JIM LEHRER: And that brings us to the analysis of Shields and Ponnuru, syndicated columnist Mark Shields, National Review senior editor Ramesh Ponnuru. David Brooks is off tonight.
Mark, is it correct to say, continue to say that this political campaign now for president of the United States is about the economy and the financial crisis, period?
MARK SHIELDS, syndicated columnist: It is, Jim. It’s of transcendent importance. And it’s not simply an issue that engages people; it’s an issue that touches people and touches their lives.
And for that reason, it is central. It will be with us. It’s not going to go away.
And I’d just toss in one little quirk that would make it different this time, and that is, it’s been 26 years since we’ve had really bad economic times in this country.
We had a couple of downspins in ’91 and then after 2001, but we’ve had essentially 26 years of low unemployment, low inflation, low interest rates. And people have come to take those as a matter of course, as a norm.
JIM LEHRER: Stocks are always going to go up, wages…
MARK SHIELDS: Stocks are going to go up.
RAMESH PONNURU, National Review senior editor: Housing prices.
MARK SHIELDS: Houses are going to appreciate. And now, I mean, now this has hit. And it’s hit even harder. And there’s a sense of who is responsible for this.
JIM LEHRER: And I was going to ask you, Ramesh, what’s your analysis of why it has, of course, helped Barack Obama so much and not — and hurt John McCain so badly?
RAMESH PONNURU: Well, I think two reasons. One is that there’s sort of a vicious circle that McCain’s campaign is in. Because he’s behind, he always has to make bold moves to try to shake the campaign up.
But we’re in a crisis where people are wanting calm and steady leadership. So every time he takes a bold move, he begins to look a little bit more erratic, a little bit riskier.
Sen. Obama, on the other hand, can be calm, cool, and collected because he’s in the lead. You know, he’s got a lead to sit on so he can project that sense of leadership.
And, secondly, I think that McCain genuinely has added a certain amount of erraticness in his own performance, you know, coming up with a new plan on one day, and then the next day you’re attacking, you know, Obama over totally non-economic topics.
There’s been a bit of a bouncing-around quality to the McCain campaign.
Financial crisis at the center
JIM LEHRER: So the traction is, on the comparative charges, one is cool and calm and the other one is erratic, there is traction there, and that's what's moving the polls, do you think, in Obama's direction?
RAMESH PONNURU: Well, look, I think that what people above all are looking for right now is a sense that there's somebody in charge, that somebody knows what's going on, and has some solutions, right?
I mean, you talk to financial experts who don't really have a great handle on what's going on, let alone people who aren't financial experts. They just -- we see the papers, we see the headlines, and we're worried. McCain needs to reassure, and he's not doing it.
JIM LEHRER: Would you frame it the same way?
MARK SHIELDS: I wouldn't argue with what Ramesh said. I'd say that Dwight Morrow, who was the Republican ambassador to Mexico and the father of Anne Morrow Lindberg, said something -- brilliant, I thought -- some 75, 80 years ago.
He said the party that claims credit for the rain cannot be surprised when its opponents blame it for the drought.
I mean, we've heard from the Bush administration -- it was the tax cuts that produced this cascading wealth and this creation of wealth, even though it might not have been evenly distributed. The gross domestic product was growing.
Now, when things go sour, the party that's in power bears the burden and bears the blame. And that's what's happened. And when the economy is bad, Jim, the economy is the only issue. That's why the William Ayers and the other sort of sideshows just don't get any traction.
JIM LEHRER: Now, you think that William Ayers is a legitimate issue to raise, though, do you not, Ramesh?
RAMESH PONNURU: I think it's a legitimate issue, but it's the sort of issue that would have some effect if we weren't in a financial crisis. If you harp on things like the Ayers story or some of these other associations that Obama has had, you begin to look a little out of touch, because people aren't scared of Bill Ayers. They're scared about their 401(k)s.
A confidence crisis
JIM LEHRER: So now where does President Bush -- he had a statement today. Nothing happened. In fact, it continues to get worse. You know, what is -- how does -- translate that into not only his low approval ratings and all of that, but how it's the way the U.S. government is now functioning on this issue?
MARK SHIELDS: Jim, there's a crisis of confidence. And I cannot overstate that. I don't know whom people trust at this point.
They don't trust Washington. It's not the Congress they trust. They don't trust the president. They don't trust Wall Street or the financial heads of the country. I mean, there is really a lack of authority in the United States of America right now, and I think that's the problem.
I mean, President Bush, you know, not to be a wise guy, but he's forgotten but not gone. I mean, he's not really central to this whole equation. I mean, he is the president.
But they understood that Hank Paulson, the secretary of the Treasury, had to be the face of whatever efforts the administration was going to mount, he and Ben Bernanke.
So I don't think there's a sense of confidence. And I think the failure of both men in the debate on Tuesday night to address the reality, to confront it and to level with the American people, to treat us like grown-ups and say, "It's tough. It's going to be tougher. We're going to get through this, but we're going to get through it together. There aren't going to be more safe havens. There's going to be sacrifice. It may not be pleasant, but we will make it."
"And forget those tax cuts we talked about. Forget all those goodies that were promised. Those were in 2007 when things looked a lot different."
JIM LEHRER: But neither candidate is doing that.
RAMESH PONNURU: No, neither candidate is stepping up to the plate. I completely agree. This is -- I mean, look, it's a financial panic. Almost by definition, one of the key ingredients of that is a lack of confidence and lack of trust and a lack of authority. And, unfortunately, nobody is supplying any of those things.
JIM LEHRER: Just for the record here, the wires -- it's now a little -- almost 12 minutes before 7 o'clock Eastern time, and the Associated Press just moved a story that Treasury Secretary Paulson says the administration will move ahead with a plan to buy stock in financial institutions, which we had talked about earlier and in Jeff's segment.
MARK SHIELDS: In the discussion.
JIM LEHRER: And, of course, it's not an American idea. It's a British plan, is it not?
MARK SHIELDS: It's a British plan. The colonies once again are following.
But we had this debate in this country some 200 years ago with Andrew Jackson about the national bank. And, I mean, we're now -- here we are in the 21st century, apparently, we're going to be major stockholders, if not determinative policymakers, in some the nation's largest financial institutions, and apparently going to be picking winners and losers and saying, "You're chosen to succeed. And, I'm sorry, you're not going to get the investment."
JIM LEHRER: I would think your colleagues at the National Review wouldn't be too happy about all of this. We had that -- that also came up in Jeff's discussion about what this says about capitalism at this moment. What do you say about it?
RAMESH PONNURU: Well, there's no question that people who want a limited federal role in the economy, these are very difficult times. And I think most of us on the more free market side of things understand, particularly when you have a crisis that is in part caused by various kinds of government policies, the government has a role in undoing that.
We're just hoping that it's going to be temporary and that some of these equity stakes, for example, will be liquidated.
JIM LEHRER: You don't see that this could lead to a fundamental change in the way the United States government operates the economy?
RAMESH PONNURU: Well, it could. And it's not just this financial panic. It's also occurring against the backdrop of the collapse of global trade talks and a rising backlash against trade in the United States.
When you build onto that, I think you have the potential for not just a U.S., but a global retreat from free markets, which I think would be an enormous tragedy.
MARK SHIELDS: I think, Jim, fueling this, in part, is the fact that over the past generation of this country, at least since the 1970s, we have moved from a society where there was a security structure provided by corporate employers.
If you worked 25, 30 years, you got a defined benefit pension after that 25, 30 years. You knew you were going to get a check every month for so many hundred dollars, to a defined contribution where employee was given so much money, but he or she was then in charge of their own political -- their own economic destiny and they were responsible for the investments.
And all of a sudden, that's come a cropper. And they not only see the worth and value of their own homes disappearing, their 401(k)s disappearing, but they have lost that sense of security that was provided by a corporate structure that provided pensions and sort of a sense of security for the future.
So I think all of this means that regulation is back big time. I mean, nobody...
JIM LEHRER: Like it or not?
MARK SHIELDS: That's right. I don't think anybody attributes what's happened to too much regulation.
JIM LEHRER: How do you see it, Ramesh?
RAMESH PONNURU: Well, there's certainly a lot of people who would suggest that you've had government policies like extremely low interest rates for a very long time, that you've had the government pushing a lot of -- really pushing people to make and take bad loans for houses.
So I do think that this is certainly not a purely free market phenomenon that we've seen.
But, look, I think Mark is right. I mean, there are certainly places where you're going to see a lot more regulation. And some of those places it makes sense.
I mean, it makes sense that certain kinds of fraud should have been cracked down on from the very beginning. No capitalist with any sanity would, you know, object to that.
Campaign attacks prove ineffective
JIM LEHRER: All right, finally, before we go, the debate coming this next week, the expectation was for last week's debate that it was going to get down and personal. It didn't get down and personal.
Do you think it will this -- Bob Schieffer is the moderator. They'll be seated at tables, similar rules to the first debate in Oxford, although they'll be seated. What do you think is going to happen?
MARK SHIELDS: It's tougher to do it seated. I mean, it really is. Vice President Cheney in both times in his debates, his people insisted they be seated because they know it's a lot more tough to be acrimonious here.
But I think now we've seen "Our opponent is not a man who sees America like you and I see America" has become the mantra of vice president nominee Palin. I think we've seen ratcheting up the decibel level this week rhetorically, I think to a dangerous level, but I do think that John McCain has chosen that path. That's the only path available to him.
JIM LEHRER: Only path available to him?
RAMESH PONNURU: Well, I actually disagree. I mean, I think that the best moments that McCain has had this week is when he made that proposal to suspend the rules so that people who are 70 don't have to sell off their 401(k) and IRA assets and when he made that proposal to have the government help buy out some of these mortgages.
When he offered constructive ideas, I think he would be much better off getting in the news for that than getting in the news for saying or having his people say these things about Obama.
JIM LEHRER: What if he says them directly to Obama and they really get into it?
RAMESH PONNURU: Well, you know, I think that, again, the fundamental dynamic of this is that Obama can afford to be cooler and more collected and would likely come across the better in that exchange.
MARK SHIELDS: Let me just edit -- I shouldn't have said available to him. I think it's the one they've chosen. And I don't argue the point Ramesh made, that that has been John McCain at his best, is when he does come up with positive proposals.
JIM LEHRER: And that could lead -- do agree with Ramesh that that could help Obama rather than hurt him?
MARK SHIELDS: Well, I do. I mean, I think that it's one more when -- Jim, people want to hear real ideas, they want to hear real solutions, they want to have a sense of leadership, and I think the diversionary stuff -- the Pledge of Allegiance flag would not work in this environment as it did in 1988.
RAMESH PONNURU: McCain's attacks are primarily effective among people who are already voting for him and not voting for Obama.
JIM LEHRER: I got you. Ramesh, good to see you again.
Mark, thank you.
MARK SHIELDS: Thank you, Jim.