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Analysts Discuss McCain Campaign’s Woes

July 11, 2007 at 6:30 PM EDT

JIM LEHRER: Next, the troubles of the John McCain presidential campaign, and to Gwen Ifill.

GWEN IFILL: It wasn’t long ago that Republican presidential candidate John McCain looked unbeatable. He had $24 million in the bank, a sleek and shiny new campaign bus, and more than 100 paid staffers working around the country.

By last week — with the candidate laboring under the weight of two unpopular issues, Iraq and immigration — that bank account had dwindled to under $2 million and the staff was slashed. Yesterday, the campaign’s top two strategists quit.

What went wrong? And can McCain still reverse his political tailspin? For that, we turn to two reporters who have been covering the senator’s reversal of fortune: Dan Balz, national political correspondent for the Washington Post; and Adam Nagourney, chief political correspondent for the New York Times.

So, Dan, what happened?

DAN BALZ, Political Reporter, Washington Post: Well, this is a continuing implosion in the McCain campaign, Gwen. It’s a remarkable story; it has been for months. He’s had one series of problems after another, but what happened yesterday was, I think, most remarkable of all.

To lose his campaign manager and his chief strategist in one day is an extraordinary admission of the problems in the campaign, and particularly the departure of John Weaver, his senior strategist. This is a person who is as close to McCain as any other person in that campaign.

There was a confrontation over the management of the campaign. Terry Nelson, the campaign manager, and John Weaver essentially objected to what Senator McCain was suggesting, which was to switch out Terry Nelson for a new campaign manager. They, in essence, called his bluff. McCain said, “OK,” and they resigned. And it leaves the campaign in turmoil at a very, very difficult moment, Gwen.

GWEN IFILL: Adam, those were the internal factors that Dan was talking about. What were the external factors?

ADAM NAGOURNEY, Chief Political Correspondent, New York Times: Well, the external factors was that the — two, financial and issues. On financial, the McCain campaign was raising far less money than it had expected for a whole lot of reasons. They had expected to raise about $100 million, $120 million this year. As you said before, they only raised $24 million so far.

At the same time, they were spending as if they were raising that much money. So they were spending money all over the place. I think, at one point, they had 150 people on payroll. There was a period a couple of weeks ago when Senator McCain asked for a report of what was going on and learned that they were almost out of money. They were essentially broke right now, for all intents and purposes.

So the financial part’s one part. The other part is the issues. I mean, McCain is out of step with a lot of Republican primary voters on the issue of immigration, which happened to come to a fore here in Washington at the very moment that he was trying to raise money and build support across the country. And in Iowa, for example, internal polls by Republicans show his support plummeting as he became increasingly identified with the immigration bill. Everything is going wrong at the wrong time for him.

Other nominees overtake the field

GWEN IFILL: And, Dan, while things are going wrong on policy matters and on campaign strategy matters, you also have other candidates in the race, and some of them not in the race, like Fred Thompson.

DAN BALZ: Well, that's right. What was interesting was that at the beginning of the year, as you suggested, Gwen, he looked like if not the inevitable nominee, certainly the nominal favorite to win the Republican nomination. And as he has gone downhill, others have overtaken him.

First, Rudy Giuliani, the former mayor of New York, overtook him in the national polls. Then, Fred Thompson, who isn't even a candidate, began to talk about running, and he surged to the point that he was challenging McCain in the national polls. And Mitt Romney, the former governor of Massachusetts, who is not well-known nationally and is not doing particularly well in the national polls, adopted a strategy of spending a lot of money on advertising in Iowa and New Hampshire and also organizing in those two states. He shot ahead of McCain in those early states.

So on almost every front, what you saw was McCain's political support eroding as his financial support was also being crippled.

GWEN IFILL: Adam, why is it that, on the Republican side of the equation, we haven't seen something of what we've seen on the Democratic side, which is to say a breakout candidate? Usually it's Republicans that do that sort of thing. Why haven't we seen it with the Republicans?

ADAM NAGOURNEY: I mean, that's one of the interesting things that's going on this year. I mean, historically, one would have thought that McCain would have been the obvious frontrunner, because he's the heir apparent, and their party has a sort of history of rewarding its heir apparent, the person who came in second last time, giving him or her -- even though I don't think there's been a her for a while -- the nomination.

But for a lot of reasons, that's not happening this year, one of which is that I think there's been long suspicion of Senator McCain's sort of ideological credentials in a conservative wing of the party, in no small part because of the fact that he was, for a long time, a critic of Bush.

But then taking it beyond McCain, right now the Republican Party is not in good shape and is very demoralized given what's happened over the past two years. And I think there's a real strong sense that they're going to lose the White House next year. And all in all, it's a kind of toxic environment that McCain is trying to deal with right now.

History of campaign shake-ups

GWEN IFILL: All that said, Dan, haven't we seen some of this play out before? We saw John Kerry do a big campaign shake-up early last cycle. Ronald Reagan fired his campaign staff early or shook it up early on. Why is this different, if it is?

DAN BALZ: Well, it may well be different. Certainly, the McCain campaign, Gwen, sees the Kerry parallel as one that they can kind of cling to at this point. Their hope is that they can get through this period, raise some money that the rest of the field is flawed in one way or another, and that, by November or December, events and politics may turn back toward McCain.

I think that may be difficult for some of the reasons Adam outlined. He is out of step with the party. There's suspicion about him. And I don't think we've ever seen a campaign go through this kind of upheaval and very easily come back. So I think that the hill he's got to climb on this one is much steeper than John Kerry dealt with four years ago.

GWEN IFILL: And yet, Adam, we hear him saying of course he is not dropping out, so that means that theoretically he has a strategy for staying in. Does that involve certain states? Does that involve a certain approach, a different change in policy? We didn't see that in Iraq.

ADAM NAGOURNEY: Well, two things. One more second on Kerry. One thing about Kerry, because I think it's instructive from last time is, even during Kerry's worst moments, his essential rationale for why he deserved the Democratic presidential nomination, which is that he was the most electable -- and you can talk about whether that turned out to be true or not -- persisted.

So you could always think, in the end, there was something that was carrying him through, right? That argument was always carrying him through, especially against the field he was against in 2004.

McCain does not have that kind of rationale right now that I can see. You know, I don't mean to be in any way mean or uncharitable about this, but I think that his strategy right now is to be the last man standing. That is not a crazy strategy, but it's one that's out of your control.

So in other words, his hope is that Giuliani doesn't go much further, that Thompson, once he gets in the race and is examined as a first-time candidate, collapses, that Romney, who I think has really shown the most sort of growth this year, does not wear well as people begin taking a look at his sort of shifts over the years. So it is what I have to call "last man standing strategy." I'm not sure what other options he has.

McCain left with little flexibility

GWEN IFILL: Dan, one of McCain's supporters was quoted somewhere today saying, "So what? It's July." Doesn't he have a point?

DAN BALZ: Well, he certainly does have a point. I mean, we know that this race is, while advanced, a long way from being settled, and that many voters, particularly those in Iowa and New Hampshire, even though they're paying close attention now, really don't make up their minds until the very end. So in that sense, yes, it's only July.

On the other hand, what McCain has got to do now, because of his financial troubles, is make some very, very difficult decisions. Will he be able to run in both Iowa and New Hampshire on the limited amount of money he has, given the kind of resources that some of his opponents do? Will he have to simply go back to essentially a New Hampshire strategy? What does he do about some of those February 5th states, the big states that come into play once the early states have happened?

He has very little maneuverability at this point. And as Adam suggested, it's not clear exactly what his message is. He cannot go back at this point and be the candidate he was eight years ago. And it will be difficult to go back and be the candidate he hoped to be just six months ago.

Needing money to keep going

GWEN IFILL: So, Adam, does this early start help him to recover if he needs to?

ADAM NAGOURNEY: Well, I guess it's better to have time than not, but the other side of that is that you need money to keep going. I mean, you know, as Dan was saying, of course, you need money to compete in either Iowa or New Hampshire. It would be bad to have to choose one or the other, but you need money to get around, and you need money to fly places, and you need money to have -- I mean, you can get away with having staff not getting paid, but American Airlines or Delta is going to insist on a check when he gets on a plane.

So, you know, the upside is he has six months to try to either get himself together or hope that his opponents collapse. But he's also got to figure out a way to finance himself through this period. I suspect that when the fundraising report actually comes out over the next couple of days, we'll see that he has even less money -- that he'll be in debt, that we'll see that he has even less money than we thought.

GWEN IFILL: It's nice to see you guys put down your reporters' notebooks competing with each other to come talk with us. Adam Nagourney and Dan Balz, thank you very much.

DAN BALZ: Thanks, Gwen.