Saturday, February 13, 2010

what will determine the outcome in 2010?

I remember a wise person--my brother--writing during the 2008 campaign that it is hard to tell what issues will happen in the next several months that will help shape the outcome of a November election.

We are now less than 9 months away from the next "big" election, and again the question becomes: what will be the issues that get voters to the booth and help make up their minds?

Unquestionably the GOP has momentum right now. But things change in politics, sometimes even overnight. And there's a lot of "overnights" between now and November.

For example, who expected the unemployment rate to drop below 10% in January? I know that people "in the know" still found that report less than reassuring, but let's look at the number for what it is: at face value, a move in the right direction. And elections are determined at face value. A few more reports of this nature and the Dems may have an avenue to sweep aside the "moderate" angst about the stimulus. The GOP hasn't, in my view, succeeded in associating the stimulus with corruption, political favors, or out-and-out fraud--the negative narrative surrounding the bill is about the rising unemployment rate. And the time to change that argument is really lost. So the stimulus is associated with the unemployment rate--and I personally do believe that number is going to continue to improve (mostly because it is a horrible marker for the strength of the employment picture).

If the Dems are smart, they'll stop talking about HCR now (in this regard, maybe Obama's ego will actually save this issue for the GOP). That bill will be forever tainted by the backroom deals of January. Even non-followers of the political process understand that having labor unions forging legislation while the minority party isn't even in the room is not how "bipartisanship" works, and the Dems paid for that move dearly in MA. If the Congress presses forward on this bill in March and April, I expect anger to still be alive and well in November. Which is why I honestly believe that, barring any enormous missteps by the GOP delegation at the Health Care Summit later this month, that meeting will be much ado about nothing.

I also expect the market to continue a resurgence. There is an enormous amount of optimism in the market, and even Obama is starting to talk nice regarding major free market forces. It's funny that nobody expects the real estate market to return to pre-bubble levels, but I rarely hear a similar talking down with regards to the stock market. DJIA stand at over 10K right now; if by October that number is up to 11K (and it's been over 10.5 already this year), then expect the Dems to get some credit for improving the confidence in our economy.

So if the job situation is SEEN as improving, and health care (and by association all the rest of the leftist liberal agenda) is shelved for a spell, and confidence in the economy is improving, what issue will drive "independent" voters in November to "throw the bums out"?

My vote: gas prices.

Keep in mind: the summer of 2008 saw the average price of a gallon of gas shoot to over $4, and it was such a "winning" argument that some GOP Congresspeople stayed in DC during the August recess demanding that the Congress take action to alleviate the cost pressure. The GOP's attempts, however, went nowhere, because they were the minority party and the Dems didn't care to do anything except Blame Bush.

But there's something important to understand here: AT FACE VALUE, Bush WAS Washington. The American people were quite comfortable associating everything bad in DC with W. So even though Bush likely couldn't have done anything to help the gas prices settle lower, in the public mind it was just another failure of his Presidency.

Enter 2010. Gas prices right now are, on average, about 90% of what they were at this time in 2008. Already that's a bad place to start; in '08 gas prices peaked 33% higher than their Febrary levels, and last year they increased almost 50% from their February levels.

Keep in mind: those increases over the Spring and Summer of the last two years were driven by market forces. Those same market forces may well be in play this year (in fact, the Dems NEED them to be in play--especially last year's recovery), but there's one major new player at the table this year: Iran.

When does the saber-rattling turn into something more? When does A-jad DEMAND an end to sanctions in terms that the whole world feels? And please keep in mind: Iran's rulers have taken stock of Obama by now, and found him to be weak. Fear of reprisal is unlikely to dissuade Iran from doing anything this summer.

Put it all together, and I think this summer is going to hurt at the gas pumps. And when the pain is felt this time, there will be no question who's hands are at the wheel.

And August anger is not a good thing for a majority party heading into November.

Hence the reason I advocate every single GOP candidate has a clear, concise AND OFT- ARTICULATED energy policy: "all of the above" (thank you, T. Boone Pickens), with an eye towards incorporating zero- and low-carbon footprint energy sources when such technology is both real AND cost-beneficial. For now, though, it means exploring, developing and utilizing our natural resources--and all the JOBS that come with such work are not exactly an unmentionable side-effect of such initiatives.

If the GOP gets in front of this energy wave--and means it!--there will be enormous gains in November.

While you still can (i.e. before the primaries have passed), get your candidates on the record regarding how they propose to solve America's energy crisis. That's the next great arena where DC--as it's governed today--is out of touch with the people, and as such it should be the target of the minority party. It's just very convenient--maybe even karma--that this particular arena is one where conservative principles (market-based solutions, discounting of phony science as a cause for policy) have a natural alignment to the best solutions.


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