Week of March 7, 2007

• Libby conviction is an embarrassment for Bush, but Democrats disappointed the investigation has ended - presidential pardon is the next issue.
• Romney narrowly wins CPAC straw poll, but the week's real GOP winner is Giuliani
• McCain gets a scare in Spartanburg
• Another Clinton friend backing Obama
• Banking Chairman Dodd pumps Wall Street lobbyists for campaign cash

Outlook

1. Reports circulate on Capitol Hill that Democrats will insert House-passed bills, stalled in the Senate, to the supplemental appropriations bill funding the Iraq war. Democratic leaders flatly deny this to us.
2. Organized labor is showing its muscle in the Democratic Congress pushing through the House the bill to no longer require secret ballots in union recognition and through the Senate the collective bargaining provision for TSA employees. But the former will die in the Senate, and the latter will be vetoed.
3. The big Democratic effort is "oversight" - actually investigative harassment - with the emphasis now on probing the Walter Reed Hospital scandal and the conduct of Atty. Gen. Alberto Gonzales.
4. On the presidential front, previous favorites for the nomination are fading - Sen. Hillary Rodham Clinton (D-N.Y.) a little and Sen. John McCain (R-Ariz.) a lot. Former New York City Mayor Rudy Giuliani (R) is hot, but a fall may be coming.

Bush Administration

Libby Verdict: The conviction of former vice presidential chief-of-staff Lewis (Scooter) Libby falls far short of what Democrats had hoped the CIA leak case would produce politically,

1. Senate Majority Leader Harry Reid (D-Nev.) greeted the conviction as the beginning of a reckoning with the Bush Administration for manipulating intelligence and discrediting critics. But that is an exaggeration of what the Libby jury actually found.
2. The worst news for Democrats was the announcement by Special Counsel Patrick Fitzgerald that the investigation is finished. Vice President Dick Cheney is not going to be put in the dock.
3. Nevertheless, the conviction is an embarrassment for the Bush Administration, adding to the impression of a regime in disarray just as it seemed to be getting its act together.
4. Although Bush aides were strictly forbidden to comment on the verdict, gloom enveloped the White House over what was considered an unjust and an unfair verdict.
5. The big question remaining is what happens to Libby. The expectation is that President George W. Bush will pardon him on the way out the door. But the pardon may have to come sooner than to keep him from jail time. Whenever he delivers the pardon, he can expect a fusillade of Democratic and media fire. So, the hope is that the pardon will come after the 2008 election.
6. The post-trial comments of juror Denis Collins, a journalist, were disturbing. Saying that the jurors wanted to hear from presidential adviser Karl Rove sounded a lot like the Democrats desiring a broadening of the case.

President 2008

The Republican Presidential pack passed some important mile-markers last week with two key straw polls that have shaken up everyone's view of the race. With two second-place finishes, Former New York City Mayor Rudy Giuliani (R) is proving his ability to win the Republican nomination in spite of his perceived liberalism.

No one is now doubting Giuliani's ability to win the nomination. He has become the clear frontrunner, a status confirmed by a Newsweek poll showing him well ahead of Sen. John McCain (R-Ariz.). In New Hampshire, a new poll gives him 37 percent, putting him ten points ahead of McCain.

The big question about Giuliani, however, remains his tumultuous personal life. His son's newly public negativity toward his candidacy reflects the natural conclusion of Giuliani's decision in 2000 to make his divorce into a public circus in the New York City tabloids.

CPAC: Giuliani was the big winner here, despite exerting no effort whatsoever to influence the outcome of the Conservative Political Action Conference straw poll or sway attendees in any other way. The biggest loser was McCain, who skipped the event.

1. Wishful-thinking conservatives maintained that Giuliani's speech lacked "applause lines." But this is actually a plus for Giuliani. He didn't need "lines" - he just got applause, including several standing ovations. The cheers came despite the more philosophical, less "rah-rah" quality of his speech. As one participant put it, Giuliani was giving a history lesson.
2. Some activists expressed dismay that so many conservatives would cheer Giuliani without even making him offer anything for the Right. Giuliani stuck to safe topics in his speech - terrorism, Ronald Reagan, tax cuts - without wading into the issue areas in which he disagrees with most conservatives, such as abortion.
3. Unlike former Massachusetts Gov. Mitt Romney (and to a lesser extent Kansas Sen. Sam Brownback), Giuliani had not stacked the crowd with supporters. This applies to the entire conference, not just the speeches or the straw poll. Giuliani had absolutely no presence there whatsoever. Not a single sticker, sign, T-shirt, or visible volunteer was present for Giuliani at CPAC. Yet somehow, without trying, he succeeded.
4. Romney's young volunteers - he bussed in and paid for scores of students, many or mostly Mormons - were ubiquitous carrying his signs and passing out his stickers. His speech, delivered in his typical staccato style, was not bad. He also pleased conservatives with specific promises for keeping down government spending and repealing McCain-Feingold. But much of the applause in the room was clearly driven by the volunteers, who were carefully placed throughout the large ballroom at Washington's Omni Shoreham Hotel.
5. Brownback relied on both student volunteers (Catholic kids from such schools as Catholic University of America and Steubenville) and even senior members of his campaign staff who wore his T-shirts and held his signs all day Thursday and Friday to promote his candidacy. Unlike Romney's cash-rich operation, Brownback's homespun campaign just had to make a strong enough showing at CPAC to prove that he does not belong in the second tier of candidates. By finishing third in the straw poll with 15 percent, Brownback tried to show that he has a serious role in the race. Brownback's biggest problem has never been his credibility among conservatives, but rather his ability to fund a presidential campaign.
6. Romney, whose problem is not money but credibility, won the straw poll. But the real story of the event was how well Giuliani did among the conservative activists. He finished second to Romney 21-17 percent, and did so effortlessly, despite the fact that only ten percent of those voting in the straw poll described themselves as "National Security" conservatives. Giuliani performed strongly enough among those describing themselves as "Limited Government" conservatives that he proved he is for real, pushing aside fears over his social liberalism. This is CPAC - the conservatives' event. The feeling is that if he can make it there, he can make it anywhere.
7. McCain, who was the only GOP presidential candidate to skip CPAC other than former Wisconsin Gov. Tommy Thompson (R), had very little overt support at the conference. He was loudly booed when his name was mentioned in the straw-poll results, in which he came in behind Brownback and former House Speaker Newt Gingrich. McCain was not present because he was launching a nationwide fund-raising campaign that began in Salt Lake City Thursday and Phoenix on Friday. McCain's campaign staff did not mention these fund-raising commitments when it turned down CPAC's invitation. It said the senator's conservative record was known to everybody without him going to CPAC, but this decision was made only after heated debate within the McCain campaign.
8. Gingrich, meanwhile, received a king's greeting when he made his speaking appearance, the final speech of the conference. Gingrich benefits from his continued status as a non-candidate, which allows him to remain the party's idea man (and to sell lots of books) until this fall, when conservatives believe he could jump in and save the party from nominating a more liberal choice.

Spartanburg: McCain's woes continued here, even though he won the straw poll last week in Spartanburg, S.C.. With the backing of some of the state's top consultants and Sen. Lindsey Graham (R-S.C.), McCain seriously underwhelmed with his narrow victory. He beat Giuliani by two votes, 164-162. Giuliani, again, had absolutely no presence whatsoever in Spartanburg. He is winning the straw polls on the basis of his own name and existence, and not by dint of hard work.

An even bigger loser was Romney, who has several paid staffers in the state. Brownback managed to top him in this poll with just a handful of volunteers - much to Brownback's glee, since his campaign views Romney as the man to beat in order to secure the conservative base. Romney, who is gunning primarily for McCain, does have the backing of several important South Carolina GOP consultants, and also of Sen. Jim DeMint (R), yet he had a miserable showing with just 80 votes.

A big surprise in Spartanburg was the close third-place finish by Rep. Duncan Hunter (R-Calif.) with 158 votes. Hunter fared poorly in the CPAC straw poll, coming in with less than five percent. Under the right conditions, Hunter could conceivably emerge as a candidate as acceptable to pro-lifers as Brownback but with the national security credentials approaching those of McCain or Giuliani. The problem is, Hunter appears less likely than Brownback to take off from the second tier.

Hunter's CPAC speech was actually well received, but little noticed, since he delivered it at 8 in the morning.

Giuliani Baggage: We have noted repeatedly that Rudy Giuliani's biggest obstacle to becoming President may not be his political views, but his personal baggage. Although his baggage is largely public record, it remains something of which most Americans are unaware.

In 2000, Giuliani was still mayor of New York when he called a press conference to announce his separation from his wife, Donna Hanover, and to introduce his girlfriend to the New York media. He had not informed his wife in advance, and so the incident began what became a defining downturn in his mayoralty.

At the time, his children were 14 and 10 years old, which could explain his son Andrew Giuliani's less than enthusiastic words for his father's candidacy, beginning with an endorsement of his mother over Giuliani: "I got my values from my mother. She's a strong influence in my life. She's a strong woman." After noting that he was finally reconciling with his father after a long period of not speaking, he added: "I have problems with my father, but that doesn't mean he won't make a good president."

It works to Giuliani's benefit that such things come out now, but this is clearly not a planned leak because it contains details that will be permanently damaging - for example, the fact that Rudy and Andrew have not spoken, perhaps in years.

Clinton-Obama: Sen. Hillary Clinton (D-N.Y.) suffered from another major defection with Greg Craig, a Washington super-lawyer with close ties to the Clintons, supporting Obama. Craig was a White House special counsel defending President Bill Clinton in the Senate impeachment trial. He also served as an adviser to Secretary of State Madeleine Albright and Sen. Ted Kennedy (D-Mass.).

Dodd: The long-shot Democratic presidential campaign by Sen. Chris Dodd (Conn.), the new Banking Committee chairman, solicited banking industry executives and lobbyists for a fund-raising reception last week at Washington's luxurious Madison Hotel. Invitations went to Democrats and Republicans alike, including several who had never met and who had never contributed to Dodd, but the invitations still went out addressing the lobbyists by their first names. It was an effort by Melanie Wong, an experienced Democratic fund-raiser, to find individual fund-raisers in the community Dodd will be overseeing as chairman. A "Team of 46" will consist of supporters who pledge to raise $46,000 for Dodd.

House 2007

Georgia-10 Special: State Sen. Jim Whitehead (R) is for now the favorite in the June special election to replace Rep. Charlie Norwood (R-Ga.), who died from lung cancer earlier this year. Whitehead is liked among conservatives - his name was part of the buzz at CPAC, where the joke was that he is more conservative than Norwood, an almost impossible feat. He has hired much of the Norwood team for his campaign.

Activist William Greene has been making the rounds among conservatives in Washington, but they privately downplay his chances. State Sen. Ralph Hudgens (R) has been lining up for years to run for the seat, but he received criticism for announcing his run while Norwood's body was still warm.

The district is so heavily Republican, though, that no Democrat will have a serious chance.

Sincerely,

Robert D. Novak