By: Politico

The financial crisis has redefined the presidential race, bringing into stark relief the candidate who can deal with the complexities of the global markets and return the country to prosperity over the next four years.

The race is no longer about change, experience, Iraq, tax cuts or universal health care. The job posting has been fundamentally altered.

Just as the Russia-Georgia conflict tilted the race toward Republican nominee John McCain a few weeks ago, this economic crisis shifts everything once again — this time to Democratic standard-bearer Barack Obama. Voters will now increasingly cast ballots on the economy, as opposed to national security or social values. This will reach right into the swing states, such as Ohio, where the economy had already been teetering before this crisis, and maybe even Florida, where many retirees on a fixed income live off their investment portfolios.

Americans — like voters around the world — have a habit of shifting their support in reaction to a crisis. In 2001, Michael Bloomberg was 20 points behind in New York’s mayoral race, until the Sept. 11 attacks transformed voters’ requirements for the job. New Yorkers needed a crisis manager, not a reformer, and they shifted to Bloomberg virtually overnight.

Over the years, I have seen other such crises have a big impact. President Bill Clinton’s strong and empathetic response to the Oklahoma City bombing in April 1995 lifted his presidency from its doldrums after the 1994 Republican congressional sweep. His reaction to the bombing was a building block toward his easy 1996 reelection. And Sept. 11 transformed the Bush administration into a national security presidency, a key part of his 2004 reelection.

But what makes the current financial crisis more like an economic Sept. 11 is the way it suddenly burst onto the scene with the unexpected collapse of major investment banks and gyrations of the world’s equity and debt markets — on top of skyrocketing oil and commodity prices.

The unrestricted consumption of oil, the unrestrained use of easy credit and the out-of-control use of complex financial derivatives all collided to send a clear message to America that the nation could actually face an economic collapse unlike anything since 1929.

So why didn’t this benefit John McCain, the seeming steady hand of experience in the midst of a crisis? First, because his performance seemed erratic rather than steady, and second, because the kinds of people we turn to in an economic crisis are very different from those we would turn to for a national security conflict.

In the showdown with Russia, America was looking for someone who would be tough, knowledgeable and certain, and would strike enough fear in the hearts of the enemy to gain respect and maybe even stare down our adversaries.

With a sophisticated global economic crisis, the voters would be looking for nuance and mutual cooperation, someone who would reach out to the nation’s economic partners. Rather than calling for moral absolutes, the voters are looking for compromise — they know it’s morally wrong to bail out Wall Street, but they also know they have to do something or they will wind up paying an even bigger bill for this crisis.

So right now the former Harvard Law Review editor, the candidate who is ready to reach out to everyone across the globe and who has a head for sorting out complexity, is the kind of presidential candidate voters are seeking to solve this crisis. It seems like a great fit for Obama.

And McCain’s running mate, Sarah Palin, is no help here. Her selection was a values play, and now values are a less important factor in voters’ decisions. How McCain must wish he had tapped former Hewlett-Packard CEO Carly Fiorina, one of his chief economic advisers. She might have been the kind of VP nominee who would be scooping up votes in this crisis. Palin was also an attempt to bring more women to the GOP — but women are typically the most nervous and concerned about economic policy, especially in a recession or a crisis. This is why the Palin effect seems to have disappeared.

Compared with Obama’s principles, McCain’s solutions — ending earmarks, slashing spending and cutting taxes — while popular enough, do not seem like a comprehensive plan to fix the global economy. McCain started off down the populist road, condemning Wall Street CEOs, but seemed to do it only halfheartedly before pulling back.

McCain had planned on using Friday’s foreign policy debate to highlight his experience, but when the event’s first 40 minutes shifted to economic talk, he lost his edge on the issues. Despite serious discussion about how to deal with Russia, no one seemed to care. Instead, McCain’s discussion of the economic crisis came across as quite weak.

Neither Obama nor McCain has so far used the values-oriented approach that President Franklin D. Roosevelt invoked in his first inaugural address, when he described how the “money changers” had fled their temples, allowing government to restore the temple to “ancient truths.” He fused populism with restoring the basic values of hard, honest work over “callous and selfish wrongdoing.”

The candidates are a long way from his rhetoric or his positions — neither has expressed the kind of outrage that FDR did at the bankers who caused so much economic misery. The average American homeowner has already lost 25 percent of the home’s value — for most people, that’s 25 percent or more of their savings.

Other events may well come along and again shift the focus of this election. But absent other game-changers, this election is now a referendum on economic leadership, and that is giving the edge to Obama, who is seen as having the intellect to solve this crisis.

Mark J. Penn served as chief adviser to President Bill Clinton in the 1996 presidential election and to Hillary Rodham Clinton during her Senate and presidential races. He is the author of “Microtrends: The Small Forces Behind Tomorrow’s Big Changes” (Twelve, 2007).

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