Forget about the war on terrorism; his father had the Gulf War, and that failed to distract voters from their pocketbook concerns. Forget about George W’s high approval ratings; his father’s slipped quickly once Americans no longer felt the need to display national unity. George W. Bush will likely lose the next presidential election.   

To be sure, the parallels are far from exact. The first Bush recession pushed unemployment to 8%; this one has been much milder. The losers are not so much the middle Americans who lost their jobs in the last recession, but the wealthy professionals who are watching the erosion of their retirement plans and mutual fund holdings. Bush Senior paid little attention to domestic policy, or to his conservative base; his son has learned the lesson, and has given more influence to vote-grubbing political consultants.   

However, history is – if not word-for-word – repeating itself. Bush II may win his war, if that is possible against an enemy so intangible, but lose the peace. Come 2004, voters will be looking for someone to punish for their investment losses, and George Bush is the most obvious target.   

And Democrats are already starting to aim. Paul Krugman writes about Crony Capitalism, USA. Al Gore digs out his populist playbook to call for a government for the people, not the powerful.   

It is not entirely fair, of course. George Bush inherited an economy already entering into recession. The spectacular corporate failures – Enron, WorldCom, Global Crossing, ImClone – built up inflated debts and inflated expectations during the Clinton boom.   

The Democrats’ corporate supporters came from precisely those industries which became most overblown: technology, telecoms, entertainment and finance. Had Al Gore won the presidency, he would have given a job to John Doerr, the venture capitalist who boasted that the internet had sparked the greatest legal creation of wealth in human history, a phrase that would have come back to haunt him in government.   

Republicans can blame deregulation of the telecommunications industry – a proud Clinton-Gore achievement at the time -- for some of the speculative excesses in that sector. They will also try, with less success, to link corporate failure to the supposed moral bankruptcy of Bill Clinton. Martha Stewart as the bastard child of Monica Lewinsky, that kind of thing.   

But none of this will matter, mainly because the cult of the CEO – staple of business magazines for the last half-decade -- is about to become as popular as is the Falun Gong in Chinese government circles. Bush administration heavyweights are inescapably, undeniably, indelibly CEO types.   

Remember, this was going to be the CEO presidency, a well-managed administration that started meetings on time. Vice President Dick Cheney used to run Halliburton; Paul O’Neill, the Treasury Secretary, was CEO of Alcoa; Donald Rumsfeld, though a long-time Washington hand, came to the administration from G. D. Searle & Company. Even George Bush, a relative under-performer, had an MBA and some kind of business track record.   

CEO was a badge of pride. Here, in happier days, is Thomas White, a senior executive at Enron who is still secretary of the army despite the energy company’s ignominious collapse: "We effectively are the CEOs of wholly owned subsidiaries of the Department of Defense." Amazing to think that kind of language was once reassuring.   

To be sure, the polls do not yet show corporate corruption rising up the list of salient issues. Neither press nor political opponents have succeeded in tieing Dick Cheney or George Bush to regulatory infractions at their former companies. Republicans maintain, hopefully, that the US is a fundamentally pro-business country, and any political attack on corporate boardrooms will backfire. And it is undeniable that leading Democrats such as Al Gore and Joe Lieberman are in no position to attack anybody for cosy ties to business.   

Nevertheless, this issue will still hurt Bush. The US has a strong populist tradition, and periodically asserts its prerogative over the robber barons. There are a few candidates – admittedly most of them called John McCain – who could credibly run against corporate corruption. And no one should ever underestimate the anger of a voter who has just lost money. Least of all a Bush.
[Written for Management Today]