Tales from the Trail

Washington Extra – Whose party?

As a Brit I never like to write too much about the Tea Party, but today I have no choice.
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Every week that goes by the movement seems to gain more momentum. On Tuesday, our poll showed Democratic heavyweight Harry Reid clinging to a narrow lead in Nevada against Tea Party insurgent Sharron Angle. That night, Republican establishment favorite Michael Castle was knocked off his perch in the Delaware primary by upstart Christine O’Donnell. Today, our Reuters/Ipsos poll shows one of the Tea Party’s most well-known favorites, Marco Rubio, opening a clear lead in the race for a Senate seat from Florida. With just six weeks to go until the elections, Rubio leads state Governor Charlie Crist, now running as an independent, by 40 percent to 26 percent, with Democrat Kendrick Meek trailing behind.

But who is going to benefit?

Republicans are hoping the surge in enthusiasm for a right-wing agenda will get their supporters to the polls, and right now there is a definite “enthusiasm gap” between Republicans and Democrats in terms of their likelihood to vote.

Democrats are still hoping that “Tea Partiers” will simply be too right-wing for voters to accept in many states. The contest in Nevada is a critical one, with Reid hoping he can cling to his slightodonnell lead against Angle, a lead he might not have against a more centrist candidate. More to the point, some Dems could scarcely contain their glee this morning after O’Donnell’s victory, calling her an “ultra right-wing extremist” who will be rejected by Delaware voters, and arguing they might now just keep control of the Senate as a result.

But Rubio’s performance shows it may not be that simple. The son of Cuban immigrants, he has softened his rhetoric since winning the Republican nomination  and has apparently picked up plenty of centrist voters along the way. The poll numbers show a big swing in his favor since mid-August, when another Reuters/Ipsos poll showed Crist marginally ahead.

Finally today, take a look at Kim Dixon’s analysis of how the tax policy espoused by both sides of the aisle would really affect small businesses and hiring, a story that cuts through some of the rhetoric around this debate. There’s an interesting story too about more privacy problems for Google after the company fired an engineer for apparently spying on teenagers’ accounts. And tomorrow, look out for Treasury Secretary Tim Geithner testifying on China on the Hill, where anger over the yuan’s value and calls for retribution are mounting. The issue puts the administration in a tight spot as the elections loom, as I am sure they will be reluctant to be drawn into a damaging dispute with Beijing.

Reuters-Ipsos poll: Senate Majority Leader Reid barely ahead in Nevada race

Perhaps it will become known as a tale of two Reids.

Senate Majority Leader Harry Reid is barely ahead of his Republican opponent Sharron Angle in the Nevada race for U.S. Senate, and his son Rory Reid is slipping against Republican Brian Sandoval in the governor’s race, according to a Reuters-Ipsos poll.

Looking at likely voters, Reid is up 46-44 percent against Angle. Among registered voters, Reid is up 46-38 percent and among independents, he is up 29-15 percent. USA-ELECTIONS

When it comes to Nevada voters views of the Tea Party, which supports Angle, 51 percent of registered voters, 56 percent of Republicans and 57 percent of independents said it would make no difference on whether to support or not support Angle.

Castle vs. O’Donnell

USA-ELECTION/The fate of another Republican lawmaker lies in the balance Tuesday in tiny Delaware, where the insurgent Tea Party movement is hoping to pull off another big primary  upset.

This time the target is Michael Castle, a nine-term Congressman who is pursuing the  Republican Senate nomination. The GOP establishment is behind Castle, a former governor and popular moderate (and said to be a direct descendant of  Benjamin Franklin) in a race Delawareonline.com reports  “hinges on character.”

Challenger Christine O’Donnell, a marketing consultant and little-known conservative, hadn’t been considered much of a threat — until she picked up support from the Tea Party Express and endorsements from Tea Party favorites former Alaska governor  Sarah Palin and Rep. Michele Bachmann of Minnesota.

Washington Extra – I see your gauntlet, and raise you a gauntlet

On Friday, President Barack Obama threw down the gauntlet to Republicans on taxes, effectively daring them to vote against a tax cut for the middle classes, just so that they can give an average of $100,000 in tax cuts to millionaires.

boehner_MitchOver the weekend, Republican leader of the House John Boehner seemed to shirk the challenge, but on Monday, Senate minority leader Mitch McConnell picked up the gauntlet and threw it right back. McConnell has promised to introduce legislation “today” to ensure that “no one in this country pays higher income taxes next year than they are right now.” There are no Republicans who support a tax hike, he said, effectively daring Democrats to vote for higher taxes when the economy is in the mire.

Washington Extra is not sure who will blink first. But whichever side you take in this debate, one thing is for sure: this “wrestling match,” as Obama called it, or game of high-stakes political poker if you prefer, does the economy no good at all.

Taxes: battle of the shoulds, musts, nots

Political maneuvering is in full bloom as positions are being staked out in the battle over tax cuts to the wealthy and for the hearts and minds of the Middle Class ahead of the November election.

President Barack Obama on Friday had his say: Congress should pass what everyone agrees on — extend Bush-era Middle Class tax relief for families earning up to $250,000.

USA/For higher incomes, Obama said the country can’t afford extending tax cuts, but he is willing to talk about it . “We can have a further conversation about how they want to spend an additional $700 billion to give an average of $100,000 to millionaires. That I think is a bad idea.” 

Washington Extra — Not another stimulus

On Wednesday, President Barack Obama plans to announce his latest package of plans to stimulate the sagging U.S. economy, most of which are already known. It was hardly a surprise to see Republicans quickly positioning themselves to block the plans, but more disappointing to the White House must have been the cautious response even from the president’s fellow Democrats on the Hill, who simply said they were looking at the proposals.wallst Even more damning, perhaps, was the verdict from the financial markets, which greeted the news with a big yawn. Both the Dow and the S&P indices ended the day more than one percent lower, dragged down by fresh growth worries in Europe. Economists on Wall Street said the plans would not do enough for small businesses or to solve the Democrats’ biggest economic and political problem: finding work for the 14.9 million unemployed. There are big questions, too, about how the plans will be paid for. “If he chooses to take away a corporate tax break to pay for this proposal, the net gain is zero,” said Andrew Busch at BMO Capital Markets. “This is likely why U.S. stocks are not seeing much of a bounce on the news.”

Last week White House economic adviser Christina Romer left town with a plea for a new deficit-financed economic stimulus. Today it was the turn of former budget chief Peter Orszag to go public with his prescription for the economy and taxes, views which differ from those of his former boss. Orszag suggested that the Bush-era tax cuts should be extended for all Americans for another two years in an effort to spur the economy, with a promise they will be allowed to expire altogether at the end of 2012. It is a view which makes some economic sense, but is unlikely to get much traction with a president likely to be campaigning for re-election that same year.

Some interesting interviews on the first day of the Reuters Aerospace and Defense Summit here in Washington. The CEOs of Lockheed Martin and of Boeing’s defense wing said both companies were well aligned for the new reality of huge fiscal deficits and tight defense budgets. Both men expressed strong support for the administration’s recently announced export control reforms, as well as new plans to extend and expand tax credits on research and development. Lockheed Martin’s Robert Stevens said he also saw the global security environment changing significantly in coming decades: withdrawals from Iraq and Afghanistan, coupled with threats from the Korean peninsula, Iran and China meant resources were likely to be shifted away from land and towards air and naval defense systems.

Republican “Young Guns” take aim at Democratic-led Washington

Republican U.S. Representatives Eric Cantor, Paul Ryan and Kevin McCarthy are all in their 40′s.

Yet with many of their colleagues far older — in their 60′s, 70′s and 80′s — see themselves as “Young Guns,” part of a new breed of Republicans ready to challenge their Grand Old Party and take on Democratic-led Washington.

“Young Guns: A New Generation of Conservative Leaders,” is the title of their book.

Reuters/Ipsos poll: Republican leads in Pennsylvania for Specter’s Senate seat

Republicans have the momentum going into Election Day for the U.S. Senate seat held by Arlen Specter for three decades in Pennsylvania. USA/

A Reuters/Ipsos poll  of likely voters showed Republican Pat Toomey with a 10-point lead, 47-37 percent, over Democrat Joe Sestak. That gap narrowed among a broader pool of registered voters to 40-37 percent.

Sestak beat Specter in the Democratic primary after the senior senator from Pennsylvania turned Democrat in April 2009 ahead of his battle for re-election to the Senate seat he first won as a Republican 30 years ago. President Barack Obama had backed Specter.

Union chief takes on a ‘Mama Grizzly’ — Sarah Palin

The head of the largest U.S. labor federation went to Alaska, “The Last Frontier,” to address local members Thursday and take on a self-proclaimed “Mama Grizzly” — Sarah Palin.

RACING/AFL-CIO President Richard Trumka mocked the former Alaska governor, a 2008 Republican vice presidential nominee who is seen as a conservative power broker and potential 2012 White House hopeful.

“Sometimes — about Sarah Palin — you just have to laugh. But it’s not really funny,” Trumka said.

Washington Extra – Slipping poll numbers

It’s more bad news for President Barack Obama with the release of our latest Reuters/Ipsos national poll today. The headline number is that, for the first time since he took office, more Americans now disapprove of his performance than approve. After a long period where his approval rating was stable at just over 50 percent, the last three months have seen a steady deterioration, matching the economy’s faltering performance.
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Just like Ronald Reagan in 1982, Obama’s mid-term poll ratings are suffering from the economy’s woes. Faith in Obama’s ability to tackle the crisis was a key factor that swung the presidential race his way in 2008, but his performance on the economy is fast becoming his Achilles heel in the face of a concerted Republican assault. As Ipsos pollster Cliff Young told us, many voters had long been giving Obama the benefit of the doubt, but now patience has “basically vanished.”

Last month’s Reuters/Ipsos poll found Obama’s approval rating for his economic leadership was lower — and was deteriorating faster — than on any other issue.  This month’s poll gives some more clues as to why this is the case. Unemployment and government spending topped voters’ economic concerns, with 72 percent and 67 percent of respondents saying they were very worried over those issues respectively.

Republicans have been trying to convince voters that last year’s deficit-financed economic stimulus was not effective in reducing unemployment and ending the recession, and this argument may be striking home.