2013-11-07

GOP Establishment Loses Control of the Message; Third Party Emerging; Christie Victory Means Nothing

The GOP Civil War has been brewing for years, but this year's election cycle may set this conflict in stone.

Despite loss in Virginia, Tea Party still getting its message out across America
Now, the Republican establishment is pushing back. In Mobile, business groups, including the U.S. Chamber of Commerce, donated heavily to the campaign of Bradley Burne, a former state senator.

The business lobby normally saves its money for elections rather than primaries. But last month’s government shutdown has spurred the Chamber and others to try to take out Tea Party candidates at an earlier stage. Mr. Burne faced Dean Young, a local real-estate developer who praised the shutdown, declared his opposition to keeping John Boehner as speaker, and said he believe Mr. Obama was from Kenya.

GOP Gives Up Virginia To Democrats Instead Of Giving Tea Party and Social Conservatives A Win
The Republican National Committee spent three times as much in 2009 on the same race as they did this year.

The Chamber of Commerce spent one million dollars in the last Governor’s race, and not one dime on Cuccinelli.

While it’s often claimed that Tea Party candidates do poorly among independents, Cuccinelli actually won independents by 9 points, 47 percent to 38 percent.

“McAuliffe outraised Cuccinelli by almost $15 million,” and in the last weeks of the campaign, this left Cuccinelli with nearly no media exposure.

Even Politico wonders if Cuccinelli was beginning to turn the tide against the “War on Women” narrative, as he drove down McAuliffe’s lead among women from 24% in polling to 9%.
The loss in Virginia looks like a strategic mistake for the GOP Establishment. The plan was to have a Tea Party candidate trounced in the election, and polling showed Cuccinelli far behind in polls as late as September. The rollout of Obamacare turned the tide though, and polling showed Virginia voters blamed Obama as much as the GOP for the government shutdown. Standing aside and watching a Republican go down to defeat in a landslide wouldn't have destroyed the Tea Party, but the establishment could have credibly shown it to be a lost cause. Instead, the establishment looks very bad to Tea Party supporters.

Where things get really interesting is the polling done by NBC in New Jersey. Chris Christie's win is touted as an anti-Tea Party result, but even if it is, it offers no hope for the GOP establishment. Hillary Clinton bests Christie in hypothetical 2016 matchup
NBC News exit polls of New Jersey found that 50% would vote for Clinton in a hypothetical 2016 matchup, while only 43% said for sure that they would stick with Christie. Clinton is widely expected to be a likely Democratic candidate in 2016, and Christie’s national ambitions have been well-documented.
Note that Christie won a big percentage of the vote in part because turnout was low. He moved the special election of the state's U.S. Senator to October, where a popular minority candidate, Cory Booker, won by a landslide. Had the elections occurred on the same day, the numbers would be much worse for Christie.

Even on the day of his landslide victory, NJ voters said they prefer Clinton over Christie. What the GOP establishment and media in Washington fail to understand (or understand all too well) is that blue states often elect Republican governors because they fear the high taxes and out of control spending that usually comes from all Democratic government. These Republicans are usually very capable executives, but also very moderate. When turning to the national election, even this level of moderation isn't enough to attract their own state's voters, who see divided government in Washington and feel safer voting for the Democrat. Thus, Christie's win shows us the typical pattern as seen before in NJ (Whitman), NY (Pataki), NYC (Giuliani), Massachusetts (Weld, Romney) and other blue states.

Below is Rush Limbaugh on Wednesday, discussing these results. His audience remains one of the highest in talk radio and he still has sway with grassroots GOP supporters.



The key place to watch moving forward is how the Chamber of Commerce and business groups fare with the Tea Party. When a third party emerges, it will be anti-Wall Street, anti-bank and very populist on the issue of jobs. The GOP has always been seen as the party of the rich, but the Tea Party is quite anti-Federal Reserve (though that is not a universal position) and anti-bailout, while the Obama administration is a subsidiary of Wall Street, more so even than George Bush the Younger.

The tough thing for a populist in the GOP was always the free-market orientation of the base. Pat Buchanan, for example, would have been far more popular had his economics been more libertarian. Five years into a depression, that may no longer hold. A relatively pro-business (in general) candidate from the Tea Party who unleashes fiery rhetoric at business groups will be greeted with roaring cheers from the crowd. The GOP risks splitting the party into two smaller parties, but more likely a GOP "spin-off" would quickly subsume the GOP because the remaining party would have almost no constituency. Wall Street likes the Democrats as much as the Republicans, but the bulk of business groups know which way taxes are headed if they supported the Democrats over the GOP. Thus, if the GOP split in two and the bulk of votes go with the Tea Party, the business groups would likely follow.

Business groups are also putting themselves in the cross hairs of Tea Party supports over the Chamber of Commerce's position on amnesty for illegal aliens. Amnesty’s Second Wind
The business community isn’t buying Heritage’s contentions. As a result, the U.S. Chamber of Commerce, along with the nation’s leading trade associations, will be backing Republicans who favor immigration reform when they run against Republican candidates who don’t in upcoming primaries. In Michigan, Reps. Justin Amash and Kerry Bentivolio will be targeted. In Alabama, business groups hope to undermine the candidacy of Dean Young, whose grassroots campaign propelled him into a Republican Party runoff with former state Senator Bradley Byrne. Business groups may also support Republican incumbent Rep. Mike Simpson, who faces a tea party challenger who pushed Simpson to embrace defunding ObamaCare.

The business community’s agenda is largely hypocritical. In September, the chief human resources officers of more than 100 large corporations sent Reps. John Boehner (R-OH) and Nancy Pelosi (D-CA) a letter, asking them to “enact legislation to fix the broken immigration system and work with the Senate to ensure that a bill is signed by the President this year.” Among the signees were Tracy Keogh, Executive VP for Human Resources at Hewlett-Packard. Hewlett-Packard laid off 29,000 employees in 2012. Cisco Systems’ Senior VP of Chief Human Resources Officer Kathleen Weslock also signed the letter, even as her company has laid off 8,000 workers over the last two years, and has announced a cut of an additional 4,000 this year. American Express’s Chief HR Officer, L. Kevin Cox also signed the letter, even as his company laid of 5,400 workers in 2013. So did Proctor & Gamble’s Chief HR Officer, Mark F. Biegger, despite a 2012 announcement that P&G would eliminate 5,700 jobs.

Several other companies, including T-Mobile, Archer-Daniels-Midland, Texas Instruments, Cigna, Verizon and General Mills also participated in this undermining of the American labor force, despite the signees insisting that “many of our companies continue to have difficulty finding sufficient American workers to fill certain lesser-skilled positions.”
How does it hurt the Tea Party to have these groups as enemies?

The final piece of the puzzle will be national security. The Tea Party already leans towards peace, but still has a lot of hawks. However, they also tend to be Constitutionalists. Were the GOP establishment to support an Obama led military action against the Tea Party's objections, then the Tea Party will have placed itself in the catbird seat of American politics. It will be at the center of anti-finance, anti-war and anti-government sentiment. I've said before, it's not yet clear whether the Tea Party will be the third party, but if there is a third party, it will be all three of those things. If there is no third party, one of the two parties will adopt the bulk of these positions. Since Clinton is as establishment as they come, the Democrats are unlikely to see any reform until at least the 2018 election cycle.

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