Is McCain More the Populist than Obama?

Is John McCain out-populisting Barack Obama?

On Friday morning, McCain, at a rally in Green Bay, Wisconsin,
delivered a speech on the financial crisis. He tore into Wall Street
and Washington, proclaiming, "The crisis on Wall Street started in the
Washington culture of lobbying and influence peddling." And he named
names. He blasted Freddie Mac and Fannie Mae:

These quasi-public corporations led our housing system down
a path where quick profit was placed before sound finance. They
institutionalized a system that rewarded forcing mortgages on people
who couldn't afford them, while turning around and selling those bad
mortgages to the banks that are now going bankrupt. Using money and
influence, they prevented reforms that would have curbed their power
and limited their ability to damage our economy.

McCain noted that years ago he had tried to reform these institutions and had run smack into Washington's same-old/same-old:

At the center of the problem were the lobbyists,
politicians, and bureaucrats who succeeded in persuading Congress and
the administration to ignore the festering problems at Fannie Mae and
Freddie Mac.

Moreover, McCain accused Obama of having been pals with Freddie and
Fannie. Obama, McCain pointed out, has taken large amounts of campaign
contributions (a total of $165,400) from donors associated with the two
institutions. In addition, Obama put a former Fannie CEO, Jim Johnson,
in charge of his vice presidential search committee. McCain also
charged that Obama has been receiving policy advice from Franklin
Raines, another former Fannie CEO. The Obama camp says Raines is no
adviser to Obama and that earlier this week Raines sent an email to
Carly Fiorina, a McCain adviser, informing her of this. Still, McCain
declared:

Senator Obama may be taking their advice and he may be
taking their money, but in a McCain-Palin administration, there will be
no seat for these people at the policy-making table. They won't even
get past the front gate at the White House. My friends, this is the
problem with Washington. People like Senator Obama have been too busy
gaming the system and haven't ever done a thing to actually challenge
the system.

McCain went on to propose a Mortgage and Financial Institutions
trust that will work with troubled companies and institutions to help
them avoid collapse. He called for greater transparency and better
regulation regarding financial markets. "Many in the financial services
industry also either forgot or neglected their duty to act ethically
and honorably," he said. "This shortcoming was aided and abetted by the
creation of financial instruments that allowed lenders to escape any
responsibility for the risk of their loans."

Forget for a moment all of McCain's connections to the current
crisis. (He seems to do so easily enough.) Forget that his pal and
adviser Phil Gramm helped create this mess. That his top advisers and campaign staffers lobbied for Fannie Mae and Freddie Mac. And that over 80 lobbyists
for top financial industry firms--including AIG, Lehman Brothers,
Merrill Lynch, and Washington Mutual--have worked for McCain's
campaign. McCain is showing anger, vowing to knock heads together (on
Wall Street and Washington), and, by the way, tying Obama to the mess.
McCain is no William Jennings Bryan. But for a Republican, he's coming
on like a populist gangbuster. Given his track record as a deregulator, this is faux populism. But that doesn't mean it can't work politically.

Let's look at Obama's response. The other day, his campaign released a two-minute ad in which Obama sits in a generic living room (in front of a generic couch and a generic lamp). In a calm tone, he notes,

Wall Street's been rocked as banks closed and markets
tumbled...This isn't just a string of bad luck. The truth is as you
have been living up to your responsibilities, Washington has not.
That's why we need change...This is no ordinary time.....Much of this
campaign has been consumed by petty attacks and distractions that have
nothing to do with you.

Obama then proposes a $1000 tax break for the middle class ("instead
of showering more on oil companies"), putting an end to the "anything
goes culture on Wall Street with real regulation," fast-tracking a plan
for "made-in-America" energy, instituting a "crack down on lobbyists
once and for all so that their backroom dealing no longer crowds out
the voices of the middle class," and bringing a responsible end to the
Iraq war.

There's not much passion or outrage expressed. Obama asks viewers to
visit his website for details of his economic plan. But following the
link led to a page that contained nothing about lobbyists, the culture
of Washington, or regulating Wall Street. The plan was a package of his
core economic proposals: that middle-class tax cut, energy rebates, a
fair trade initiative, green jobs, cracking down on mortgage fraud and
predatory lending.

At the end of the ad, Obama says, "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."

Obama's approach is cerebral--a term not often well received within
political circles. In the ad, he does not directly connect to and tap
into the frustration or anxiety of voters. His message: let's rise
above our politics and solve this thing together. There's not much talk
of punishment or consequences for those who messed up. And there's no
slap at McCain, George W. Bush, or the Republicans for leading the
system that failed. (The McCain camp has produced a television ad
assailing Obama for his tie to Jim Johnson, and another for his
purported--but denied--connection to Franklin Raines.)

On the campaign trail, Obama has been more pugilistic. At a campaign
rally on Thursday, he slapped McCain for his recent comment that "the
fundamentals of our economy are strong." And he assailed McCain for
holding "the same philosophy" as George W. Bush "that says we should
give more and more money to those with the most and hope that
prosperity trickles down...that says even common-sense regulations are
unnecessary and unwise...that lets Washington lobbyists shred consumer
protections and distort our economy." Obama noted that "Phil Gramm, one
of the architects of the de-regulation in Washington that led directly
to this mess on Wall Street, is also the architect of John McCain's
economic plan." He pointed out that McCain "took seven of the biggest
lobbyists in Washington from that [old-boy] network and put them in
charge" of his campaign. Obama derided McCain's call for a commission
to review the financial crisis, and he called McCain out on his
late-to-the-party proposal for better regulation of financial markets.

Obama went after McCain's hypocrisy. (And an ad the campaign
released ton Friday morning blasted McCain for relying on the policy
advice of Gramm and Fiorina, who received a $42 million package after
being fired as Hewlett-Packard CEO.) He did not, though, direct much
anger at the financial players and their Washington pals who recklessly
steered the US economy into a ditch. Obama must be careful not to come
across as an angry black man. But he still needs to show some gut-level
outrage: not only at McCain and his lobbyist friends but against all
the Big Finance screw-ups who got rich on Wall Street while placing the
economy in peril.

Right now, McCain is keeping up--if not ahead of--Obama in
displaying fury concerning the ongoing economic meltdown. And he's also
playing even when it comes to proposing policy responses to the crisis
at hand. But it sure takes chutzpah--and selective amnesia--for McCain
to position himself as the enraged scourge of Wall Street
greed-meisters and Washington influence-peddlers. After his speech on
Friday morning, a New York Daily News reporter blogged,
"Our jaw dropped just now listening to McCain blame lobbyists and Obama
advisers. Just consider that McCain advisers (chief among them Phil
Gramm) wrote the laws that deregulated these markets and lobbied hard
to keep scrutiny to a minimum."

But McCain's campaign has already signaled it doesn't give a damn
about its reviews in the press. Reality doesn't matter; impressions do.
And McCain is trying to create the impression he is indeed a
mad-as-hell populist maverick and reformer. Obama cannot stop the
McCain camp from attempting this extreme makeover. He can only control
his own reaction to the crisis. But it would pose trouble for the
Democrats if Obama's response leaves any opening for McCain the
Populist to stomp through.