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Pay Scandal Could Propel or Hinder Vilsack's Bid in '08

Management Competence is Theme for '08, Analyst Says

Thomas Beaumont

Des Moines Register

April 9, 2006

Management competence in the wake of Hurricane Katrina and the war in Iraq will be a theme in the 2008 campaign
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Gov. Tom Vilsack's efforts to burnish his national leadership credentials likely will be affected by how he handles the brewing controversy surrounding a state job-training agency's finances, some political observers and analysts say.

Revelations that officials at the Central Iowa Employment and Training Consortium earned excessive salaries could give fuel to critics who say Vilsack has been less engaged in state affairs than he ought, some political analysts say.

Vilsack, a Democrat who is not seeking a third term, last month adopted a message that stresses strong and confident leadership as he has increased his national travel in advance of a decision about 2008.

In a speech to Missouri Democrats in St. Louis on March 24, Vilsack criticized the Bush administration's performance on issues ranging from the Iraq war to Hurricane Katrina.

When Democrats lead, he said, "We will make honesty, integrity and accountability central and unconditional to every single decision that is made on behalf of the American public.

"That is why the current wave of corruption in Washington D.C. . . . cannot and should not be tolerated as simple a matter of business as usual," Vilsack told the Missouri Democrats.

Management competence in the wake of Hurricane Katrina and the war in Iraq will be a theme in the 2008 campaign, Georgetown University professor Stephen Wayne said.

"Poor management, particularly if there are hints of corruption, would be the albatross around the neck of any serious candidate," said Wayne, "given the credibility issue with the Bush administration."

Wayne also said any perceived missteps by Vilsack would be easy targets for Democrats who challenge the Iowa governor during the leadoff Iowa caucuses, which, he said, exaggerate the influence of Iowa politics on the nomination.

Joe Trippi, who managed former Vermont Gov. Howard Dean's campaign for the 2004 Democratic presidential nomination, said the episode could work to Vilsack's advantage as he prepares for a national campaign.

"The real issue is how he deals with it. Does he deal with it openly, knock heads and move on? Or does it grow and become cancerous?" Trippi said.

"This could turn out to be one of the best things to happen to him."

Democratic activists in Iowa with their power to propel or dash any presidential hopes Vilsack harbors are watching closely and could have the most to say about his handling of the situation.

"I think he needs to continue what he's doing, keep pushing for the investigation to go forward to let all the facts come out," said Sandy Opstvedt, a Story City Democratic activist.

Vilsack asked for Iowa Workforce Development Director Richard Running's resignation on Wednesday, five days after a state auditor's report that the CIETC's top executives were earning "excessive" salaries became public.

Although CIETC answers to a board and not a state department director, the governor said Running and his lieutenants were responsible for oversight and failed to "ask the right questions." Vilsack appoints the director of workforce development, which monitors the job training and placement program.

"If you don't do your job, you've got to be held accountable," Vilsack said, announcing the resignations of Running and deputy director Jane Barto.

The findings have prompted federal and state investigations and a review by state lawmakers.

Republicans on Friday sought to fan the story by issuing a press release with the headline: "What did Vilsack know?"

In addition, Republicans on the Legislature's Government Oversight Committee have indicated they want Cynthia Eisenhauer, Vilsack's chief of staff, to testify about what the governor's office knew about the situation.

None of the probes have implicated officials higher than those at Iowa Workforce Development, which helps finance CIETC's $5 million budget.

But the episode comes during a stressful time professionally and personally for Vilsack, who has been locked in negotiations with legislative leaders over a budget deal less than two weeks after his friend and former chief of staff Steve Gleason committed suicide.
The audit report containing the salary information became public when Vilsack was out of the state on national political travel, which also forced him to participate in budget negotiations by telephone last week. The governor attended events in Washington, D.C., Florida, Pittsburgh and New York during the past two weeks.

"It's not a distraction from what he's trying to accomplish," Vilsack spokesman Rodell Mollineau said. "It doesn't stop him from working with legislative leaders to improve education, lower health care costs or strengthen the economy. This is what leaders do."

But Vilsack, who is taking steps toward running for president in 2008, at least temporarily must attend to the crisis at the same time that he works to gain credibility as a leader outside of Iowa, according to University of Iowa political science professor Peverill Squire.

"He can try to clean it up quickly, and there's no evidence to suggest anyone close to him condoned this kind of thing," Squire said. "But it does cause him some problems because he wants to portray himself as a solid competent leader, and this is easy fodder for those who dislike him."