The implosion of Wall Street last week resulted in a near-death crisis for John McCain's presidential campaign. His post-Palin bump eviscerated, McCain was staggered by the re-emergence of the economy as the dominant issue in the 2008 election. His daily-changing positions revealed that McCain, a man who has repeatedly admitted his ignorance of economics, is struggling to cope with his diminished presidential prospects. Armchair psychologists might call the process John McCain's five stages of grief over the economy.
Denial. McCain's refusal to confront the realities of the failing Bush economy has long roots and was again on display last Monday. McCain, who has frequently described the economic slowdown as "psychological," for at least the 18th time proclaimed the "fundamentals of our economy are strong." As the Dow plummeted over 500 points, McCain reacted to the white-hot crisis on Wall Street by comically announcing his support for a 9/11-style commission to study the causes of and make recommendations to address the meltdown. Willing to kick the can down the road with his since forgotten 9/11 panel idea, McCain also took a head-in-the-sand position in opposing the government rescue of teetering insurance giant AIG:
"We cannot have the taxpayers bail out AIG or anybody else."
Anger. Sadly, McCain's denial of the obvious produced an immediate backlash from the press and the public alike. Literally within hours last Monday, McCain reversed course on the underlying strength of the American economy and declared the fundamentals of the economy to be "at great risk."
Then John McCain did what he does best - he got mad.
(Unsurprisingly, McCain also launched a furious tirade in response to accusations 20 years ago about his Keating Five role during the last U.S. financial catastrophe.) Redefining "economic fundamentals" to refer the U.S. work force, McCain blasted his "opponents" for slandering American workers. By mid-week, McCain found a convenient - if unconstitutional - target for his rage, SEC chairman Chris Cox.
Bargaining. His response mocked as incoherent at best, McCain then proceeded to the third textbook phase of grief over the economy: bargaining. As the Kubler-Ross model describes the bargaining stage, "Now the grieving person may make bargains with God, asking, 'If I do this, will you take away the loss?'"
So, fast and furious, McCain started to bargain. Acknowledging that as President he couldn't fire the SEC's Cox, McCain instead called for his resignation. (This morning, McCain cynically offered up New York Democrat Andrew Cuomo as a replacement.) Within 24 hours, he changed his tune on AIG, now supporting the bail-out package he opposed just the day before:
"The government was forced to commit $85 billion...The focus of any such action should be to protect the millions of Americans who hold insurance policies, retirement plans and other accounts with AIG."
And to be sure, McCain bargained economic surrogate and serial embarrassment Carly Fiorina right out of his campaign. When the details of her massive $42 million severance package from HP became public, the woman who deemed McCain incapable of running a company found herself on the sidelines.
Depression. By last Thursday, a pall of gloom hung over McCain as he entered the fourth stage of grieving, depression. In a move that could only draw attention to his own checkered past in the savings and loan scandal of the 1980's, McCain meekly proposed the creation of a Mortgage and Financial Institutions (MFI) trust to help the failing firms of Wall Street fend off insolvency. Ironically, McCain had repeatedly opposed the Resolution Trust Corporation in the past, an institution that ultimately poured $400 billion into bailing out the S&L's, including the $3 billion lost by McCain sugar daddy Charles Keating's Lincoln Financial.
That same day, McCain tried to fight back, but his heart wasn't in it. In a foreboding ad fraught with racial overtones, McCain tried to link Obama with former Fannie Mae chairman Franklin Raines. While the Washington Post quickly debunked the spot by noting that Raines is not an adviser to the Obama campaign, Time suggested McCain was playing the race card.
Acceptance. By today, it was clear that John McCain had reached the fifth and final stage of grieving over the economic issue. Just one week after proclaiming the "fundamentals of our economy are strong," McCain said on the Today Show this morning:
"We are in the most serious crisis since World War II."
That clarity is letting McCain do what McCain does best - attack. In a cynical attempt at misdirection the Politico's Jonathan Martin deemed "tossing more chum overboard," the McCain campaign aired a new ad once again trying to connect Barack Obama to Chicago dealmaker Tony Rezko. And on Sunday, McCain ignored his own week of dizzying incoherence on the economy and thundered at Obama:
"At a time of crisis, when leadership is needed, Senator Obama has simply not provided it."
Apparently, John McCain's new-found acceptance of the dismal state of the economy lets him rage against the Obama machine without embarrassment. After all, McCain's transition manager William Timmons was a lobbyist for Fannie Mae and Freddie Mac. This morning, the New York Times revealed that McCain's campaign manager Rick Davis pocketed $2 million in lobbying fees from the failed home mortgage giants. And on Sunday, McCain refused to rule out that his adviser and UBS vice chairman Phil Gramm, of "nation of whiners" fame and himself a possible bailout recipient, as Treasury Secretary in a McCain-Palin administration.
To be sure, watching John McCain wrestle with his demons - and ignorance - over the troubled economy has been painful to watch. As crypto-conservative columnist George Will put it:
"John McCain showed his personality this week and made some of us fearful."
But with his 11 houses and 13 cars, John McCain can afford to work through his cognitive breakdown over the state of the broken economy. Unfortunately, the rest of us can't. While Americans are mourning the loss of their homes and savings, John McCain is apparently grieving over his potential loss of the White House.
(This piece was crossposted from Perrspectives.)
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