Peter Schiff's Bitter Pill

With Sen.


With Sen. Chris Dodd’s low approval ratings, Republicans are eying a pick-up in increasingly blue Connecticut. But so far the roster of challengers is underwhelming—there’s a state senator, a former congressman who’s already been voted out and a Bush-appointed ambassador, largely unknown.  

 

“How are they going to energize anybody?” asks Peter Schiff, a Connecticut-based stock broker. “If a regular Republican runs in Connecticut, why is anybody anywhere else going to give a damn? I don’t even know why anyone in Connecticut would care. What’s he going to change?”

 

What Republicans need, Schiff says, is someone outside of the Republican mold—someone like himself. That’s why Schiff, a political neophyte, is considering running against Dodd.

 

Schiff became a minor celebrity in 2006 when he took to cable, predicting an approaching economic meltdown. He was laughed at—until the economy melted down. Now he’s a talk-show staple and has a legion of libertarian followers.

 

Earlier this year, a collection of his supporters, who have already convinced Ron Paul’s son to run for Senate in Kentucky, launched an online effort to get Schiff into the Senate race. I sat down with Schiff this afternoon to talk about why he’s now considering just that. He’s certainly well-equipped with soundbites against Dodd already. “When he was saying how sound Fanny and Freddie were, I was saying they were bankrupt,” says Schiff. “When he was saying everything was great in the housing market, I was saying, ‘No, it’s a disaster.’”

 

At first, Schiff was reluctant, noting just how hard it would be to take down a five-term senator, especially as a Republican in a blue state. Now he sounds all but convinced. He’s got a team of consultants in place—who are working on a “month-to-month” basis as he considers the choice—and he had to dash out of our interview so he could meet with NRSC chair Sen. John Cornyn.

 

He said his final decision “has to come relatively soon.” It depends on whether or not he thinks he can actual win: “Would it be worth the time and money to try to do something that was impossible?” he asks. He’s done no polling so far, and, before his meeting with Cornyn, had little interaction with the Republican Party.

 

If he runs, his campaign will center on his outsider status.

 

“I’ve never run for office,” he says. “I’ve barely ever voted for anybody running for office. Living in Connecticut, even if I go to the polls and vote for a Republican, a Republican’s not going to win. Even if he could win, in the grand scheme of things he’s not going to make a difference.”

 

Why then, would Schiff make a difference? He says he hopes a win on his platform—centered on free markets, individual liberties and slashed government spending—might convince Republicans that a new brand could work in 2012. (Schiff served as an economic advisor to Rep. Ron Paul’s presidential campaign last year, but says he would only run within the two-party system—his only chance of winning.)  

His well-known bearish views will offer his strategists a challenge. Though most politicians like to run positive (think "shining city upon a hill"), Schiff feels no need to hide his pessimism.

 

“There is no recovery coming,” he says. “It’s just going to get worse and worse. That’s the lot in life now for Americans.” It’s a bitter pill, he admits, but “if they don’t swallow it, they’re going to choke on it. So I figure they might as well swallow it.”

 

Don’t expect to hear those kinds of words from any of his opponents, Democrats or Republicans. But, Schiff says, if they can't admit the truth, how can we expect them to make real change?

 

“The key is, are we going to send somebody to Congress who might make a difference?” he asks. “I don’t even know that I can [make a difference]. Maybe I can. But obviously the other guys can’t.” 

Want to know more about Schiff? Here are some more of his views.Why he's running: Even though I was able to accurately predict a lot of what’s happened, I still don’t have a voice in making policy. The people who are in charge of policy are the people who are consistently wrong on the economy. They didn’t understand why the policies of the past were wrong, why they created this mess, and now they’re presenting more of those same policies in the name of solving the problem. I know they’re just making the problem worse. As a citizen do I just sit back and watch it as a spectator, or do I actually try to do something to turn the situation around?On the Republican identity crisis:  If I win on those issues [in my platform] then maybe the Republican Party will have the courage to campaign on those issues in 2012. It seems like there’s a big debate going on—what is the future of the Republican Party? I don’t think the answer is to try to be more like the Democrats. They’re already so similar, they’d be completely indistinguishable. On tax cuts: It’s like everybody wants to go to heaven and no one wants to die. We have to cut programs—not just fraud and abuse. We have to cut real programs. Tax cuts all by themselves solve nothing. If you keep spending money, all you’ve done is change the way you pay for government. I don’t want to change the way I pay for it—I don’t want it. On whether other senators share his views: I don't think I'd be the only one there. They’re just not speaking out or they’re afraid their political interest is not served through that political agenda or philosophy. But maybe I can persuade more people based on my own ability to win and my own fundraising that this is important. Maybe this is the time where you should put that political career aside and stand for something and try to do something with your office—even if it means you step on somebody’s toes or you don’t get a plum assignment. On sacrifice: Most of the sacrifices people are going to make, they’re not that terrible. You’re not going to be out there buying new clothes, you’re not buying a new TV, you’re not buying a new cell phone or laptop every year. Is that so terrible? . . . We’re broke so we have to make some sacrifices, but they’re not permanent sacrifices. Right now we have to ratchet it down, based on all the damage that’s already done. Once we reform our tax code and our monetary system and we start building a viable economy, we start saving again, we build capital, eventually we’ll be able to afford more stuff. We’ll have a higher standard of living as result of all that hard work. But right now we have to live with the fact that we’ve been on this giant consumption binge and we’ve squandered a lot of wealth.  On political opportunism: Most people, once they spend all that money and all that effort to get a Senate seat, the first thing they want to do is make sure they get reelected. So everyting, all their decsions, everything they do, is all about their reelection. I’m not going to do anything based on whether or not it’s going to help me get reelected. That’s going to be the furthest thing from my mind. Six years to me seems like a lifetime in the Senate—why would anyone want to stay in for more than six years?

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