Bush battles to turn second term into reform legacy

Bush battles to turn second term into reform legacy
By Caroline Daniel
Published: January 30 2006 20:51 | Last updated: January 30 2006 20:51. Copyrighted by the Financial Times

President George W. Bush likes to say that his job is to confront big problems, not leave them to those who follow. As he prepares to deliver the State of the Union address he has been forced to tackle the issues bequeathed him by the man who has occupied the White House for the past five years: himself.

The sixth year of a two-term presidency is a critical time. It offers a last chance to shape the domestic political agenda and exploit the bully pulpit of moral leadership before attention is diverted to the succession battle. The approach of mid-term elections is making the opposition party unco-operative and the governing party timid and disinclined to embrace radical initiatives.

For Mr Bush, the chief constraints are managing the fall-out from his signature first-term policies. A combination of the Iraq war, the war on terror and his tax cut agenda have left him with a swelling budget deficit that limits his room for manoeuvre domestically. An already uncertain outlook for the economy grew cloudier still on Friday, when data showed the economy grew at 1.1 per cent in the fourth quarter, the slowest rate for three years.

“The president faces a unique challenge,” says Charlie Cook, editor of the Cook Political Report. “There is little new or different he can do about Iraq or energy costs. Iraq, Hurricane Katrina and healthcare costs are blowing the lid off the federal budget. There is no money left for any big bold programme and his party’s narrow majorities and scandals make getting anything big through Congress extremely difficult.

“Beyond looking for policy initiatives that cost little or no money, the president has to figure out how to tread water while making it look like he is doing the butterfly stroke.”

Such political calisthenics are not simply a contrast with the vaulting ambition of his first term: they are a direct result of it. In his first State of the Union in 2002, he declared that North Korea, Iran and Iraq “constitute an axis of evil, arming to threaten the peace of the world” and pledged both the largest increase in defence spending in two decades and a doubling of funding for homeland security.

A year later he solemnly prepared the nation for war against Iraq while also pursuing an adventurous domestic agenda: calling for tax cuts to be made permanent and for Medicare reform backed by an additional $400bn in spending. In 2004, an election year, constraints were more obvious but he still unveiled plans for immigration reform. In 2005, his boldness returned with a controversial pledge to overhaul Social Security, the state retirement system, by cutting future benefits and introducing private accounts.

Such flourishes are beyond him this year. As he scans the sea of congressmen and flashes a grin at the Supreme Court justices (including John Roberts, his own appointee) he will focus less on new adventures than on defending old decisions. Most important will be the need to stay the course in Iraq and a defence of how he has chosen to prosecute the war on terror.

Although officials shun comparisons with Bill Clinton’s second term, mocking Mr Bush’s predecessor as the “school uniform president” for small but symbolic wheezes, Mr Bush is expected to outline policies for health savings accounts, improving science and technology education, energy independence and more renewable fuels, and a new policy on nuclear fuel reprocessing: small-bore policies from a big-gun president.

This shift to a minor key is typical of second-term presidents. The sixth year of a presidency is tough – both Mr Clinton and Richard Nixon were impeached in theirs. Even those who avoid that fate are moving inexorably into lame-duck territory. “Second-term presidents typically don’t have much leverage with Congress. It is hard to think of any second-term State of the Union that led to a major shift in domestic policy,” says John Pitney, professor at Claremont McKenna College in California.

Second, the congressional and gubernatorial elections in November impose their own limits. “This is a president with a penchant for big institutional change issues, who is bumping up against Congress, [which wants] a narrower and play-it-safe agenda,” says Bruce Josten, vice-president for government affairs at the US Chamber of Commerce. “And then you overlay that with the congressional calendar. You could get below just 80 session days this year.”

The paralysed Republican leadership, which could not deliver Mr Bush’s agenda last year, will remain distracted by Washington’s current lobbying scandal. “[The president’s] problem is the other end of Pennsylvania Avenue. With all the focus on Bush’s approval ratings and Iraq, that is a bigger problem than anyone realises: the inability of the Republicans in Congress to do anything,” says Vin Weber, a Republican strategist.

As a result the president must deal with a mass of policies left over from 2005 before he can even think about staking out fresh ground. Mr Josten cites tax, the Patriot act, the pension bill and a massive new lobbying reform measure.

“We will start the real second session at the end of March or April,” he says, noting that, four months into the government’s fiscal year, Congress has yet to approve a modest package of spending and tax cuts left from last year.

Third, Mr Bush needs to rebuild his own credibility after his toughest year in office. His negligent handling of Hurricane Katrina, when he was slow to recognise the scale of the disaster, dented his image of managerial competence. As his poll numbers slumped to a low of 37 per cent in November – down from 57 per cent on re-election – a man who had once had a “shoot first, aim later” confidence had looked increasingly unhappy in his own skin. And presiding at dozens of town-hall meetings to sell social security reform made him look like a political Scrooge.

“They [White House advisers] know they still have to do more to raise and spend the president’s political capital,” says Tucker Eskew, a political consultant who worked for Mr Bush in the first term.

So the White House is attempting to present the lack of an expansive domestic reform agenda as a sign of fiscal frugality, in part to appease conservatives. An administration that has generally been slow to express contrition is admitting that mistakes were made in Iraq and that Mr Bush has to project realism about the pace of progress there.

“They have learnt from a difficult year and you saw that with the Iraq speeches. There is a risk of appearing rigid and he understands the bully pulpit has got to have wheels and he needs to be seen to be adjusting,” adds Mr Eskew. Crucial to the fightback plan is national security, which forms the core of the second-term agenda. Karl Rove, Mr Bush’s chief political adviser, has made clear that the strategy is to marginalise the Democrats by making them fight on territory where the Republicans have an advantage. He told the Republican National Committee last week that the two parties had fundamentally different perspectives on the issue. “Republicans have a post-9/11 view of the world and Democrats have a pre-9/11 view of the world. That doesn’t make them unpatriotic...but it does make them wrong, deeply and profoundly and consistently.”

Even what at first looked like a serious setback – the disclosure that the National Security Agency had spied inside the US without a warrant on those suspected of ties with al-Qaeda – has been seized on as ammunition by a White House confident that it is in tune with the American people on this point. Advisers have launched a communications offensive, aimed at depicting Mr Bush as America’s protector as well as burnishing his tarnished image as a strong leader, a commander-in- chief willing to make hard decisions.

“Revelations in the New York Times do not typically work to the administration’s advantage,” says Mr Pitney, “but this is proving to be an unexpected benefit. They are confident they can frame the issue in the way that helps them politically. Republicans have owned national security issues since Dwight Eisenhower in the 1950s.

The approach reinforces Mr Bush’s strongest suit: the war on terror. Asked if his policies on terrorism and national security had made America more secure, a Los Angeles Times/Bloomberg News poll last week found 52 per cent agreed and 21 per cent disagreed. Some 48 per cent approve of his handling of terror while 49 per cent disapprove – his highest rating on any issue.

But the strategy risks rejection by a public that wants the president to focus on domestic issues and a business community anxious to see him offer strong leadership on tax reform and other corporate concerns. The potential pitfalls were evident in the reaction to a speech this month by Andrew Card, chief of staff, to the US Chamber of Commerce.

Mr Card spent more than half the address discussing the war on terror. Not a single domestic initiative was mentioned. He closed by describing a picture that hangs in the office of Donald Rumsfeld, defence secretary. It is an old image of Uncle Sam, bearing the legend: “We are at war, what are you doing to help?” The intended crescendo elicited barely civil applause. It was left to Tom Donohue, Chamber president, to put a brave face on matters, thanking Mr Card for reminding them all of the “larger context”.

At a White House press conference last Thursday, however, Mr Bush’s body language proclaimed how comfortable he is on this terrain. There were no inappropriate smirks or verbal stumbles as he invoked his executive power to deny calls for the release of Hurricane Katrina-related White House documents and defended the NSA surveillance as lawful. “I think Bush wins this fight,” says William Kristol, editor of the conservative Weekly Standard.

But will it be enough? On almost every other issue his ratings are meagre. On Iraq, 41 per cent approve of his handling of the war, 56 per cent do not. On healthcare – now the highest priority for Americans after Iraq – he did even worse. Democrats were twice as trusted as Mr Bush. Only 27 per cent approved of his handling of the issue. On the economy, only 37 per cent approved of his performance. After a robust 10 quarters of growth, 47 per cent think the economy is worse than in 2001.

As Mr Bush’s advisers know, his legacy depends on the economy and events overseas. How he manages the gradual withdrawal of troops from Iraq this year will be one test. Another is Iran, where his resolve as commander-in-chief could soon be tested if Tehran begins full-scale uranium enrichment despite international pressure. The military is stretched. After a 40 per cent jump in defence spending since 2001, over the next five years the Pentagon faces cuts of $32bn.

Mr Kristol argues that the most critical part of the speech will be the passage on Iran. “People got caught up in the pseudo-apologies and new frankness. That doesn’t matter that much really when you have 140,000 troops fighting in Iraq and the most radical regime in the Middle East wanting nuclear weapons and there are new terrorist threats. Reality trumps optics . . . It is a very fluid and uncertain moment and Bush still has the chance to shape the agenda.”

Mr Bush’s actions in the last two months have helped stem the slide in his approval ratings. In his first term, he was able to defy conventional wisdom. The speech could help determine whether he will be able to do so in his second.

DEMOCRATS LAND PUNCHES BUT REMAIN DIVIDED

By Holly Yeager in Washington

When Democratic leaders tapped Timothy Kaine, the new governor of Virginia, to deliver their party’s response to the State of the Union address, the choice seemed to make good sense.

Elected last November in a Republican-leaning state, Mr Kaine is a fiscal conservative who is comfortable talking about his Roman Catholic faith – just the kind of image many Democrats think they need to project if they are to take back power in Washington.

But Mr Kaine’s selection provoked an angry backlash in some liberal circles, with activists and bloggers crying out for someone who would present a tougher critique of President George W. Bush, especially on the Iraq war.

“This is the Democrats’ only opportunity to face off directly with Bush on national TV and they are going to blow it!” read one blog post. Why give such a platform to a governor without a voice on foreign policy, they asked, when John Murtha, a leading Democrat on defence issues who has called for an immediate withdrawal from Iraq, was available?

That dust-up illustrates the current strains within the Democratic party, in which centrists such as Mr Kaine are clashing with others who want to stick to the party’s more traditional positions. Those tensions help explain why Democrats have failed to put forward a detailed agenda, in spite of promises to offer a unified campaign manifesto akin to the Contract with America that helped Republicans take control of the House of Representatives in 1994.

A similar dynamic can be seen in Democrats’ stance toward Mr Bush’s nomination of Judge Samuel Alito to the Supreme Court. While leading Democrats fear he would curtail abortion rights and expand the power of the presidency – and vowed to vote against him when his nomination goes to the Senate floor today – they decided against more aggressive moves to block him, worried that they would be seen as obstructionist.

But late last week, John Kerry, the 2004 presidential candidate who is weighing another run in 2008, heeded the call of liberal activists and promised to try to filibuster the nomination. Keen not to be outflanked on her left, Hillary Clinton, the frontrunner among potential Democratic presidential candidates, quickly said she would support Mr Kerry’s move.

In a week-long series of “pre-buttals” to the president’s address, top Democrats have attacked the Bush administration on a wide range of issues, including the conduct of the war, homeland security, healthcare, energy costs and the economy, while calling for fresh attention to education and national competitiveness.

Democrats may have some time to spare before they are required to get more specific. Newt Gingrich’s Contract with America was issued far closer to election day, and Democrats have been scoring well with their current tactic of linking a series of recent scandals to what they call a Republican “culture of corruption”.

A Los Angeles Times/Bloomberg poll last week found that 47 per cent would vote for a Democratic candidate for Congress if elections were held today, while 35 per cent would vote for a Republican. As long as the Republican scandals are in the news, says Stuart Rothenberg, editor of a Washington politics newsletter, it makes sense for Democrats to keep them as the focus of their 2006 campaign rhetoric.

Republicans have begun to counter-attack, trying to paint their opponents as a party without an agenda. But, in spite of their efforts, there is a growing sense that victory in November could be within the Democrats’ reach. This week’s edition of National Journal, a Washington magazine, depicts Mr Reid and Nancy Pelosi, the Senate and House minority leaders, as the new king and queen of Capitol Hill. The cover story’s title: “What If?”

‘THE CIVILISED WORLD FACES UNPRECEDENTED DANGERS’

State of the Union speeches usually lack the sweeping rhetoric of inaugurals and descend into a shopping list of ambition, policy initiatives and political platitudes designed to lever the watching congressmen to their feet as often as possible, writes Caroline Daniel. Vin Weber, a Republican strategist, observes: “There are memorable lines from these speeches, but not memorable speeches.”

President George W. Bush’s memorable lines have been more consequential than those of many presidents, from setting out the case for war in Iraq to grand plans to overhaul pensions. Here are a few:

2002

“Our goal is to prevent regimes that sponsor terror from threatening America or our friends and allies with weapons of mass destruction.” North Korea, Iran and Iraq “constitute an axis of evil, arming to threaten the peace of the world”.

“My budget includes the largest increase in defence spending in two decades because, while the price of freedom and security is high, it is never too high . . . my budget nearly doubles funding for a sustained strategy for homeland security.”

“As we gather tonight, our nation is at war, our economy is in recession and the civilised world faces unprecedented dangers.”

2003

“Today the gravest danger facing America and the world is outlaw regimes that seek to possess nuclear, chemical and biological weapons . . . Tonight I have a message for the brave and oppressed people of Iraq. Your enemy is not surrounding your country. Your enemy is ruling your country . . . If Saddam Hussein does not fully disarm, for the safety of our people and for the peace of the world, we will lead a coalition to disarm him.”

Said with a somewhat sinister chuckle while highlighting success in targeting al-Qaeda’s leadership: “Many others have met a different fate. Let’s put it this way – they are no longer a problem to the US.”

“Healthcare reform must begin with Medicare. My budget will commit an additional $400bn over the next decade to reform and strengthen Medicare.”

2004

“Key provisions of the Patriot Act are set to expire next year. The terrorist threat will not expire on that schedule . . . You need to renew the Patriot Act.”

“Having broken the Ba’athist regime, we face a remnant of violent Saddam supporters . . .  these killers joined by foreign terrorists are a serious and continuing danger. Yet we are making progress against them. The once all-powerful ruler of Iraq was found in a hole and now sits in a prison cell.”

2005

“One of America’s most important institutions – a symbol of trust between generations – is also in need of wise and effective reform. Social Security was a great moral success of the 20th century and we must honour its great purposes in this new century. This system, on its current path, is headed towards bankruptcy.”

“America’s immigration system is outdated, unsuited to the needs of our economy and to the values of our country.”