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First Thoughts: The Hangover

Back to work … Who has leverage on debt ceiling – and who’s winning? … David Brooks’ Fourth of July gift to the White House … 100,000 jobs expected in Friday’s jobs report … Romney, Huntsman meet in New Hampshire … So do Bachmann, Gingrich … Pawlenty claims victory in Minnesota shutdown fight … Iowans show pragmatic streak … Romney’s full flop … GOP presidential hopefuls won’t get to Obama’s low estimate of $60 million… RGA raises $22.1 million … Romney, Huntsman back in Granite State … Santorum kicks off jobs tour in Iowa.

*** The Hangover: This was supposed to be one of those slow vacation weeks (or in Congress-speak -- "district work period"), but no such luck. The deadlocked debt-ceiling talks have made it important politically for anyone involved in these talks to show up for work. So, no golf for President Obama over the weekend, though he was at Camp David; no recess for the Senate this week, though the first thing it’s taking up is the Kerry-McCain Libya resolution NOT the debt ceiling. So, now what? The "now what" is a question that has haunted many a group of lawmakers. Think back to the founding of the country. It’s a question that took the founding fathers more than a decade to figure out, by the way. (See Confederation, Articles of). But we digress...

*** Who’s got the leverage? So who's got the leverage in the debt-limit talks? Leverage depends on who the negotiators are answering to. For instance, the White House believes it has the most leverage because swing voters and independent voters simply want a deal done. They are exhausted from the Washington political games, the gridlock, the inability to solve problems. (By the way, this Congress is on pace to be one of the least productive in history.) GOP leaders think THEY have the leverage, because there are NO cracks in the base and they have their own polling showing that, while independents are turned off by the process, they do NOT want taxes raised and want to see government cut. Bottom line: Republicans believe that on the SUBSTANCE, the middle is with them (if they sell it properly), even if on PROCESS, the middle might be more on the side of the president. (Of course, there's a reason the president uses the phrase "balanced approach" all the time; it's their argument on substance). President Obama is expected to engage in talks Wednesday either on Capitol Hill or at the White House, but will it be with Republican leaders as well? That's in question.

*** Victory is in the eye of the voter: It also looks like Republicans don’t want to hand President Obama something that looks like a victory, in a presidential election cycle; that would cause the base to erupt even more than a perceived tax hike. The GOP, though, can already be granted a measure of victory for dictating the terms of the debate – all about spending cuts. But will that be enough for the base? Senate Republicans are open to the idea of a short-term deal (something really no one wants) with some revenue raisers, like eliminating ethanol subsidies. But House Republicans don’t want more than one vote before the end of 2012 and know they have dwindling capital with their Tea Party freshmen. 

*** ‘A normal conservative party or an odd protest movement’?: The voice of the center-right, David Brooks, gives the White House some cover today, noting that the GOP should take a deal that is “trillions of dollars in spending cuts in exchange for a few hundred million dollars of revenue increases” or the party risks overplaying its hand. He calls it the “mother of all no brainers.” And he adds, “A normal Republican Party would seize the opportunity….” But: “The Republican Party may no longer be a normal party. … The struggles of the next few weeks are about what sort of party the G.O.P. is -- a normal conservative party or an odd protest movement that has separated itself from normal governance, the normal rules of evidence and the ancient habits of our nation.” Expect the White House to be doing a lot of Brooks-channeling over the next few days. It could be, after months of angst with Brooks, that the president's favorite non-liberal columnist is back on the West Wing's "must read list."

*** Economic hangover? The biggest news that comes out of this week, though, might be Friday’s coming jobs report. Though Wall Street had “its best weekly performance in nearly two years” last week, CNBC’s Domm writes, Friday’s report is “expected to show that just 100,000 new jobs were added for the month.” Mark Zandi of Moody’s says anything under 200,000 would be “subpar,” but he expects hiring to pick up by September or October provided gas prices don’t tick up and the debt-ceiling is raised. And Obama’s summer of discontent continues, as he didn’t get any support from Frank Rich, who wrote, that the economy still haunts him, but mostly because of, he says, “the stunning lack of accountability” for Wall Street. But question: Does anyone seriously think that economics that are even further to the left than Obama’s position will benefit him politically? And, yes, there was ANOTHER oil spill. This one an Exxon spill in Montana in the Yellowstone River.

*** While you were eating burgers and hot dogs… : Republican presidential hopefuls were campaigning in early states and marching in patriotic parades. Jon Huntsman and Mitt Romney were in the same parade in New Hampshire. Romney broke the ice and said hello. Romney, who has a home in the Granite State (and leads in the polls) welcomed Huntsman to the state. He said New Hampshire must be nicer than Beijing. Huntsman responded, “The air is breathable.” Michele Bachmann and Newt Gingrich were also in the same parade. And the enthusiasm gap was clear between the two candidates. Bachmann was seen sprinting along the route and had a campaign bus with her. Gingrich was there with a smaller “entourage,” as the New York Times put it and a teal Thunderbird convertible with Florida plates. And Tim Pawlenty is up in Iowa with an ad, claiming he “won” because the Minnesota government shut down when he was governor. That government is shut down again because Republicans and Democrats couldn’t agree on a deal to cut spending and raise taxes. Sound familiar?

*** Iowans’ pragmatism over purity: A poll out of Iowa for the IowaRepublican.com finds that Iowa GOP caucusgoers overwhelmingly want someone who can beat Obama (61%) vs. someone is closest to their views (32%). “The survey finds that the desire to beat the president is greater with fiscal conservatives than it is with social conservatives.  However, even among social conservatives, which we defined as being those who mentioned social issues as their top voting issues, 53 percent feel it is more important to beat the president, while 40 percent feel it is more important to support a candidate that they agree with on the issues,” writes Craig Robinson, former political director for the Iowa GOP. And it throws some cold water on the notion that Iowans need candidates to do lots of retail campaigning in order to vote for them. “That finding may seem to indicate that Romney’s decision to down play the Iowa Caucuses could work,” Robinson writes. “The poll clearly indicates that a frontrunner like Romney would appeal to voters in Iowa if electability is the top priority.”

*** Romney’s full flop: Mitt Romney at the most recent GOP debate said President Obama made the economy “worse;” In New Hampshire last week, he said of Obama, “He did not cause this recession, but he made it worse.” But then, answering a question from NBC’s Sue Kroll, who ticked off several positive items about the economy, including expansion of the gross-domestic product and the improved stock market (as well as mentioning the negative news of a lagging unemployment number), Romney said, “I didn't say that things are worse.” And then by the weekend, the GOP presidential front runner reverted back to his original form: “Our president has failed us,” NBC’s Matt Loffman reports. “The recession is deeper because of our president.” Technically, the recession’s been over for a while now.

*** These don’t go to $60 million: If you ADD UP all of what the Republicans will raise in this quarter, it won’t get to the low-ball $60 million estimate that President Obama is expected to raise. To recap what we know so far: Romney will raise $20 million (less than he raised in the first quarter in 2007), Ron Paul $4.5 million, Pawlenty $4.2 million, Huntsman $4.1 million, Herman Cain $2.5 million. That’s just $35.3 million. So unless Bachmann, Gingrich, Santorum, et al, are able to raise $24.7. million between them they won’t get to $60 million. And that’s not going to happen. The GOP total will be far smaller total than the top three were able to raise in 2007, when Romney, Rudy Giuliani, and John McCain, were able to raise $53 million between them. Gingrich, by the way, will be in debt. “Our numbers will not be as good as we would like, and candidly, the consultants left us in debt,” he said in Iowa, per the Los Angeles Times.

*** RGA raises $22.1 million: The Republican Governors Association announced it has raised $22.1 million, more than it raised in all of 2007. After retiring a $3 million debt from 2010, the RGA has $16.2 million cash on hand vs. $8.1 million cash on hand from 2007. The Democratic Governors Association has not put out its numbers yet.

*** On the trail: Huntsman and Romney are in New Hampshire … Santorum appears on several morning shows to kick off his “Courage to Fight for American Jobs” tour, which begins today in Iowa.

Countdown to Iowa GOP straw poll: 39 days
Countdown to NV-2 special election: 70 days
Countdown to Election Day 2011: 126 days
Countdown to the Iowa caucuses: 216 days
* Note: When the IA caucuses take place depends on whether other states move up

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