Massive Gains Leader: Party Could Pick Up 40 House Seats

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July 18, 2002

Gephardt Eyes

Massive Gains Leader: Party Could Pick Up 40 House Seats

By Ethan Wallison



House Minority Leader Richard Gephardt (D-Mo.) has told senior Democrats that the party could pick up as many as 40 House seats if the continuously unfolding corporate scandals can be kept on the political radar screen until November, according to sources.
The figure far surpasses any that has been suggested previously - even privately - by Gephardt or any other top Democratic campaign official, all of whom have consistently indicated that the House will be won or lost by a slim margin.

"He said if this thing plays out right, we could pick up 30 to 40 seats," said one Democratic source who attended a recent meeting where Gephardt threw out the figures.

Gephardt's remarks, which were confirmed by a second source at the meeting, came on the heels of twin political developments that dovetailed with the unfolding scandals on Wall Street: revelations that the Securities and Exchange Commission was investigating accounting practices at Halliburton Co. when Vice President Cheney was at its helm; and re-emerging speculation about President Bush's stock trades as a board member at Harken Energy Co. more than a decade ago.

Neither new development - let alone the continuing revelations of questionable business activities in some of the country's top board rooms - has so far appeared to shift the political landscape on Capitol Hill.

But Gephardt's private remarks to colleagues would seem to underscore the political stakes Democrats see in an issue that is only beginning to set in among voters.

"As this unfolds day after day, I think there's a good chance the Republicans will be turned out [of power] and the Democrats will be given a chance to get at this cowboy mentality [in Corporate America]," said Rep. Max Sandlin (D-Texas), a chief deputy whip.

Asked whether he believes Democrats could do as well as Gephardt has suggested privately, Sandlin said, "I think there's certainly the possibility of [40 seats] as Corporate America unravels before our very eyes."

A similar outlook has taken hold across the Caucus. One top Democratic strategist, referring to only the latest accounting scandal on Wall Street, even went so far as to say, "I tell you [that if] you drop another WorldCom thing in September, the Republicans are really [screwed]."

Gephardt has certainly appeared confident that the issue of corporate ethics will ultimately play out to the Democrats' benefit.

Meeting with the top leadership Tuesday afternoon, Gephardt opened by advising Members to read a Paul Krugman column in that day's New York Times that accused President Bush of shady land dealings and cronyism in Texas. He also touted a similarly themed story in the New Yorker magazine.

"[Gephardt] said he thinks this is where the whole thing is headed," said one source who was in the room.

Republicans have suspected from the outset that Gephardt and the House Democrats would try to capitalize on the corporate scandals for political advantage - what White House Press Secretary Ari Fleischer has called the "secret plan" to keep the issue alive through the elections.

Steve Schmidt, a spokesman for the National Republican Congressional Committee, accused Gephardt of saying that he wants to restore confidence to the markets, while at the same time sowing anxiety among investors and "cheerleading for the market to decline" in order to gain politically.

"He's trying to talk down the market," Schmidt said. "If he's saying [the Democrats could make major gains], he is basically saying, 'I want to exploit this politically. I don't want to solve this.' "

Rejecting those criticisms, Gephardt has repeatedly pointed to his calls for quick House action on a package of reforms, put forward by Senate Banking Committee Chairman Paul Sarbanes (D-Md.), which passed that chamber 97-0.

In fact, Gephardt has accused Republican leaders of foot-dragging on reform, presumably in the interest of placating GOP benefactors in corporate America. Speaking to reporters on Wednesday, Gephardt cited reports that suggested strong resistance to the Sarbanes measure among key Republicans, particularly House Financial Services Chairman Mike Oxley (R-Ohio).

"It's always the same with them," Gephardt said. "It's like [they're] trying to get something done, but really [the plan is to] slow it down and water it down. That's their goal, that's their game plan, that's their strategy."

Gephardt spokesman Erik Smith said he had never heard Gephardt privately suggest the party could ride the corporate scandals to a landslide this November. He also suggested that 40 seats would be an unlikely prediction, since Gephardt has said only 40 districts are in play this year.

"I don't think he believes we could win all 40," Smith said.

But Smith added that Gephardt does believe that the political climate is now "better that at any other point this cycle," in large part because of revelations of wrongdoing in corporate board rooms.

"He said we're in an environment where winning the House is becoming more and more of a reality," Smith said. "He's bullish."

The upcoming one-year anniversary of Sept. 11 and the ongoing debate over the creation of a Department of Homeland Security have presented significant political hurdles, however.

Even before the corporate scandals began to unfold in earnest, Gephardt was privately expressing concern that GOP leaders would try to stretch out debate over the new department in order to draw attention away from issues the Democrats would want to raise in the home stretch before the elections.

Indeed, Republican leaders initially suggested that planning for the new department would take until the end of the year. Gephardt responded by putting forward an ambitious timetable yoked to the anniversary of the terrorist attacks, in hopes that the issue would be off the table before the campaign enters its most intense phase in the fall.

The Sept. 11 time frame has essentially been adopted. But no one yet knows what will transpire once the basic blueprint for the department, put together by a special committee of top House lawmakers, comes up against conflicting plans from powerful committee chairmen and ranking members, who have their own ideas about what should comprise the new department.

Already, Gephardt has faced strong resistance to quick action from institutionalists in the Caucus, such as Appropriations Committee ranking member David Obey (D-Wis.), who are devotees of Congressional prerogative. In the Senate, Appropriations Committee Chairman Robert Byrd (D-W.Va.) has threatened to filibuster the legislation.
 

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