by Tim Alberta
As the clerk tallied the votes, GOP congressman Fred Upton of Michigan stood in the back of the chamber, phone to his ear, announcing to colleagues that the Dow Jones Industrial Average was plummeting. “Two hundred points . . . three hundred points . . . five hundred points . . . seven hundred points.”
Boehner, watching the markets on a television in the cloakroom, said a prayer. McHenry, the feisty young conservative who’d voted against the bill, approached Upton and felt a wave of nausea. “I was a hard-core no,” he says, “but as I listened to Fred, this sinking feeling came over me.”
Back at the White House, Bush looked for the positives. “Hopefully,” he told a pair of staffers, “this will scare some people straight.”
It did and it didn’t. A number of on-the-fence Republicans were sufficiently spooked to back the next version of the bill, no matter what it included. But for many on the right, the vote was cathartic. After failing for eight years to break the GOP’s addiction to big government, conservatives had defied their party’s president and its congressional leadership on the most urgent legislation in modern American history.
It had been a long time coming. Jim DeMint, the conservative South Carolina senator, had pledged to be a “team player” when he jumped from the House to the Senate, working on behalf of the party’s senatorial committee to raise money for upcoming elections. But by the summer of 2008, his feuds with the establishment having escalated, DeMint broke away and started his own group, the Senate Conservatives Fund, meant to recruit and support conservatives who could restore the party’s credibility. “The basic Republican platform of limited government was not evident in any of the things we were doing,” DeMint recalls. “It just felt like Republicans had nothing to run on anymore.”
A parallel sense of revolution was percolating in the lower chamber. As the White House scrambled to make recommended changes to the package, with Bolten taking over for Paulson as the point man on passing TARP, House conservatives called an emergency meeting in the Budget Committee’s hearing room. On one side, Wisconsin congressman Paul Ryan and another conservative favorite, Kevin Brady of Texas, implored their colleagues to reconsider. They argued that $700 billion was nothing compared to the cleanup that would be necessary if hundreds of thousands of people lost their jobs overnight.
But Ryan and Brady were outnumbered. A murderer’s row of House conservatives—Mike Pence of Indiana, Jeff Flake of Arizona, Jim Jordan of Ohio, and Jeb Hensarling of Texas—argued that free-market principles meant nothing if they could be jettisoned at the first sign of crisis. “The question is, are we Republicans or are we conservatives?” Hensarling asked the group.
“We’re Americans,” Ryan replied angrily, “And if we don’t do something, this economy is going to crash.” In truth, Ryan feared not just the crash itself. If Democrats wiped out Republicans that November, with the economy in ruins, he warned his comrades, “this will be FDR on steroids. It’ll be another New Deal, run through Alinsky in Chicago,” he said, referring to the legendary community organizer and left-wing boogeyman Saul Alinsky.
Ultimately, a revised bill passed both chambers a few days later and was signed into law. The bleeding stopped. The financial sector steadied. The program, by any objective metric, worked. But the political repercussions suggested otherwise. Institutional mistrust and class divisions were exploding in real time; Republicans who backed TARP would be punished, while those who rejected it benefited.
“Not enough of our members bought into the gravity of the situation—and they were rewarded for not buying into it,” says Eric Cantor, the House GOP’s chief deputy whip, who struggled to secure the votes needed to pass TARP. “That mentality would come back to haunt us.”
A decade later, Flake, who touted his TARP opposition while jumping from the House to the Senate in 2012, is the only such Republican to express regret for how he voted in September 2008. “In the House, it’s much easier to vote no and hope yes,” he explains. “When you’re one of 435, it’s easier to cast an ideological vote and force someone else to carry your water. But it’s irresponsible. When I got to the Senate, I decided I couldn’t do that anymore.”
TARP is quite possibly the most successful government program of its generation. All the money was paid back, with interest, and experts believe that the intervention almost certainly staved off a Depression-like catastrophe.17 But the entire episode was scarring for millions of Americans who became convinced that Washington and Wall Street were playing by a different set of rules; that the economy was rigged against them; that professional politicians had sold them out.
“McCain came back to bail out the banks. He had a chance. I was hoping he wouldn’t vote for it,” says Jordan. “That was when the populist sentiment started to take root around the country. I think that was probably laying the groundwork for what happened in 2016.”
THE FINAL MONTH OF THE CAMPAIGN WAS ANTICLIMACTIC. THOUGH the financial rescue package had finally passed, the Republican Party’s management of the affair had hardly inspired confidence. After a second term plagued by volatility, it was yet another crisis on the GOP’s watch. This, combined with his own economic amateurism and his running mate’s slow-motion implosion, was too much for McCain to overcome.
The candidate came to peace with this. But many Republicans could not.
Palin thrashed wildly in the campaign’s final weeks. She alleged that Obama was “palling around with terrorists.” She also invoked his former pastor, Rev. Jeremiah Wright, whose controversial sermons at a black church McCain had declared out-of-bounds for criticism, determined that, win or lose, he would not be remembered for injecting race into the contest.
Several of McCain’s top aides spent the home stretch bad-mouthing Palin to the press, attempting to pin the imminent defeat on her. Steve Schmidt, the senior strategist who had insisted on picking Palin (and who, ten years later, would announce his departure from the Republican Party due to Trump’s takeover) suffered what friends described as a nervous breakdown and left the campaign for three weeks in October, returning just before the election to begin shoveling blame onto Palin.
On Hannity’s Fox News show, a guest described the nature of Obama’s community organizing work in Chicago as “training for a radical overthrow of the government.” In battleground Pennsylvania, Bill Platt, chairman of the Lehigh County GOP, warmed up a McCain rally by mentioning how Obama didn’t wear an American flag lapel pin. “Think about how you’ll feel on November 5 if you wake up in the morning and see the news that Barack Obama—Barack Hussein Obama—is the president-elect of the United States of America,” Platt warned.18
McCain’s closing argument—“Who is the real Barack Obama?”—aimed to contrast the Democratic senator’s ultraliberal voting record with his centrist rhetoric. Obama promised to deliver comprehensive immigration reform, for instance, but the Illinois senator had helped torpedo the McCain/Kennedy effort by supporting a “poison pill” labor amendment. Obama railed against money in politics, but he became the first presidential nominee ever to reject public financing for his campaign, reversing an earlier pledge and triggering an avalanche of outside spending.19 Even Obama’s opposition to same-sex marriage, Republicans felt, was insincere, aimed at mollifying white moderates and black churchgoers.
Yet more than drawing attention to these issues, McCain’s approach was unwittingly successful in eliciting ugly responses from the right. Shouts of “terrorist!” echoed at Republican events nationwide. Conservative websites exploded with last-minute allegations that Obama had been born overseas; that he was a Muslim; that he was a Manchurian candidate. Rock bottom was reached at an October 10 rally in Minnesota, where McCain was repeatedly booed for telling his town hall audience that they should not be scared of Obama. At one point, a woman named Gayle Quinnell stood to speak. “I can’t trust Obama,” she told McCain. “I have read about him and he’s not . . . he’s not . . . he’s an Arab.”
McCain shook his head and took the microphone from her
hands. “No, ma’am,” he replied. “He’s a decent family man, citizen, that I just happen to have disagreements with on fundamental issues. And that’s what this campaign is all about.”
Watching the news coverage with Obama and their team at Chicago headquarters, Axelrod says he was stunned—not at McCain’s honorable defense of his opponent, but at the reactions to it. “I remember when John McCain was the ‘it’ guy among the young Reaganite class in Congress,” Axelrod says. “To see him shouted down at his own rally for showing a modicum of civility, I just said out loud, ‘My God, I’ve never seen anything like this.’”
Obama brought out the worst in the Republican base. The seeds of anger and resentment, of nativism and victimization, were sown by forces outside his control long before his ascent. But he harvested them in a way no other Democrat could. The succession of liberal policies; the ostensive shaming of patriotism (“I believe in American exceptionalism, just as I suspect that the Brits believe in British exceptionalism and the Greeks believe in Greek exceptionalism”); the imperiously lecturing tone; the hints of class condescension (“They cling to guns or religion”); perhaps most critically, the dark skin and the African roots and the exotic name—any of these elements, on their own, might not have been so provocative. But in this era of convulsion and cultural dislocation, Obama was a perfect villain for the forgotten masses of flyover country.
DAYS BEFORE THE ELECTION, RICH BEESON, THE REPUBLICAN NATIONAL Committee’s political director, told a pair of junior staffers that they were about to witness history. The youngsters perked up, having heard nothing but doom and gloom for the past month with regard to their party’s prospects. “The way we lose this election,” Beeson told them, “is going to be historic.”
Barack Obama won the presidency in a landslide, carrying the Electoral College by a margin of 365 to 173 and winning the popular vote by nearly ten million—the biggest spread since Ronald Reagan’s forty-nine state reelection romp in 1984. There was no silver lining for the GOP: Democrats expanded their majorities in both houses of Congress, giving the incoming president and his party unified control of the government and a mandate to make wholesale changes to Washington and the rest of the nation.
More concerning for Republicans than the scope of Obama’s victory were the fundamentals behind it: The Democratic nominee had turned out huge numbers of minorities, young voters, and women with college degrees. This “coalition of the ascendant,” as journalist Ron Brownstein described it, represented the fastest-growing segments of an electorate undergoing a rapid, far-reaching makeover. While McCain captured 57 percent of white men and 55 percent of whites overall, he won just 43 percent of women, 31 percent of Hispanics, and 32 percent of voters under age thirty.
The implications were chilling. Republicans weren’t just heading into political hibernation; they were at risk of entering a demographic death spiral. “Things looked pretty bleak,” Boehner recalls. “You’ve got this young, dynamic African American who rebuilt the Democratic Party in one fell swoop. There was no way out. We were going to be in the minority for one hell of a long time.”
The morning after Obama’s victory, a senior RNC official handed down orders to his communications staff. They were to plant a story in the media about grassroots support for a new party chairman, a black Republican by the name of Michael Steele.
AS THE NEW PRESIDENT PREPARED TO TAKE OFFICE, REPUBLICANS faced a moment of reckoning. For the past generation, the party had promoted a set of principles colloquially described as a “three-legged stool”: fiscal responsibility, social conservatism, and strong national defense. Sifting through the wreckage of 2008, they found that the stool had collapsed. Republicans had spent recklessly while exposing their military’s limitations after fighting a two-front war for the better part of a decade.
Only the social conservatism had been strictly adhered to, and even within that foundational conception, cracks were showing. The Bush administration’s effort to pass a constitutional amendment banning same-sex marriage, for instance, had rankled many in the Republican professional class. This foretold of the growing disconnect between the party’s elite and its base on many other issues that transcended the divide between secularists and religious voters. Whereas the questions of immigration, trade, and entitlement spending were understood by upscale, white-collar Republican moderates through a prism of macroeconomics, they were processed by the party’s working-class conservatives through a filter of societal insecurity.
The GOP had once been a country club party, drawing its life force from the discipleship of affluent suburbanites. But that was changing. As America’s wealthier, better-educated voters grew more progressive in their social views, they had begun drifting into the Democrats’ column. At the same time, the Democratic Party’s rejection of Bill Clinton’s centrism—and its abandonment of big labor’s focus on protecting American jobs—was beginning to push its blue-collar, less-educated voters rightward into the Republican camp.
Into this moment of realignment had stepped Obama, the urbane citizen of the world, and Palin, the tough-talking hockey mom whose husband worked oil rigs and raced snow machines.
Even as Democrats ran away with the election of 2008, Palin’s appeal was a revelation. She was connecting with portions of the electorate in ways that nobody had since Reagan. But unlike the Gipper, she was not channeling their hopes and ambitions and highest aspirations. Instead, she was provoking their fears, fanning their anxieties, inciting their animosities. And it worked.
This, more than any botched interview or off-the-cuff comment, fueled the rift over Palin within the GOP: She was doing that which horrified the party’s establishment, and doing it well.
“She was the early embodiment of some of the problems that would plague the party: mediocrity, anger, resentment, populism, proudly anti-intellectual, and increasingly bitter. And she was a rock star for it,” says Wehner, the Bush White House official. “That was a sign that something was going on in the Republican base. We went from glorifying excellence and achievement to embracing this anger and grievance and contempt.”
It was a long time coming. Palin’s resonance with Republican voters was, above all, an indictment of the party’s tone-deaf arrogance. Having catered to the aristocrat caste atop the GOP for decades, winning far more elections than they lost along the way, Republicans were blissfully ignorant of the discontent simmering below the surface. When it boiled over, the defensiveness of the elites—reproaching Palin, for example—only made things worse.
“I really think what created the problem we have today in the party was the donor class and the intellectual class blaming that loss on Sarah Palin,” says David McIntosh, a former Indiana congressman and longtime leader in the conservative movement. “We felt the establishment guys blew it—they were the ones in charge under Bush. They lost; they were out of power. So, the effort to scapegoat Palin fell on deaf ears.”
In the aftermath of the 2008 election, McIntosh and several other heavyweights on the right launched a group called the Conservative Action Project.20 Its mission was to bring together under one roof the leaders of prominent activist groups, hoping to pool their ideas and leverage their numbers to rebuild a Republican Party that sounded more like Palin than Bush. They began holding weekly meetings in early January of 2009, their first one in a conference room at the Family Research Council, plotting the ways in which they could steer the new GOP farther to the right.
The energy these conservatives saw and tapped into might have been lost on the Republican establishment, but it did not escape the Democrats. Indeed, while many GOP leaders worried about a permanent tilt in the country’s political axis, Obama knew, by virtue of the huge expectations for him, that backlash was inevitable. The only question was its size and strength.
Six weeks after the election, the incoming president and his advisers met with Bush’s team for an official transition briefing on the economy. The updates were brutal: While the bank bailouts had prevented a syste
mic collapse, families and communities were being pounded. Thousands of jobs were being shed, waves of homes were going into foreclosure, and all indicators pointed to things getting much worse before they got better.
When the meeting ended, David Axelrod walked out of the room and looked at his boss. “We’re going to get our asses kicked in the midterms,” he told Obama.
WHATEVER WAS TO HAPPEN BETWEEN THE TWO PARTIES, OR WITHIN them, was no longer Bush’s concern. He was taking a vow of political silence, he told friends, eager to extract himself from the public glare after eight enormously trying years.
He would not spend his life as a private citizen consumed by partisan wins and losses. He would be rooting for the country; he would be rooting for his successor. If there was one thing Bush worried about as his tenure closed, it was the “isms” he saw infecting America’s mind-set—and how they might animate the GOP’s opposition to Obama.
On Wednesday, January 14, six days before he left office, the president convened a group of conservative talk radio hosts in the Oval Office. The firebreathers, such as Rush Limbaugh and Sean Hannity, were not invited; they were hopeless cases. Bush wanted to speak to the “reasonable right-wingers,” including Dennis Prager, Hugh Hewitt, and former secretary of education Bill Bennett.
“Look, I asked you here for one reason,” Bush told the group in a solemn tone. “I want you to go easy on the new guy.”
Chapter Two
January 2009
“He could have annihilated us for a generation.”
THE CANNONS THUNDERED AT FIVE MINUTES PAST NOON. THE FORTY-FOURTH president of the United States had just taken his oath of office, and the faux artillery fire merged with the roar of some two million people1 on the National Mall to create a spectacle befitting the momentous occasion. Stepping to the podium, surveying the record-setting crowd braving a subfreezing chill to witness the inauguration of America’s first black president, Barack Obama itemized our national crises: protracted wars abroad, economic hardships at home, rising health care costs, failing schools, flawed energy policies, and a reluctance to recognize the changes inherent to a new century.