GOP: The Party of Missed Opportunities

Republicans like to think that theirs is the party of opportunity. The question as we head into the 2014 election season is whether it will remain the party of missed opportunities.

The GOP had chances to take control of the Senate in 2010, amid the backlash against runaway federal spending and the newly passed Affordable Care Act, and again in 2012, when the election calendar exposed many Democratic seats in states that favored Mitt Romney over President Obama. Each time, however, Republicans in critical states nominated candidates who looked irredeemably ideological and sometimes hopelessly ignorant. This allowed Democrats or allied independents to take or hold seats that Republicans could have won in states like Nevada, Delaware, Indiana, Missouri, North Dakota and Maine. Those seats would have been enough to shift the balance of power in the Senate, and thus also between Congress and the White House.

So what lessons should we draw from this week’s off-year elections? No Senate seats were at stake, but two gubernatorial contests provide a rough idea of how similar high-profile statewide Senate races might play out next year.

Republican Chris Christie was overwhelmingly re-elected in heavily Democratic New Jersey, in a race that was called just moments after the polls closed. Christie’s social positions, opposing abortion rights and gay marriage – a court battle he abandoned just weeks before the election – are out of step with the majority in his state. Yet he drew almost as much support from women as from men and had substantial backing from registered Democrats.

In Virginia, where conservative Christian voters are a diminishing bloc but still much more potent than in New Jersey, socially liberal Democrat Terry McAuliffe eked out a narrow victory over conservative Republican Ken Cuccinelli. The race was decided in the burgeoning Washington suburbs, whose spiffy condominium towers are inhabited by few Cuccinelli supporters. McAuliffe hammered Cuccinelli over his opposition to abortion, including his past support of a measure that would have required women to undergo transvaginal ultrasound prior to the procedure. Abortion became a major issue in the race, and women – especially unmarried women – gave McAuliffe his slim margin of victory.

Yet that margin was much smaller than had seemed likely in the days and weeks leading up the election. McAuliffe held double-digit advantages in polls taken around the time of the federal government’s partial shutdown in early October, which hit Virginia’s workforce hard. McAuliffe, a prolific fundraiser with close ties to Bill and Hillary Clinton and the rest of the Democratic establishment, outspent his opponent nearly two to one – and there were estimates that television advertising in the final week of the campaign favored McAuliffe by 5 or even 10 to 1.

So how did Cuccinelli come so close to winning that, for nearly three hours after the voting ended, Democrats all over the country must have been queasy? The candidate credited the messy launch of Obamacare, and he was probably correct. A Cuccinelli victory would, I think, have immediately led to calls from vulnerable Democrats everywhere – and especially those running for Senate next year – to delay the law’s implementation by at least that long.

There really is not much daylight between Cuccinelli’s social views and Christie’s, yet Christie harvested his bumper crop of votes in New Jersey’s less-fertile (for Republicans) political fields. If social conservatism sank Cuccinelli, why was Christie seemingly immune?

In short, because Christie has the advantage that every candidate must possess to win against uncomfortable odds: People in his state like him. They don’t necessarily agree with him on everything, but they trust that he is on their side and that, when push comes to shove, he puts results before ideology. His resistance to gay marriage is an example. After vetoing a bill that would have legalized it, and after appealing a court decision that demanded it, Christie dropped his fight once the state Supreme Court said same-sex marriage must commence while the litigation continued. He is still opposed, but he drew the line at taking away a right that was already in place.

The problem with hard-liners is that they never seem to know when to quit a losing fight. Whether the topic is abortion or immigration or Obamacare, they make voters question whether they know the difference between arm-wrestling and thermonuclear war. Such politicians can get elected by like-minded constituencies, but they can’t draw swing voters, who decide elections in many states.

A Republican like Christie or Jon Huntsman, the former Utah governor, might be a formidable presidential candidate if he could get his party’s nomination, because he could compete even in states that typically favor Democrats. Huntsman never got off the ground in 2012, and for all the talk about Christie’s potential in 2016, it remains doubtful that he has any chance of surviving the GOP primary and caucus gauntlet that drives otherwise electable candidates like Mitt Romney so far to the right that they face an uphill fight in the subsequent general elections.

Christie got to the Trenton governor’s mansion in the first place because, as a former U.S. attorney, he started his first campaign four years ago with good name recognition and without the political baggage carried by fellow Republicans who must work their way up the party ladder. That’s the same route taken by other recent Northeastern GOP luminaries such as Rudy Giuliani, Michael Bloomerg and Romney, though the latter two drew their advantages from personal wealth and business success rather than from prior public office.

Cuccinelli had to climb that party ladder by appealing to a socially conservative base that can no longer carry the day in Virginia. He lost a race that a Republican who was seen as moderate and pragmatic could have won.

Losing is what Republicans have been good at lately. The party will keep losing winnable elections until it starts nominating more electable candidates. That process for the 2014 Senate races will begin almost as soon as the upcoming holiday season is over. We’ll see what comes of it.

About Larry M. Elkin 553 Articles

Affiliation: Palisades Hudson Financial Group

Larry M. Elkin, CPA, CFP®, has provided personal financial and tax counseling to a sophisticated client base since 1986. After six years with Arthur Andersen, where he was a senior manager for personal financial planning and family wealth planning, he founded his own firm in Hastings on Hudson, New York in 1992. That firm grew steadily and became the Palisades Hudson organization, which moved to Scarsdale, New York in 2002. The firm expanded to Fort Lauderdale, Florida, in 2005, and to Atlanta, Georgia, in 2008.

Larry received his B.A. in journalism from the University of Montana in 1978, and his M.B.A. in accounting from New York University in 1986. Larry was a reporter and editor for The Associated Press from 1978 to 1986. He covered government, business and legal affairs for the wire service, with assignments in Helena, Montana; Albany, New York; Washington, D.C.; and New York City’s federal courts in Brooklyn and Manhattan.

Larry established the organization’s investment advisory business, which now manages more than $800 million, in 1997. As president of Palisades Hudson, Larry maintains individual professional relationships with many of the firm’s clients, who reside in more than 25 states from Maine to California as well as in several foreign countries. He is the author of Financial Self-Defense for Unmarried Couples (Currency Doubleday, 1995), which was the first comprehensive financial planning guide for unmarried couples. He also is the editor and publisher of Sentinel, a quarterly newsletter on personal financial planning.

Larry has written many Sentinel articles, including several that anticipated future events. In “The Economic Case Against Tobacco Stocks” (February 1995), he forecast that litigation losses would eventually undermine cigarette manufacturers’ financial position. He concluded in “Is This the Beginning Of The End?” (May 1998) that there was a better-than-even chance that estate taxes would be repealed by 2010, three years before Congress enacted legislation to repeal the tax in 2010. In “IRS Takes A Shot At Split-Dollar Life” (June 1996), Larry predicted that the IRS would be able to treat split dollar arrangements as below-market loans, which came to pass with new rules issued by the Service in 2001 and 2002.

More recently, Larry has addressed the causes and consequences of the “Panic of 2008″ in his Sentinel articles. In “Have We Learned Our Lending Lesson At Last” (October 2007) and “Mortgage Lending Lessons Remain Unlearned” (October 2008), Larry questioned whether or not America has learned any lessons from the savings and loan crisis of the 1980s. In addition, he offered some practical changes that should have been made to amend the situation. In “Take Advantage Of The Panic Of 2008” (January 2009), Larry offered ways to capitalize on the wealth of opportunity that the panic presented.

Larry served as president of the Estate Planning Council of New York City, Inc., in 2005-2006. In 2009 the Council presented Larry with its first-ever Lifetime Achievement Award, citing his service to the organization and “his tireless efforts in promoting our industry by word and by personal example as a consummate estate planning professional.” He is regularly interviewed by national and regional publications, and has made nearly 100 radio and television appearances.

Visit: Palisades Hudson

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