The New New Deal (40 page)

“Oh, the hypocrisy is unbelievable,” Congressman Rangel told me. “They cuss Obama, cuss the stimulus, and then they come with their scissors to the ribbon cuttings to brag about bringing jobs to the community. I’m sorry, but I wouldn’t be able to do it if I was raising hell on the floor.” Then he stopped and grinned. “Maybe I’d send a staffer.”

The House Democratic campaign committee’s “Hypocrisy Hall of Fame,” featuring 128 “cash-and-trash” Republicans who chased stimulus money after opposing the stimulus, was a bit unfair. Politicians weren’t necessarily hypocritical to say nasty things about the Recovery Act and then seek their fair share of its bounty for their constituents once it passed, although it did take chutzpah for Governor Jindal to pass along stimulus money to a Louisiana community by presenting an oversized check with his own name at the top. In any case, Republican leaders believed that the stimulus would work out for them in the end, that it
would force Obama to take ownership of the soaring deficit and collapsing economy he had inherited from Bush.

“We lost that legislative battle, but we won the argument,” Pence told a conservative conference.
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“Welcome to the beginning of the comeback.”

That hypothesis would be tested on March 31 in upstate New York, in a special election for the state’s 20th Congressional District.

S
ix weeks before the vote, Republican Jim Tedisco, a veteran Albany power broker who was the state assembly’s minority leader, held a 21-point lead over Democrat Scott Murphy, a young entrepreneur who had never run for office. The district had a Republican tilt, and Tedisco, who had represented the area since Murphy was in junior high, had a huge advantage in cash and name recognition. But once the Recovery Act passed, the race instantly became a referendum on the stimulus.

The Democratic businessman quickly endorsed the bill, calling it “far from perfect” but essential for reviving demand. By contrast, the Republican career politician did not endorse the bill. Or oppose the bill. Instead, Tedisco smothered reporters in word salad, refusing to engage in hypotheticals, criticizing the bill’s length, praising its infrastructure, attacking its pork. As one headline observed: “Asked About Stimulus, Tedisco Talks a Lot.”
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Tedisco was torn. Some of his advisers warned that opposing tax cuts for his constituents and road repairs for his district would be electoral suicide. But Washington Republicans suggested they would stop bankrolling his campaign if he sided with Obama.
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“They were saying: ‘You don’t want to go against us,’” recalls Tedisco aide Dan Bazile. “Was it an overt threat? No, more like: Do your part, and we’ll keep helping you raise money.” Pete Sessions, the House Republican campaign chair, acknowledges pressuring Tedisco to toe the party line.

“I told him he had to be against the bill,” Sessions says. “The base hated it.”

Republicans ran ads tying Murphy to the “pork-laden federal stimulus,” while Murphy hammered Tedisco for refusing to stand up for jobs.
When Tedisco finally announced he would’ve voted no, unions immediately aired ads of an ostrich with its head in the sand: “Doesn’t Jim Tedisco notice that our economy is in trouble?”

In Washington, there was bipartisan agreement that the results would be a bellwether. “Tedisco’s victory will be a repudiation of the spending spree,” GOP chairman Steele proclaimed.
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But Murphy eked out a 726-vote upset. “He proved you could run on the Recovery Act and win,” says Chris Van Hollen, the House Democratic campaign chair.

Really, it was hard to tell whether voters had punished Tedisco for opposing the stimulus or dithering about the stimulus. His waffling helped reframe the race as a choice between an energetic entrepreneur and a finger-in-the-wind politician. Republican operatives thought Tedisco would have won easily if he had started bashing the bill sooner. And he did get some traction late in the race by attacking Murphy over AIG, making the Recovery Act sound like a $787 billion excuse to protect fat Wall Street bonuses.

But Tedisco believes that if he’d opposed the bill earlier, his margin of defeat would’ve been larger. The more Murphy talked about the Recovery Act, the more voters seemed to like him.

“It was heads you win, tails I lose,” Tedisco says. “The bill was $1 trillion, it had a multitude of infrastructure projects, and every elected official in every village and town was saying: ‘I have a bridge I want built.’”

I
n the Senate cloakroom, after Arlen Specter secured his $10 billion windfall for NIH’s medical research and endorsed the stimulus, one of his Republican colleagues said: Arlen, I’m proud of you.

“Then why don’t you vote with me?” the grouchy Pennsylvanian asked.

That will get me a primary, the senator replied.

“You know I’m getting a primary,” Specter snapped.

He sure was. The free-market Club for Growth was the scourge of Republican moderates, bankrolling right-wing primary challenges around the country to enforce supply-side orthodoxy in Washington. And club president Pat Toomey, a former banker and Pennsylvania
congressman, had himself almost unseated Specter in 2004, despite Specter’s support from Bush and the party establishment. Now the club was denouncing Specter’s stimulus vote as “the ultimate act of treason,” and Toomey wanted a rematch. In the past, Republicans had overlooked Specter’s apostasies, like his support for abortion rights and his refusal to convict Clinton. (In typical Lone Ranger fashion, he also refused to acquit, insisting on voting “Not Proven.”) But now after twenty-nine years as a Republican senator, he had a 29 percent approval rating among Republican voters. They didn’t care what he had done for NIH—only what he had done for BHO.

Biden and Specter had been Amtrak buddies for nearly three decades; before getting off in Wilmington, Biden had often teased Specter about switching parties. He and Rendell applied more friendly pressure at a public meeting in Philadelphia shortly after the stimulus vote, condemning the abuse Specter was taking from Republicans, suggesting another party’s voters might be more appreciative of his stand for jobs and medical research. “You could make life easier for yourself by taking that registration card of yours and making that little change from R to D,” Rendell suggested.

When Specter started to protest, Biden interrupted: “Don’t make your decision now!”

He made his decision in late April. “I now find my political philosophy more in line with Democrats than Republicans,” he announced. “It has become clear to me that the stimulus vote caused a schism which makes our differences irreconcilable.”

Republican operatives declared good riddance, scoffing that Specter was only defecting to try to save his political skin. They were right. He knew he’d have no chance in a Tea Party–dominated primary. “I won by the skin of my teeth in 2004, and 200,000 moderate Republicans had left the party,” he told me. But his switch was still a huge setback for the GOP. A Republican primary would have put constant pressure on Specter to prove his anti-Obama credentials; instead, facing a Democratic primary, Specter became a reliable vote for Obama. And Specter represented the fifty-ninth Democratic vote in the Senate; once Al Franken
was finally seated in July, Obama would have a filibuster-proof majority. Anyway, regardless of the balance of power, Specter’s departure sent a powerful message that the modern Republican Party was no place for middle-of-the-road politicians.

“There aren’t any Republican moderates left in the Senate,” Specter says. “Even Snowe and Collins can’t vote as moderates. They wouldn’t get reelected.”

Quite a few Republicans were convinced the GOP would be better off without wobblers like Specter tarnishing its brand. DeMint said he’d rather have thirty Republican senators who believed in limited government than sixty who believed in nothing. “I don’t want us to have power until we have principles,” he told me at a Tea Party rally at the South Carolina capitol. Governor Sanford argued that Chick-fil-A would never let its franchisees cook their chicken however they wanted; why should the Republican Party let its politicians promote big government?

“We’re essentially franchisees, and right now nobody has any clue what we’re really about,” he said.
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“You can’t wear the jersey and play for the other team!”

But it’s hard to put together a center-right coalition when you’ve said good riddance to the center. The popular Governor Huntsman, feeling out of step in a narrow party of angry people, accepted Obama’s offer to be ambassador to China. The genial Governor Crist was just as popular, but when he ran for Senate, a young conservative named Marco Rubio refused to step aside, bashing Crist for supporting the stimulus.
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“That was the moment I realized what was at stake,” Rubio told me. Rubio started the race 40 points behind, but the hard-right activists who dominate Republican primaries adored him. I watched him charm a sun-weathered group of party faithful on the Treasure Coast; they loathed Obama, loathed Crist for aiding, abetting, and even hugging Obama, and devoured every morsel of Rubio’s red meat. “I’m not here to tell you Barack Obama is Fidel Castro,” he said. “But the imperialism of this government is very real!” Crist would soon quit the GOP to run as an independent. Like Specter, he didn’t want to make his case before a Tea Party jury.

Even some across-the-board conservatives in the Republican establishment started to worry that enforced purity could relegate them to permanent minority status. It might feel righteous to purge the Specters of the party, but it would also help Obama pass his agenda without any Republican votes. Ronald Reagan had preached a big tent, and his former political director, Governor Barbour, wished DeMint and Sanford understood that not all of America was as conservative as South Carolina.

“Chick-fil-A can get fabulously wealthy with a 20 percent market share,” Barbour said. “In our business, you need 50 percent plus one.”

It was easy to rail against government spending in theory. But when it came to actual government spending on math teachers and traffic lights, even South Carolina turned out to be less hostile than advertised.

R
epublican governors talked a big game about turning down Obama’s freedom-crushing stimulus money. And a few did reject a few million dollars, mostly the strings-attached cash for expanded unemployment insurance that Democrats slipped into the Recovery Act while Republicans were railing about condoms. In the end, though, almost all of the governors accepted almost all the state aid. Rick Perry not only took the cash, he tried to use some of it to renovate his governor’s mansion. (Granted, it had been firebombed.) Sarah Palin did turn down the state energy grants that required governors to pledge to promote green building codes and utility regulations, but after she quit, her Republican successor quickly signed the pledge. When Senator Jon Kyl of Arizona slammed the stimulus on a talk show, Rahm ordered several cabinet secretaries to write letters to his state’s Republican governor, Jan Brewer, asking which stimulus funds she didn’t want. She wanted all of them.

Sanford was the only governor who really tried to put less money where his mouth was, turning down $700 million in state aid designed to prevent layoffs of teachers and other public employees. He argued that the one-time windfall—and its “maintenance of effort” rules prohibiting education cuts—would prevent South Carolina from making
the tough decisions necessary to live within its means. The first rule when you’re in a hole, he said, is stop digging.

When it came to fiscal conservatism, Sanford was the real deal, “Tea Party before Tea Party was cool.” A former financial analyst and real estate investor, he had distributed bumper stickers during his 1994 run for Congress that said DEFICIT with a
Ghostbusters
-style slash through it, and his standard-issue stump speech had been an apocalyptic chronicle of great civilizations undone by debt. Unlike many of his fellow Republican revolutionaries in the Gingrich army, he had kept faith with the conservative principles in the “Contract With America,” voting against popular spending programs, keeping his pledge to serve only three terms. He had dedicated his political career to the proposition that there was no free lunch. He believed in a right-wing Rahm’s Rule; this crisis was an opportunity to make the painful cuts that politicians habitually avoid “when times are good and people are fat, dumb and happy.”

Sanford only wanted to turn down 8 percent of his state’s stimulus cash, less than 2 percent of his state’s budget. But the backlash was ferocious. Protesters built a tent city called “Sanfordville” in a Columbia park. Business-funded scare ads predicted horrific consequences if Sanford got his way. At a hearing of the state Senate finance committee, I watched legislators line up to denounce Sanford as a heartless Scrooge intent on “budgetary Armageddon,” warning that without the extra cash South Carolina would have to fire teachers and firefighters, shutter programs for autistic and disabled kids, jack up tuition at state colleges, fling open the doors to state prisons, and dismantle the safety net when it was needed most.

And those weren’t Democratic legislators.

“The governor has one of the most radical philosophies I’ve ever seen,” said the seventy-eight-year-old Republican committee chairman, Hugh Leatherman. “I’m a conservative, but I’ve got compassion for the poor, the blind, the mentally ill. Sanford wants chaos. Absolute chaos! He’s destroying this state, and the Republican Party, too.”

The consensus in the Republican-dominated legislature was that when the feds offer money, you take it. “Most of us are Ronald Reagan
Republicans, Strom Thurmond Republicans,” said Senate majority leader Harvey Peeler. “Republicans control everything around here. It would be nice if we could accomplish something.”

When I sat down with Sanford, the venom didn’t seem to bother him much. Wearing jeans and a denim shirt, he lounged on his office couch like he was home watching a game. “I sleep like a baby,” he said. South Carolina had the nation’s third-highest jobless rate, and he knew the extra money from Obama could avert short-term suffering. But he wasn’t interested in postponing the day of reckoning. If generational theft through deficit spending was the only way to avoid a depression, he said, then we might as well have our depression now. If America wanted to avoid the fate of overleveraged empires like Rome and Spain, it needed to stop relying on fiscal child abuse.