GOP Leaders Say Democrats Stall Help for Economy
Legislation Held Up in Congress for Political Gain in November, Racicot Charges
By Dan Balz
Washington Post Staff Writer
Saturday, July 20, 2002; Page A10
SAN FRANCISCO, July 19 – Worried that the declining stock market and economic sluggishness could be far more damaging in November than the unfolding corporate scandals, Republican Party leaders charged today that the Democrats are willing to hold the economy hostage to help their chances in the November elections.
On a day when the stock market recorded another huge drop, Republican National Committee Chairman Marc F. Racicot said here that Democrats, looking to gain seats in the House and Senate, have deliberately held up legislation in the Senate that would boost the economy and restore consumer and investor confidence.
"It seems to me that the Democrats are so eager to win at virtually any cost that they aren't really interested in helping the economy grow . . . because they feel they can win if the economy is disrupted," Racicot told RNC members meeting here this week. "As my grandmother used to say, shame on them."
Racicot's attack provided a glimpse of the unfolding GOP strategy for dealing with an issue that threatens to undermine Republican candidates this fall. That strategy couples aggressive rhetoric and action aimed at cracking down on corporate fraud, an attempt to tie Democrats to corporate America and a growing effort to shift some of the blame to the Democrats for the problems of the economy.
But Democrats responded that Racicot's charge highlighted the clear differences between the parties on economic issues. "To suggest the Democrats are trying to politicize economic problems confirms our concerns that Republicans are still out of touch with Americans' worries about Wall Street, the jobless recovery and the current state of economic uncertainty," said Jennifer Palmieri, press secretary for the Democratic National Committee.
The corporate scandals and financial market stumbles have put Republicans on the defensive, but strategists and candidates here expressed far more confidence that they can defuse the issue of corporate accountability, despite the party's close identification with big business, than deal with potential problems in the economy.
"The Democrats are really trying to get traction on this," said Rep. John Thune (R-S.D.), who is challenging Sen. Tim Johnson (D-S.D.) in one of the country's most competitive Senate races. "But if we take aggressive steps, I think we take that issue pretty much off the table. I don't think it's working for them [Democrats] out there."
But Thune noted that further bad news on the economy could reshape the elections to the GOP's detriment. "What's problematic about this is what is the effect on the economy. . . . It's the difference between running with the wind at your back and running with the wind in your face," he said.
Two other GOP candidates for Senate who are in tough races – Minnesota's Norm Coleman and Missouri's Jim Talent – agreed that Republicans should be more aggressive in calling for swift legal action against corporate officials who have defrauded investors.
Coleman said President Bush should be telling prosecutors it's time "to put somebody in jail." The three Senate candidates agreed that Republicans should not wait for Bush to speak out but should be on the leading edge of calling for tough action.
Republican strategists have been charting the economy's impact on voter attitudes, but so far they say that, despite some measures that suggest growing pessimism, GOP candidates are not in greater jeopardy today than they were a few months ago. But they recognize that conditions could be shifting and are determined not to let Democrats gain the upper hand.
Matthew Dowd, the RNC's director of polling, said attitudes about the direction of the country have deteriorated recently, but still are no worse than they were just before Sept. 11. Offsetting that, Dowd said, are other measures of improved political health for Bush and the GOP. That, he said, does not point to Republican losses in November, but rather that the elections will be fought out on a race-by-race basis, rather than influenced by an overriding political trend.
"The anger right now is aimed not at politicians but at other people," he said. "Until it's aimed at politicians, it won't have a political effect."
John Dowd, New Hampshire GOP chairman, agreed with the view that voters do not view the corporate scandal issue as a partisan issue, but added that the state of the economy is "the key" to the climate in the fall. In New Hampshire, he said, economic conditions in general remain solid, but said "if the markets keep going down," voter attitudes could begin to shift.
Republicans argued that Democrats put themselves at risk by appearing too eager to exploit the economy politically, but also because Democrats may sound too anti-business at a time when voters want reassurance that the economy will grow.
"I think everyone's concerned" about the economy, said Bob Kjellander, the Republican national committeeman from Illinois. "The investor class includes everyone now. But what everyone's tired of is finger-pointing. So I don't think it's going to have a significant impact this fall."
But Racicot did some finger-pointing of his own today, arguing that Democratic leaders in Congress are delaying action on legislation that would make last year's tax cuts permanent, expand trade negotiating authority for Bush and crack down on corporate fraud, to the benefit of the economy.
A GOP strategist privately expressed concerns that Republican candidates could yet see a turn for the worse in the political climate "if things continue to have a downward trend on the economy" and voters don't think the president or GOP lawmakers "are trying to do something about it."
© 2002 The Washington Post Company
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