Memo To: Steve Forbes
From: Jude Wanniski
Re: A Life in Iowa
My sincere congratulations, Steve. By getting 30% of the vote in yesterday’s Iowa caucuses, you bought yourself a real chance of winning the Republican presidential nomination. George W. Bush’s 41% was not all that impressive, given the fact that he is the organization’s candidate and the caucuses are dominated by the GOP organization. You only have a few days to leverage this win into a victory in the New Hampshire primary, which almost everyone has considered a two-way race between Bush and Arizona Sen. John McCain. McCain has already positioned himself to Bush’s left, for some reason deciding to come out for higher taxes for the “rich,” which seems mostly designed to draw independents and Democrats into the GOP primary on his behalf. This could backfire on McCain, I think, by causing Republicans who are skeptical about Bush and telling pollsters they would vote for McCain to give you another hard look. The elder Bush never did well in New Hampshire, where voters almost can be considered anti-establishment.
Remember Bush won the Iowa caucuses over Ronald Reagan in 1980 and had the “Big Mo” (momentum) going for him with only ten days to go before New Hampshire; Bush enjoyed a 15-point lead over Reagan. It was Reagan’s tv spots that concentrated almost entirely on economic growth issues -- including his promise to cut tax rates by 30% a la John Kennedy -- that scored so heavily with the voters. When the votes were counted in New Hampshire, Reagan beat Bush by 27 percentage points -- a swing of 42 points in ten days. In the primaries that followed, every time those spots ran, Reagan won. When Reagan ran out of money in Pennsylvania and Michigan, Bush beat Reagan. Do you remember?
You only have one week to do something similar in New Hampshire, Steve. If you spend that time on tv spots hitting at Bush, you will throw away this opportunity to get the New Hampshire electorate. If you have tv spots doing so, burn them. Make new spots, not promising lower taxes, but talking about restructuring the tax system so that the country can grow at a rate that will solve the enormous deficits in the pension and Medicare systems. The voters know you have spent more money trying to serve their interests than any amount you could possibly gain by tax reform. Talk about fixing the money with a gold dollar. And do a spot pledging to share our ideas with the rest of the world... so the poverty on the planet can be ended with ideas you would promote as President. Don’t distract voters by talking about your competitors. Just say you are the only candidate in the field who would eliminate the capital-gains tax -- so that more capital can be put into the hands of the American people to lift their standard of living from the bottom up. If Reagan were here, do you have any doubts that’s what he would do? He would not replace Greenspan with Kemp, but with gold. As to the media baloney about this being a perfect economy, remind them how quickly Reagan’s great economy turned sour with the Bush tax increase. It’s not today’s economy I am worried about in the hands of the other candidates, it is tomorrow’s.
In a client letter I sent out yesterday, Steve, I said it was clear to me that in domestic and international economic policies, you would make the best President. The voters won’t know that unless your ideas come through as clear as a bell. Don’t distract by hitting Bush -- although in tomorrow’s debate, I would point out that while he may understand the benefits of intangible drilling expenses for Texans, he does not understand the critical importance of a low capital-gains tax to the rest of the nation. If you want to take a bite out of anyone, bop McCain on the nose. It will fortify the resolve of those who don’t want to Bush and really are uncomfortable with McCain. If you want any more private advice, you always know where to find me. In any case, Steve, congratulations on your Iowa showing.