Update from David Lewis 1/12/2009
I hope this email finds you well and that you had a great Christmas and New Year’s Holiday. I am working hard to figure out which of the six candidates for National Chairman best understands that we must be a Party of ideas based in principle AND be able to implement those ideas when given the chance to govern. I have long admired Gov. Haley Barbour and his points are right on target. I wanted to share this Wall Street Journal article with you. The Republican Revival Will Start in the States The former RNC chairman says the party will again have to sell ideas, not access. Haley Barbour has a message for Republicans still dispirited by the November elections: "We've been in a lot worse shape than this. . . . When I first started working in politics during the Watergate era only 16% of Americans identified themselves as Republicans." He recalls one incident in the mid 1970s when "Mary Louise Smith, the chairman of the party, appointed a committee to change the name of the party. You can't get much lower than that." Zina Saunders That doesn't mean the Grand Old Party will storm back into power in 2010 and 2012. "We shouldn't kid ourselves. Republicans have a whole lot of work to do to win back voters who've fled the party. I think the brand damage is much worse than in 1992," is his sobering assessment. Mr. Barbour is a political-turnaround artist -- the Lee Iacocca of party rebuilding. He took over the chairmanship of the Republican National Committee in 1993 during another one of those low points. George H.W. Bush had just mustered 38% of the vote and lost the White House to Bill Clinton. Mr. Barbour recounts that the political wise men all agreed that 1992 was a realigning election, that the GOP had become a regional party of the South, that the conservatives were devoid of ideas, and that the era of Reaganism was over. Not quite. Two years later the GOP stormed back and Mr. Barbour was one of the unsung masterminds of the 1994 Republican revolution. If Newt Gingrich was the four-star general, Mr. Barbour was the field marshal. As we talk at the Willard Hotel in Washington, D.C., I can't help noticing that he appears to have shed a few pounds in the last few years. Could it be in preparation for a presidential run? "Hail no," he retorts in his trademark southern drawl. He self-deprecatingly informs me that "the American people aren't likely to ever elect a former Washington lobbyist as president." Perhaps not, but that didn't stop him from winning two terms as governor of Mississippi and from racking up a successful record of achievement. He's cut taxes, put the state budget in Jackson on a diet, passed one of the boldest tort reform laws in the nation, and helped bring thousands of new jobs into the state that ranks by many measures as America's poorest. He gets universal accolades for his handling of Hurricane Katrina, which obliterated whole regions of Mississippi. In contrast to Louisiana, which captured all the media attention because the botched recovery effort there, in Mississippi the reconstruction and relief efforts were a case study in government professionalism and, as he puts it, "harnessing the power of the private sector in a time of crisis." "I am a small government, rational regulation, low tax, free market capitalist. And I'm going to be one even if I'm the last one!" Mr. Barbour declares. He then offers a sobering fact of political history: "We need to understand that only once since 1896 has a party that took the White House not held on for at least two terms, and that was when Reagan beat Jimmy Carter. So the odds are stacked against us." Message: Brace yourself for eight years of President Barack Obama. One of his biggest worries is that voters have lost confidence in Reaganite free-market principles. "The last few times that we've lost elections, it has not been because voters changed their mind about our policies, it's been because they changed their mind about us," he explains. "They decided that we hadn't adhered to the policies and principles that they had thought they were voting for during that election." That was certainly true after George H.W. Bush raised taxes in 1990 and then in the 2006 bloodbath, when Republicans were punished for their reckless overspending. Now the problem may be deeper: "Right now a lot of people that have voted for us repeatedly are not so sure about free-market capitalism. They're scared. They don't know if they're going to have to work until they're 80, they don't know if they're going to send their children to college, they don't know if they're going to lose their business or job." So he fears that "right now the only answer they know is government. The only place they know to turn that can help them is government." This seems overly pessimistic to me, but we both agree that Republicans haven't exactly done much to disabuse voters of this sentiment. In 2008 the GOP became the party of federal bailouts and other socialistic solutions to the financial meltdown. Most voters don't fully understand why the stock market and economy collapsed this year, says Mr. Barbour, "but they do know it happened on our watch, and so we get the blame." As with any rehab process, the first step for a Republican comeback, he argues, is to "come clean and admit we did a lot of things wrong." Like what? He quickly rattles off the misdeeds: "Corruption, out-of-control spending, enormous increase of the national debt under a supposedly conservative administration, no vetoes of spending bills that Ronald Reagan would have hit with a hatchet." He adds that the war in Iraq remains highly unpopular even among many conservatives. "Americans simply don't like long wars," he says. There's a temptation after a loss like this, he continues, "to purify our party by running off the people that aren't with us 100% of the time, or the people who aren't social conservatives, or the people who aren't this or the people who aren't that." He says party purges like that would be catastrophic. "This is a time for the party to be figuring out how to multiply. Politics is about addition and multiplication, not division and subtraction." He fumes that efforts to evict moderate Republicans in primaries is counterproductive. Wait, I say, aren't the big spending Republicans who act like Democrats -- people like Ted Stevens of Alaska or Jerry Lewis of California -- the people contaminating the GOP brand? His view is that Republicans need to elect a lot more moderates from the Northeast to regain operating majorities. Mr. Barbour is fanatical about the need for the GOP to "to do the hard work to build strong and self-reliant" state and local chapters of the party that are in such disrepair. "Now is our chance when we're out of power to build back up from the bottom, to have a participatory, inclusive process for letting people get involved in our party. Barack Obama proved something that I've seen time and time again: if you'll give people a chance to participate in politics they'll knock your door down. And the Democrats did a whole lot better job of that than us this time." Another worrisome trend he mentions is the youth vote. "We've got young people who voted for Obama by better than a 2-to-1 margin. The data is very clear, that when people vote in their first two presidential elections for the same party, more than 80% of those people are going to stay with that party for the rest of their life, barring some big event that changes it." This gives the GOP four years to learn to communicate with the iPod generation. The party, he says, must figure out how to tap new media and new messaging to reach out and touch 20-somethings. He also advises that the party figure out in a hurry how to close the money gap. Democratic money swamped not just John McCain but Republicans in all 2008 races. To counter that advantage, Mr. Barbour insists that Republicans have only one real option, which is to once again tap into the power of the mom-and-pop small donor. "When you're in power a long time, you become dependent on big money -- a few large donors." He again mentions with admiration how Mr. Obama captured the email addresses of a reported four million donors who "are giving $10 a month on their credit card. Republicans are going to have to once again become a party of ideas and then raise money on those ideas, because we're not going to get any access money. We haven't got anything to give anybody access to anymore. . . . You can get a picture with me, but that's worth about a sixpack of beer." North Carolina Article of Interest The following article appeared in Saturday’s Wall Street Journal. It is, sadly, indicative of the state of our economy and why the General Assembly must work hard to “do know harm” going forward. North Carolina's Celebrated Rebirth Proves No Match for This Downturn HICKORY, N.C. -- It's 8 a.m., and the line of people waiting to get into an unemployment office on a rainy day here in the foothills of North Carolina is already down the sidewalk. "This is the worst it's been here in a long time," said James Harrell, a 50-year-old out-of-work truck driver waiting for the doors to open. North Carolina's widely lauded economic transformation of the last three decades -- in which the state diversified away from its dependence on agriculture and textiles and into technology, banking and pharmaceuticals -- is proving no match for what could be the longest and deepest U.S. recession since World War II. The Nation's Unemployed North Carolina is among the states suffering the most in the economic downturn. Review November's month-by-month data. The Tar Heel State lost a bigger percentage of jobs, 1.1%, than any other state from October to November 2008, shedding 46,000 positions, according to the Bureau of Labor Statistics. A record number of people in the state are now out of work, and its unemployment rate of 7.9% for November was the highest in 26 years, up from 7.1% in October and 4.7% in November 2007. Some state economic observers are predicting double-digit unemployment for 2009. The numbers are a bad harbinger for the rest of the Southeastern U.S., most of which until recently appeared to be shrugging off the worst of the economic slowdown. For decades, high-growth states like North Carolina, Georgia and many of their neighbors showed extraordinary resiliency during national economic downturns. But increasingly, the region appears no longer able to stave off the slowdown. In November, the South accounted for four of the top 10 job declines among U.S states, with North Carolina, Florida, Georgia and South Carolina contributing to a 0.47% regional loss in payroll employment, according to data compiled by Moody's Economy.com. It was the region's first collective monthly payroll loss since September 2003. In the South, "the slowdown has largely been a Florida story," said Mark Vitner, senior economist for Wachovia Corp., Charlotte, N.C., purchased last week by Wells Fargo & Co. North Carolina had been among the states in the Southeast holding up well, but the region's states "all turned down very hard" in the fourth quarter. The slowdown in North Carolina is expected to worsen in 2009, as limits on Chinese textile imports are lifted and Charlotte's big banks prepare sizeable layoffs. Bank of America Corp. and Wells Fargo are preparing to eliminate thousands of positions in the coming years. Over the past 30 years, North Carolina beat back aggressive global competition by reducing its reliance on traditional strengths of textiles, tobacco and furniture and adding jobs in technology, pharmaceuticals, banking, food processing and vehicle parts, which now represent 17% of the state's production. And North Carolina had largely avoided the mortgage blowups that slashed jobs in Florida, California and Nevada. But now all industries are under stress, from the remaining textile and furniture makers to auto-parts suppliers near the state's border with South Carolina to information-technology providers in Raleigh-Durham's Research Triangle. Truck maker Freightliner, owned by Daimler AG, announced this week that it would cut 2,137 jobs across the state by mid March. The losses hit the state's smaller cities first as durable-goods manufacturing suffered. Now, big metro areas are also shedding jobs at an accelerated pace, reflecting a downturn in services. "I don't look for significant improvement in the state's job market until 2010," said Mike Walden, a professor of economics at North Carolina State University. This year will be a "bloodbath" for North Carolina, said Steve Cochrane, managing director at Moody's Economy.com. No place in the state is experiencing more pain than Hickory, a town of about 40,000 approximately 50 miles northwest of Charlotte. The area is still a hub for furniture and textile makers, despite plant shutdowns and tens of thousands of layoffs as cheaper foreign labor took its toll. A campaign in the 1990s to protect the area from further losses attracted several fiber-optics companies that now are among the region's largest employers, making Hickory a model of economic reinvention. Google Inc. recently opened a $600 million data center in neighboring Lenoir, which is part of the Hickory metropolitan area. "We have done the right things," said Hickory Mayor Rudy Wright. But the fiber-optics firms shed lots of jobs during the dot-com bust, and now the downturn in housing and autos has delivered another blow to the remaining furniture and textile firms, plus some auto-parts suppliers. The unemployment rate for the metro area now is 10.2%, the highest mark in 2½ decades. Through November the Hickory metro area lost 3,400 jobs, according to preliminary figures from Moody's Economy.com, the worst performance in the state. Manufacturing led the way in job losses, with the furniture sector accounting for about half of the losses, according to Mr. Walden. Among the area companies cutting local workers are Furniture Brands International, La-Z-Boy, Bradington-Young LLC, Valdese Weavers and Corning Cable Systems, one of the local fiber-optics firms. The mayor blames larger economic forces for the area's plight. "We are getting hit again with things we have no control over, and we are a little angry about it," he said. "We have done the right things and our good, hard-working people continue to get battered." But James Thomas Shell, who writes about the area on his blog "The Hickory Hound," said the region's efforts to diversify didn't go far enough. "Our problem is that we have not transitioned well over the last few years from our old-school-style manufacturing of textiles and furniture to modern industry," he said. Carl Howard worked in the furniture industry here for 16 years, making $17 an hour before being laid off recently. Now he runs the grill and fryer at the Backstreets Bar & Grill, making $8.75 an hour, without health insurance. This downturn, he said, is worse than other slumps in Hickory. "This time it's not just furniture. All sorts of things are closing....It's pretty grim." Local officials tout several projects expected to create 2,300 jobs in the next five years, including a customer-support center employing 913. "They're trying" said Mr. Harrell, the out-of-work trucker, but "it ain't been enough to replace the job losses we had." David
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