THE BLOG

Populist Surge or Muddled Message Overwhelmed by Money?

10/13/2010 04:44 pm ET | Updated May 25, 2011
  • Mike Lux Co-Founder, Democracy Partners

Mark Mellman's latest Hill column captures the essence of the moment, and echoes what I have been telling my friends for a while: this is the most unpredictable election in at least a dozen years -- arguably the most unpredictable in my political career (which has been a 30-year run so far). I've said it over and over again, and it remains true: you look at some data, and it is easy to see all the conventional wisdom about a Republican tidal wave coming true. Another set of data tells you this may be a surprising year in terms of Democrats holding their own. We just don't know the last-minute factors which will turn this one way or another.

If the Obama team hadn't decided that outside efforts to help candidates were to be discouraged at all costs, and our groups working on campaigns weren't being outspent 7-1 by the Chamber of Commerce with their foreign money, the Koch brothers, and Karl Rove's banking, oil, and insurance company buddies, I think we'd have a better than even chance to do better than expected and hold the House and Senate. The Republicans' completely secretive corporate money is just overwhelming us in a lot of places, and it is spreading the field by putting lots of formerly safe seats into real danger. It is easy to imagine losing 55 or 60 seats in the House.

But this whole populist anti-Wall Street, anti-corporate special interest thing is still stirring around on our side, too, and there is real evidence that it is working for Democrats in a lot of key races. Check out this number from a Bloomberg poll:

BLOOMBERG NATIONAL POLL: Would it make "you more likely or less likely to support a particular candidate .... [if that] Campaign was aided by advertising paid for by anonymous business groups"? More likely: 9% ... Less Likely: 47% ... Would Not Matter: 41% ... Not Sure: 3%

We've been seeing numbers like that all over the place in different races, and more and more Democratic candidates are picking up on the message and going on offense against the sleazy corporate ads flooding their districts. Meanwhile, activists all over the country are doing local demonstrations taking on these corporate advertisers with their undisclosed donations: there were 52 events around the country by MoveOn volunteers alone. And now the White House and DNC are getting into the act, attacking the Chamber and American Crossroads and their mysterious donations from who knows where.

If voters begin to understand that Democrats really are on their side, and will fight back against these shadowy special interests with their hundreds of millions in dollars coming from who knows where, our candidates can win a lot of these close races even with the outside groups outspending them so badly. But they also have to hear loud and clear from Democratic elected officials that they are standing up to these special interests when it matter the most, which brings me to my final point of the day: we need a far clearer and stronger message from the White House on whether they will take on the big banks that have committed foreclosure fraud.

So far on this issue as it has emerged over the last couple of weeks, when the White House had to make a choice on policy, the President has mostly done the right thing: his veto of that make-foreclosures-quick-and-easy nightmare of a bill that snuck through Congress in the dead of night was incredibly important. And while I would have chosen to go with a complete foreclosure moratorium, I give the White House a lot of credit for having Gibbs come out yesterday in support of the state AGs in their investigation of this fraud debacle, and in saying these simple but crucial words that probably hit some of these fraudulent bankers like a punch in the guts: "We just want to take the just and necessary steps to ensure that the process is being followed legally." The reason that simple idea is so crucial is that banks and foreclosure mills are desperately moving to try and find ways to get around the inconveniences of the laws on the books so that they can get these foreclosures processed. With the White House vetoing their first attempt to circumvent the law, and saying clearly they are backing AGs in making certain that the law is actually adhered to, it gives the bankers and their foreclosure mills a massive problem.

So that's mostly to the good, and plays into the populist surge that democrats are trying to ride in the final weeks of the campaign. What is terrible is the messaging coming out of Tim Geithner's mouth. Check out this convoluted stuff:

Charlie Rose: You're encouraging banks to declare a moratorium on foreclosures?

Tim Geithner: No, I wouldn't say it that way. I think that you know what you're seeing in housing still now is a national tragedy, still very, very difficult. You know, again, this was a crisis caused by a lot of people were taken advantage of, a lot of people were too optimistic about what they could afford in terms of a house, lot of people were speculating in real estate, and a lot of innocent victims got caught up in the consequences of those basic mistakes. You saw, you know, the nation's largest banks that ran these servicing businesses, not invest anything like what they needed to, to run that business effectively in a downturn like that. And you're seeing the consequences of all those mistakes play out still across the American economy. Now, you've seen some banks suspend temporarily the foreclosure process so they can just make sure that they're not causing any injustice to the borrowers and that's very important for that to happen. And we're going to -

Charlie Rose: So you're pleased to see that happen.

Tim Geithner: I think where that's happening again the suspension is to make sure they're not causing any injustice is very important, but I think it's important to recognize, Charlie, that if you -- a national moratorium would be very damaging to exactly the kind of people we're trying to protect, because the consequence of that would be in neighborhoods that have been most affected by the foreclosure crisis, where you see lots of houses on the block empty, unoccupied, what it means is those communities will be living longer with houses unoccupied, with more pressure on their house price with the people still in their houses. That would be very damaging, and so again we want to make sure we're holding these services accountable, that they're not causing any injustice to people who can afford to stay in their home, and we're going to make sure we're careful in doing that. But we also want to make sure that we're not going to make the problem worse.

Geithner here defends the banks, not only giving them a free pass on the fraud going on the foreclosure market, but actually saying they should get credit for temporarily suspending the foreclosure process "so they can make sure that they're not causing any injustice to the borrowers". Does anyone besides Geithner and the occasional Ayn Rand acolyte believe that these bankers are such moral, salt of the earth types that they care about the injustice being done to mortgage holders? It is this kind of messaging that makes a muddle of what Democrats are trying to do nationwide. The explosion of the mortgage fraud issue gives us our best opportunity yet to re-frame this election around populist economic issues that show Democrats to be fighters for the middle class and against the big banks and other special interests. The White House is on the right track ingoing after the Chamber and Karl Rove's secretive and possibly foreign funding. They are doing the right thing in vetoing that terrible make-illegal-foreclosures-fast-and-easy bill, in backing the AGs, and in backing the rule of law on foreclosure fraud. Now they need to get their messaging right: make it clear, tough, and not in doubt as to being on the side of homeowners against the banks who are trying to rip people off.

Anyone confidently predicting what will happen in this election is full of themselves and will probably be proven wrong: no one knows how this puppy will turn out. The money and voters' anger about the economy could overwhelm the Democrats, especially if they mush up their message. But an anti-special interest, anti-secretive corporate funding message gives us a real chance to make the results different than we thought.

Cross-posted on OpenLeft.com, where you can read all of my writing on messaging, the 2010 elections, and populism.