10/18/2008 05:12 am ET | Updated May 25, 2011

Populist McCain, Polite Obama

The progressive Section 527 groups, such as America Votes, have been gathering all this week, determined to save the Obama campaign from its own gentle post-partisanship. They began aggressively recruiting large donors, to finance the tough TV spots that the Obama campaign has mostly avoided to date. I attended one of these meetings on an off-the-record basis. "We need to do a far better job defining John McCain," said one national 527 leader.

Earlier, in the year, the 527 groups had been waved off by the Obama campaign, which had plenty of its own money and didn't want independent organizations complicating its "high road" messaging (or fundraising). But after a week of Obama's sickening slide in the polls, the groups decided to take matters into their own hands, just seven weeks before the election.

"We had a superb system in 2004," one leader of a progressive 527 told me. "Now, we have to start almost from scratch, while the Republican independent committees have a huge head start and are already on the airwaves."

The groups came armed with Stan Greenberg's latest Democracy Corps polls, which show Obama running behind John Kerry's losing 2004 performance in eight key battleground states and among demographic groups that Obama has to win. "He is underperforming [Kerry] among women generally, especially white women over 55, blue collar voters, even among college educated," prospective donors were told.

Advocates of a tougher line have had difficulty breaking through the palace guard of senior advisers -- Messrs David Plouffe, David Axelrod, and Robert Gibbs -- who have reinforced Obama's sometime tendencies to be "post-ideological" and "post-partisan" rather than hanging the Wall Street meltdown where it belongs -- around the necks of the Republicans and their strategy of letting Wall Street wreak whatever havoc it wishes. Obama seems to recover his own voice the further away he gets from his handlers.

McCain himself was very quick to reverse course, rushing out an ad promising "tougher rules on Wall Street to protect your life savings." Speaking on morning talk shows, McCain was born again. The people "have been betrayed by a casino on Wall Street of greed, corruption and excess that has damaged them and their futures," he said. "And we're going to fix it."

"I am a Teddy Roosevelt Republican," he insisted. "Teddy Roosevelt believed that we needed an economy that can function without government interference. But he also said unfettered capitalism can breed corruption. We're seeing Teddy Roosevelt's words come true."

"McCain sounded more populist than Obama," one disgusted Democratic senator told me. McCain's latest turnabout of course was at odds with his entire Senate record, of supporting one deregulation after another. McCain was even a big booster of Social Security privatization -- which would have whacked retirees if the Bush Administration -- with McCain's support -- had managed to enact it during the stock-bubble years. The Obama campaign, having trouble with retirees who usually back Democrats, has managed to keep McCain's views on sacking Social Security a well kept secret.

Obama did a modestly better job Monday and Tuesday connecting the deepening financial collapse to McCain and Republican regulatory policies. But his new ad simply mocks McCain for asserting that "the fundamentals of our economy are strong." McCain has been quicker off the mark, sounding like a leader, despite reversing course 180 degrees. Even with the deepening crisis, the Obama campaign has still largely stuck to fairly bland, generic, and largely uninspired messages about McCain being an out-of-touch Washington insider.

Here is Obama's latest ad. It's a two minute speech talking directly to the American people. Instead of hanging the Wall Street collapse directly around the necks of the Republicans and John McCain, and pointing out McCain's utter hypocrisy a born-again regulator, it's the same laundry list of generic fare. Who writes this stuff?

In the past few weeks, Wall Street's been rocked as banks closed and markets tumbled. But for many of you--the people I've met in town halls, backyards and diners across America--our troubled economy isn't news. 600,000 Americans have lost their jobs since January. Paychecks are flat and home values are falling. It's hard to pay for gas and groceries and if you put it on a credit card they've probably raised your rates. You're paying more than ever for health insurance that covers less and less. This isn't just a string of bad luck. The truth is that while you've been living up to your responsibilities Washington has not. That's why we need change. Real change. This is no ordinary time and it shouldn't be an ordinary election. But much of this campaign has been consumed by petty attacks and distractions that have nothing to do with you or how we get America back on track. Here's what I believe we need to do. Reform our tax system to give a $1,000 tax break to the middle class instead of showering more on oil companies and corporations that outsource our jobs. End the "anything goes" culture on Wall Street with real regulation that protects your investments and pensions. Fast track a plan for energy 'made-in-America' that will free us from our dependence on mid-east oil in 10 years and put millions of Americans to work. Crack down on lobbyists - once and for all -- so their back-room deal-making no longer drowns out the voices of the middle class and undermines our common interests as Americans. And yes, bring a responsible end to this war in Iraq so we stop spending billions each month rebuilding their country when we should be rebuilding ours. Doing these things won't be easy. But we're Americans. We've met tough challenges before. And we can again. I'm Barack Obama. I hope you'll read my economic plan. I approved this message because bitter, partisan fights and outworn ideas of the left and the right won't solve the problems we face today. But a new spirit of unity and shared responsibility will.

The outworn ideas of the left and the right? Jesus Wept! How about the outworn ideas of Republicans?

The Obama campaign sent me several email messages on the past 24 hours trumpeting their latest commercials and their man's comments. I have to say that the most persuasive of these emails was not anything Obama himself said about the financial meltdown, but the campaign's forwarding of Jackie Calmes' Tuesday front page New York Times story on how Obama and McCain respectively would handle the financial crisis.

Reporter Calmes managed to unearth McCain's prior statements cheering on deregulation, and pointed out the utter absence of a prior McCain record calling for stronger regulation. She cited Obama's best speech on the subject, from last March 27, when Obama issued prescient warnings on the deepening financial crisis and calling for tough new regulation. It was literally his last tough speech on the subject.

It's quite a comment on the campaign when a thoroughly evenhanded piece in the New York Times comparing the two nominees' records does a more persuasive job than the candidate himself. We await news of whether donors, or senators, break through.

UPDATE: As of 10:39 a.m. Wednesday, the Obama campaign released the following statement in Obama's name. They're two days behind the curve, but maybe they are learning. I am audaciously hopeful:

"The fact that we have reached a point where the Federal Reserve felt it had to take this unprecedented step with the American Insurance Group is the final verdict on the failed economic philosophy of the last eight years. While we do not know all the details of this arrangement, the Fed must ensure that the plan protects the families that count on insurance. It should bolster our economy's ability to create good-paying jobs and help working Americans pay their bills and save their money. It must not bail out the shareholders or management of AIG.

"This crisis serves as a stark reminder of the failures of crony capitalism and an economic philosophy that sees any regulation at all as unwise and unnecessary. It's a philosophy that lets Washington lobbyists shred consumer protections and distort our economy so it works for the special interests instead of working people; a philosophy that says we should give more and more to those with the most and hope that prosperity trickles down to the rest.

"Instead, the pain has trickled up--from the struggles of Main Street all the way up to the crises on Wall Street.

"Despite his eleventh hour conversion to the language of reform, Senator McCain has subscribed to this philosophy for twenty-six years in Washington and the events of this week have rendered it a colossal failure. It is time for a new economic strategy, guided by the principle that America prospers when all Americans prosper, where common-sense rules of the road ensure that competition is fair, open, and honest. That is the strategy I will pursue as President, and I will bring the change we need to restore confidence in our financial markets and strength to our economy," said Barack Obama.


Robert Kuttner, co-editor of The American Prospect and Distinguished Senior Fellow at Demos, has just published Obama's Challenge: America's Economic Crisis and the Power of a Transformative Presidency (Chelsea Green). He is blogging daily about the election and the economic crisis at