The New New Deal (29 page)

In a memo the next day titled “The Republican Problem,” Pelosi’s office suggested the GOP was committing electoral suicide, voting against jobs in their own communities during a jobs crisis.
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“The House Republican leadership put its members in another politically untenable position yesterday,” the memo said. Van Hollen predicted that in 2010, Republicans would pay for rejecting the stimulus. A coalition of liberal groups and unions immediately ran ads pummeling Republicans for opposing Obama’s plan, a move that Cantor unironically declared would “undermine our nation’s desire for bipartisanship.”

The GOP’s doom-and-gloom rhetoric and unified opposition reminded Pelosi of the war over Clinton’s 1993 budget, which then Minority Leader Newt Gingrich had predicted would “kill jobs and lead to a recession, and … actually increase the deficit.” The budget passed without a single Republican vote, and actually helped usher in an era of vibrant growth and record surpluses. Now once again, Democrats were trying to clean up a Republican mess without Republican help.

“There’s a pattern here,” her memo said.

Pelosi wasn’t the only politician thinking about 1993. The next day, Gingrich addressed a House Republican retreat at a posh resort in the Virginia mountains, and said the stand against the stimulus brought back the same memory.
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What he remembered about the Clinton budget’s aftermath was not the spectacular failure of his economic predictions,
but the Republican political revival that culminated in his rise to power the next year. Now he made a more accurate prediction: Boehner would become speaker “at a speed that will shock the Democrats.”

The Republicans were not behaving like a team that had just gotten pasted. They felt like insurgents who had just pulled off their first ambush. Boehner replayed the C-SPAN video of the vote, prompting a standing ovation. “I know all of you are pumped about the vote the other day,” Cantor said.
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“We’ll have more to come!” Pence showed a clip from
Patton
of the general rallying his troops against their Nazi enemy: “We’re going to kick the hell out of him all the time and we’re going to go through him like crap through a goose!”

That night, Cantor had his whip team sign a celebratory bottle of red wine, not to be uncorked until Republicans took back the House.

“I was very confident the country was heading in the wrong direction,” Cantor told me. “I thought if we stayed the course, we could earn back the majority.”

There was one discordant note when Boehner suggested that the stimulus was so egregious it had practically whipped itself, prompting Cantor to pull him aside and tell him not to rewrite history. “We had to send a little message: ‘Uh, we worked our asses off for that vote,’” says one Cantor aide. “Holy cow! We just had two million people show up in D.C. saying: ‘Yes, We Can!’ The pollsters were saying America had shifted underneath us. The president was wildly popular, even with Republicans. Don’t sit there and say it was an easy victory.”

Otherwise, the mood was buoyant. The Republicans had said no to Obama, and it felt good. In a later roundtable discussion, the Young Guns Cantor, Kevin McCarthy, and Paul Ryan, all agreed that the stimulus woke up the Republicans and launched their comeback.
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“It became a very defining moment for this conference,” Cantor said.

“Very much so,” Ryan chimed in.

“I think that’s when we got our mojo back,” McCarthy agreed.

T
he new leader of the free world seemed a bit mojo-deficient. His honeymoon was over before it had started, and he was already losing
control of the stimulus narrative. “Republicans—short on new ideas, low on votes, and deeply unpopular in the polls—have been winning the media war over the president’s central initiative,” the liberal
Washington Post
columnist E. J. Dionne wrote.
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A
Politico
news story drew the same conclusion: “Obama Losing the Stimulus Message War.”

Obama was sending mixed stimulus messages: It’s my bill, but I don’t like everything Congress is doing with it, and this flawed legislation needs to pass right away. He was peddling a short-term rescue but also long-term change, an immediate fiscal fiesta but an eventual shift to fiscal responsibility. He was trying not to oversell the crisis, because his economic team feared that talking down the economy could depress confidence and deepen the slump, but he didn’t want to undersell it, either, because his legislative team wanted Congress to feel a sense of urgency.

Republicans had a much simpler narrative: No.

It was resonating. In the week after the House vote, support for the stimulus sank from 52 percent to 38 percent.
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Polls showed that the closer respondents were following the debate, the less likely they were to support the stimulus.

To try to seize control of the narrative, Obama’s team summoned the anchors from all five major news networks to the Oval Office for one-on-one interviews. This would be the president’s best chance to pitch the stimulus directly, to get his conversation with the public back on track. “We really wanted to drive the message, to compete against all the myths,” Phil Schiliro recalls. But the morning of the sit-downs, Tom Daschle withdrew from consideration for health secretary because of unpaid taxes, so Obama’s sit-downs with Katie Couric, Anderson Cooper, and the rest of the media elite focused almost entirely on the botched nomination. “That was a key moment,” Schiliro says. “He didn’t get to rebut all the false information out there.”

Instead, the big news from the interviews, replayed for days, was Obama’s assessment of the Daschle snafu: “I screwed up.”

Obama couldn’t afford to screw up the Recovery Act. The economic carnage was worsening by the day. January was the worst month yet,
with 800,000 more job losses, including mass layoffs at iconic firms like Microsoft, Boeing, Home Depot, and Starbucks. It felt like an economic 9/11, without the bipartisan determination to fight back. Somehow, he had to find sixty senators willing to follow him into battle.

In his diary, the Republican consultant-turned-congressman Tom Cole speculated that the president was already saying to himself: “And I asked for this job?”

“Obama is finding that controlling his party’s large majorities is tough—and reining in the GOP is tougher,” Cole wrote. “As he knows, he will own the economy at some point. Once he does, we will clobber him in the midterms.”

B
ipartisanship can become a habit, which is one reason the Obama team wanted the new Congress to start with two motherhood-and-apple-pie bills that already had some Republican support. The Lilly Ledbetter gender equity legislation followed the script perfectly, and Obama got to host a bipartisan signing ceremony in the East Room. The S-CHIP children’s health expansion turned out to be trickier.

In the last Congress, Senate Finance chairman Max Baucus of Montana and ranking member Chuck Grassley of Iowa had cut a deal to cover four million more kids, but Bush had scuttled it. Now Baucus, a moderate Democrat from a ranching family, and Grassley, a conservative Republican from a farming family, wanted Obama to make it law. Baucus and Grassley were more than “my good friend from Iowa” friends; their mutual admiration bordered on old-man bromance. “We’re family,” Grassley says. Their alliance looked like a starting point for the kind of deals that could attract eighty votes in the Senate, maybe even for comprehensive health reform.

But their relatively modest deal on children’s health soon ran into trouble. The problem was that the deal had excluded noncitizens, to make it palatable to more Republicans. Now Democrats had larger margins in Congress, and no longer needed a two thirds majority to
override Bush’s veto. So the Obama team insisted on covering legal immigrants. To Grassley and other Republicans, this was a defining moment, proving Obama’s rhetoric about cooperation was just rhetoric.

“Once they controlled everything, they shoved us off to the side,” Grassley says. “They decided to go partisan. It’s not how you treat a partner.”

Obama aides found this pique ludicrous. Why should the president throw immigrant children under the bus to preserve someone else’s obsolete deal? “We had just won a landslide, and this was offensive to our values,” one official says. “It’s one thing to compromise if you need the votes, but we didn’t.” The idea that Obama should offend pro-immigrant groups that had supported his election in order to help his political adversaries avoid a political quandary seemed delusional. From Rahm’s perspective, a bill that helped children while putting more Republicans on record against helping children was practically ideal. Obama cared more about bipartisanship than Rahm did, but not for its own sake, and certainly not at the expense of sick kids.

“These are kids! They’re here legally! Sorry, that busts the deal,” says Congressman Becerra, himself a child of working-class Mexican immigrants.

Still, Grassley felt burned. He and several GOP allies had gone out on a limb against Bush, only to see it sawed off by his supposedly post-partisan successor.

“It was a real tactical error,” says one congressional aide. “It let Mitch McConnell go to Grassley and say: ‘See? You can make a deal with Max, but the president is just going to fuck you.’”

Obama did get his bipartisan victory. The day after he signed the Ledbetter bill, the Senate approved the new S-CHIP by a comfortable margin, even without Grassley’s vote.
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But it left a partisan taste in some Republican mouths.

“We got screwed,” Grassley says. “It got things off to a terrible start.”

S
ome White House officials truly believed the stimulus could attract eighty votes in the Senate. The White House official who knew the Senate best was not one of them. Vice President Biden would lead the administration’s outreach to his former colleagues, and he had close friends in the institution of every ideological stripe. But he says that even before the GOP posted its zero in the House, he never thought he could pick off more than a few Republicans in the Senate.

“Never for one single instant,” he told me.

Biden says that during the transition, he was warned not to expect any cooperation on major votes. “I spoke to seven different Republican senators who said: ‘Joe, I’m not going to be able to help you on anything,’” he recalls. His informants said McConnell had demanded unified resistance. “The way it was characterized to me was: ‘For the next two years, we can’t let you succeed in anything. That’s our ticket to coming back,’” Biden says. The vice president says he hasn’t even told Obama who his sources were, but Bob Bennett of Utah and Arlen Specter of Pennsylvania both confirmed they had conversations with Biden along those lines.

“So I promise you—and the president agreed with me—I never thought we were going to get Republican support,” Biden says.

One Obama aide says he received a similar warning from a Republican Senate staffer he was seeing at the time. He remembers asking her one morning in bed: How do we get a stimulus deal? She replied: Baby, there’s no deal.

“This is how we get whole,” she said with a laugh. “We’re going to do to you what you did to us in 2006.”

P
illow talk aside, writing off the Senate minority was not an option. Even if all fifty-eight Democrats lined up behind the stimulus—by no means a sure bet—Biden still needed at least two Republicans to break a filibuster. And he soon realized he’d need three, because no Republican
wanted to be the sixtieth vote for an Obama victory. So he had to figure out who was truly persuadable.

The vice president never thought Grassley was likely to bolt, even before his fit over S-CHIP. He saw Grassley as someone who might walk up to the edge of cooperation with a Democratic president, but would never jump. Sure enough, Grassley would become a strident critic of the stimulus, and would later scuttle bipartisan health reform negotiations after stringing the White House along for months. Biden also discounted the usual speculation about his old friend John McCain, the Beltway-celebrated maverick. Even though Obama had hosted a dinner to honor McCain’s record of bipartisanship the night before the inauguration, Biden could tell he was too bitter to help the rival who crushed his dreams. In fact, during the stimulus debate, McCain would clamor for partisan unity behind the scenes, amusing GOP colleagues who had never considered him much of a team player.

“Look, it’s tough, man,” says Biden, who had watched defeated presidential candidates like Hubert Humphrey and John Kerry return to the Senate, and had endured two unsuccessful campaigns himself. “It’s a hard thing to be that close.”

Republicans who had deviated from right-wing orthodoxy in the past and were up for reelection in 2010—including McCain, Grassley, Specter, Bennett, and Lisa Murkowski of Alaska—also had to worry about primaries. Specter had barely survived a right-wing challenge in 2004, and he told Biden that supporting the stimulus would guarantee him another brutal primary. “Joe thought I could still keep the seat,” Specter says. “But I told him: It’s not your seat. It’s my seat.” Even Bennett, a Mormon bishop who had been part of the Republican leadership, told Biden he expected a challenge from the right. The vice president thought he was joking.

“I couldn’t believe the Bishop would be viewed as too liberal,” Biden says. “Who would’ve thunk it?”

So Biden targeted the Republicans he thought he had a shot at peeling away: Specter and Maine’s Susan Collins and Olympia Snowe, the remaining moderates, plus George Voinovich of Ohio and Mel
Martinez of Florida, who were preparing to retire and were somewhat less anti-government than their brethren. He also stayed in touch with his pal Bennett and Obama’s pal Richard Lugar of Indiana; they opposed the stimulus from the start, but Biden considered them patriots, and thought they might be willing to help rescue the economy in a pinch.

Biden, the son of a car salesman, is a deal maker at heart, renowned on Capitol Hill for his relentless pitches. He tracked Collins down over the holidays in her hometown of Caribou, Maine; the patchy cell phone service in the north country kept cutting off their chat, but Biden kept calling back.
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And he basically became Specter’s stalker. “Joe says he called me fourteen times,” Specter says. “That sounds about right.” Biden told his targets that the nation would plunge into depression without stimulus, that Obama deserved a chance to lead, that the country needed their help. He schmoozed them, flattered them, and repeatedly asked them: Whaddya want? Specter, who had just beaten cancer for the second time, wanted research money for the National Institutes of Health. Voinovich, a former Cleveland mayor and Ohio governor, wanted more infrastructure.