How Bad Times in Northeast Might Be Bush's Achilles' Heel

WEEK after week, the Union Leader, New Hampshire's largest newspaper, is chock-full of ads that tell of the economic anguish that has recently fallen on the Granite State.Hundreds of houses, condominiums, and businesses are being sold at forced auctions. Growing numbers of people are losing their homes when they fail to pay their real estate taxes or make their mortgage payments. The Union Leader often carries more advertising for foreclosure sales than for ordinary real estate listings. This spreading economic pain, felt in much of the Northeast, now could play a pivotal role in the 1992 presidential election. It was here in New Hampshire nearly four years ago that George Bush crushed Robert Dole in the nation's first primary and virtually locked up the Republican presidential nomination. Today, many New Hampshirites speak resentfully of the president, who they say cares much more about the economic plight of Russians than Americans. "There is a great deal of economic discontent in this region," says David Moore, a political scientist and director of the Survey Center at the University of New Hampshire. Democrats sense a political opportunity. Chris Spirou, chairman of the New Hampshire Democratic Party, says: "I think we have in this country what the Balkans and what the Soviet Union are experiencing: Discontent, social and economic discontent. It is not malaise anymore." Mr. Spirou, who ran unsuccessfully for governor in 1984 against John Sununu, the White House chief of staff, calls it a Sununu myth that Bush is unbeatable in 1992. "Somebody ought to remind the White House about Margaret Thatcher and ask who defeated her. No one will remember the individual, but actually it was economic internal discontent.... I think the same thing is playing here," he says. John Disko, executive director of the New Hampshire Association of Counties, says defense cutbacks are taking a heavy toll on the economies of southern New Hampshire and nearby Massachusetts. "With the withdrawal of defense money, layoffs have hit middle- and upper-income people, and they have $1,500- to $3,000-a-month mortgages. The real estate market has plummeted," he says. There are homes that once sold for $600,000 that now can be bought for $300,000, or even $200,000, Mr. Disko says. At the same time, property taxes have shot upward, putting a double squeeze on family budgets. Almost every New Hampshirite seems to have a story of woe, either his or her own, or someone they know. A Nashua woman tells of a banker friend who dreads having people walk into her office and hand her the keys to their homes, saying, "We can't make the payments anymore." A Manchester newspaper executive tells of salary freezes, early retirements, and layoffs that are spreading throughout the news industry. Newspaper advertising is off 20 percent in New England. "This business was supposed to be depression-proof, but not this year," he says. Riding this discontent, the Democratic theme in the coming presidential campaign will be "taking care of America's business," Spirou says. "The politician who misjudges that sentiment right now is going to be the person who is not going to have a chance of getting elected in 1992." Spirou says Bush feels "very comfortable playing outside the borders of the United States, but you're going to find that the battle is going to be in the streets of America in this election.... We are in an economic depression in this area of the country.... It's deep. It's ingrained. It has been created from the greed of the Reagan-Bush eras." Dr. Moore says the economic weakness in the Northeast obviously presents the Democrats with an opportunity. "The potential ... is quite great," he says. "If you get a real dynamic candidate who is concerned about the problems of the economy ... you could see a real effect in New Hampshire." Moore says the problem for Democrats will be fending off Bush's call to patriotism in the wake of the Persian Gulf war. Moore explains that there are usually two major themes in American politics - patriotism and alienation. The patriotic themes are obvious: pride of country, support for a strong military, support for certain basic values. They are the primary Republican strengths. Alienation becomes more important during an economic downturn when people feel left out of the American dream. An economic populist, like Sen. Tom Harkin of Iowa, who launches his presidential campaign on Sunday, is well-positioned to capitalize on such discontent. Success comes when a candidate can combine those two themes, as Ronald Reagan did in 1980 by calling for a strong military, while also blaming the government for high inflation and other economic problems.