had enough time to read the entire bill prior to the Christmas Eve vote.

On January 19, voters in M a s s a c h u s e t t s responded and spoke loud and clear on behalf of Americans everywhere by electing Scott Brown to become the 41st vote needed in the Senate to block the health care legislation. Brown’s victory brings new hope to the fight

against a government takeover of health care and the opportunity for Congress to start over and get it right.

Although the health care debate is badly bruised, the fight is not over. Congress must create a new way to move forward:

First and foremost, we must

Reality CheckWhy I support health care reform but opposewhat the Democrats are trying to do

I believe we can achieve health care reform, but only if we start over and focus on

reducing the costs, improving quality and not adding to the nation’s debt.


address the issue of cost. A study by the Kaiser Family Foundation found that the average premium for a family receiving health care benefits through an employer rose above $13,300 in 2009 with employers paying more than $9,800 of that, while the workers contributed the rest. Workers also faced larger deductibles and co-payments despite receiving fewer benefits. The Kaiser study estimates that if we continue to see the trend of the last 10 years, health insurance premiums in 2019 will almost triple. These numbers, coupled with the statistics on how much our government spends on health care, is a strong reason why we cannot ignore reforming the health care system.

Congress must commit to considering only legislation that would turn the cost curve down. We need legislation that is market-based and allows insurance companies to reduce costs as they compete for business. Crafting a bill that provides affordable health care for Americans without adding to our national debt is

possible and settling for anything less would be a mistake.

Second, we must provide Americans with choice and portability. Today, more than half of American workers who have employer-provided health insurance have no say in the

type of coverage they receive. We need to empower individuals with the ability to choose the plan that best suits their needs. Once Americans have chosen health care coverage that works for them, they should be able to keep it. Insurance should be portable so individuals don’t feel locked in a job they don’t like for fear of losing their health care coverage.

Finally, we need to recognize the great progress that has been made on a state level and ensure that federal legislation does not undo the successful innovations already in place. The state of Utah has been a leader in creating a market-based,

innovative program that is specifically tailored to the needs of Utahns. Congress must encourage states to develop these promising models and not undo the success of programs already in place.

Every member of Congress agrees that we need to reform the health care system and bring down the unsustainable rate of growth in health care

costs. However, Congress must focus on fixing the problems rather than rushing through haphazardly simply to claim victory and make history.

We need to start over and get it done right. RF

Bob Bennett is a United States Senator from the State of Utah.

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...we need to recognize the great progress that has been

made on a state level and ensure that federal legislation does not undo the successful innovations already in place.


HOWARD P. “BUCK” MCKEON

As the world transitioned to a new year, Americans were reminded that we remain a nation at war. On Christmas Day, the act of one individual solidified this reality: America faces a determined and ruthless enemy who is committed to killing innocent civilians and destroying our way of life. This enemy resides in ungoverned spaces like those found in Afghanistan, Pakistan, Somalia, and Yemen, and exploits our advances in mass communication and modern means of travel to mobilize and execute missions of hatred.

For the last decade, Congress and the Executive Branch have worked together to develop the necessary policies and tools to take on this global, multifaceted, and constantly evolving threat. Like the threat, America must refine these instruments in order to keep this war out of America’s backyard. As our nation’s Commander-in-Chief, President Obama plays the critical role in guiding the United States during wartime and must send a clear message to our enemies and allies that America will not stand down. We will take the fight directly to those who seek to do us harm.

On December 1, 2009, with his speech at West Point, President Obama

officially took ownership of the war in Afghanistan and the broader war on terrorism. He correctly reminded the country and the world that al-Qaeda — operating from safehavens in Afghanistan — planned and launched the 9/11 attacks on the United States.

Al-Qaeda does not act alone. They are supported by the extremist Taliban who continue to provide sanctuary within its tribal homes in Afghanistan and Pakistan and intimately linked to a robust terrorist network in that part of the world.

If America and our allies fail to defeat – not only degrade – the Taliban in Afghanistan and the Pashtun tribal belt in Pakistan, there is the possibility that al-Qaeda could re-formulate to its pre-2002 strength and launch attacks

against the United States, our allies, and our interests once again.

The President rightly committed the Unites States to a counterinsurgency strategy designed to separate the Afghan people from the threats posed by the Taliban and al-Qaeda. Just

as important, the President announced that the top military commander in Afghanistan, General Stanley McChrystal, will be provided most of the military forces he needs to implement his strategy. While many have questioned whether the President has provided the resources necessary to win in Afghanistan, General McChrystal personally reassured Congress that he has the resources to win. More importantly, he committed to requesting additional

troops if they are necessary to successfully complete the mission.

Now the hard work has begun. Logistically, deploying 30,000 additional forces is a heavy lift. Politically, in the coming weeks and months, some of my colleagues in Congress will attempt to either narrow or end our troops’ mission in Afghanistan — even before the full 30,000 troop surge arrives in the country. While Congress must continue to exert its oversight role to ensure

Status ReportThe War in Afghanistanand the Challenges Ahead


General McChrystal and our troops have the resources they need to win, I will call on my colleagues to support our brave troops by providing them the tools and time they need to complete their mission. We must resist the temptation to judge progress or success in Afghanistan against the Washington political clock. Events and conditions on the ground must drive our decisions from this point.

Afghanistan and Pakistan offer the most relevant and immediate examples of what criteria must exist for al-Qaeda and its terrorist affiliates to operate most effectively: ungoverned or under-governed swaths of land and the lack of strong local governance. As evidenced in Iraq’s al-Anbar Province in 2006 – 2007, al-Qaeda will step into the vacuum of ungoverned space in a country; set up training facilities; intermingle, threaten, or coerce the local population into cooperation; and then launch attacks to further destabilize the “host” government or harm United States interests.

The attempted Christmas Day bombing of Northwest Flight 253 has drawn renewed attention to Yemen — a country roughly twice the size of Wyoming located on a key international transit lane between the Red Sea and the Gulf of Aden. The Yemeni government is currently fighting at least two insurgencies within its borders — one against al-Qaeda in the Arabian Peninsula and the other against Shiite extremists. Yemen is also the current home of the al-Qaeda cleric and recruiter who had communicated with Fort Hood shooter Army Major Nidal Malik Hasan, and the site of the 2000 al-Qaeda attack on the USS Cole that killed seventeen American sailors.

The failed Christmas Day terrorist attack underscores the importance of the current efforts by the United States to work with foreign governments to train, equip, and professionalize their security forces — both military and police. For example, the United States Departments

of Defense and State have allocated approximately $70 million to help the Yemeni government professionalize its force in order to defeat al-Qaeda in the Arabian Peninsula and gain control of the entirety of its territory. By working with host countries to develop their security forces, it reduces the likelihood that the United States will have to commit its sons and daughters to completing the mission.

In addition to effective security assistance tools, the United States must commit to treating those terrorists captured in the ongoing war on terrorism, such as Christmas Day bomber Umar Farouk Abdulmutallab,

as enemy combatants — not common criminals. On January 5, the U.S. Court of Appeals for the District of Columbia Circuit upheld the right of the United States government to detain criminals suspected of committing terrorist acts. The decision — in placing a higher value on war powers over the individual rights of detainees captured in the ongoing war on terrorism — reaffirms the belief that the laws of war are the appropriate foundation by which to continue to detain and try terrorists who are captured by the United States.

On January 6, the top Republicans on the House Appropriations, Intelligence, Homeland Security, and Judiciary Committees joined me in calling on the President to designate Abdulmutallab as an unprivileged enemy belligerent, and detain and prosecute him according to the laws

of armed conflict — not the criminal justice system. In the war on terrorism — like any other conflict — combatants need to be thoroughly interrogated by the Intelligence Community before they encounter counsel, let alone a public defender. All terrorists captured in the war on terrorism should be charged as enemy combatants, taken into military custody, interrogated for vital intelligence, and tried in military courts under the laws of armed conflict.

The President could send a strong message to Americans, the international community, and those terrorists aspiring to attack the United States by treating Abdulmutallab as a combatant

captured in an ongoing war. In addition, the President should reverse his decision to try 9/11 mastermind Khalid Sheikh Mohammed and his cohorts in U.S. federal court in New York City — and recommit to prosecuting these dangerous terrorists through the military commissions system. This step by the President would ensure that military operations are not

compromised.We have invested significant

amounts of our precious blood and treasure to defeat al-Qaeda and its networks, and curtail these terrorist ambitions. All Americans have asked much of the men and women of our military and diplomatic corps — and their families who support them at home.

By recommitting ourselves to providing them with the tools and resources they need to effectively do their jobs, we are taking strides to better protect our nation and citizenry. RF

Howard P. “Buck” McKeon represents the 25th Congressional District of California. He is the senior Republican on the House Armed Services Committee.

If America and our allies fail to defeat – not only degrade – the Taliban in Afghanistan and the

Pashtun tribal belt in Pakistan, there is the possibility that al-Qaeda could re-formulate to its pre-2002 strength

and launch attacks against the United States, our allies, and our

interests once again.


PETER KING

On Christmas Day, while many Americans were preparing to exchange gifts and enjoy Christmas dinner, Umar Farouk Abdulmutallab was preparing to attack America.

As Northwest flight 253 approached Detroit, Abdulmutallab left his row-19 window seat, went to the lavatory and assembled a bomb, the parts of which he had hidden in his underwear before boarding. After he returned to seat 19A, he ignited the device in an attempt to bring down the plane and murder hundreds onboard.

We got lucky. Despite Abdulmutallab’s planning and training by al-Qaeda leadership in Yemen, the terrorist failed in his attempt to fully detonate his weapon and explode the plane. But he did start a fire. Fortunately, it was quickly extinguished by vigilant passengers and flight crew, who also subdued the perpetrator.

If Abdulmutallab’s attack had been successful, he would have orchestrated the worst terrorist attack on America since September 11, 2001.

As troubled as I am by the fact that federal intelligence agencies failed to recognize Abdulmutallab as a threat and the fact that he was able to smuggle the device past airport screening, I also am troubled by the response of the Obama Administration.

Shortly after the plane safely

landed, federal law enforcement officers took the al-Qaeda-trained Abdulmutallab into custody and informed him that he had the right to remain silent, which is exactly what he did. Then, federal prosecutors brought charges against him in federal criminal

court.Now, because of the Obama

Administration’s decision to treat

Abdulmutallab’s attack as a crime and charge him as a criminal in federal court (FBI Director Mueller acknowledged that “very senior people in the FBI had input”), we lost the opportunity to interrogate him in order to seek life-saving intelligence. We will not learn

more about al-Qaeda in the Arabian Peninsula (AQAP), the terrorist group claiming responsibility for the Christmas Day attack. We will not learn where and how he obtained his explosive device and his training. We will not learn from him what other attacks against America are planned by AQAP.

Instead of arranging for Abdulmutallab to meet with our most well-trained interrogators, the Obama Administration arranged for this terrorist to meet with a well-trained lawyer.

Even though American lives are at risk, the Obama Administration’s decision sadly is not all that unexpected when you consider the Administration’s apparent belief that we can defeat international terrorism in the courtroom instead of on the battlefield.

If we are going to protect Americans in our international war on terror, Abdulmutallab and his fellow terrorists should face trial in military commissions,

not in civilian courts.Clearly and tragically, the Obama

Administration sees things differently.

Dangerous DecisionTerrorists should be treated as enemycombatants, not criminal defendants

Instead of arranging for Abdulmutallab to meet with our

most well-trained interrogators, the Obama Administration arranged for

this terrorist to meet with awell-trained lawyer.


A year ago, the President announced his decision to close Guantanamo Bay without any plan of how to do so. In November, he made what I believe to be one of the worst decisions by any president when he decided to move Khalid Sheik Mohammed (KSM), the admitted mastermind of the 9/11 attacks, and four co-conspirators from Guantanamo to New York City for trial in civilian court. This ill-conceived decision – made without consulting any law enforcement officials in New York – will launch judicial proceedings that will surely drag on for years and cost American taxpayers hundreds of millions of dollars. The President’s decision also threatens to expose highly sensitive sources and methods used to gather intelligence, creates a platform for spewing anti-American propaganda to attract more jihadists, and could almost stretch the NYPD to its breaking point.

Transferring terrorists to lower Manhattan creates an enormous, unnecessary risk to the people who already live and work near the federal

courthouse. The director of the Federal Protective Service -- charged with protecting the courthouse -- stated at a recent Committee on Homeland Security hearing that he does not have the resources to properly secure the facility during the trials while performing its normal duties.

It seems that every month we learn of a new Obama Administration plan to try terrorists in civilian court. In

November, KSM and the others in New York; in December, Abdulmutallab in Detroit; this month, we see reports that the Bali nightclub bomber, for inexplicable reasons, may face trial in downtown Washington, DC.

The fact is that trial in civilian court is unnecessary. Last year, Congress established a meticulous forum -- per

the Military Commissions Act -- to try terrorists captured on the battlefield as enemy combatants in military commissions at Guantanamo.

House Republicans are working to pass legislation to appropriately direct the Obama Administration in dealing with dangerous terrorists and keep them out of civilian court. For example, I co-sponsored the Keep Terrorists Out of America Act, a common-sense bill

to prevent terrorists from being brought onto our soil. I have also co-sponsored the Terrorist Detention and Prosecution Act to ensure the President has clear authority to utilize military commissions to try terrorists captured in the U.S.

The Christmas Day attack was a wake-up call for many; my hope is that it awakened the

Obama Administration to the need to treat terrorists as enemy combatants, not as defendants in criminal courts. RF

Peter King represents the 3rd Congressional District of New York. He is the Ranking Member of the House Committee on Homeland Security.

If we are going to protect Americans in our international

war on terror, Abdulmutallab and his fellow terrorists should face

trial in military commissions, not in civilian courts.

leGiSlative SPotliGhth. r. 4415

the terroriSt Detention

anD ProSeCution aCt of 2010To amend title 10, United States Code, to authorize the President to

determine that certain individuals are unlawful enemy combatants subject totrial by military commissions, and for other purposes.

Introduced - January 12, 2010

Sponsor - U.S. Rep. Candice Miller (MI-10)

Cosponsors - U.S. Reps. Paul Broun (GA-10), Dan Burton (IN-5), Tom Cole (OK-4) , Jim Gerlach (PA-6), Gregg Harper (MS-3), Peter King (NY-3) Jack Kingston (GA-1), Robert Latta (OH-5), John

Linder (GA-7), Pete Olson (TX-22), Frank Wolf (VA-10)


DAN LUNGREN

To adequately defend against a threat one needs to understand the nature of that threat. This is particularly true with regard to Islamic extremists who have attempted to hijack a religion to justify their terrorist actions against innocent men, women and children. The danger they pose to innocent lives is magnified by an unnatural obsession with death.

We must understand that we face an enemy who is as elusive as they are deadly and sinister. They have made adaptations in response to the measures we have taken to protect the flying public. As the threat evolves, we must constantly adjust our defenses. We did this after the shoe bomber incident and then again after the London liquid bomber. Obviously this task is made all the more difficult by the willingness of the perpetrators to offer themselves as human incendiary devices. The latest threat – a lone traveler carrying a pentaerythritol trinitrate bomb (PETN) hidden in his underwear – will again require us to adapt our defenses since the magnetometer will not be effective against this

new threat. Our best approach includes

actionable intelligence and layered defenses. Within that overall context, the best way to detect a PETN bomb or any bomb concealed under clothing is with whole-body imaging technology. I support this screening

technology because it is the very best available. It detects anomalies on the human body. It will detect plastics, ceramics, explosives, liquids and gels that cannot be detected with current technology. It would also meet the higher throughput requirements necessary for our busy airport

checkpoints. Because of 9/11, airport

screening procedures (stripping down at checkpoints and taking off your shoes) have become more intrusive and sometimes irritating to air travelers. These security procedures are necessary in today’s

threat environment. They are essential to secure the aircraft and ensure the safety of the traveling public. If you were told that a body bomber would be on your next flight, wouldn’t you want all passengers screened with whole-body imaging technology? Unfortunately, we won’t be given prior notice. What we do know is that Islamic extremists remain committed to killing us.

Therefore, I oppose unreasonable privacy concerns

standing between me and the rest of the flying public and the Jihadist body bomber. We need to employ the very best

screening technology available to deter or defeat this Jihadist threat. Safe and secure air travel is far more important than any arbitrary privacy standard. Dead people are not in a position to raise privacy concerns.

Let me be clear – I understand the initial objections to whole-body

Understandingthe Enemy

We must understand that we face an enemy who is as elusive as they are

deadly and sinister.


imaging technology centered on privacy concerns. We have taken steps to address the substance of those concerns. The outlined image of the screened passenger, while graphic, is not identifiable to a particular individual. The Transportation Security Administration (TSA) has separated the security operator reviewing the images (no window office) from the actual passenger being screened, so no linkage is possible. Images are not stored or transmitted and are immediately deleted after review by security personnel. Blurring techniques for the face are also used for added privacy. The final piece, which should eliminate remaining privacy concerns with whole-body imaging technology, is automatic detection software. This software is currently being field tested. It will allow for whole-

body anomalies to be automatically identified with no need for screener review or retention of these images.

Whole-body imaging technology was first piloted by TSA in 2007 as an alternative to the pat down in secondary screening. With 90 percent of the public selecting whole-body imaging over the pat down, TSA has now moved it to primary screening at

select airports. I agree with the vast majority of the public who chose whole body imaging over the pat down for both security and privacy reasons.

After receiving my new metal hip two years ago, I’m somewhat of

We need to employ the very best screening technology available to deter or defeat this Jihadist threat.

an authority on pat-down screening. I have been patted up and down and down and up in airports across the country. Whole-body imaging would not only relieve me of this invasive procedure but every other person with an artificial body part.

More importantly, using whole-body imaging for primary airport screening will improve our airport

defenses against this evolving extremist threat. Elected officials must assure our travelers that we consider their safety to be a solemn obligation. RF

Dan Lungren represents the 3rd Congressional District of California. He is the Ranking Member of the Homeland Security Subcommittee on Emerging Threats, Cybersecurity, Science and Technology.

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PHILLIP SWAGEL

More than a year after the financial system nearly collapsed, the administration’s lurch into populist rhetoric has put the already-stalled effort for regulatory reform into reverse gear.

In tacking hard left, President Obama has shifted focus from ensuring that the financial system contributes to growth and job creation through intermediation (e.g. lending) to instead bluntly constraining the size and scope of bank activities. Protestations by White House aides that proposals to punish banks were long under consideration, if anything, make the situation worse. It is sadly revealing to learn that the President’s jarring switch to non-substantive rhetoric is actually the result of a considered policy process rather than a crude but understandable political calculus.

Two policy switches in January 2010 are directly at odds with President Obama’s putative agenda on financial reform. First, the proposed tax on banks is at odds with the earlier urging of bank executives (those who would show

up) to increase lending, since the tax is meant to be levied on funding that banks would use to support increased lending.

The second lurch on financial regulatory reform, immediately following the Massachusetts election, involved a salvo against proprietary trading and toward limiting the size

of U.S. banks. This appears to be a strike against a phantom menace, since the administration put forth no evidence that either trading or size were meaningful factors behind the crisis, or pose a risk to the economy, or to public resources going forward. After all, some of the largest financial

institutions were islands of relative stability during the crisis (even as others were not) while dozens of smaller banks have failed. It might sound good to attack banks, but it’s not necessarily the right move for the economy and for the millions of American families with low and moderate incomes who benefit from

expanded access to credit as the result of financial innovation and the activities of large banks.

The strike against proprietary trading is perplexing, since it would be well-nigh impossible to distinguish this from banks’ normal activities in making a market for clients looking to buy and sell securities such as stocks and bonds. A bank acting as a “broker-dealer” will at times accept a sell order from a client that results in taking a security or derivatives position onto its own book for a while until

it finds a buyer or an offsetting derivative position. This risk-taking helps create the deep and liquid financial markets that attract capital to the United States — and that not incidentally helps fund the massive federal borrowing in the “new era of fiscal responsibility” proclaimed in

GettingitRightFinancial reform begins withgood policy, not populism

It might sound good to attack banks, but it’s not necessarily the right move for

the economy…


While the financial industry is among the most regulated

in the U.S. economy, the crisis exposed gaps in oversight and

information gathering that would be useful to fill.

President Obama’s February 2009 Budget.

The impression is that both lurches on financial reform are driven by political necessity. When President Obama is quoted in the press as being upset that he is on the “wrong” side of an issue, it should be understood that he means the wrong side of popular opinion, not the wrong side of substance. As with his flailing efforts to challenge the AIG bonuses condoned by his top staff, the President is following the pitchforks rather than seeking to channel popular energies into productive legislative efforts.

All of this is unfortunate because it detracts from the still vital agendas for regulatory reform that would help prevent future crises and provide a framework under which the government could better deal with financial crises when they inevitably arise.

The key aspects of the positive agenda on financial regulatory reform focus on helping to detect activities that contribute to systemic risk, and improvements to the way that failing financial firms are dealt with. These policy areas are related; reforms that make clear to banks that they will be allowed to fail in the end will lead to changes in behavior by market participants that helps make failure less likely.

While the financial industry is among the most regulated in the U.S. economy, the crisis exposed gaps in oversight and information gathering that would be useful to fill. The Federal Reserve has become politically unpopular, but it remains the only government institution that has both the broad overview of the economy and the deep knowledge of the financial system needed to serve as an effective backstop to other financial regulators. Other regulatory agencies necessarily have a narrower view — the FDIC,

for example, focuses on the status of its deposit insurance fund to the neglect of broader systemic issues.

It might be useful to establish a council of regulators to watch for systemic risk, as now proposed by House Financial Services Committee chairman Barney Frank, so long as the Fed remains the ultimate ‘free safety’ in football terms, with the mandate to run down financial sector activities that appear to put the system at risk or that seem to be motivated mainly by the prospect of a government guarantee or backstop. Such a mandate would have led to a prolonged whistle-blowing at Fannie Mae and Freddie Mac, the two government-sponsored enterprises for housing finances, whose outsized

portfolios put the banking system at risk and necessitated a costly taxpayer rescue of these firms in September 2008.

Even with this change, it is inevitable that the financial industry will eventually develop problems that include the potential collapse of major industry participants. Resolution authority over non-bank institutions would provide a roadmap for the government to deal with firms that are not banks (such as the holding companies that own banks along with other financial subsidiaries such as insurers and broker-dealers) or the forty or fifty banks that are too large for the effective capabilities of the FDIC. The administration’s approach would institute a system under which the executive branch could

take over a failing financial firm and use taxpayer money to support it. Ironically, this proposal — now lost in the vapors of the President’s populist rhetoric against bailouts — has the essential characteristics of the TARP in allowing the executive branch to put public money into a private firm without a vote of Congress. And it goes a step further, by allowing the government as well to change contracts. Put simply, the administration’s proposal is for a permanent and supercharged TARP.

A better alternative would be to improve the bankruptcy process, to ensure that troubled firms are allowed to fail without putting at risk the rest of the financial sector or the broader economy. The failure of

Lehman Brothers had impacts on the broader economy through lax oversight of money market mutual funds that held Lehman’s debt, through a disorderly unwinding of Lehman’s derivatives positions, and through poor coordination between the U.S. and UK bankruptcy regimes that left the assets of some Lehman clients “frozen” in London.

These failings can be addressed—and doing so would be preferable to a permanent TARP. This is not saying “no more bailouts ever,” but it does require a vote of Congress for public funds to be deployed at length in the future.

Such a focus on bankruptcy would help fix market expectations that firms would be allowed to fail. This would affect risk-taking behavior and thus help reduce the likelihood of future crises. RF

Phillip Swagel is a visiting professor at the McDonough School of Business at Georgetown University. He previously served as Assistant Secretary for Economic Policy at the Treasury Department.


the neW horizon

John Kasich and rob Portman stand poised to lead a republican comeback in ohio

by MiChael G. oXleY

After two dismal showings in the elections of 2006 and 2008, Republicans in the great political state of Ohio are ready for a comeback. Let’s face it, in both of these cycles, the Democrats didn’t win so much as our Republican Party lost, due to scandals and poor judgment exercised by some of our Ohio elected officials.

In a recent piece about Ohio politics for National Review Online, Jim Geraghty quotes a source who observed that the

losses stemmed from “an anti-corruption wave in 2006 and the excitement and enthusiasm for Obama in 2008.” Voters in the ultimate swing state are smart and engaged, and they don’t hesitate to make their displeasure known at the polls.

The Republican brand has been damaged, and it’s up to us to restore it with quality candidates who connect with voters on core values and who advocate sound public policy. Just one year ago, few would have predicted the tremendous

Cover Story


opportunity for our Party that is now before us in 2010. President Obama’s campaign message of hope and

change has quickly become dismay and disappointment among the electorate. His soaring start has stalled and is now more of a freefall, as Ohioans increasingly disapprove of the broad direction on mega-issues like the economy, health care, energy cap-and-trade, government spending, and security/terrorism.

Internationally, despite Obama’s hopes expressed during the campaign and in the first months of his presidency, his personal appeal and popularity have done nothing to budge the world’s dictators and nuclear bullies. The extent to which he has adopted many of the previous Administration’s international policies is remarkable, and he is learning that perhaps many of those policies were the best course, after all.

At home, Ohioans are less than impressed with economic stimulus bills that cost hundreds of billions of dollars but don’t stimulate the economy. At this writing, Ohio’s unemployment rate is 10.6 percent, and behind that number stand hundreds of thousands of out-of-work Ohioans and their families who are paying the human cost of the housing/credit crunch combined with a vicious recession. In July of 2009, the unemployment rate was above 11 percent, the worst since the recession of the early 1980s.

While it seemed overwhelming at his inauguration, President Obama’s job approval is fading fast. It has turned out to be a thin reed on which to build the Democrats’ basis for governing.

The elections of 2009 revealed the shallowness of the Democrats’ support, particularly in the gubernatorial races in Virginia and New Jersey. In those two races, the first-time voters, unmarried women, younger voters, African Americans, and Latinos that comprised the Obama “surge” stayed home. Candidates (now Governors) Bob McDonnell in Virginia and Chris Christie in New Jersey outperformed GOP presidential nominee John McCain’s 2008 results among conservatives, moderates, and men. The truly independent voters who came to the polls in 2009 were more conservative than those who voted in 2008.

Going forward, it is important to watch the views of true independent, swing voters, as they determine the outcomes of elections. By definition, they are likely to be uncomfortable with one-party rule and with excessive government programming and spending.

Having said all of this, it would be a huge mistake for Republicans to assume that Democrats’ stumbles will result automatically in GOP success.

As Republicans, it is our challenge and responsibility

to present proven leaders with effective ideas to the voters. Politically, our candidates must be able to bring together Republican Party loyalists and conservatives, as well as making progress among youth, women, and minorities.

We have a great deal of enthusiasm. However, should Republicans and conservatives fail to unite, the result will be more years of liberal Democrats in public office who generally seek to use government as a means to re-engineer society, as well as to collect and to redistribute wealth. Should we fail to unite, we will be standing by and watching it all happen.

We are fortunate to have talented and capable candidates running for the Republican nominations for Senate and Governor this year. I believe that Ohio Republicans can present one of the most formidable tickets in the nation by nominating Rob Portman for Senate and John Kasich for Governor. I was fortunate to serve with both of them in the U.S. House of Representatives. John and Rob have energy as well as years of experience, policy expertise as well as common sense.

As one of the best budgeteers in Congress during his tenure, John Kasich has what it takes to effectively tackle Ohio’s economic and financial problems as governor. He also knows the workings of business and the media and is one of the most energetic and committed people you will ever meet.

Similarly, I can’t think of anyone better suited to represent Ohio in the U.S. Senate than Rob Portman. Rob’s deep knowledge about budgeting and international trade, as well as his abilities to think strategically and to connect with voters, will make a dynamic contribution to Ohio’s recovery and prosperity.

We are fortunate to have these two intelligent and respected leaders running as Republicans. We should nominate Portman and Kasich and do everything possible to ensure their election in November of 2010.

Certainly, Buckeye football transcends politics for Ohioans. But perhaps the Buckeyes won’t mind if we borrow some inspiration and a page from Coach Tressel’s Rose Bowl playbook: with talent, unity, drive, intelligence, and hard work, the Buckeyes got up from numerous defeats and won. We can too. RF

Michael G. Oxley is Of Counsel at Baker Hostetler, Washington, D.C. He represented Ohio’s 4th Congressional District in the U.S. House of Representatives for more than 25 years and was a Member of Ohio’s General Assembly for nine years.

President Obama’scampaign message of hope

and change has quickly become dismay and

disappointment amongthe electorate.


WILLIAM BINNING

The political environment in the battleground state of Ohio is shaping up to be a toxic one for incumbents in 2010.

The economic challenges facing the state are chronic and severe. According to the Ohio Department of Jobs and Family Service, the state unemployment rate in the last quarter of 2009 was 10.6 percent.

Of greatest concern is that many of these job losses appear to be permanent. Indeed, a significant portion of Ohio’s unemployment is the result of the long standing but accelerating deindustrialization of the state economy. The poster child for this most recent deindustrialization is the auto industry. Despite the federal government’s infusion of capital, the job losses in

TheWinterofOhio’sDiscontent

that vital sector have been enormous. Moreover, the few auto jobs that were saved by last

year’s infusion of federal capital are still at risk. Unlike in the past, these unionized, high paying jobs will not return

with the awaited recovery. Plants have been closed; factories have been shuttered. The layoffs are no longer just temporary. A reduction in Ohio’s unemployment rate will not bring happy days back again. The hardy industrial workers will be carrying their lunch buckets to jobs that pay less than half what they once made, working at call centers rather than the assembly line.

The loss of jobs has had a rippling effect to other sectors of the Ohio economy. Realty Trac reports that the number of foreclosures in the state reached 113,

Unlike in the past, these unionized, high paying jobs

will not return with the awaited recovery. Plants have been closed; factories have been

shuttered. The layoffs are no longer just temporary.

“While Ohio’s problems are daunting, I believe they are fixable – but only by creating a business environment that rewards investment and increases wages.

“With forward-thinking, solutions-oriented leadership, we can transform Ohio into a model of job creation and economic vitality that other states will want to follow. To succeed we must:

“Lower taxes – Create a tax climate that allows Ohio to compete with other states to attract new businesses, foster job creation, and keep our precious, existing jobs here;

“Make government more efficient and effective – Skinny-down state bureaucracy to ensure taxpayers are getting their money’s worth, and reform state government into a 21st century partner with Ohio’s job creators – not one that punishes business with outdated or unnecessary regulation;

“Transform our education system – Help our kids achieve, compete and succeed to meet the workforce demands of tomorrow’s economy; and,

“End the influence of special interests – Build common-sense solutions to our problems and kick out those who, for too long, have kept us from fixing all that is wrong in our state.”

Taxpayers deserve “their money’s worth” JOHN KASICH


570 in 2008 – the 7th highest in the U.S. The loss of tax revenue has led to layoffs and service declines in local governments and school districts. Those local fiscal budget problems will also be chronic. Public service employment will have to return to being its own reward.

Budgetary ChallengesThe impact on the state’s biennial budget will also

be significant. Democratic Governor Ted Strickland’s first biennial budget was adopted in July 2008 with little partisan rancor, despite the fact that Republicans held majorities in both houses of the bicameral legislature at the time. The FY 2010 budget approved last summer was much more challenging to the state leadership, because the 2008 elections had given Democrats control of the House. The difference between the political parties over budget issues was intense because of the significant loss of tax revenue. Further, Governor Strickland was unwilling to propose any tax increases, so the budget was very lean and a number of the issues were not settled until late December 2009.

The Democratic leadership in the House under Speaker Armond Budish, the GOP Senate leader Bill

Harris, and Governor Strickland were noticeably restrained in their rhetoric in their budget dispute. This has mitigated the partisan rancor going forward into the 2010 election, even though the stakes are very high. A number of groups closely affiliated with the state Democratic Party of Ohio were very disappointed by the lean budget. Without the infusion of federal stimulus monies, the state budget situation would have been much more difficult to resolve.

The final and possibly most significant environmental factor in Ohio’s 2010 election is Ohioans’ assessment of the performance of President Obama’s government and the Democratic Congress. The most significant Obama policy that specifically impacted Ohio was the bailout of the auto industry. Particularly significant was the federal aid to General Motors and Chrysler, both of whom have a strong presence

in Ohio. The financial condition of those now publicly financed corporations remains precarious. Reflecting national trends, President Obama’s approval rating has declined precipitously in Ohio. The most recent state polls show him at 47 percent. The political party in the White

“Having grown up in a small family business and being back in the private sector as a lawyer and small business owner since leaving government 2 1/2 years ago, I know that jobs aren’t created through government, but through hard work, innovation and investment in the private sector.

“In fact, the taxes, fees, rules and regulations that government imposes on businesses makes it more difficult for Ohio to retain and create jobs. With Ohio continuing to lose jobs and

fall behind economically, I have spent the past year touring factories, farms, hospitals, and research centers, listening to small business owners, workers, local economic development experts and others about how current and proposed policies affect jobs here in Ohio.

“I have made it a point to talk directly with the people making hiring decisions about the impact of tax law policy, health care proposals, cap and trade and other energy ideas, card check, regulations and government spending. After 24 plant tours, several small business roundtables and meetings with economic development groups in every region of the state, I am more convinced than ever that the reckless spending and anti-jobs policies coming out of Washington today are bad for Ohio jobs. I am also convinced that there is a better way, one rooted in the free enterprise system that creates the environment for job growth in Ohio.”

“Jobs aren’t created through government” ROb PORTmAN


House typically is a liability for that party’s candidates seeking election to office. Efforts of candidates to run and hide from that burden typically fail.

It is folly to attempt to predict the outcome of the significant state elections in a highly competitive state like Ohio. However, we can identify the likely major actors in Ohio’s 2010 statewide election and speculate on how some of the environmental factors mentioned above will impact on those races.

Races to WatchThe marquee race in the Ohio midterm will be the race

for Governor. At the beginning of 2009 it appeared that Governor Ted Strickland was expected to win reelection easily. Strickland’s soft spoken, civil, down home style is a perfect fit for Ohio politics. However the environmental factors -- principally the dismal conditions of the Ohio economy and the very tight state budget -- have put his tenure at risk.

Ohio is reluctant to deny a governor a second term. The 1974 defeat of Democrat John Gilligan by the master of Ohio politics, Republican Jim Rhodes, was the last time an Ohio incumbent governor was denied a second term. Governor Gilligan had introduced the state income tax in his first term, and that contributed to Rhodes’ surprising win in the midst of Watergate.

In 2010, Governor Strickland faces the energetic former member of Congress John Kasich, recently of Fox News fame who more importantly served as Chairman of the House Budget Committee when the federal government had a budget surplus. Kasich has never run statewide in the byzantine, bifurcated state of Ohio. The environmental conditions will put wind in the sails of his campaign; he actually has led Strickland in some recent public polls. Certainly the political environment is contributing to Strickland’s weak poll numbers. The themes of that important contest have yet to unfold. The condition of the state’s economy will be a central part of that narrative.

The other very important race in Ohio in 2010 is for the open United States Senate seat resulting from the decision of one of Ohio’s most potent vote getters, George Voinovich, to step aside. The actors in this very important play have not been cast. It does appear that on the Republican side, Rob Portman, a former Cincinnati Congressman and an appointee to a number of important posts by President George W. Bush, will be the Republican

standard bearer. There is a wealthy Cleveland car dealer named Tom Ganley who is attempting to run to the right of Portman in the GOP primary. It is not clear how much of his own money Ganley is willing to put into this primary challenge. If he does not spend millions, then Portman, who has not run statewide, will carry the flag for the Republicans in this very important race, which could, in the final weeks of October, become a national headliner.

The Democratic candidate in this matchup is not yet determined. Lt. Governor Lee Fisher is facing a formidable challenge from Secretary of State Jennifer Brunner. Most of the state pundits are picking Fisher, who is an experienced statewide campaigner. But that will likely be a very hotly contested primary. This U.S. Senate race, perhaps more than the race for Governor, will be greatly influenced by environmental factors, particularly Ohioans’ opinion of the Democratic government in Washington. Portman is running even with Fisher in some public polls,

despite the fact that, at this juncture, Portman is virtually unknown outside of the Cincinnati media market.

The Republicans can take heart that, after two very bad election cycles, the stars are lining up in their favor in Ohio. In 2004, the total two party vote in Ohio was 5,674,259, while in 2008 the total two party vote was 5,534,259 -- a decrease of 140,296 votes in a national

election that produced close to a historic national record turnout. Recent national polls are showing an increase in GOP voters’ enthusiasm. Perhaps that will spread to Ohio. However to take full advantage of these apparent opportunities, Ohio Republicans need to figure out who they are, and how they should campaign.

They might want to keep in mind the classic work of political scientist John Fenton, who wrote years ago that Ohio politics are issueless. No one understood that better than the 20th century Ohio Republican political icons, Ray Bliss and Jim Rhodes.

Energized Ohio Republicans also should keep in mind that the best laid plans can go astray. As Machiavelli pointed out, fortuna can change quickly. RF

William Binning, Ph.D., is Professor Emeritus of Political Science at Youngstown State University. A former Chairman of the Mahoning County Republican Party, he has been involved in a number of gubernatorial campaigns in the State of Ohio.

Strickland’s soft spoken, civil, down home style is a perfect fit for Ohio politics. However the

environmental factors -- principally the dismal conditions of the Ohio economy and the very tight state

budget -- have put his tenureat risk.


JOSEPH R. GAyLORD

No two elections are alike. There are too many variables in play. The economy changes, the culture evolves, new leaders and new issues emerge.

But I see three important similarities between the GOP’s status in 2010 and in 1994 when Republicans won control of Congress. I also see three differences, which are equally important.

The SimilaritiesUnusually unified. In both 1994 and 2010, the GOP

quickly recovered from the disillusionment of losing a presidential election and forged a united front. Frankly, much of the credit for that unity should go to the Democrats. In both years, a Democratic president was polarizing and Democratic Congressional leaders were hyper-partisan. There’s nothing like fear of a common adversary to unite people.

Two months ago, when Republicans lost the U.S. House seat in New York’s 23rd district, Democrats hoped that it signaled the beginning of a civil war in the GOP. But the victory of Scott Brown in the special Senate election in Massachusetts dashed that hope. Brown ran a populist campaign, calling himself independent, and communicating a mix of conservative, moderate and nonpartisan positions. Yet all kinds of Republicans, from all over the country, rallied around him. We have not seen that kind of GOP unity and enthusiasm since Ronald Reagan.

Energized by conservative grassroots activism. The GOP leaders in Congress are usually “conservative” in taking action – they tend to be patient and gradual, rather than quick and aggressive. But conservative activists, demanding outright defeat of liberal schemes for more intrusive government, strengthen the resolve of GOP

incumbents and help motivate GOP challengers. Listening to grassroots activists makes Republican leaders more responsive and in touch with public opinion, and thus more effective candidates – in contrast with Democratic incumbents afraid to hold “Town Hall meetings” or engage in debate.

Genuinely optimistic. In 1994, the unpopularity of a Democratic president and a Democratic controlled Congress helped convince GOP incumbents and challengers that the off-year election would be a great opportunity to gain seats. As a result, better challenger candidates were

recruited, more money was raised, more volunteers got involved, and candidates acted with greater confidence. “Great expectations” can be self-fulfilling that way.

Recent elections have given us ample reason to be optimistic about GOP prospects in November. Republicans won resounding victories in three states that Barack Obama carried – governorships in Virginia and New Jersey, and the

Senate race in Massachusetts. If a little-known Republican could come from 30 points behind in the polls to win the Senate seat formerly held by Ted Kennedy, the greatest icon of contemporary liberal Democrats, all things seem possible.

The DifferencesGalvanizing Leadership. In 1994, House Republicans

were fortunate to have a Teddy Roosevelt type of leader as a catalyst – a hard-charging reformer. That was Congressman Newt Gingrich of Georgia. His spirited challenges to Speakers Tip O’Neill, Jim Wright and Tom Foley inspired fellow Republicans to realize that being in the minority didn’t mean you had to be silent or acquiescent.

Politics & Perspective

Will the 2010 Electionsbe a Replay of 1994?


Equally important, he helped recruit good challenger candidates. Without credible challengers, of course, incumbents can’t be beaten. Gingrich not only gave these candidates hope and confidence, he also gave them an example. They adapted his rhetoric in making the case against the arrogance and corruption of one-party rule, and they adopted his attitude of being a “happy warrior.”

We don’t yet have a clear national GOP leader who is a catalyst in uniting our party, defining our reform message, and developing our campaign strategy. But we do have new leaders emerging – including those who won in New Jersey, Virginia and Massachusetts.

Alternative solutions. The GOP House candidates signed and campaigned on a platform of clear, compelling reforms, the “Contract with America.” This accomplished a number of things:

It nationalized House races – not allowing Democratic incumbents to get away with pretending in their districts to be all about constituent service and “bringing home the bacon” while voting for harmful liberal policies in DC. It also enabled GOP candidates to appeal to a larger percentage of voters than the 40 percent who call themselves conservative – offering ideas, like we promote at American Solutions, which appeal to 70-80 percent of voters. The “common sense reforms” in the “Contract with America” (e.g. “require all laws that apply to the rest of the country also apply equally to the Congress”) appealed to skeptical independents and disillusioned Democrats.

In 2010, the GOP has not done as well in convincing non-Republicans that it has alternative solutions to the radical proposals of Barack, Nancy and Harry. In the Massachusetts Senate race, Scott Brown gave us a good example. He made clear that he’d be the 41st vote against Obamacare, but he also said, “We can go back to the drawing board and do it better.”

He made clear that he favored sensible reforms – not a 2,000 page monstrosity that would make things worse.

Innovative challenger campaigns. In 1994, GOP challengers learned from GOPAC and National Republican Congressional Committee books and audiotapes that they needed to run campaigns which were opposite those of entrenched incumbents. They realized they needed five essential things to pull off an upset victory: creativity, capital, confidence, contrast, and controversy.

That new model for challengers led to a new kind of political entrepreneurship. Challenger campaigns were more aggressive, innovative and persuasive. Instead

of being shy and overly polite, challengers drew bright lines of contrast with incumbents. Instead of talking like accountants, they spoke with the conviction of reform. Instead of wasting money on campaign overhead, they invested in persuasion. Instead of being fearful of the news media, they used imaginative tactics to create and sustain the kind of controversy that exposed out-of-touch incumbents.

In Massachusetts, Scott Brown was running for an open Senate seat against the state Attorney General, Martha Coakley. Yet he ran a challenger style campaign in the spirit of 1994. He ran against the arrogance, over-spending and corruption of the liberal Democratic establishment. And he forced his opponent to defend that establishment.

He had the confidence, capital, contrast, controversy and creativity to pull off an upset victory – the second “shot

heard ‘round the world.”

The Prospects forthis Fall

In 1994, Republicans had a net gain of 54 seats in the House and 8 in the Senate, taking majority control in both chambers.

This year Republicans should have major gains, as well, having the advantages of the three similarities with 1994: being unusually unified, being energized by conservative grassroots activism, and having the optimism that goes along

with great expectations. But for Republicans to win enough seats to take control

of both House and Senate, the GOP needs to work harder on the three things that are different from 1994: we need more GOP leaders who are galvanizing in a positive way; we need to offer clear and compelling alternative solutions, not just opposition to Democratic legislation; and finally, we need our challenger campaigns to be aggressive, innovative, reform-minded and persuasive.

Can we achieve the last three goals by November? With a little more help from the Democrats, I’m very optimistic. RF

Joseph R. Gaylord is CEO of American Solutions, a citizen action network of over 1.5 million members, chaired by Newt Gingrich. In the 1980s, Gaylord was Executive Director of the National Republican Congressional Committee and then directed GOPAC, a political action committee credited with “the long campaign” that in 1994 resulted in the GOP takeover of the House.

We don’t yet have a clear national GOP leader who is a catalyst in uniting our party, defining our reform

message, and developing our campaign strategy. But we do have new leaders emerging – including those who won in New Jersey, Virginia and

Massachusetts.


JOHN FEEHERy

Mr. President:It is a relatively new tradition for the party that

is out of power to give a response to the President’s State of the Union.

This was done initially by Congressional Democrats who in the mid-80s desperately wanted to give their side of the story in response to President Ronald Reagan’s State of the Union Addresses.

They wanted to provide balance.In the spirit

of balance, I will provide this response to your address.

You have given another w e l l - d e l i v e r e d and glib speech to the country. You have attempted to convince people that everything you have done is fine and honorable, and everything your opponents have done is corrupt and misguided.

You have continued the fiction that all is well in America, and that the state of our union is strong.

You have also done all of those things that so many presidents have done in the past. You have laid out your agenda for the new year, you have urged the Congress (which you control, by the way) to get moving on last year’s agenda, you have detailed your new spending wish list, and you have kept your colleagues moving up and down in their chairs for a better part of an hour, all in the hopes of currying favor with the voters.

One thing you haven’t done is put it all in context for the American people. You haven’t talked to them about the very real challenges this country faces in honest terms.

So, what I would like to do is be straight with the citizens of this great country.

In the spirit of balance, I would like to talk about the seven ways this country is, well, out of balance,

why that lack of balance will hurt the long-term health of this country, and what we should do to bring ourselves back into balance.

Fiscal Imbalance

We can’t continue to spend money we don’t have on government spending we don’t need. We can’t continue to borrow money from the Chinese

government to fight terrorists in Afghanistan. We can’t continue to borrow money today with the promises that we will pay it back a generation from now. At some point, the bills will come due. At some point in the not-too-distant future, the interest payments we pay on our debt will exceed the money we spend on our national defense. At some point, we will either have to sharply raise taxes, sharply cut spending, or see inflation spiral out of control.

Our budget is not just a little out of balance. It

The Real State of the UnionA balanced response fromthe GOP

Mr. President … You have continued the fiction that all is well in America, and that

the state of our union is strong.


is out of balance in historically high terms. We are deeper in debt than we have ever been in our nation’s history. Our debt as a percentage of GDP is at a higher percentage than at any time since the Second World War. This is unsustainable and unnecessary. Just a decade ago, we had a budget surplus. We need to get back to a budget surplus so we can start paying off some of this debt.

Trade ImbalanceTrade is an essential part of any growing and

thriving economy. But trade, by its very nature, is a two-way transaction. You trade something of value to me and I trade something of value back to you. Over the last 15 years, we have traded our dollars for consumer products of all kinds, and, unfortunately, to a much lesser extent, we have traded our products to people in other countries for their version of dollars.

A healthy trading relationship means that the trade in products and money is roughly in balance. We have a healthy trading relationship with Europe, to a large extent. We don’t have a healthy trading relationship with China. They make all the products and we consume them all. This needs to change for a long-term, balanced relationship between our economies.

The Chinese need to consume more of our products and we need to consume less of theirs.

Age Resource ImbalanceA nation that spends considerably more on

its senior citizens than it does on its young people is a nation that is looking not to the future for its inspiration, but to its past.

We don’t spend enough making our kids ready to compete for the future. We don’t spend enough on education, we don’t invest enough in teacher quality, and we don’t do everything we can to make America’s future brighter. We can’t, because we spend so much of our resources on senior citizens, now and in the

future. Our national budget tells the story. Social Security and Medicare cost the federal

treasury well north of a trillion dollars a year (last year, it was $1.152 trillion). Last year, we spent about $70 billion on education (at the federal level) and children’s health care. We need to find a way to achieve a better balance on that spending allocation.

Private andPublic Sector Imbalance

Without a robust, vibrant, and large private sector, the public sector won’t have the resources to operate. After all, somebody has to pay the taxes to fund the government. But over the last couple of decades, the public sector has threatened to eclipse the private sector in its size and its cost. This imbalance has dire budgetary implications, at the local, state and federal

level. For example,

while the private sector has largely a b a n d o n e d defined benefit pension plans, u n d e r s t a n d i n g that individual companies can’t afford them, the public sector continues to insist on them. But that leads to large budget problems

at all levels of g o v e r n m e n t . Another example comes with labor contracts. Government jobs are as close to permanent as just

about anything can be in this life, no matter what the performance of the government employee. In the private sector, employees have to perform or they risk losing their jobs. This imbalance builds resentment between those who work in the government and those who don’t.

We need to seek greater parity between the two. We certainly shouldn’t give the public sector employees a better deal than they can get in the private sector.

Wealth ImbalanceDemocrats look at the gnawing wealth imbalance

in this country and see that the rich are making too much. I see the great wealth imbalance and think

Our budget is not just a little out of balance. It is out of balance in historically high terms. We are deeper in debt than we

have ever been in our nation’s history.


that the poor and the working class aren’t making enough. I believe that the marketplace should and does accurately assess the worth that each employee brings to the market. We shouldn’t try to manipulate the market to bring the rich and poor closer together. We should try to improve the worth of the worker so we can make the poor richer.

Life-long education and worker-retraining is a necessary component in making the poor more productive. Making communities safer, keeping drugs out of the hands of kids, and improving the chances for families on the margins is another part. The President has authorized a surge in Afghanistan. Perhaps it is time for a surge in our most isolated and distressed communities to help them climb out of poverty.

National SecurityImbalance

It is time for us to reconsider the basic premise that has dominated the national security discussions for the last 50 years. It is the “I’ll buy, if you fly” philosophy. We take care of the national security interests of all the Western world (including Japan), and they allow us to use pieces of their countries to store our weapons, planes and armed services personnel.

In the second half of the 20th century, this all made perfect sense. The rest of the world needed our robust presence to keep the Soviet Union at bay and to impose stability in an instable world. It also made sense because America, with its economic superiority, could afford it. Well, we can’t afford it anymore.

If our allies want the promise of American economic security, they should start helping us pay for it. If they don’t want it, we should pull our troops out.

Political ImbalanceThis all comes to my final point. The American

people want Republicans and Democrats and independents to all work together, free of spite, in a spirit of bipartisanship. That’s not going to happen any time soon. But hard-won bipartisan compromise can and should happen.

Right now, the political system is leaning severely to the left, while the country is leaning slightly to the

right. Liberal Democrats run the House, the Senate and, of course, the President is the leader of the liberal Democrats. But according to polls, only 20 percent of the country sees themselves as liberal.

What the system needs now, more than ever, is divided government. This will give the President a counterweight, to bring him closer in line with the wishes and hopes of most Americans, who are centrist in their ideological makeup.

Mr. President, the purpose of the response to your State of the Union address is to provide the American people with both sides of the argument, to give the viewers a more balanced assessment of the world. Balance is an important attribute in life, in policy and in politics.

I believe that in many key ways, America is dangerously out of balance. It is time that we seek greater balance as we work together to

move this country forward. RF

John Feehery is a former congressional aide. He is also the founder and president of The Feehery Group (www.thefeeherygroup.com), a boutique advocacy firm that focuses on communications and government affairs strategy.

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BURDETT LOOMIS

Any conversation about moderates in the 111th Congress begins by focusing on the Blue Dog Democrats in the U.S. House. Although centrist Senate Democrats wield more power, the cleverly named Blue Dog Coalition gets the lion’s share of attention. And let’s face it, the House Blue Dog Democrats, those fifty or so fiscal conservatives on the right side of their party, have had a great ride.

Established in the wake of the 1994 GOP takeover of the House, they have consistently won broad coverage for their various pronouncements, usually on issues of fiscal restraint, deficits, and governmental growth. During the 12 years of Republican House majorities, the Blue Dogs were a bit of a curiosity, though never a major force, in that Speaker Dennis Hastert decreed that only bills that could be passed with a strong Republican majority in the House would be brought up. Thus, negotiating with Blue Dogs – who might well have been interested – was rare on major issues.

Starting in 2007, however, the Blue Dogs appeared to gain real leverage, given the Democrats’ 35-seat margin in the 110th Congress. With about 235 Democrats in the House majority, the fifty Blue Dogs should have been able to move legislation to the right – toward what political scientists call the median point of the chamber. No question that the Blue Dogs tried to moderate their party’s fiscal policies, both on the floor and behind closed doors. But did they accomplish much? That’s another story – and a lesson, perhaps, in the difficulties of practicing moderate politics in a highly partisan age.

Who, then, are the Blue Dogs? First, they come

disproportionately from rural areas and southern states, and are thus easily stereotyped as across-the-board conservative Democrats. Second, they make up a well-organized, formal caucus in the U. S. House; would-be members must apply to join (some are rejected), members must attend most meetings to remain in good standing, and 60 percent approval is needed to endorse a coalition position. Although these legislators maintain strong ties to each other, it is their stated commitment to fiscal restraint that gives the Blue Dog Coalition its potential clout.

As veteran Rep. Dennis Moore (D-Kansas) observed, “Our focus is key – on the economic issues of balanced budget and paying for program (Paygo). We don’t take positions on social issues.” It is no wonder that journalists turn to the Blue Dogs as a good story; they often personify conflicts inside the Democratic caucus by opposing the powerful party leadership and offering a centrist counter-narrative to that of Speaker Pelosi and a liberal majority.

Given a catchy name and a clear organizational structure, Blue Dogs provide journalists a simple way to touch base with centrist Democrats – get a

quote from a leader like Mike Ross of Arkansas and move on. This is problematic in at least three major ways.

First, the Coalition is often split on given issues; second, beyond fiscal concerns, its members hold widely divergent views (say, on abortion or gun control); and third, the Blue Dogs are all Democrats. To be sure, their centrist views pull them away from their leaders on some issues, but (save for the recent defection of Alabama’s Parker Griffith) they remain members of the Democratic caucus, whose careers depend in part on how well they can

The Blue Dogs:Are they all bark and no bite?

No question that the Blue Dogs tried to moderate their party’s

fiscal policies, both on the floor and behind closed doors. But did

they accomplish much? That’s another story…


work with the leadership. Moreover, as Democrats they agree with many of their

party’s initiatives. In fact, Blue Dogs almost never vote as a separate bloc to oppose a major party position. And in the three-plus years since Democrats won control of the House, it has not happened at all. From TARP to stimulus funds to health care reforms, Blue Dogs simply do not constitute a cohesive or powerful force in congressional voting.

Rather, their members argue that their voices are heard within the Democratic caucus, in committees, and in private conversations with the party leadership and the president. This claim of insider influence over the agenda and on specific issues is credible, but difficult to pin down.

Ironically, the Democrats’ likely loss of, say, 25 seats in the 2010 mid-term elections, would reduce Blue Dog numbers in the House, while increasing their clout. Were there 230 or so Democrats in the next congress, fewer than 20 Blue Dog defections could determine the outcome of key votes, and the Coalition might well exercise both voting and agenda-setting power.

So, does the existence of the Blue Dogs matter?

From TARP to stimulus funds to health care reforms, Blue

Dogs simply do not constitute a cohesive or powerful force in

congressional voting.

Coalition members argue strongly that it does, by bringing like-minded legislators together and providing a voice for fiscal moderates. As for impact, however, the answer is less clear. Despite the fears of some liberals and the attention of many journalists, there is little evidence that Blue Dog votes have made much of a difference. Whether they have significantly altered the Democrats’

agenda may be in the eye of the beholder, with House leaders acknowledging few adjustments and Blue Dogs seeing real modifications on given issues, such as Paygo.

In the end, actual substance may not matter much. The Blue Dog brand name is convenient for

the press to use, standing broadly, if inaccurately, for all moderate-conservative Democrats across all issues.

The Blue Dog narrative continues to work, even as the Coalition’s impact remains open to question. RF

Burdett Loomis is a professor of political science at the University of Kansas and author of a recent study on the Blue Dogs entitled, “Blue Dog House Democrats: Lead Dogs or Mythical Beasts?”

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LOU ZICKAR

To young Americans today, Archie Manning is best known as the father of Peyton and Eli. But to those who grew up watching the game of football in the 1970s and 1980s, he is perhaps better known as one of the finest quarterbacks never to win the Super Bowl.

A two-time pro bowler and NFC offensive player of the year, Archie spent most of his career playing for the New Orleans Saints. Long before Katrina devastated the Crescent City, the Saints were known as the biggest disaster on the Gulf Coast. During Archie’s tenure as quarterback, the Saints compiled a record of 41-96.

But no one ever blamed him for the losses. In the words of sportswriter John Fennelly, the fans viewed Archie as “a terrifically talented QB,” but also knew that “the teams he played for were hapless to say the least.”

One year into his young administration, President Barack Obama is viewed as different things to different people. To some Republicans he is a socialist, while to some Democrats he is a saint. To some on the left he is a savior, while to some on the right he is a threat.

Now, with polls showing that the President is hemorrhaging support among independents and those in the political center, another view is beginning to take hold — namely, that Barack Obama is the Archie Manning of American politics, the one shining star on an otherwise hapless team.

On issue after issue this past year, Obama has called a play only to have others on the field let him down.

On the economic stimulus package, the president called for legislation that didn’t just “throw money at our problems.”

Then he handed the ball off to Senate Majority Leader Harry Reid, who proceeded to do just that by including the biggest spending increase since World War II in the 1,071-page bill.

On the climate change measure, the president called for legislation in which special interests didn’t overshadow “common sense.”

Then he handed the ball off to House Energy and Commerce Committee Chairman Henry Waxman, who

proceeded to defy common sense by including the largest tax increase in history in the 1,427-page bill.

And in the health care reform debate, the president called for legislation that would not put “government in charge of your health insurance.”

Then he handed the ball off to House Speaker Nancy Pelosi, who proceeded to give government a massive new role in health care by including 111 new federal bureaucracies in

the 1,990-page bill.On each of these issues, Obama took the snap from the

center, then watched as his teammates took the handoff and ran to the left. The result is that independent voters are now leaving him in droves.

The numbers speak for themselves. In the spring, numerous polls showed the president had an approval rating of over 60 percent among those in the political center. By the end of the year, that number had dropped to below 45 percent.

As Democratic pollster Doug Schoen noted in the New York Daily News: “That erosion can only be called a cratering of support. The single biggest reason independents are breaking away from Democrats is that they feel he is

The Archie Manning ofAmerican politics


....with polls showing that the President is hemorrhaging support among independents and those in the political center, another view is beginning to take hold — namely, that Barack Obama is the Archie

Manning of American politics, the one shining star on an otherwise

hapless team.

spending too much money, increasing the deficit and not addressing the nation’s problems in a bipartisan way.”

Of course, it should also be noted that Obama himself remains very popular. In fact, a recent poll by John Zogby found that 52 percent of Americans are proud to have him as their president. But then, Archie Manning was popular, too. And the people of New Orleans were certainly proud to have him as their quarterback.

The difference, though, is when fans were unhappy with Archie’s team, they would sit in the stands wearing brown paper bags over their heads with the word “Aints” written across the front.

But they would still come to the games. For Obama and his teammates, the problem is much worse. If independents are unhappy with the Democrats in the midterm elections this November, they will either stay at home or switch their allegiance to the other side.

That is exactly what happened this January in Massachusetts, where Scott Brown won 65 percent of independent voters in his upset victory for Ted Kennedy’s seat in the United States Senate. And it’s what happened last fall in Virginia, where Bob McDonnell won 62 percent

of independents in his successful campaign to become the commonwealth’s next governor.

The Brown/McDonnell blueprint for victory represents not just the best hope for Republicans in 2010, but the worst nightmare for Democrats. It is a blueprint that stresses issues over ideology and value over values.

It is also a blueprint very similar to the one Obama based his campaign on last year — one that seeks to govern from the center, and one that, unfortunately, Obama’s teammates have now chosen to ignore.

Nearly 25 years after Archie Manning retired from football, his old team, the Saints, are in the Super Bowl. In large measure, their success this year has come because they have found another great quarterback in Drew Brees.

More than anything though, the success of the Saints is due to the fact that their great quarterback is finally surrounded by good talent and the team is all on the same page.

If only Obama were so lucky. RF

Lou Zickar is the editor of The Ripon Forum.

RIPON FORUM April/May 2007 C1

RF65Ideas that matter, since 1965.


Name: U.S. Rep. Jo Ann EmersonHometown: Cape Girardeau, MissouriOccupation: Member of CongressPrevious Jobs: Senior Vice President of Public Affairs, American Insurance Association; Director of State Relations and Grassroots Programs, National Restaurant Association; Deputy Communications Director, National Republican Congressional Committee

Individual(s) who inspired me as a child: My father, Ab Hermann, who was the executive director of the RNC in the 1960’s. He was charged with the task of uniting our party and redefining the Republican Party to a new generation of conservatives using new technologies and media – our challenges today are much the same as the ones he took on 50 years ago.

Historical figure(s) I would most like to meet: Abraham Lincoln – he had to fight to preserve our Union and, though the challenges are different today, we have to stop runaway federal spending and work harder to preserve individual freedoms in order to guarantee the blessings of liberty for future generations of Americans.

Issue facing America that no one is talking about: People may be talking about how the manufacturing sector of the U.S. economy is hurting, but no one is talking about the changes we must make. For starters, we should expand tax incentives for American businesses to invest in modernizing equipment and to expand R&D efforts. We should also emphasize business expensing for all kinds and sizes of American businesses, instead of depreciation, to speed the benefits of tax treatments to the U.S. economy at a critical time. Finally, we must make wise choices in government to curb wasteful and redundant spending in favor of investments in public infrastructure – chiefly transportation infrastructure – to create lasting, stable jobs in America.

What the GOP must do to reclaim its congressional majority: Simply put, but not so simple to do, we must return America to the days when an entrepreneur could make his idea a profitable reality entirely within the United States. Today, great business and manufacturing ideas from America are assembled in Mexico using labor from Central America, capital from Japan, energy from Brazil and the Middle East, and packaging from China. The call centers to answer questions about the resulting product are in India, and the only thing made in America is the credit card transaction to buy the thing. Public-private partnerships to achieve this goal should be a staple of a smaller, more streamlined government that encourages American economic productivity.


The Ripon SocieTy2010 policy & politics Dialogue Series

John BoehnerRepublican Leader of the U.S. House of Representatives“The Year Ahead in Congress”January 27, 2010

Pete SeSSionSChairman, National RepublicanCongressional Committee“Battle for the House”February 3, 2010

Paul ryanRanking RepublicanHouse Budget Committee“Fight Over the 2010 Budget”February 25, 2010

For more information, please contactThe Ripon Society at 202-216-1008

or [email protected].

John CornynChairman, National RepublicanSenatorial Committee“Battle for the Senate”March 10, 2010

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