The Essential Phil Gramm

When the Phil Gramm flap broke out about 10 days ago, with his Washington Times interview miscues about a nation of whiners and a mental recession, other McCain economic advisors were quick to lambaste the former Texas senator. Douglas Holtz-Eakin told the PBS Nightly Business Report that Gramm is no longer giving advice to McCain or his aides. He said, “I haven’t spoken to Sen. Gramm since the comments took place, and I’m not expecting to.” On Meet the Press, Carly Fiorina emphasized that Sen. McCain had rejected Gramm’s remarks, and then said, “I don’t think Sen. Gramm will any longer be speaking for John McCain.”

While McCain clearly disowned Gramm’s remarks, Holtz-Eakin and Fiorina were wrong, at least at that point, to throw Gramm out of the campaign. In fact, McCain spoke to Gramm after dissing him, and asked him to stay in the campaign and continue to be a surrogate speaker. This was not widely reported, but several sources confirm the conversation. However, it was no secret that Holtz-Eakin in particular has been a Gramm adversary inside the campaign.

So when Robert Novak’s Saturday column was initially published Friday evening, correctly reporting that McCain and Gramm had patched up their relationship, McCain insiders apparently went ballistic, even though their boss wanted to keep Gramm inside the tent. Once Gramm got wind of this internal war dance last Friday night, he resigned as campaign co-chairman, relegating himself to rank-and-file supporter status.

What exactly happened Friday night is still a mystery. At least one senior campaign official believes Gramm resigned without any prodding. Sources close to Gramm, however, report that it was the campaign staff revolt that forced Gramm’s hand.

Interestingly, Sen. McCain himself has yet to publicly comment on Gramm’s resignation. When asked about it this morning on NBC’s Today Show, McCain dodged the question. Many conservatives are hoping McCain will overrule his staff by saying no to Gramm’s resignation. In other words, not accepting it. Those conservatives believe the hard-nosed free-market Gramm is essential to the formulation of McCain economic policy.

As inartful as Gramm’s initial comments were, these things happen during campaigns. And Sen. McCain could have made light of the comments while still rejecting them. He also could have pivoted and attacked Obama’s constant whining, economic pessimism, and American declinism. What’s more, McCain’s basic economic message of low taxes, ending pork-barrel spending, and drill, drill, drill to generate more energy supplies at lower prices is a strong contrast to Obama’s high-tax-and-spend plan. Essentially, McCain has an economic-recovery program. Obama does not.

But the effects of Gramm’s absence may already have surfaced. Appearing in Michigan at a GM town hall meeting last Friday, McCain lapsed into talking auto-bailouts and huge government subsidies for GM’s new battery car, the Volt. McCain’s message was basically that he’ll do anything to keep the car business afloat. This sort of pandering by McCain was missing during the Michigan primary last winter. And when asked by a worker how GM could cope with cap-and-trade greenhouse-gas emissions standards, McCain said that we’ve got to adjust these standards so they don’t kill off the industry. So McCain is back on his cap-and-trade system which completely dilutes his drill, drill, drill message. It’s this kind of confusion that the tough-minded Phil Gramm could solve with a clear policy message. An attempt to be all things to all people and all constituencies is a sure-fire path to an empty message that garners the support of no one.

A last thought: If Sen. Gramm is in fact out of the campaign, might Sen. McCain give new titles and influence to supply-side stalwarts Jack Kemp and Steve Forbes? So far their contributions have been sporadic. Perhaps elevating their roles would fill the gap left by a departing Sen. Gramm.