On the Prowl

On the Prowl

By From the October 2008 issue

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Top seed

Sen. Dick Durbin, currently deputy majority leader, has his eye on the top Senate job after the November elections. Quietly, the senior senator from Illinois has seeded the Obama campaign (his junior counterpart’s) with former staffers and advisers, with an eye toward having built-in support for his usurpation of current majority leader Harry Reid.

“[Durbin] has people close to Obama, and he is very focused on seeding K Street with lobbyists to build up support from businesses and special interest groups,” says a Democratic National Committee fundraiser. “He thinks his time has come and Reid’s is over.”

Speculation about Reid’s future has been an ongoing discussion in Washington, with speculation focused mostly on Sens. Hillary Clinton and Chuck Schumer, particularly Schumer. But Durbin, some observers say, has played the political chess match better than either, helped by the fact that he already has the No. 2 slot in leadership, ahead of Schumer.

“He has sat back and been patient, the good soldier,” says a Senate leadership aide. “And while Schumer has raised more money for his colleagues, Durbin has been just as supportive and in some ways more collegial. When people were frustrated with Reid’s leadership he listened. Schumer didn’t.”

The seeding of Durbin acolytes along K Street leaves his GOP colleagues chagrined. “This is a guy who lives to bash businesses and for the chance to screw them and make them into political punching bags,” says a Senate Republican leadership aide. “And now he’s setting himself up to be their best friend. And in a new Congress, it won’t matter that he won’t be. He won’t, but won’t matter. He’ll be in charge.”

Fanny, Freddie, and Obama

When President George W. Bush nominated Henry Paulson to serve as Treasury Secretary, Republicans raised a red flag that Paulson, who, along with his wife, has strong ties to the Democratic Party, would not be an honest broker with Republicans. That seems to have been borne out, with sources inside Treasury reporting that Paulson briefed Sen. Barack Obama and his campaign advisers on the Fannie Mae and Freddie Mac bailout plan before offering such a briefing to the McCain campaign.

Republicans now intend to press to anchor Obama’s campaign to the federal bailout of Fannie Mae and Freddie Mac in the home mortgage collapse. While the Democrats and Obama have tried to tie economic fears to the Republicans, Obama finds himself in the middle of a potential backlash due to his personal and political ties to leaders of both Fannie and Freddie.

As it stands, Obama was the leading receiver of lobbyist/fundraiser dollars from both quasigovernmental agencies, according to FEC documents. This might explain why the Obama campaign was so keen on getting advance word about the bailout.

“They have a huge problem with the mortgage and housing market story, and everyone is missing it,” says a Republican political media consultant with ties to the Obama campaign due to the bipartisan nature of the firm he works with. “You look at Obama’s economic advisers, the guys he has counted on from day one and who have raised him a ton—and I mean a ton—of money: Franklin Raines and Jim Johnson, both of them are waist- to neck-deep in the mortgage debacle.”

Both Raines and Johnson have served as CEO of Fannie Mae, with Raines taking over from Johnson. Both are key political and economic advisers to Obama. “How can Obama go out with a straight face and say it was Republicans who made this mess, when it is his key advisers who ran the agencies that made the big mess what it is?” says a Democratic House member who supported Sen. Hillary Clinton. “It’s his people who are responsible for what may well be the single largest government bailout in history. And every single one of them made millions off the collapse that are lining Obama’s campaign coffers. If the McCain campaign let’s this one go, they deserve to lose.”

It isn’t just Fannie Mae where Obama has a problem. Another close political adviser, in fact the one man responsible for rallying support for Obama early on among congressional Democrats, is Rep. Rahm Emanuel, who served on the board of directors for Freddie Mac after leaving the Clinton White House. According to Freddie Mac insiders, Emanuel during his time on the board opposed every reform proposed by the Bush administration that would have impacted Freddie and Fannie Mae. Emanuel claimed to be neutral in the primary race between the wife of his old boss and his longtime Chicago acquaintance Obama. But the chairman of the House Democratic Caucus, who would be first in line for the vacated Senate seat of Obama should he win the presidency, quickly dumped Clinton when it was clear Obama had a head of steam for the nomination.

“We ought to be able to— rightly—hang the Fannie and Freddie scandal around the neck of Obama, if they can get out in front,” says a House Republican. “Middle-class folks’ mortgages are probably safe, but the American taxpayer will also be paying for this scandal for years to come.”

Palin Power

Republicans concerned about maintaining a workable minority in the Senate believe that several seats have been saved or strengthened with the addition of Alaska Gov. Sarah Palin. Those seats include Oregon, Minnesota, and New Hampshire.

“We may be a bit more competitive in Colorado, but that is a much tougher race,” says a GOP political consultant based in California.

That Colorado seat features Democrat Mark Udall against Republican Bob Schaffer. Udall has been heavily favored. “Palin, though, makes Colorado more competitive nationally with her appeal to rural voters and women,” says the consultant. “We may lose the seat, but we may hold the state for the presidential.”

A similar state may be Virginia, where Democrat Mark Warner is expected to defeat former Gov. Jim Gilmore. But as of mid- September, the McCain-Palin ticket appeared to be turning the once rock-ribbed red state back from purple to red. “Palin, assuming she holds up, has really transformed the map,” says the consultant. “The Obama team has to be pulling out their hair. States like Ohio and even Michigan are now more in play if the Republicans can rally rural voters. You’re even seeing places like upstate New York in play.”

Bad Experience

In selecting Sen. Joseph Biden as his running mate, Sen. Barack Obama may have made the safe pick, but according to several campaign insiders, Biden wasn’t necessarily his first or even his personal choice. “He really wanted [Kansas Gov. Kathleen] Sebelius,” says one Obama insider with knowledge of the Democratic candidate’s vetting process. “And if our European tour had played better here at home, she might have been the pick.”

But, says the insider, the campaign’s internal polling indicated what the public polling indicated— that Obama failed in his European sojourn to build out his foreign policy credentials. “We needed the foreign policy on the bottom of the ticket more than we want to admit,” says the insider. Sebelius would have helped Obama in several other ways domestically, particularly in the Midwest, where her success as a moderate governor in a borderline red state would have perhaps diluted his extreme leftist tendencies.

But beyond his failure to create the impression that he had any foreign policy experience, Obama’s polling also indicated that Sebelius’s presence on the ticket probably further damaged his relationship with Hillary Clinton supporters. “We have enough problems with them as it is. Putting Sebelius on the bottom of the ticket would have been another stick in the eye,” says another adviser.

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