D.C. Dispatch May 10, 2005

Bush's job rating hit a new low for a President just three months into a second term.

What Political Capital?

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The rule about political capital is, when you've got it, spend it, because you can't hold on to it. "I earned capital in this campaign, political capital," President Bush said two days after winning re-election, "and now I intend to spend it." And spend it is exactly what he is doing—with a bold agenda focused on Social Security, the Middle East, energy, judicial nominations, and the "culture of life."

But the president has a problem. His political capital is just about depleted. Bush had a huge supply of capital after 9/11. And he spent it—all of it—on Iraq. The 2004 presidential election, which he won with 51 percent of the vote, replenished only a little of his capital.

Look at what's happened to Bush's job-approval ratings, as of April: the Gallup Poll, 48 percent approval; The Washington Post/ABC News poll, 47 percent approval; and the CBS News, Associated Press, and American Research Group polls, all 44 percent. Bush's ratings have fallen since the beginning of the year in every poll. His average job-approval rating for April was 45 percent, the lowest on record for any president just three months into his second term.

In January, Bush's job rating in the same five polls averaged 50 percent. His rating has gone down 5 points in three months, to the lowest level of his presidency. The result? Bush's agenda is in trouble. He has spent the past 60 days campaigning for Social Security changes. But instead of rallying public support, he's lost ground.

According to the Post/ABC News poll, things started out bad for Bush and got worse. In January, 55 percent of Americans disapproved of the way he was handling Social Security. At the end of April, 64 percent disapproved. And for the first time since 2000, a majority of Americans said they opposed a plan in which people could choose to invest some of their Social Security funds in the stock market.

The decline in the stock market has not helped Bush make his case. At the end of April, the Dow Jones industrial average was down more than 600 points from the beginning of the year. Is there a link between people's assessment of the stock market and their view of Bush's Social Security plan? Absolutely.

In a February Gallup Poll, about half of those who said they expect the stock market to rise thought private Social Security accounts were a bad idea. Among those who thought the market would be static, two-thirds called private accounts a bad idea. That proportion rose to three-quarters among people who thought the market would fall. Being bearish on the market makes Americans more likely to be bearish on private Social Security accounts.

Now let's look at California. When Arnold Schwarzenegger won a spectacular victory in the 2003 gubernatorial recall election, he, too, had a huge supply of political capital. He spent it on a campaign to straighten out the state's finances. Some key Democrats, including Sen. Dianne Feinstein, gave the new governor crucial support.

This year, Schwarzenegger spelled out a bold agenda, including pension changes, spending cuts, education revisions, and legislative redistricting. "Last year, we stopped the bleeding," Schwarzenegger said in January. "This is the year when we have to cure the patient.... That is what my mission is all about."

Critics argue that Schwarzenegger does not have the political capital to wage all of those battles. Democratic consultant Darry Sragow said, "He has just picked too many fights. He needs to pick fewer fights, and he needs to not pick fights."

Schwarzenegger's targets have been running ads against him. The California Teachers Association has spent $5 million on television ads featuring complaints from parents: "He borrowed $2 billion from the education budget and now refuses to pay it back." "The governor is always running around talking about reform, but to me, it sounds a lot like breaking his word on education."

Hundreds of parents rallied against Schwarzenegger in the state capital last week. "Sacramento is not a movie set. We are living in reality here," one parent said. "Our governor needs to understand that our children are not actors.... We don't have time [to wait] for them to grow up ... we need to invest in the state of California for our kids."

The governor's response? "Some people say that I have taken on too much," he told a television interviewer last month. "Some people say, 'Why don't you do one reform a year?' What do you think, I'm going to hang out in Sacramento for the next 100 years to create all the reforms that I want?"

He may have to, because he has dropped his pension proposal and is now negotiating with Democrats on redistricting. As for his political capital, Schwarzenegger's job-approval score stood at a robust 60 percent in January in a poll taken by the Public Policy Institute of California. By late April, his rating had collapsed to 40 percent. Polling by the Survey and Policy Research Institute at San Jose State University shows a comparable drop, from 59 percent approval in January to 43 percent approval in March.

Schwarzenegger and Bush both overreached, putting forth agendas that went way beyond their mandates. They have both depleted their political capital. They're now into deficit spending.

William Schneider is the Cable News Network's senior political analyst. He is also a resident fellow at the American Enterprise Institute in Washington, D.C., and a contributing editor for the Los Angeles Times, National Journal, and The Atlantic Monthly. His column appears every week in National Journal, a weekly magazine covering politics and government published in Washington, D.C.