Deja Vu All Over Again?

November 4, 2009—Jay Timmons, Exec. V.P. National Association of Manufacturers

"The most important thing we can do is create an environment in which business investment is triggered and they are leading us on this path of economic growth."

(President Barack Obama, The Wall Street Journal, 11/2/09)

Like many Americans, I sure would like to sit down at the famous White House picnic table and drink a beer with the President.

His optimism and can-do attitude are important characteristics for a President to possess. Just as Ronald Reagan did, President Obama projects that spirit to America and the world.

When he acknowledges the critical role of the private sector and business in leading the way to economic recovery, job creation and sustained growth, I’m not alone in rooting for him to succeed.

But while many polls show that Americans like the President personally, these same polls also show that the policy agenda he is advocating isn’t quite as popular. Yesterday’s elections, particularly in Virginia and New Jersey, were the most definitive referendums to date on the direction of Washington, D.C. It seems voters understand that many of the policy proposals coming out of both ends of Pennsylvania Avenue, while idealistic, would be detrimental to jobs and growth in this country.

If I were sitting at that picnic table with the President, I’d recommend that he look to yesterday’s elections for guidance from his constituents.

Virginia is “Exhibit A.” Governor-elect Bob McDonnell (R) ran a laser-focused campaign on a robust agenda of issues of concern to Old Dominion voters. He addressed real opportunities and threats to job creation and economic growth – opposing the Employee Free Choice Act and promoting sound energy policy, infrastructure improvements and lower taxes. Conversely, state Senator Creigh Deeds (D) embraced the policies of his Party’s Washington leadership. Deeds was soundly rejected by the voters of Virginia.

The Virginia results should be of paramount concern to Democratic strategists. In three key counties, Loudoun, Prince William and Fairfax, McDonnell tromped Deeds. In 2008, Candidate Obama rolled to victory in each of these counties. In fact, it has been 12 years since a Republican carried Fairfax. Tuesday’s results showed independent voters moved away from the Democrats and over to the Republicans.

Moreover, the Republican gubernatorial candidate won 62 percent in the 2nd Congressional District of Rep. Glenn Nye; 61 percent in the 5th District of Rep. Tom Perriello; and 55 percent in the 11th District of Rep. Gerry Connolly. All three of those members of Congress have something in common: they are Democrats who won a Republican-held seat in the Obama landslide. In the 9th District, where Democratic Rep. Rick Boucher was a key leader on the Waxman-Markey climate legislation, McDonnell earned 66 percent of the vote. McDonnell ran numerous ads in that district criticizing that bill and the potential job loss it would create. So, in just one state, four Democrats suddenly have reason to be greatly concerned about next year’s election.

“Exhibit B” is the New Jersey Governor’s race. While this contest centered more on personality than a policy agenda, New Jersey voters rejected incumbent Governor Jon Corzine (D), replacing him with former U.S. Attorney Chris Christie (R). Christie won by four points, 49 percent to 45 percent, the largest margin of victory for a Republican in almost 25 years. Corzine had suffered from dismal approval ratings for months, caused in part by the economic recession, which hit New Jersey especially hard. He was criticized for his handling of the economy and failing to come through on one of his campaign pledges – reducing the state’s high property taxes. Instead of lowering them, he increased these taxes, to the ire of citizens reeling from the economic downward spiral.

Winston Churchill said “those who fail to learn from history are doomed to repeat it." Some are trying to downplay the importance of these state elections and their potential impact on the national policy agenda and the federal elections taking place next year. But history tells a different story. 1993 was not that long ago and the similarities are striking. That year, Republicans also won Governor’s races in Virginia and New Jersey, setting the stage for the wave of Republican victories in Congress in 1994, when President Clinton’s party lost eight Senate seats and 54 House seats (and control of both chambers). The 1993 percentages were similar. In Virginia, George Allen (R) beat Mary Sue Terry (D) by 17 points, 58 to 41 percent; and in New Jersey, Christie Todd Whitman (R) beat the incumbent James Florio (D) by a one-point margin of 49 to 48 percent.

Similar political shifts occurred in the first off-year elections of 1978 (when President Carter lost three Senate seats and 15 House seats) and 1982 (when President Reagan lost 27 House seats). Carter didn’t learn from his losses and went on to defeat in his first term. Reagan and Clinton heard the voices of the voters and shifted their priorities to be more aligned with American viewpoints.

In 1993, voters were speaking out against the Clinton health care proposal and overall dissatisfaction with the direction of government. In yesterday’s exit polling data in Virginia, the economy and jobs were the most important issues for voters, and 85 percent expressed worry over the direction of the national economy in the next year. While they may not have been expressly voting against the President, the message for incumbents and the majority party across the country is that they cannot discount the importance of job creation and economic growth in the minds of American voters. And voters are pretty savvy – they understand that just because a piece of legislation is labeled as “pro-jobs” or “pro-economic growth,” that doesn’t mean that’s what it will accomplish.

The lesson for the Obama political team is pretty clear. When the President talks about jobs, investment and growth – as he did in the Wall Street Journal earlier this week – he is talking about the issues Americans care about. In order for the results of the 2010 election to be different from 1994, 1982, or 1978, however, his policy proposals now need to match his words. The business community – the job creators – can help him and Congressional leaders craft legislation to accomplish that goal, and we are ready and willing to help.