RAW DATA: Moore & Liddell on US midterms

RAW DATA: The Nation transcript: Lisa Owen interviews NZ Ambassador to the US Mike Moore and Chris Liddell about the US midterm elections.

Watch the interview here

NZ Ambassador to the US Mike Moore and Kiwi businessman Chris Liddell, a senior adviser with Mitt Romney's 2012 presidential campaign and Xero's [NZX: XRO] chairman, talk about the implications of the US midterm elections next week.

All of the seats in the House of Representatives and a third of the Senate are up for grabs. 

The big question is whether the Republicans can take control of the Senate as well as the House, and for New Zealand what it'll mean for trade deals and the fight against the Islamic State.

Lisa Owen: Over in America, it's election season. All the House of Representatives and a third of the Senate is up for grabs. The big question is whether the Republicans can take control of the

Senate, as well as the House, and for New Zealand, what'll it mean for trade deals and the fight

against the Islamic State. New Zealand's Ambassador to the US, Mike Moore joins us from Chicago, where he's looking forward to that All Blacks match, and New Zealand corporate high-flyer Chris Liddell, a senior adviser to Mitt Romney in his 2012 presidential campaign, is in New York. Good morning to you both, gentlemen.

Chris Liddell: Good morning.

Mike Moore: Hello.

Mr Moore, if I can come to you first, internationally, Barack Obama is still seen as a bit of a rock star, but he's got the lowest approval ratings ever at the moment, and even his own candidates seem to be backing away from him at this election. What's going on?

Moore: Well, it's second-term blues for any president. A bit more accelerated for President Obama, his ratings at this moment, in some polls at least, than George W Bush. And so you're right. Many of the candidates are moving from him. There's a fantastic ad, well, in Kentucky, where the Democratic Senate candidate holds a gun, and she goes, 'Click, click. I disagree with President Obama. Click, click. Bang. On guns. Click, click. Bang. On coal. Click, click. Bang. On the Environmental Protection Agency.' So, uh, it's going to be an interesting struggle. Most embassies and pundits are suggesting the Senate could flip, although as Chris will explain, there are a couple of strange electorates. In Kansas, the Democrats have pulled out, and an independent is running against a Republican, and because it's because you've got to break a 50% threshold, there are two states — Louisiana and Georgia — where we may not get a result, and there has to be a run-off.

Run-off. You say that it's likely to flip. The Senate's likely to flip. But by how much? Is this

gonna be a bloodbath for the Democrats, do you think?

Moore: Oh, I doubt it's a bloodbath. As I was saying, in Kansas, something strange could happen, where an independent is challenging the Republican incumbent, and the Democrats don't have a candidate. Uh, in Georgia and Louisiana, you have to get over 50% of the vote, and so there could be another election after this one, and there isn't a tidal wave towards the Republicans. There is arguments against incumbents. If you're in there, that is a bad thing. So Democrats and Republicans

are being hammered if they are incumbents. And there's another series of races which are getting the publicity, which are the governorships. Now, why are they important? Well, in those governorships, there could be one or two Republican presidential nominees. Also — the governor's mansion and the state assemblies decide the electoral boundaries for the Congress. This is not done in an independent way. So these races are of interest to us as well.

So let's bring Chris Liddell in here. What do you think? How is it going to play out? Are the

Republicans gonna romp in?

Liddell: (CHUCKLES) Well, uh, I don't think it's gonna be quite the same score as what we're gonna see in Chicago tomorrow. But the way it's sort of shaping up, I would say there's 100 seats in the

Senate. Basic math is there's 100 seats. You obviously need 51 to control it. So I would say there's broadly 45 seats apiece that are reasonably certain to fall to the Democrats and Republicans. Those that are already held or reasonably assured, which leaves 10 up for grabs. They're all pretty close, and what's called the ground game here — turnout on the day — could make a big difference. Having said that, the polls are indicating probably six of those 10 would go Republican, two Democrat, and two, it's a dead heat. So if it was done exactly on the polls, and it never is, but if that

was done, that would probably indicate around a 52, 53 seats to the Republicans. But as Mike said, there's a couple that could go over to January because they're so close and need a recount of some form. So there's still a long way to go, but most people are saying it's likely to be a Republican victory in the Senate.

In saying that, though, Chris, doesn't the saying go, 'Anything less popular than Obama is a Republican'? I mean, does the Republican party still got this civil war going on within?

Liddell: I think there's a more fundamental issue at stake here, and it's really around the competence of the government. Every election has a theme, and if there was one single theme, it would be that. You know, just one number that always sticks with me. The US government employs around 4 million people, including the Army, so about the size of the whole of New Zealand. So if you imagine one organisation employing every New Zealander, you get a sense of the complexity of

running it, and over the last year or so, there have been a series of embarrassments both domestically and internationally for the government. Uh, Obamacare roll-out. The Secret Service allowing people into the White House. Most recently, the handling of Ebola—

But there is... But the economy is lifting there, isn't it? And when it comes down to it, people vote with their back pocket, don't they?

Liddell: Yeah, but they don't feel it. That's the problem. And one of the ironies under the last six years is that inequality in the country's actually got worse rather than better. So there's a poll out that I think is a really interesting one, which is called 'Right Track, Wrong Track', and it basically says, 'Do you think the country's on the right track or the wrong track?' It's a pretty simple one, and Americans by nature are generally optimistic. The latest versions of those have about 27% of people think it's on the right track. Over 60% think it's on the wrong track. That's very unusual for America.

And so there's this fundamental concern where the country's at and the role of government in it, and so that's playing as big a role as whether you're a Democrat or a Republican.

OK, Mr Moore, if I can come back to you. If the Senate does change hands, what's that gonna mean in practical terms? What are the consequences of that?

Moore: Well, if it does flip, our great national interests don't change that dramatically with the change of government, and the administration will continue to negotiate the trade deal we've had

so much interest in. Uh, although historically Republicans have been more interested in trade than Democrats, um, but they will be holding the administration's hand to the fire, and there'll be all sorts of subpoenas going around, and there could be some chaos and conflict. There will be between the

administration and the Senate. However, trade is one area where there is a little bit of bipartisanship creeping into it, and this could well be a legacy issue for the president. So I'm not saying it's gonna be unhelpful or helpful. It is what it is.

But do you anticipate, then, that the Trans-Pacific Partnership...? Do you anticipate, then, that we could see a deal in the Trans-Pacific Partnership within the next six months? Could there be a deal regardless of what happens in the Senate?

Moore: It is very possible. It could even be soon. Yeah, but what happens — the administration negotiates the deal. Then it's got to take it to the House and to the Senate to see whether it floats

and whether or not the senators and Congress, men and women, feel it's big enough and good enough for the Americans. So, um, yeah. The administration cuts the deal, brings it back. Now

this could happen very fast or not. We don't know because it's a negotiation. Um, but I don't see, um, if the deal's good enough, whether it's a Republican Congress or a Democrat one, being substantially different. However, it is true that, historically, the Republicans have been more pro-trade. Depends on the deal the administration can get.

What about the situation with the Islamic State? If the Republicans have control of the

Senate, do you think there's gonna be more pressure to ramp up military action from America against Islamic State?

Moore: Yeah, the defence of the country is with the commander-in-chief. It is the president's prerogative. But if there is a flip, there'll be some aggressive congressional and senatorial questions and accountability to hold the government to account, and so it will be more vigorous.

Chris Liddell, what's your take on that?

Liddell: I think the biggest change we'll see is just on legislation going to the president. The way the system works here is basically either the House or the Senate can generate legislation, and the other one can either veto it or not, as the case may be, before it goes to the president. When you have a split situation like we've had in the last couple of years, uh, the House generates it, the Senate blocks it or the other way around. When you have both of them controlled by one party, obviously legislation gets through, which means it goes to the president, and then he has to decide whether he passes it or not. So I think you're gonna see a lot more legislation, both domestically and internationally, going forward. So I think it's gonna be a more active period, and the real issue is gonna be, 'Do we shift gridlock from one place, being between House and Senate, to another place, which is the president?' So I think it could actually be a very interesting couple of years.

So what does this election tell us about the presidential race? Because we see Hillary Clinton as out there, shaking hands and doing her thing. And even Mitt Romney has been brought in to, um, help support Republican candidates. What does it tell us about the presidential race?

Liddell: I think it sets up a really interesting dynamic. And, again, it obviously depends on whether the Republicans or the Democrats win the Senate, so that's a different scenario, but let's assume the

Republicans win it. Then they have the opportunity to basically show that rather than just being blocking legislation, they can put some positive legislation forward. So it actually sets up a more

interesting dynamic for the presidential race because it gives the Republicans a platform on which to launch their candidate, whoever that might be. If it flips the other way and it's the Democrats, unfortunately, we've probably got more of the same for the next couple of years. But assuming it's a Republican victory, it actually makes the presidential race more interesting.

Mr Moore, what are your thoughts on that? How does that stack up in view of the presidential race?

Moore: Well, I agree with Chris. Obviously Hillary Clinton is the frontrunner for the Dems, and the Republicans have got quite a wide range of possible candidates, and don't underestimate Jeb Bush.

He's centre. If he can survive the primary process, he's a very likable person. Um, but demographics are destiny, and half of all Texans are now Hispanic. And the Republicans — for a presidential victory — are gonna have to reach across to the Hispanic community in a way they've been unable, so far, to get results from. Um, George W Bush did quite well with the Hispanics, but since then, the Republicans have not done as well.

Mr Moore, briefly on another topic. Sorry to interrupt you. On another topic, you are in Chicago for the rugby game. Have the Americans worked out yet that the ball gets passed backwards?

Moore: There are people queuing at 6am, a mile long, at a restaurant to get autographs. The biggest rugby game in American history has been 20,000. We're going to get 65,000 people at this game. It's a frenzy, and our people are doing very well. Alongside the 75 New Zealand businesses, Soldier Field, which is where a memorial to the First World War is there. Wreaths will be laid. I think we're doing a good job, and I'm slightly confused at the New Zealand media sneering that there is no interest. Walk in the streets. Banners everywhere. But, OK, 65,000 — three times as big as any other game.

And in the political game, Mr Moore, we have an election going on back here at the moment. It's for the leadership of the Labour Party. Who's got your vote in that respect?

Moore: Well, I'm not available. Impossible, I mean. (LAUGHS)

Fantastic. Thank you very much to both of you for joining us this morning. That's Mike Moore and Chris Liddell. Thank you, gentlemen.