Sharron Angle has no business being in the Senate, at least according to many of her fellow Nevada Republicans. The GOP mayor of Reno called Angle "wild" when he publicly endorsed her opponent in the November election, the embattled majority leader Harry Reid. Attempts by Angle’s advisers to soften her image amount to a game of media whack-a-mole—there’s no keeping down the real Angle, whose head pops up roughly once a week to unfurl something bizarre. She has said she’d like to "phase out" Social Security and Medicare and eliminate the Energy and Education Departments and the EPA. She called BP’s handing more than $20 billion to the victims of its negligence a "slush fund." She referred to the separation of church and state as an "unconstitutional doctrine." She’s mused about "Second Amendment remedies" if the ballot box doesn’t deliver redemption. She agreed with a talk-radio host that there are "domestic enemies" currently sitting in Congress. And on and on.
Here’s the kicker: Angle has a good shot at winning. Reid is in trouble because elections usually hinge on voters’ sense of economic security and opportunity. Nevada voters feel very little of either. Since the bursting of the housing bubble, Nevada has been a basket case, with unemployment now above 14 percent. More than one in ten Nevadans receive food stamps, up 35 percent from a year ago. At this point, Nevada is pretty much a failed state. As is to be expected, Angle blames Reid. And she’s not entirely off base—but not for the reasons she thinks. Angle, being Angle, hasn’t the slightest clue why or how Nevada got into this mess. She says government is too big and blames bailouts and the stimulus and government debt, and she pins all that on Reid. In fact, $2.5 billion in federal Recovery Act money has managed to keep the state solvent.
Nevada has been hit harder than just about any other state because policy-makers happily bought into the illusion that the housing bubble wasn’t really a bubble. They failed to properly regulate the mortgage industry, which was giving out sham loans like a mobster handing out Christmas hams. Similarly, they believed that no amount of building on the Las Vegas Strip would sate Americans’ need for casino resorts. These delusions led them to create an economy built on a faulty foundation.
Meanwhile, Nevada has one of the leanest governments in the country by any measure, with more budget cuts on the way, and one of the most regressive tax systems. Elected officials of both parties have refused to enact the tax increases necessary to make key investments—in education, infrastructure and healthcare—to build a diverse economy outside tourism and gambling. In nearly every metric of social, educational and physical health, Nevada is at the bottom.
So who is at fault for all that? It wouldn’t be fair to blame Reid alone. But let’s be clear: though he is rightly associated with the legislative victories of President Obama’s first term, for most of Reid’s career he’s been a Western moderate. Most of all, he’s a survivor, and for a long time surviving in Nevada politics meant throwing in with the casinos, builders and lobbyists who helped craft the Nevada version of the Sun Belt Ponzi scheme. There’s an old saying by the dean of the state press corps, Jon Ralston: there’s only one party in Nevada, and it’s the Gaming Party—the party of the Las Vegas Strip. But you can also throw in developers, construction firms, private health concerns, utilities and other powerful players, all represented by a handful of lobbyists. It’s a small group of people, and Reid is at the center of it.
Reid has been instrumental in clearing the way for a long-planned pipeline—highly sought by the Gaming Party—to bring water from the north down to Las Vegas, a plan many environmentalists fear will repeat the disaster of California’s Owens Valley, of Chinatown fame. When casino giant MGM Mirage needed financing to complete the massive $8.5 billion City Center project, Reid called banks and told them to take the calls of its CEO; so far the project seems to merely have cannibalized customers from other resorts. In the past five years, the $961,000 Reid and his PAC and committees received from unions was dwarfed by the $11.1 million from lawyers and lobbyists, insurance, banking, real estate, gaming and other business interests. Two of Reid’s closest advisers in Nevada? A pair of business lobbyists, Billy Vassiliadis, a Democrat, and Sig Rogich, a Republican and onetime Ronald Reagan adman. Vassiliadis and his firm represent homebuilders, utilities and mining companies. Mining? It was Reid who told Democrats in the State Legislature that the gold-mining companies, making big profits because of a favorable tax climate and the soaring cost of gold, were not to be touched during the 2009 legislative session despite the fiscal crisis.
Reid’s campaign points out all he’s done since the beginning of his career, and especially since the recession began, to try to turn Nevada—which has abundant sun, wind and geothermal energy—into a renewable-energy state. He’s brought home money for needed pipelines to transport the energy, delivered R&D grants, paved the way for a wind turbine factory and furthered countless other projects. Fair enough. But for years Nevada was engaged in bubble economics, and Reid was one of its most important, if soft-spoken, operatives. His political fortunes were aided by the seemingly never-ending building boom. If he loses this fall, he’s merely getting what he deserves. It’s just unfortunate that Nevadans will be left with Angle, while never getting any meaningful debate about the failed policies that got them into this mess.