Newt is back, doing what he loves to do: challenging a sitting president of his own party, inciting insurrection among conservatives, and in his own words, "having a ball." He confesses to a sense of déjà vu, having made life hell for President George H.W. Bush in an earlier era when the elder Bush, confronted with rising deficits, broke the no-taxes pledge that defined his candidacy. Back then, Newt Gingrich bucked his own leadership to rally a hundred conservative House members against the White House, humiliating Bush and eroding confidence in his leadership. The defiant action set the stage for Bush's defeat in 1992 and the Republican takeover of the House in 1994, installing Gingrich as House Speaker.
Gingrich is long gone from the halls of Congress, having been toppled by a rebellion in his own ranks. But he never lost his skill as a strategist—or his delight in antagonizing a Bush administration (even as he maintains he's got nothing personally against the president). Last weekend, he decided to come out aggressively against the Bush team's ambitious economic bailout plan. "We've been here before," he told NEWSWEEK. Gingrich recalled being the Republican whip in the Democratic-controlled House in 1990 when the senior Bush sought the votes for a budget proposal that contained a five-cent gasoline tax. It was political cyanide, but the leaders of both parties backed it, believing they were putting country first—the same appeal we hear echoed in today's urgings from the administration to save the financial markets.
Gingrich brings a clarity of mind and simplicity of action that is a tonic to a Republican Party that seems uncertain of its core principles and ambivalent about its presidential standard bearer. Even before John McCain announced he was suspending his campaign and riding to the rescue in Washington to find a bipartisan solution to the financial crisis, Gingrich saw the impasse on Capitol Hill as an opportunity to recast the Republican Party on the side of Main Street. "It's very clear that their bias is entirely in favor of the big banks and Wall Street," he says of the Bush administration's $700 billion bailout plan presented by Treasury Secretary Henry Paulson. "This is the decisive moment of defining McCain. If he comes out on the side of the taxpayer, then there will be a McCain wing of the Republican Party that will be dramatically different than the Bush wing."
Gingrich's not-so-subtle message: Bush is irrelevant. It's in McCain's hands as the leader of his party to drastically reconfigure the Paulson bailout or he will suffer the same ignominious political fate as George H.W. Bush. Gingrich put out a statement hailing McCain's eleventh-hour intervention. "This is the greatest single act of responsibility ever taken by a presidential candidate and rivals President Eisenhower saying, 'I will go to Korea'." Eisenhower's pledge was enough to reassure voters that if elected he would find a way to resolve the Korean conflict. McCain's high-octane involvement in the bailout is meant to convey the same sense of stature and leadership, and to provide cover to reluctant Republicans to support a deal that runs counter to everything they thought they stood for.
McCain alone can bring along enough Republicans to make a deal stick. "The Democrats are not going to go out on a limb for an unpopular position and give Bush money five weeks before an election unless Republicans deliver the votes," says Gingrich. "And the Republicans I believe cannot deliver the votes. So they'd better be designing Plan Two because I think Plan One is dead."
Never one to hold back, Gingrich unleashed his views about the original bailout plan in a torrent of words, calling the authority Paulson wants over the financial industry "a bureaucratic dictatorship" that is "outside the law" and will lead to a "20-year bureaucracy of corruption and cronyism." He's sounding the cry of what he calls the Reagan-Thatcher wing of the party, newly energized by a familiar fight against the corporate country-club wing he says is "boxed in by a Goldman Sachs chief of staff and a Goldman Sachs Treasury Secretary," so they're not receptive to alternatives (Paulson and top White House aide Josh Bolton are alumni of the investment house). "If they don't have any better ideas, they should resign, and the president should get a new team."
He finds it absurd (one of his favorite words) that the SEC would announce that 799 companies are protected from short selling. "You ought to call the SEC and ask why wasn't it 797 or 801? Where's the documentation? How did they magically pick 799—who's being protected and who's being left vulnerable?" He cites a poll conducted for American Solutions for Winning the Future, a group he chairs, that found by a margin of 68 percent to 19 percent the country would rather let these Wall Street giants go broke even if it damages the stock market than have the government bail them out. American Solutions is charged with finding "tripartisan" policies that Republicans, Democrats and Independents can support. For Gingrich, who made his name as an ultra-partisan leader, a bomb thrower, this is a rare second chance to steer his party and his presidential candidate toward a new conservative future that can persuade voters to forget the last eight years.