The McCain campaign seems to have been caught off guard by the financial crises, i.e., Fannie Mae/Freddie Mac, Lehman Brothers, AIG, etc. The message from John McCain has seemed convoluted and vacillating: the fundamentals, Wall Street greed, SEC leadership, bipartisan commissions. In an uncertain environment, the benefit of the doubt probably goes to the challenger, in this context, Obama.
First of all, as I've suggested in the past, McCain should start a series of 'Straight Talk' ads. The focus should be to acknowledge there is a problem, avoid fingerpointing, and recommend specific action. Note that we've weathered through past crises: the S&L crisis, Black Monday, 9/11, Enron, etc. Express confidence in the comparative strength of our country. Suggest that there were faults with all of us, consumers whom bought houses beyond their means or taking out risky second mortgages, government not keeping up with new financial products, and Wall Street firms taking on too much risk to maximize profits. Sarbanes-Oxley did not go far enough with financial services firms, talk about things like asset structures, insufficient collaterization and regulation for mortgages and complex financial instruments, restrictions on real estate gimmicks like teaser/variable-rate interest rates and no/low down payments, tax penalties on real estate speculative activities like property flipping, favorable tax benefits only for primary residences and extending the period necessary for preferential capital gains rates (with prorated exceptions for job relocation). We also need to look at higher risks with loans requiring multiple incomes. In addition, we need to provide interim loan checkpoints when we look at changes in credit risk and make any necessary adjustments, like pushing out the loan period to lower payments. We also need to talk about increasing an incentive to save and invest with flat exemptions for interest and dividend income.
Second, John McCain should indict the Obama campaign for its talking down the economy and the mortgage crisis for political reasons. Point out that the emperor is wearing no clothes: the Democrats have been in control of the Congress the last two years, and they have done nothing. If Obama had a solution, why couldn't he rally his own party behind it? The response of the Democrats was NOT to question the adequate capitalization behind the loans and the scale of the government's risk behind the GSEs' mortgage value, but to argue we needed to extend home loans to low-income people whom have the highest credit risk. Point out McCain expressed concern about the taxpayer vulnerability to Fannie Mae/Freddie Mac's multi-trillion dollar exposure, but the Democrats have failed to live up to their responsibility in taking control of both Houses of Congress last year. Given a string of declining housing prices and growing foreclosures, the Democrats in Congress did not take a proactive stance in anticipating the vulnerabilities of Fannie Mae, Freddie Mac, and the financial services industry.
Third, McCain should distance himself from the Bush Administration on the Katrina-like response to this financial tsunami. I'm not sure what good it does demanding the firing of the SEC Commissioner (Christopher Cox) with 4 months left to the Bush Presidency and leaving a vacuum of leadership during the current crisis. But clearly the financial services sector had been in decline for some time, and it was important for the Administration to be more proactive. The President should have been jawboning the Democratic-led Congress.
The Misuse of Sarah Palin
First of all, there is a perception that the campaign is limiting access to Sarah Palin. In my opinion, this leads to speculation about her readiness to assume her role as Vice President.
Second, she is reusing the same lines from her nomination acceptance address, and her message is beginning to sound canned and stale, not to mention misleading, e.g., 'thanks, but no thanks, to the Bridge to Nowhere'. What Sarah Palin should have said is that when her predecessor left her with a $400M bridge to build and only $70M to pay for it, she changed her mind and made the tough decision to pull the plug on the bridge project and search for a more feasible solution for the Gravina Island link. I think that people want straight talk, not spin, not only from John McCain, but Sarah Palin as well. I think the American people would be far more impressed with a politician whom is willing to admit to having made a mistake and changed her course, vs. Bush's belated reaction to Katrina and a deteriorating situation in Iraq.
Third, I think that McCain and Palin need to separate on the campaign trail; I think, for instance, Sarah Palin should make a sweep of the North/Northwest states, including blue states within reach, e.g., Michigan, Wisconsin, Minnesota, Washington, and Oregon. I don't see the logic of joint appearances in townhall meetings.
Fourth, I would use a different approach in dealing with Palin's relative experience on foreign affairs based on Trivial Pursuit of key country leaders and geographic facts. I would point out the State Department handles actual diplomacy, and she is acquainted with our global alliances, policies and trade issues.
Upcoming Campaign Themes
First, McCain has to run against the do-nothing Democratic Congress--how they fought the surge, how they stopped the domestic energy drilling that leaves us overly dependent on foreign oil and hurts the dollar, how "not in my backyard" refineries and nuclear power plants drive the global energy markets crazy everytime a storm heads to the Gulf coast, the lessons of the failed GSE's, Fannie Mae and Freddie Mac, and what the implications are for the government gets more of its hands into health care, the lessons of corn ethanol on food inflation, etc. Point out that in the recent Democratic energy proposal, Pelosi kept some 88% of known oil formation (less than 100 miles of our shore lines) off limits and refused to negotiate with the GOP. Reinforce McCain's bipartisan credentials, and what McCain needs the American voters to do, besides elect him, is to elect a Congress willing to get big things done, not the "gridlock-as-usual" crowd.
Second, McCain has to focus on Obama's unconscionable agenda on defense and foreign policy and his inherent unfitness to be Commander in Chief. For instance, I would point out Obama repeatedly and obstinately has refused to acknowledge the success of the surge and of General Petraeus' tactical strategies. There are news reports that while Obama was in Iraq, he tried to convince the Iraqis to postpone conclusion of a US-Iraq agreement to extend US forces in Iraq until after the election. Obama has also refused to listen to Gen. Petraeus and others whom apparently don't fit in with his withdrawal-first, Iraq-security-second agenda. There's also a Youtube clip out there where Obama makes reference to unconditional cuts in Defense Department, preemptive announced changes in our nuclear weapon defense, deferment or cancellation of new weapon systems, etc. I seriously doubt if any independent voter believing in a strong national defense saw that clip they would vote for Obama.
Third, McCain has to argue the main issue with health care is not whether we are spending enough money on it but spending money more effectively. Similarly the question with tax money is not whether we are taxing enough but whether we are getting enough out of our tax dollars.
Fourth, point out Obama's deliberate, knowing distortions of McCain's words--the "100 years in Iraq" (but ignoring his distinction about peaceful conditions such as our bases in Korea), similarly, the claim, "fundamentals of the economy are strong" (but ignoring what McCain said at his acceptance address: "These are tough times for many of you. You're worried about keeping your job or finding a new one, and are struggling to put food on the table and stay in your home. ")
Fifth, the McCain campaign needs to do a better job picking its battles. I would not have run national ads on the "pigs wearing lipstick" or the "kindergartener sex education" issues.
- Instead, I would run an ad on earmarks and showing McCain 0 and then start scrolling down a list of Obama's earmarks--then then show Obama demagoguing against Palin's "Bridge to Nowhere" and then show his votes for the earmark and against using Bridge for Nowhere funds for Katrina relief.
- I would have Spanish ads explaining how Obama helped kill immigration by supporting poison pill amendments, some of which passed.
- I would respond to Obama's criticism to McCain's suggestion of a bipartisan commission on the financial service crisis by listing all the times Obama has suggested bringing people together to address a problem.
- I would be rerunning the 3AM ad where an Obama lookalike answering "I am voting 'present'" and/or signing 130 bills "present" at the signature line.
- I would run an ad explaining how Obama single-handedly blocked the "born alive" act in Illinois (requiring medical care for babies born alive from induced abortions), which was passed and signed by a Democratic governor the year AFTER Obama was elected to the US Senate.
- I would be running the "bitter"/guns/Bibles quote in every battleground state.
- I would run an ad showing every Obama flip-flop on various topics after he won the nomination (the gun ban in DC decision, FISA, oil drilling, etc.)--and ask which Obama will show up after election day...
- I would run a spot on his concept of foreign policy--and then show how his comments stirred things up with traditional allies (Canada, Pakistan, Iraq and Israel).
I would also run a job interview skit where we show a single-page resume for Obama and a thick folder for McCain (with a section on awards showing his military awards and his Eisenhower leadership prize, a section listing bipartisan legislation and initiatives)--and then we go to Obama's references, and we find Rev. Wright, William Ayers, and Tony Rezko.
A Role for President Bush
I would ask President Bush, still popular among Hispanics, to campaign in McCain's behalf, including a number of Spanish-language commercials, and in Southern states where he is popular.
