Washed It!

The day after Jesse Kelly won the Republican primary in Arizona’s 8th Congressional District, Democratic incumbent Gabrielle Giffords went on the air with a lacerating attack. Noting that Kelly said he ultimately wanted to eliminate Social Security, Giffords’ television ad warned that Kelly “is a risk we can’t afford.”

Kelly, a construction manager with no political experience, had made the mistake of venturing into the mine-strewn politics of Social Security. No matter that he said he would preserve benefits for current retirees. The fact that he once described it as “the biggest pyramid scheme in history” gave his rival the equivalent of cannon fodder in a district where nearly one-fifth of the population is older than 65.

Kelly is now running his own ad vowing to “honor our commitment to seniors,” trying to fend off a line of assault that Democrats are stepping up throughout the country. It’s one of the few consistent themes in Democratic campaign commercials in a year when the party has otherwise eschewed a national message.

Accusing Republicans of wanting to do away with Social Security is a well-worn trope for Democrats. But a slew of “tea party”-backed candidates who have called for privatizing or eliminating the program have given Democrats fresh ammunition at a time when they are on the defensive about healthcare reform and the economic stimulus.

The strategy allows Democrats to link their rivals to former President George W. Bush, who sought to allow younger workers to invest a portion of their Social Security taxes in the stock market.

“And because it has also become a rallying cry among some of the tea party movement … it’s an indicator of how far to the right and how extreme a position the Republican candidates are taking,” said Rep. Chris Van Hollen of Maryland, chairman of the Democratic Congressional Campaign Committee, which has devoted the majority of its spots to slamming House GOP candidates on the topic.

Republicans, however, complain that their rivals are distorting their position.

“There have been numerous fact-checks and editorials calling out Democrats for their Social Security attacks,” said Paul Lindsay, spokesman for the National Republican Congressional Committee. “Democrats are desperately trying to scare seniors.”

“This is what a Democrat says when they’re losing an argument,” said Grover Norquist, president of the conservative Americans for Tax Reform. “If they’re saying this, it means they don’t have anything else to say.”

Nevertheless, Norquist advises GOP candidates to steer clear of Social Security on the campaign trail: “It’s too easy to demagogue.”

Indeed, it’s a testament to the political thorniness of the subject that most Republicans are strenuously avoiding it now that the primaries have passed. While Rep. Paul Ryan (R-Wis.) proposed personal retirement accounts for younger workers in his “Roadmap for America’s Future” economic plan this year, the GOP “Pledge to America” released last week does not address how to reform Social Security, whose outlays will regularly exceed its revenue beginning in 2016, the Congressional Budget Office estimates.

But Democrats are still feeding off comments made by their GOP rivals earlier in the year. In Nevada, Senate Majority Leader Harry Reid weaves it into nearly every spot he runs against Republican Sharron Angle, who has backed away from earlier statements that she would phase out Social Security. A commercial for Sen. Michael Bennet (D-Colo.) includes footage of GOP rival Ken Buck calling Social Security “a horrible policy,” words Buck later said he regretted.

A commercial for Rep. Baron P. Hill (D-Ind.) spotlights a clip of GOP challenger Todd Young calling the program “a Ponzi scheme.” And a new ad by Democratic challenger Tarryl Clark argues that Rep. Michele Bachmann (R-Minn.) views seniors as addicts, noting that she said she wants to “wean everybody off” Social Security.

“In the past, the Democrats had to strain and work hard to convey the risk of a Republican victory to Social Security,” said Lawrence Jacobs, a political science professor at the University of Minnesota who studies the program. “This year, it’s low-hanging fruit … because there are prominent Republicans running for the Senate and House who have very publicly and clearly raised questions about future of Social Security.”

But in some races, Democrats have taken more generic comments by GOP candidates as evidence of their antipathy to the entitlement. In Wisconsin, the Democratic Congressional Campaign Committee has run three ads asserting that former prosecutor Sean Duffy, the GOP nominee for an open House seat, supports a plan to privatize Social Security. “Sean Duffy may not be worried about his retirement security, but the rest of us are,” stated one, featuring images of the onetime star of MTV’s “The Real World” climbing into a purple SUV.

As evidence, the committee cited Duffy’s endorsement of Ryan’s “Roadmap” plan. But Duffy has never explicitly voiced support for personal accounts, and on his campaign website he states, “I have not and will not endorse privatizing Social Security.” The Democrats’ campaign committee said Duffy was merely trying to backtrack.

It remains to be seen whether the Democratic fusillade will pay off for them at the ballot box. Evan Tracey, president of Campaign Media Analysis Group, a division of Kantar Media that tracks political advertising, said the party was hitting Social Security particularly hard in this cycle because the passage of healthcare reform took away one of their traditional critiques of the GOP.

“The Democratic message is — let’s face it — fear-based and designed to get seniors worried about their Social Security check,” he said. “That’s as common as Republicans calling Democrats liberals. I don’t know if anybody has presented a real argument that’s going to connect with voters.”

matea.gold@latimes.com
Democrats campaign on GOP threats to Social Security

By announcing major changes in his economic team ahead of the midterm elections, President Obama is hoping to galvanize a listless Democratic base that has been unimpressed with the administration’s efforts to ease unemployment and buoy the still-troubled housing market.

The two key moves — Lawrence Summers’ exit as top economic advisor and Elizabeth Warren’s ascendance as a consumer protection czar — are widely viewed as overtures to liberal Democrats, a voting bloc that must turn out in large numbers if the party is to stave off deep losses in the Nov. 2 congressional elections.

“Larry Summers was never that popular with the base, and this president is desperately trying to mobilize the base between now and November,” said Stephen Wayne, a government professor at Georgetown University.

“Elizabeth Warren coming and Larry Summers going, these are moves designed to placate the Democratic base and mobilize it as we approach the election,” Wayne said.

At the same time, administration officials insist Obama does not intend a broad retreat from his economic policies.

“The change in personnel is not going to affect the course that we’re on,” said Jared Bernstein, chief economic advisor to Vice President Joe Biden. “We’re going to build on the momentum that the policies have helped to create.”

Indeed, there is little else Obama can do to lower the jobless rate, reduce home foreclosures or improve growth before the November elections. The economy moves too slowly for that, and so does Congress.

On Thursday, for example, congressional Democrats indicated that they might put off a crucial decision on whether to extend temporary, Bush-era tax cuts until after the November election.

Obama announced this week that Summers would be leaving at the end of the year, the third member of his economic team to make departure plans public in recent weeks. Summers had long planned to return to Harvard, but announcing the move now is seen as giving Obama a political boost ahead of the elections.

A week ago, Obama appointed Warren to set up the new federal agency charged with protecting consumers from abuses by banks, credit card companies and other financial firms. She also joined the White House economic team.

Both Summers and Warren evoke strong emotions among Democrats.

Summers is loathed by many progressives, who see him as tied to Wall Street interests. At the same time, the left praised the arrival of Warren, hailing the Harvard law professor as a champion of the middle class.

But nothing in the new lineup of advisors suggests Obama is abandoning the path out of the deep recession he has plotted over the past 20 months.

Two pivotal vacancies — budget director and chair of the Council of Economic Advisors — have been filled from within the administration. And although the White House has said Obama might tap a corporate executive to replace Summers, the team’s most senior member will continue to be Treasury Secretary Timothy F. Geithner, a chief architect of the administration’s economic policy.

Some economists said that strategy was a mistake given the slowing pace of economic growth and continued deep problems in the housing market. The nonpartisan Congressional Budget Office forecasts a modest 2.1% increase in real economic output next year, far too weak to make much of a dent in 9.6% national jobless rate.

“There’s a distinction between shaking up the team and making shifts in policy,” said Robert Shapiro, an economic official in the Clinton administration.

“The question is how much confidence do they have that, without additional measures, the economy will strengthen on its own,” he said. “I think Larry had confidence in that six months ago … but no one has as much confidence in it today.”

While Obama has one eye on the midterms, he is also focused on his reelection in 2012. The president and his economic team have been adamant that the economy is on the right track and that their policies simply need more time to reverse the effects of the deepest recession since the Great Depression.

“We’re moving in the right direction,” Obama said this week during a town hall meeting about the economy.

Obama plays to his base with financial team moves

President Obama drew a sharp contrast with Republicans Wednesday over what was shaping up as a key issue in the midterm congressional elections: the extension of tax cuts for top earners, which he said were unsustainable.

Obama’s remarks, delivered in the traditional electoral battleground state of Ohio, sounded every bit like the speeches he gave there two years ago during his first election bid. Originally billed as a policy speech, Obama only briefly outlined his new plan for $180 billion in spending — including $50 billion in infrastructure investments and a permanent extension of research-and-development tax credits.

Instead, he used the debate over Bush-era tax breaks to make a populist pitch, shaping the coming congressional midterm election as a choice between Democrats who support policies to advance the middle class and Republicans who would return to policies that created only “the illusion of prosperity.”

As he did so, Obama mentioned House Minority Leader John Boehner (R-Ohio) by name eight times, as the White House sought to elevate the man who would become speaker of the House if Republicans gained a majority this fall.

“Make no mistake: He and his party believe we should … give a permanent tax cut to the wealthiest 2% of Americans,” Obama said. “With all the other budgetary pressures we have, with all the Republicans’ talk about wanting to shrink the deficit, they would have us borrow $700 billion over the next 10 years to give a tax cut of about $100,000 each to folks who are already millionaires.”

“So let me be clear to Mr. Boehner and everybody else,” he continued. “We should not hold middle-class tax cuts hostage any longer.”

Obama’s plan calls for extending tax cuts for households earning less than $250,000 a year, while allowing the marginal rates for higher earners to increase as scheduled Dec. 31.

“For those who claim that this is bad for growth and bad for small businesses, let me remind you that with those tax rates in place, this country created 22 million jobs, raised incomes, and had the largest surplus in history,” he said.

Obama also, as he had done often since Congress broke for its summer recess, urged Republicans to pass a package of small-business tax credits that had been stalled in the Senate, a holdup he said was delaying hiring.

Obama said Republican obstruction was emblematic of a strategy aimed at allowing the GOP to “sit on the sidelines and let Democrats solve the mess.”

“They’re making the same calculation they made just before the inauguration: If I fail, they win,” he said. “Well, they might think this will get them where they need to go in November, but it won’t get our country where it needs to go in the long run.”

Earlier Wednesday, Boehner announced two Republican alternative economic proposals for the September session. Foremost among them was a two-year extension – which he termed a freeze – of all current tax rates.

Republicans also would seek to cut non-security spending to 2008 levels, which they estimated would save $100 billion in its first year.

In January, Obama had proposed a three-year budget freeze that the White House said would save $250 billion over the next decade.

“We can’t deal with the deficit until we’re willing to get our arms around spending and have a strong economy,” Boehner said in an interview with ABC’s “Good Morning America” on Wednesday. “And you can’t have a strong economy if you’re raising taxes on the very people that you expect to invest in our economy to begin hiring people again.”

The Ohio Republican also seemed to welcome the direct confrontation with the Democratic president.

“Here’s the White House worrying about what I’ve got to say instead of working together to get our economy going again and to get jobs back in America,” he said.

Under election-year pressure, even Democrats have expressed reservations about Obama’s new proposals. Sen. Michael Bennet, seeking election to a full term this November in Colorado, said in a statement Wednesday morning that he opposed “additional spending in a second stimulus package.”

mmemoli@tribune.com
Obama blasts continued tax cuts for the rich

Pressure on President Obama to do something about the weakening economy intensified Friday with new government data showing that hiring remains lackluster, nudging the nation’s unemployment rate up to 9.6%.

With congressional elections less than eight weeks away, Obama appeared in the Rose Garden to say that he would soon propose a new package of tax cuts and other incentives to spur employment.

“We are confident that we are moving in the right direction, but we want to keep this recovery moving stronger and accelerate the job growth that’s needed so desperately,” the president said.

Obama spoke after the Labor Department reported that the nation lost 54,000 net jobs in August, fewer than economists had expected but still dismal. The private sector’s weak gain of 67,000 jobs was wiped out largely by the number of federal census jobs that ended.

The unemployment rate edged up to 9.6% from 9.5% in July, the first increase in that figure since April.

The president is expected to use a speech in Cleveland on Wednesday to outline a series of measures to kick-start the economy, which could include extending research and development tax credits for business, increasing spending on highways and other public works projects, and retaining the middle-class portion of the Bush administration tax cuts that are set to expire at the end of the year.

Many analysts believe that those measures will have only a modest effect, especially in the short time remaining before the midterm elections. But with Republicans lined up solidly against the Democratic administration on economic policy, more far-reaching proposals are considered out of the question.

“The key will be whether it’s smart — getting bang for the buck — and if it’s big enough,” said Heidi Shierholz, an economist at the nonprofit Economic Policy Institute, a liberal-leaning research group in Washington. “And I’m concerned on both of those fronts.”

One idea that has received some support from Republicans is a three-month payroll tax holiday for all workers and businesses.

That would amount to a 6.2% tax cut for each, freeing up money that employers could use for new hiring and workers could use to boost consumer spending.

But White House aides indicated that Obama will not embrace the idea. It would cost the government about $120 billion in revenue if adopted for two months — and a staggering $700 billion if continued for a full year.

Also, an unrestricted tax holiday would not be narrowly focused on Obama’s goal of adding jobs.

“I think the notion of giving payroll tax holidays is not very well targeted,” said Gary Burtless, an economist at the Brookings Institution think tank in Washington. “That’s going to go to all kinds of firms, even those that are reducing their employees.”

Instead, Alan Krueger, the Treasury Department’s chief economist, said Obama asked his economic team to “review options that are targeted and responsible” — that is, more narrowly focused and less likely to aggravate the government’s budget and deficit problems.

Recognizing that many Americans have an unfavorable view of last year’s massive stimulus program, White House Press Secretary Robert Gibbs has been taking pains to caution that “some big new stimulus plan is not in the offing.”

Among the narrower options under consideration is extending a tax break signed into law in March that exempts employers from their share of payroll taxes for the remainder of 2010 and provides other incentives if the employer hires someone who has been unemployed for at least 60 days.

The law, known as the Hiring Incentives to Restore Employment Act, or HIRE, passed with bipartisan support, and one of its main backers, Sen. Charles E. Schumer (D-N.Y.), recently urged a six-month extension.

A White House aide, Jen Psaki, would not lay out specifics, but said that “the options under consideration build on measures the president has previously proposed.”

The moves being discussed are unlikely to change the jobs picture any time soon, Burtless said. He noted that the R&D tax credit, which expired Dec. 31, has repeatedly been renewed and is expected to be extended again this year.

Obama to propose new incentives to spur employment

Powerful Hurricane Earl spun toward the East Coast on Wednesday, driving tourists from North Carolina’s vacation islands and threatening to bring damaging winds and waves to the Atlantic seaboard through Labor Day weekend.

Democratic Govs. Bev Perdue of North Carolina and Martin O’Malley of Maryland declared states of emergency in their states, and federal authorities have warned people along the coast to be prepared to evacuate if necessary.

The evacuation of the Outer Banks, a stretch of thin barrier islands, had begun in North Carolina, and hundreds of cars were backed up on the highway that is the sole link to the mainland. Earl’s strongest winds were expected to hit the coast Thursday night into Friday morning.

Earl’s effect on the East Coast will depend on when it makes its expected turn to the northeast.

A later-than-expected turn could mean the storm’s eye makes landfall on the extreme eastern tip of North Carolina as a Category 3 hurricane late Thursday or early Friday.

If that happens, hurricane-force winds could reach Long Island, N.Y., and Cape Cod, Mass.

Virginia Gov. Bob McDonnell, a Republican, declared a state of emergency as a precaution, allowing the state to mobilize staff and resources before the storm. Emergency officials as far north as Maine urged people to have disaster plans and supplies ready.

Earl was on track to approach the North Carolina shore and then blow north along the coast, but forecasters cautioned that it was still too early to tell how close the storm might come to land.

The National Weather Service issued a hurricane warning for much of the North Carolina coast and hurricane watches from Virginia to Delaware.

Not since Hurricane Bob in 1991 has such a powerful storm had such a large swath of the East Coast in its sights, said Dennis Feltgen, spokesman for the National Hurricane Center.

“A slight shift of that track to the west is going to impact a great deal of real estate with potential hurricane-force winds,” Feltgen said.
Hurricane Earl approaches East Coast

Democratic gubernatorial nominee Jerry Brown argued Thursday that his experience makes him the only candidate who can right California, and he slashed at Republican rival Meg Whitman by calling her a neophyte who has run an ugly and inaccurate campaign against him.

“Everything I’ve done in my life has prepared me for this moment in time, to do what I can to protect the state I love,” said Brown, the former two-term governor and current attorney general, standing in front of a vat of sulfuric acid after touring New Leaf Biofuel in San Diego.

“I’m confident at the end of the day, though it’s going to be a close race, people are going to vote for change, they’re going to vote for integrity, and they’re going to reject the negativity and the carpet-bombing of deceptive commercials we’ve been facing these last two months.”

More than 100 miles north, at a rivet manufacturer in the City of Industry, Whitman argued that the state would be ill-served if it elected a career politician who “has not delivered” in the past. Faced with a query from a worker about whether she could be any more effective than another political novice, Gov. Arnold Schwarzenegger, Whitman said the business skills she developed as EBay’s chief executive would ease her path in Sacramento.

Schwarzenegger “did a number of good things … but he had not run and managed and led large organizations” as she has, Whitman told an audience gathered on the factory floor of Allfast Fastening Systems. The next governor, she said, “has to be very tough-minded.”

“We cannot afford a third term of Jerry Brown,” Whitman said. “And I am going to give Jerry Brown the toughest fight he has had in his 40-year political career.”

The events marked a rare moment in the general election campaign so far — one in which the two gubernatorial candidates were actually campaigning at the same time.

Although Whitman has kept a brisk pace traveling around the state, airing ads and reaching out to voters since she won the GOP primary in June, Brown, who lacks his rival’s deep pockets, has spent much of his time raising money while juggling his duties as the state’s attorney general.

Organized labor has propped up his campaign with television ads over the summer, but until Wednesday it had been nearly a month since the candidate held a campaign event. Brown has said he was biding his time and would spend $25 million to $30 million in the fall, when voters would be paying attention.

“There are two things that are unprecedented in American political history,” he said Thursday. “One, the $100 million plus that Whitman has paid on her campaign, most of it from her own pocketbook, and two, the virtually no effect it’s had. This is basically a tie race.”

Brown, who picked up the endorsement of Planned Parenthood and NARAL Pro-Choice America on Thursday, appeared to be gearing up for the start of the general election battle. He headlined a rally in front of 800 people in Santa Rosa on Wednesday night, followed by the Thursday morning tour and news conference.

Those events offered Brown the chance to respond to several attacks Whitman has launched against him in recent weeks, including questions about his recent use of a state plane after he bragged about eliminating such luxuries during his prior time as governor. Brown dismissed a query as a “Whitman-fed” question.

“I fly it so little, really, compared to commercial flights,” he told reporters in Santa Rosa. “By the way, sometimes funerals are very important to go to, for fallen officers.”

Whitman’s newest television ad, unveiled Thursday, charged Brown with hypocrisy for touting his frugality even though he used a state plane 10 times since he assumed the attorney general post in 2007. The ad says that Brown used a Beechcraft King Air turboprop for trips to a conference at the La Costa Resort and Spa and a reception in Pebble Beach. “It’s your money — not his,” the announcer says.

Whitman, who received the endorsement of the National Federation of Independent Business on Thursday, was fending off her own attacks from the state’s nurses‘ union and the Courage Campaign, which used the anniversary of women’s suffrage vote to protest the candidate and her spotty voting record at a Sacramento rally.

More than 1,000 people gathered on the west steps of the Capitol, ostensibly to honor the 90th anniversary of suffrage. Labor leaders, led by the California Nurses Assn., hammered Whitman for her poor voting record and painted her as a corporate elitist who plans to cut 40,000 state jobs, slash pension benefits and curtail the political influence of unions.

“She may not have voted,” said Rose Ann DeMoro, executive director of the nurses’ union, “but we will.”

Whitman countered that the protest appeared to be driven by “union bosses trying to distract from the fact that I will go to Sacramento and I will change Sacramento.” But she once again apologized for her past voting record: “I have said I should have been more engaged and I was not. But I am all in now.”

seema.mehta@latimes.com

maeve.reston@latimes.com

Times staff writer Michael Mishak contributed to this report from Sacramento.
Brown and Whitman spar in sync

Many people who encounter Mikael Moore, the chief of staff for Rep. Maxine Waters, see a typical Capitol Hill aide: a young, serious, BlackBerry-toting workaholic in a business suit with an intense belief in the importance of his work.

If they know he is also Waters’ grandson, making him a rarity in Congress, it is not because he talks about it much, if at all.

Colleagues say Moore rarely offers information about his family connection, and that they have instead come to know him as a talented, politically gifted peer who has brought order to a sometimes tangled office and quickly grasped the intricacies of Washington.