Tuesday, Sept. 30, 2008 | 2 a.m.
Rep. Jon Porter’s support of a plan to bail out Wall Street was a calculated risk, and it may pay off politically. If nothing else, Porter might have changed the dynamic of his toughest reelection battle since winning the seat in 2002.
His opponent, state Sen. Dina Titus, a Democrat, said she would have opposed it, and the race will likely be framed by the issue in the coming days.
The $700 billion package to take bad assets off the books of America’s large financial institutions failed, and Monday the Dow lost 777 points, a one-day record.
Now Republicans own the new financial turmoil because a strong majority of House Republicans voted against it while most Democrats supported it.
If evaluated purely in a political context, Porter’s decision to support the bill is a potentially prescient move. He bucked his party at a time when Titus is arguing — from his record for most of his congressional career — that he marches in lock step with Republicans, whose policies she says have failed.
Porter can also point to suffering Nevadans and credibly say he tried to contribute to a solution.
Porter was one of only two Republican members of Congress who face tough reelection fights who voted for the bill. The other was Rep. Christopher Shays, a moderate Republican whose wealthy Connecticut district includes tens of thousands of Wall Street financiers — so his support was no surprise.
But Porter’s calculation may be similar to Shays’. With corporations and private equity financiers now owning the Las Vegas Strip, the fate of Las Vegas has become inextricably intertwined with that of Wall Street.
That’s because Strip developers must rely on Wall Street financiers to provide billions of dollars to invest in new resort projects. The turmoil on Wall Street has stopped construction at Echelon and delayed other projects.
Porter may have looked at his district, with its dozens of upper-middle-class subdivisions with names like Ventana Canyon and Seven Hills, and heard the voices of casino managers who understand the importance of a solvent financial system.
Then there are the thousands of Porter’s constituents who are retirees and watched their savings tied up in the markets begin to evaporate Monday.
A source close to Porter said the congressman was flabbergasted the Bush administration had failed to make Americans understand how a Wall Street crash would affect Main Street.
If trends shown in recent polls continue, Porter made a smart move politically.
During the weekend, polls found that public opposition to the bailout was shrinking, with a strong minority apparently becoming convinced of the extreme risks of Washington inaction. A Rasmussen poll had the public evenly divided, with one-third for, one-third against, and one-third unsure.
If the stock markets continue a steep decline, the polls could move even more.
Titus, who said in a statement that she supports action but would have opposed the measure presented Monday, had a different political calculation to make.
Indications are that Titus is controlling the race, even though she’s the challenger. She’s raised vast sums of campaign money. The excitement surrounding the early Democratic presidential caucus in Nevada, as well as the enthusiasm for nominee Sen. Barack Obama, has given Democrats a 25,000-voter edge in the district.
Titus made a safe choice, if evaluated purely from a political standpoint. She said the bill “lacks critical provisions to provide needed regulation of the mortgage market or help for families facing foreclosure. If Washington is going to bail out Wall Street, there has to be some relief for families who played by the rules yet are faced with losing their home.”
For Rep. Dean Heller, who voted “no,” the decision was no doubt easier. Many residents of the rural north have a strong antipathy toward and distrust of all things Washington, but also of all things Wall Street. Moreover, continued losses on Wall Street mean ever higher prices for gold, which investors will turn to as a safer investment than securities. And gold mining is a key industry in Northern Nevada.
So Heller could support gold mining while railing against a bailout of Wall Street.
His challenger, Jill Derby, had little choice but to also oppose the plan, given the makeup of her district.
The only real risk for Heller, whose district is still solidly Republican, is a huge Democratic wave in November.
How could that happen?
More losses on Wall Street, life savings lost, bank failures, job losses.
At this point, anything seems possible.