09/29/2008 02:51 pm ET Updated Dec 06, 2017

Nails in McCain's Coffin?

Normally electoral vote tides take weeks and months to form and impact a campaign. Ten days ago the financial crisis wave rose quickly and swamped this presidential campaign. It is the only thing anyone is talking about; it has received saturation media coverage (and, as we write this, the Asian and European markets are down significantly). And it may be the final nail in the coffin for John McCain.

Up until the financial crisis, the McCain campaign had been doing a remarkable job of staying close (and even, briefly, pulling ahead) in a campaign that it has no real business winning when you consider the environment. But with a sinking economy piled on top of everything else, even a perfect campaign might not be enough.

Which brings us to the debate. Both men were terrific (kudos, too, to Jim Lehrer for staying out of the way and basically letting the two candidates go at it), so we'll call it a draw. But in many respects it doesn't matter what McCain does or says during these debates; all eyes are on Obama. We've said it many times: if Obama can prove himself to be a credible commander-in-chief (not an easy task, mind you), he'll win. And he did that on Friday night. He was poised and direct, much better than he was during his primary debates or during the two recent forums at Saddleback and Columbia University. His performance, combined with the financial crisis, makes it likely that he will win this election.

Today, the LCG regression vote model projects McCain losing by 2.2 points in November. He currently trails by 2.3 points. In many of those national and key state polls, Obama has taken a three-eight point lead; he obviously has momentum. McCain's recent vote strength is still checking the more recent bounce that Obama got from the fiscal crisis (and we haven't seen an impact from his debate performance yet), which is preventing the model from giving Obama any momentum beyond his current advantage. Put another way, because McCain has (recently) proven himself to be a strong and credible candidate, the model needs more evidence that Obama's "fiscal crisis"/debate bounce is genuine before it projects him as a bigger winner.

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What the regression does show is that the financial crisis has all but eliminated the GOP Convention/Palin pick bounce that McCain enjoyed. We have reverted to the early-August Obama lead. Undecided and "soft" voters have drifted back into the Obama column. And as many other pollsters have noted, Obama has re-taken a solid lead with Independents. There is a direct relationship between this and the collapse of the Palin/Maverick narrative--and this began way before the Couric interview. Thursday's debate will be an opportunity for the McCain campaign to re-engage with some of those voters, but Palin will have to have a strong night (see #4 below). Having said all of the above, there are still five weeks to go (a lifetime in political campaigns), so anything can happen. But the next few weeks (and debates) will be critical for the McCain campaign as it works to change the current narrative.

Up-to-the-Minute Analysis of the Environment

  1. McCain's gambit last week may yet pay off. The President spoke at 7:30 a.m. this morning. It is likely that the House will vote today to pass the amended version of the Administration's $700 billion plan. As it stands at 9:30 a.m. this morning, it appears that taxpayer protections have been built into the plan. It remains to be seen if McCain's interventionist actions taken last week will be seen as a political asset or a liability, but this morning's activities have improved his odds.

  2. There is every indication that this week may be just as financially painful as the last. This will be the only political conversation for the next 72 hours. If the economy is in crisis and it remains the dominant news story it continues to help Obama. And as of this writing the markets are experiencing big drops. So long as the financial crisis is front-and-center, McCain's ability to move the needle (i.e. improve his standing in the polls) will be at the margins.

  3. As we said above, Friday's debate was a draw and that translates into a win for Obama. We have said this several times before but it bears repeating: this election is really almost all about Obama. If the public decides he is an acceptable alternative--and a credible commander-in- chief--then he wins. Friday night was another step in that direction. Simply put, he passed the credibility test. Obama seemed reasonable, responsible and rational. The debate likely served to allay fears that some voters have with Obama. Other debate thoughts:

    • McCain was about as good as he can be. Our sense is that this might have been the best debate performance of the year for both candidates. McCain in particular seemed to steer the debate to talking points that best supported his candidacy (spending, earmarks, troop surge in Iraq).

    • Obama talked to McCain (and the camera) and McCain talked to the Ole Miss audience. It made Obama seem more natural while McCain came across as a bit awkward.

    • Obama telling his own bracelet story was awkward at best. Any time a candidate tries to one up another on their turf it almost always backfires. Obama should have let that one go.
  4. Thursday is the VP debate and it is time to let Sarah Palin be Sarah Palin. Our sense is that you have to let her sink or swim, so let her do a dozen interviews a day and just let it fly. We agree with Bill Kristol: it was a mistake to put her into this cocoon because it turns every interview into a white-knuckler. In doing so, you make her afraid to make a mistake, and her interviews get worse because of it.

  5. The financial crisis will move up the timetable on harsh comparative attack spots. They will wait until the financial crisis bill passes and the VP debate is over, but it is our sense that the McCain team will not let this thing drift too far before unleashing whatever "A" material they have in reserve. Hold on to your hat...because things are going to get wild.

LCG Electoral Vote Map

Below is our updated map. Obama's lead is widening basically everywhere, except PA and FL. He continues to maintain a lead in solid electoral votes.

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Based on recent state polling we have moved the following states:
  • New Mexico from toss-up to Obama

New Mexico is extremely problematic for Team McCain. While McCain appeared to have closed the gap in late July and early August, it now appears that Obama has opened up a seven-point lead based on an average of the last three state-wide polls. While it is unlikely that New Mexico will be decisive on November 4th, peeling away states like New Mexico could allow Obama to get to 270 electoral votes while winning only two of the heavyweight toss-ups of Ohio, Michigan, Virginia and Florida. The trend has to be disconcerting.

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