- To help readers better understand the nuances of foreign policy, CFR staff writers and Consulting Editor Bernard Gwertzman conduct in-depth interviews with a wide range of international experts, as well as newsmakers.
Amity Shlaes, an economic scholar, says she is impressed by Sen. John McCain’s (R-AZ) New Hampshire primary win but adds that his forte is not economic issues, the main area of concern cited by voters in exit polls. Shlaes describes McCain as a foreign policy candidate. “You see people who care about foreign policy voting for him,” she says. “He doesn’t really like economics; he is not comfortable with it.” She says the winner of the Democratic primary in New Hampshire, Sen. Hillary Clinton, has focused her economic talk around the health care issue.
The New Hampshire primary results are in. Hillary Clinton won the Democratic race and John McCain the Republican one. Everyone is now looking ahead to the next rounds of primaries. What are your main impressions from the voting in New Hampshire?
One thing that people like about McCain is that he is consistent, that he will wait through a hard time and not change his position. Clearly New Hampshire recognized that. The second thing is that women did come out for Hillary Clinton. It’s always been a truism that women don’t vote differently from men. Ever since women got the vote people have noticed that but in this instance women did vote for Hillary.
Talk a bit about McCain. You wrote an article last summer in which you lamented his apparent fading from the race. Do you think he has much staying power?
I absolutely do. That’s what I said last summer. Last summer, if you mentioned his name people looked away, especially among Republicans. It’s a credit to him today that he’s back. One more thing that is important about McCain is that he is not an “econ” candidate; he is a foreign policy candidate. You see people who care about foreign policy voting for him. He doesn’t really like economics; he is not comfortable with it. He can have pretty good policies and he does but they don’t deal with home foreclosures and stuff like that.
But that’s of course a major issue in the campaign isn’t it?
Actually you want to see what happens to McCain if he becomes a serious Republican candidate. He talks a lot about tax cuts. You see in the New York Times today, an article quoting his economics adviser, Doug Holtz-Eakin [former director of CFR’s Maurice R. Greenberg Center for Geoeconomic Studies], saying that McCain didn’t mean to say tax cuts always generate more revenue. He got him to say something more cautious: “Tax cuts don’t pay for themselves, but pro-growth tax cuts—especially along with spending restraint—spur the economy, which raises incomes, and offsets the revenue loss.”
McCain is not [Mitt] Romney or [Rudy] Giuliani, who are positioning themselves as Reagan heirs and maybe Bush heirs. He’s something different. He’s more cautious. One thing he does that is quite admirable is that he doesn’t want to think about antidotes for the “recession.” Right now every candidate is preparing an antidote for the “recession.” The Bush administration also has an antidote for the “recession.” Holtz-Eakin says we just want to have good conditions for strong growth. He says, “We’re not going to be pestering the economy.”
Now, talk a bit about Hillary Clinton’s economic policies.
Her economic policies are a work in progress. What she calls economics is “health care.” That’s her economics. If you talk to Hillary, that’s the economy. In terms of her personal druthers it just depends on what happens. Suppose the dollar crashes and she’s president. Then she’ll be a completely different Hillary than what you see if you go look at the issues on her website.
Looking ahead to Michigan [which has January 15 primaries], that’s a key state in a way because Mitt Romney, of course, is from Michigan. His father was a very popular governor there for three terms. Do you think McCain can do well in Michigan?
Foreclosure is a big concern, energy prices are a concern. They have their own foreclosure crises in these states which are not just speculators, not just adjustable mortgages, but also the economy itself because of the decline of the automakers and the machine tool companies that served them as suppliers. So it’s much darker there. I do see Romney getting some bounce there because of that.
Do any of these candidates have much in the way of policies on what to do about getting people back to work?
People are already at work. It’s important to recall that we have 5 percent unemployment, that’s pretty low historically. It’s very low compared to the 1970s, very low compared to a lot of other periods. Putting people back to work isn’t exactly how I would phrase it. You hear Hillary talking about safety, people’s sense of insecurity, the changing jobs. People have jobs but they are not so happy with their jobs, or whether they will get to keep their jobs. Certainly I think the number one problem in the employment sector is health care, given that costs are going up 10 percent a year for the employer. That’s major. No one can sustain that. That’s the biggest workplace problem.
This gets into the question of jobs moving overseas. This is a big issue for the Democrats in particular right?
It’s a big issue for the Democrats in particular but it is not a big issue relative to all jobs. It is a small issue relative to all jobs. At the CFR we published a book by Daniel W. Drezner, U.S. Trade Strategy, that quantifies how many jobs moved oversees relative to other jobs and it’s small. We also have jobs that come in: insourcing. But it’s going to be a theme that Democrats are going to work because it’s part of the insecurity. It’s interesting the way immigration, terrorist threats, and job security are all pulled together into one word for the candidates: “safe.” Hillary has said “safe, safe, safe” and it’s worked for her. We want to feel safe as a country.
That’s interesting, but you don’t hear the Democrats talk as much about illegal immigration although a lot of the unions are leaders in the fight against immigration.
That’s right, we don’t. I think that’s because we all know that so many illegal immigrants have done so much for our economy. Especially here in New York City, we know that. Illegal immigrants helped make Queens come back—a borough which was kind of a troubled place ten to fifteen years ago is far less troubled now. The immigrants settled, or resettled, in Queens. Many were at least initially illegal. That’s part of the problem [Republican candidate] Rudy Giuliani has had. Romney has beaten him up about this. Giuliani was supposedly a sanctuary mayor for illegals. From the New York point of view, being a sanctuary was probably worth it. We love those immigrants here in New York; they are filling our coffers now with tax money. It’s a different situation in California. Democrats understand that better.
What is the problem in California?
In California there are more immigrants, they are more of one ethnicity. They do seem, in terms of the budget of the state, to be more of a challenge: healthcare, Medicare, turning into seniors before they ever worked. I am not a complete expert on that but you see when you talk to people in California of whatever party they are more concerned with being overwhelmed. That’s the phrase they use. In New York you just don’t hear that.
What about Barack Obama? I think his defeat yesterday came as an enormous surprise to the many correspondents covering the elections since most had written that he was going to win big.
But it’s also interesting that you read in the paper “Obama Upset,” because, well, Obama couldn’t have had an upset two months ago since no one expected him to do what he did in Iowa. Obama is a very wonderful candidate because he is a person of ethnicity but he is not totally ethnicity. He is also just a man. That’s what made him attractive to the media; now whether he will be attractive to voters, we’ll see. Who does Hillary represent? A lot of groups: women, unions, people who want health care reform of the more progressive, government-expanding variety. She has a lot of clientele and she represents them. That is why you see black ambivalence on Hillary vs. Obama. You don’t see all blacks for Obama because Hillary is more of a party person. Obama is less defined there because he is new and also because he has chosen to be a more everyman’s man. That is intensely attractive.