The Winners and Wipeouts of 2002


By Richard S. Dunham In a normal year, the list of political winners and losers is written on Election Day. But 2002 was anything but normal, and the midterm elections were just the beginning of the political melodrama. In the six weeks following the Nov. 5 midterms, the political casualty list has grown long: Treasury Secretary Paul O'Neill, White House economic adviser Lawrence B. Lindsey, House Minority Leader Dick Gephardt, and, in one of the classic capital flameouts, the once-but-not-future Senate Majority Leader, Trent Lott. That's an "A List" of vanquished figures.

However, D.C. has plenty of big winners these days, too. (Notice I haven't mentioned Al Gore yet.) Here's a holiday sampling of the big winners and losers of 2002:

Winners

Bill Frist. He's hardly known outside of Tennessee and Washington, but the surgeon-turned-senator is about to become the second-most prominent Republican in America, after George W. Bush. The White House's preferred choice to replace the disgraced Lott is considered a smart, squeaky-clean conservative.

Like Bush, he has compassionate credentials: He volunteers each year to perform free surgery in Africa. He's very close to Bush and, perhaps more important, to White House political guru-extraordinaire Karl Rove. Frist, the chairman of the National Republican Senatorial Committee, worked closely with Rove to plot the successful strategy to recapture the Senate in 2002. Now, he'll be on the hot spot.

Can this miracle worker, who hungers to be President himself someday, continue to win, win, win? We'll see. Just remember that old adage in Washington: The faster the rise, the steeper the fall.

John Snow. A month ago, Snow was a respected CEO of a somewhat underperforming corporation, CSX (CSX). Now he's expected to turn around the biggest underperforming corporation in the world: the U.S. economy. Like Frist, Snow is smart and ambitious. And he won raves for his work as chairman of the Business Roundtable, where he was an expert on issues ranging from trade liberalization to tax reform. But, as soon-to-be-ex-Treasury Secretary Paul O'Neill learned the hard way, some corporate superstars end up fouling up (and fouling out) in Washington.

Mary Landrieu. Louisiana's junior senator is the Democratic Party's newest national treasure. The reason: She took the edge off the sting of the 2002 GOP sweep by winning a December Senate runoff. Of course, a great deal of credit goes to fellow Pelican State Senator John Breaux and hardworking homestate Democratic Representatives Chris John and Bill Jefferson for getting out the vote. But Landrieu, by beating a popular President's handpicked candidate, even after Bush and Vice-President Dick Cheney upped the ante by stumping in her state, has won a spot on the short list for Vice-Presidential candidate in 2004. The Democratic Party could do far worse. And probably will.

Karl Rove. He has been compared to Rasputin, the power behind the throne in imperial Russia, and Mark Hanna, the brilliant strategist behind the rise of President William McKinley. He's derisively described as "Bush's brain" by some Democrats and "Boy Genius" by the President himself. And some liberals just call him unprintable things.

Whatever you call him, Karl Rove had an amazingly successful year. He was the architect of the GOP congressional sweep, and he deserves some credit for Republicans holding a majority of governor's mansions and, for the first time since 1946, winning a majority of legislative seats. Still, the genius of 2002 could become the goat of 2003 or 2004. In this kind of rarified atmosphere, one misstep could be his downfall. (Just ask Trent Lott.)

Al Gore. How can the former Vice-President be a winner? After all, he campaigned for a raft of losing candidates in 2002, from Maryland to Florida. His major accomplishment, other than hosting Saturday Night Live, was withdrawing from the 2004 Presidential race a day later. That's exactly why Gore is a winner. Rather than face almost-certain defeat in 2004, he's now in line for a favorable verdict from history.

If he never sets foot on the national stage again, he'll be seen as a modern-day Samuel Tilden, the highly respected 1876 Democratic standard-bearer who won more votes than his Republican opponent but was unfairly denied the Presidency after a controversy over the electoral votes of Florida (and several other states). And if Gore decides to go for the gold in 2008, he has a winner for a role model: Richard M. Nixon, who sat out the 1964 contest after a disputed defeat in 1960, then captured the White House in '68.

Charles Grassley. The conservative populist from Iowa proved that it can be hip to be square. He condemned corporate excesses, stood up for whistleblowers, and was an outspoken voice for reform in the business sector. Now he's in line to become chairman of the powerful tax-writing Senate Finance Committee. If he sounds like a modern-day Teddy Roosevelt, well, in a way that's what he is. Like Teddy, he wants corporations to play fair. But like TR, he also wants them to make a fair profit. Look for him to push for significant tax cuts in 2003.

Losers

Harvey Pitt. The first loser on Election Day was the controversial chairman of the Securities & Exchange Commission. Pitt's Nov. 5 resignation was overshadowed by the huge headlines about the GOP sweep, but his decline and fall was painful to watch. Fairly or not, he became a symbol of the go-along, get-along relationship between Washington regulators and the interests they oversee. In the end, Big Accounting's former lawyer fell victim to his own political tone-deafness, hubris, and unwillingness to listen to others. He embarrassed his patron, the President, once too often. And that's a mortal sin in the Bush Dynasty.

Trent Lott. The deposed Senate leader learned that, in Washington, loyalty is skin deep. Although he had been praising Confederate President Jefferson Davis and Dixiecrat Strom Thurmond's 1948 segregationist campaign for decades, one episode on live national television (C-SPAN) triggered his demise. All of a sudden, his colleagues were shocked -- shocked! -- that the former University of Mississippi frat boy had retro attitudes about the mixing of the races.

Hypocrisy, however, isn't a sin in Washington, weakness is. Despite Lott's loyal service to Republicans and the conservative cause, he was inelegantly shown the door by his supposed friends.

Don Nickles. The Oklahoma senator learned that timing is everything in politics. For years, he has been Lott's second-in-command and not-so-secret rival. Nickles had lusted for the leader's job but could never accumulate enough votes to depose Lott. In the end, he played a crucial role in ending Lott's tenure by being the first senator to call for the Republican caucus to discuss the matter. But for all his boldness, Nickles ended up with so many arrows in him he couldn't become the new leader. So he threw in the towel on Dec. 20 and endorsed Frist. His consolation prize: the Senate Budget Committee chairmanship.

Dick Gephardt and Tom Daschle. The tag-team award for defeated Democrats goes to Daschle, who lost his job as Senate majority leader when Republicans took over, and Gephardt, who resigned as House Democratic leader after leading his party to a fifth consecutive defeat. So what does the dynamic duo have in store for 2003? Both are looking for promotions. Each is contemplating a run for the White House.

Don't expect a groundswell of grassroots support. Daschle and Gephardt are running far behind Senators Joe Lieberman of Connecticut and John Kerry of Massachusetts in early polls in New Hampshire, home of the nation's first Presidential primary.

Paul O'Neill. The venerated CEO of Alcoa (AA) had all of the qualities that business leaders admire: smarts, management skills, imagination, boldness, a proven track record of success. But he was chewed up by the Washington crowd and bounced by President Bush on Dec. 6. O'Neill's failure was an object lesson for execs who think they can change Washington with a wave of the hand and a pounding of the fist: The qualities that make you a success in the private sector don't necessarily make you a hit in the political sphere.

O'Neill was too blunt and insufficiently deferential to the congressional poobahs and White House spinmeisters. It didn't help that the President's economic plans still haven't fixed the sputtering U.S. economy.

Bob Rubin. Bill Clinton's second Treasury Secretary is revered on Wall Street and respected in boardrooms, but he ends 2002 more reviled than ever by conservative economists. Now, the Right is in charge, and supply-siders have coined a new epithet: "Rubinomics." Conservatives say that Rubin had an unhealthy obsession with eliminating deficits. They dispute the former Goldman Sachs boss's view that red ink results in interest-rate hikes. They point out that the resurgent deficits of 2002 have been accompanied by ever-lower interest rates.

And they argue that the economy can (and must) handle big deficits as the country fights a war against terrorism. Rubin-bashers claim that deficits will disappear when the economy rebounds. Democrats say it's vital to heed Rubin's warnings. They argue that the Bush economic path will lead to structural deficits, higher interest rates, and stunted economic growth.

It will take the next few years to find out who's right. And of course, the losers of one year can always be winners the next. Dunham is a White House correspondent for BusinessWeek's Washington bureau. Follow his views every Monday in Washington Watch, only on BusinessWeek Online


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