Haley at halfway

SC governor gets high marks on jobs, but some allies are alienated

gnsmith@thestate.comOctober 28, 2012 

  • The first two years A look at some of the pluses and minuses from Gov. Nikki Haley’s first two years in office Successes • Cabinet appointments. Republicans and Democrats applauded several of Haley’s cabinet appointments, including Bill Byars at the Department of Corrections, Bobby Hitt at the Commerce Department, Tony Keck at the Department of Health and Human Services and Mark Keel at SLED. • Jobs, jobs, jobs. The business community applauds Haley’s efforts to pass pro-business legislation and attract new jobs, including a new Continental Tire plant in Sumter, a Bridgestone expansion in Aiken and a new Nephron Pharmaceutical plant near Cayce. • On-the-record voting. Haley ran on a transparency platform. Her key issue: Exposing that lawmakers did not cast all of their votes on the record. Requiring them to do so was her first victory as governor. • Medicaid reform. Haley and Keck, director of the state’s Medicaid agency, cut reimbursement rates to doctors and other health providers. The change allows the state to better control its rising health care costs. •  Pension reform. Haley pushed reform making it harder for state workers to retire early, a big savings for the state. • Tort reform. Haley and her allies pushed caps on punitive damages. Haley says the change helps recruit businesses. She plans additional tort reform in the coming session. Mixed results •  Ethics reform. Following an ethics investigation, Haley could have been branded as one reason why South Carolina needs tougher ethics laws. Instead, she has called for tougher laws, setting the stage for what could be a political victory. •  Illegal-immigration reform and voter ID law. Haley advocated for and signed into law tougher immigration and voting laws. The immigration bill, still being challenged in court, requires police to check the immigration status of drivers and others they stop. The voter ID law would have required voters to present a driver’s license or another form of state-approved ID at the polls. But that requirement effectively was gutted by the court that approved the law. National profile. Haley has built a national profile as a young, energetic conservative, intent on reform. But that profile has come at the cost of some supporters back home, who say Haley is more interested in the national spotlight than governing South Carolina. Failures •  Administration Department. Tensions between Haley and lawmakers have made it difficult for Haley to pass key pieces of her agenda. The Department of Administration bill failed because lawmakers did not want to give Haley a victory. House divided. From report cards that criticized lawmakers to a memoir that called them “good ole boys” to her intervention in primary races, Haley has upset lawmakers who feel she unfairly targets them. • Lack of experience. Critics have wondered why Haley did not hire more experienced staffers who could have helped her better manage the transition to governor from legislative back-bencher. • Lost faith. Some of Haley’s most vocal, early supporters are no longer on her side, including the S.C. Policy Council, and some Tea Party members and supporters of former Gov. Mark Sanford. They say Haley has not done enough to restructure government and bring more accountability into the process. Some Republican Party faithful also are upset Haley has not worked to build up the party and raise money for it – even though she has done so for Republican parties in other states. •  Moore effect. The ousting of trustee Darla Moore upset University of South Carolina supporters, leading to a public relations nightmare for Haley, who replaced Moore with a campaign donor. • Ports controversy. A decision by Haley’s environmental board helped Georgia expand its port at the expense of the Charleston port. The biggest gaffe thus far by Haley’s administration, the move continues to hurt Haley’s relationship with lawmakers

Politics is a game of addition, normally. Politicians work to keep the support of their base and, at the same time, win new supporters.

Not so with S.C. Gov. Nikki Haley, critics say. In the two years since her election, the first-term Republican has turned that adage on its ear, playing a game of subtraction.

Critics say Haley has adopted an insular management style, surrounding herself with a small group of 20-something former campaign staffers, led until recently by a young chief of staff, with limited state government experience. She also employs an “us vs. them” mentality against her perceived foes.

The result?

Haley has alienated some former allies, made powerful enemies and damaged relationships with legislators who could have helped pass her agenda. A list of the bruised extends from Tea Party elements and the libertarian Policy Council, both of which once championed Haley, to fellow Republicans, including House Speaker Bobby Harrell.

Inside South Carolina, the Lexington Republican has failed to add to her political following – with one major exception. Her support has grown in the business community, which says Haley is working hard to bring jobs to the state.

Haley has had far more success outside South Carolina. She has spent dozens of hours and traveled thousands of miles building her national image as a rising conservative star – a young, minority woman, driven by the desire to reform her state. That image has allowed Haley to raise big bucks, much from out-of-state donors, and landed her a coveted speaking role at this year’s Republican National Convention.

Haley repeatedly has said she has no ambition beyond South Carolina. But chatter continues that a win by Republican presidential nominee Mitt Romney, whom the governor has worked to elect, would open untold national doors for Haley.

But if President Barack Obama is re-elected, opinions are split on whether Haley can win re-election in 2014.

Some Republicans expect Haley will face a GOP primary challenger, funded by dissatisfied party donors. If that challenge comes, Haley may not be able to rely fully on the S.C. Republican Party. In part, that is because many S.C. Republicans are peeved Haley has not raised money for the party, as previous GOP governors have done. Instead, she has raised money – and her national profile – for Republican candidates and groups in other states, from Virginia to Arizona.

Still, some political observers, including Bob McAlister, a longtime S.C. political consultant and former chief of staff to the late Gov. Carroll Campbell, say Haley is a shoo-in for renomination.

“By and large, she’s made herself virtually unbeatable in a primary,” said McAlister. “She’s raised a lot of money,” a reference to the more than $1 million in Haley’s re-election war chest.

The ‘frat-boy’ inner circle

Haley arrived in office bruised, dogged by allegations of ethical scandals. The team that Haley assembled to help her run her office did little to help her move beyond those problems.

While some of Haley’s hires for the governor’s office had experience in prior administrations, including Haley’s attorney and her D.C.-based pollster-adviser, most of her team was young and had worked only on campaigns, not in state government.

“It consisted of inexperienced people, almost a frat-boy mentality, who were giving her a lot of bad advice,” said John Crangle, a longtime State House lobbyist and frequent Haley critic.

As an example, Crangle points to Haley’s decision to oust Darla Moore from the University of South Carolina Board of Trustees. Moore, the university’s largest donor, was replaced with a Haley campaign contributor.

Emails among Haley staffers showed the administration was caught off guard by the outraged reaction from USC alumni, supporters and students. Lawmakers on both sides of the political aisle still are scratching their heads over why Clemson-grad Haley ousted Moore.

Haley didn’t help herself by saying Moore had declined to return her phone calls. Her office’s records, subsequently obtained by The State newspaper, showed Haley had not tried to contact Moore until after lining up her successor.

Crangle said previous governors would have avoided the public relations nightmare. “If it had been (former Gov.) Dick Riley, he would have taken Darla Moore to lunch, thanked and praised her for all of her hard work over the years for the school, and he would have squeezed another $10 million out of her, too.”

Haley’s office acknowledges the new governor “did hire a few key campaign staff members.” But Rob Godfrey, Haley’s spokesman who also worked for her campaign, says, “They have done a great job.”

Godfrey adds Haley reaches out to experts when needed, citing her cabinet picks. Some of those appointments – including Bobby Hitt at the Commerce Department – have been praised widely. “And she (still) relies a great deal on the counsel of people like former Speaker David Wilkins, who are held in high regard across party lines in the General Assembly,” Godfrey added.

Haley also is making changes in her office that could signal a new day, particularly in working with lawmakers.

Bryan Stirling, 42, started as Haley’s new chief of staff on Oct. 15. With experience working for two S.C. attorneys general and lobbying at the State House, Stirling widely is praised for his abilities to build relationships.

Rocky relationship with ‘old bulls’

Haley’s relationship with the Legislature could use a reboot.

On the 2010 campaign trail, Haley repeatedly was asked whether she could work with the General Assembly to get legislation passed. Voters – and lawmakers – were tired of the gridlock that marred the two terms of her predecessor and one-time mentor, Mark Sanford.

Haley vowed to work with lawmakers.

Instead, Haley has angered lawmakers, issuing report cards last year that graded them on whether they followed her lead and writing a memoir that sharply criticized several legislators.

In the June primaries, Haley again ruffled fathers, stumping for favored Republican candidates at the expense of other Republicans. Now, her new political fundraising arm, The Movement Fund, is working to defeat a fellow Lexington Republican in next month’s general election, state Sen. Jake Knotts.

Haley has had some legislative successes, notably reforming the pension system for public-sector workers, passing tort reform to cap punitive damages in lawsuits and requiring more on-the-record votes by lawmakers.

But there have been many stumbles and fireworks too.

In January and February, for example, the House and Senate unanimously passed resolutions disavowing a vote by Haley’s environmental board that helped Georgia expand its Savannah port at the expense of Charleston’s port. Lawmakers say they still don’t know why Haley acted as she did on the issue, now tied up in lawsuits.

Haley also has made an enemy of House Speaker Bobby Harrell, R-Charleston. The two have long quarreled – starting with Haley’s committee assignment while a House member. But the private shouting matches exploded into public over Haley’s portrayal of Harrell as corrupt in her memoir and Harrell’s role in a probe of Haley’s ethics.

Haley’s office says tension is inevitable when a reform-minded governor takes on hard-headed lawmakers, resistant to change.

“Gov. Haley has made more progress on government restructuring and on accountability measures, like on-the-record voting, than any of her predecessors,” Godfrey said. “But she shares the movement’s frustration that a few old bulls in the General Assembly have been able to stymie some really important reforms. ... That’s why she’s out there now campaigning for reform candidates, and why she will continue to push for those reforms.”

Trying to rebound on ethics

In an unexpected twist, Haley’s greatest achievement thus far may be in persuading lawmakers to update the state’s outdated ethics laws.

This spring, the GOP-controlled House that Harrell leads launched an investigation into whether Haley, while a state representative, illegally exploited her position for personal financial gain.

While Haley eventually was cleared, the allegations – for which her attorney’s defense was, essentially, that everybody does it – made a powerful case for ethics reform.

In the wake of the probe, Haley could have become the poster child for why reform was needed. Instead, in August, Haley toured the state, touting a list of ethics reforms that she wants passed and, later, organizing a commission to oversee the process.

“She’s taken this giant negative and made it a positive,” former Campbell staffer McAlister said. “That was politically smart.”

‘Some friction is inevitable’

Still, some of Haley’s top agenda items remain undone because of her sour relationship with lawmakers.

The biggest example? Haley’s inability to pass one of her top agenda items, a new Department of Administration. Haley and her allies say creating the department, which would be the biggest government restructuring in decades, would make state government more accountable and efficient.

Odds seemed good the bill would pass this past legislative session.

Republicans and Democrats alike – including Haley’s 2010 Democratic opponent for governor, state Sen. Vincent Sheheen of Camden – supported the effort. On the final day of the legislative session, the bill only lacked a final vote from the Senate to become law.

Instead, a majority of senators – led by Haley nemesis Knotts, who used a racial slur to describe Haley in 2010 – ran the clock out on the bill.

“There was an element in the Senate, a bipartisan element, that did not want her to be able to declare victory,” said state Sen. Larry Martin, R-Pickens, who worked with the governor’s office to get the bill passed. “What happened that last day, I view that just as being personal. They just didn’t want her to have it.”

Martin said Haley’s relationship with the General Assembly is not good. But he does not fault Haley alone.

“I found her very easy to talk to, even when we didn’t agree,” he said. “But for some (in the General Assembly), it’s about partisan politics, legislators vs. governor, parochialism. They just can’t get along.”

Haley did win accolades from some lawmakers for her efforts to try to save the Department of Administration bill.

In the early morning hours of the final day of the session, she met with groups of lawmakers, trying to work out a compromise deal. “It had to be one of the most frustrating days for her. ... But I think it was her best day of governing,” said state Sen. Shane Massey, R-Edgefield. “She got her hands dirty. She worked with us. She agreed to some compromises.”

Haley spokesman Godfrey contends Haley has a good relationship with all but a few members of the General Assembly, reaching out to lawmakers more than previous governors had.

“She has particularly strong relationships with key leaders,” said Godfrey, citing specifically fellow Republicans Senate Majority Leader Harvey Peeler, Martin, Massey, and House Ways and Means chairman Brian White, Speaker Pro Tem Jay Lucas and Rep. Murrell Smith, “even though they sometimes disagree on some issues.”

“But, look, some friction is inevitable when the legislative and executive branches disagree, particularly when it comes to spending and restructuring,” he added. “Gov. Haley would like to see a lot less state spending than a majority of the legislators want, and legislators historically have been resistant to changing the antiquated structure of our government. That leads to battles.”

Democrats remain unimpressed with Haley, saying the Republican governor’s style makes it impossible to forge a fruitful relationship between the Legislature and the governor’s office.

Part of the issue is Haley’s sometimes-facile ability to interpret the truth, some say.

“This lady just makes stuff up,” state Rep. Gilda Cobb-Hunter of Orangeburg said earlier this year. Cobb-Hunter is one of many lawmakers Haley criticized in her book – criticisms lawmakers say are untrue and intended to build Haley’s national image as a crusading outsider, trying to reform a corrupt state system.

Others say Haley is incapable of making the compromises necessary to win victories.

“(Former Republican Gov.) Carroll Campbell had a Democratic-controlled General Assembly and got major reforms passed,” said Phil Bailey, director of the Senate Democratic Caucus, who got in trouble earlier this year for calling Haley an offensive term on Twitter. “The same is true of (Democratic Gov.) Jim Hodges with a Republican-controlled General Assembly. It is possible.”

Bailey added, “I don’t think Haley cares about governing. It’s all about politics to her.”

Many in the Legislature see Haley as too self-focused.

As examples, they cite her courting of the national press, particularly Fox News Channel, her speaking role at the Republican National Convention and her nationwide fundraising.

During the Democratic National Convention, which Haley attended as a GOP “truth-squader,” S.C. Democrats mockingly issued press releases saying it had been almost two weeks since Haley had been to her State House office and suggesting she go back to work.

The Sanford effect

Other fractured relationships have broken some of the bonds that laid the groundwork for Haley’s unlikely win in 2010.

Perhaps Haley’s most important early advocate was former Gov. Sanford, who persuaded Haley to run, then went hat-in-hand to his large network of supporters, asking them to support her. By election night, Sanford had raised more than $400,000 for Haley and also invested his political capital in her, promising backers that Haley would carry his libertarian baton and continue his reform fight.

Today, that political capital has dried up.

Sanford has not publicly discussed Haley. Privately, those close to the former governor say the word that he uses to describe his assessment of Haley is “disappointed.”

Many of his deep-pocketed donors share the sentiment.

Other former political allies also have cooled on Haley.

In 2010, the state’s Tea Party organizations, then a new power in S.C. politics, fired up their grassroots base and helped deliver the Governor’s Mansion for Haley. Today, some of those organizations also say Haley is a disappointment.

Joe Dugan, state coordinator for the S.C. Patriots and chairman of the Myrtle Beach Tea Party, said he is disappointed in Haley, specifically her endorsements of two moderate candidates – Romney, before the state’s January GOP presidential primary, and Tom Rice, this spring in the 7th District congressional race.

But Dugan says he is not turning his back on Haley. “My choices are this: Either stay so absolutely P.O.’ed and accomplish nothing or get over it and move on. I want to help South Carolina, so I’m hanging in there.”

Other former Haley backers are willing to move on.

The libertarian S.C. Policy Council, for example, introduced Haley to the issue she used to establish her bona fides as a reformer in the 2010 race – the call for more on-the-record legislative voting – and championed her candidacy.

Today, the group has soured on Haley, saying she has left many other important transparency issues undone, including changing how judges are appointed, failing to open up the process by which the state lures private companies to the state, handing out millions of public dollars in tax breaks, and working to shorten the state’s six month legislative session that encourages career politicians.

“There are things she should be doing right now, things that are in her reach, that she’s not doing,” said Ashley Landess, president of the think tank.

Landess points to Haley’s announcement earlier this month that she will form a committee to propose ethics reforms.

“Why do we need another commission?” Landess said. “It’s about avoiding responsibility. That’s why we have all of these study committees and commissions – to avoid action. They (Haley and lawmakers) know what needs to be done. ... In South Carolina, there is this concentration of power and secrecy, and there is no interest on the part of the governor or legislatures to address that because it gets at the heart of their power.”

Landess said Haley could act now to increase transparency in government. To start, Haley could issue an executive order, requiring the agencies that she directly oversees to comply with the state’s open-records law. That would ensure the public gets access to public records in a timely manner without cost-prohibitive charges.

“She’s not done that and she won’t,” Landess said.

‘She has the style’

The one area where Haley seemingly has expanded her support is in the business community, where many laud her focus on job recruitment, a top priority in a state with a 9 percent jobless rate.

(At the request of the governor’s office, more than a dozen economic-development and tourism officials called The State newspaper to express support for Haley’s jobs efforts.)

Even one-time opponents have changed their minds.

S.C. Chamber of Commerce president Otis Rawl – whose organization endorsed Gresham Barrett, one of Haley’s GOP rivals, in 2010 – said Haley deserves part of the credit for the $7 billion in investment and 27,000 new jobs landed by the state’s manufacturing sector since 2011.

While previous governors also worked to land jobs, Haley is one of the best at it, said Danny Black, chief executive of SouthernCarolina Alliance, the economic-development organization for the southern part of the state.

“She has the style and personality to connect with people,” said Black, who credits Haley for helping Denmark recruit Masonite, a door manufacturer that has pledged to bring up to 200 jobs to that rural town. “I don’t know of anyone – with the exception of Carroll Campbell – who is so good at handling the heads of these companies.

“To me, she’s outstanding,” Black said. “She knows the subject every time I’ve been around her. She knows what economic development is all about. She knows what the business community is looking for, whether it’s training or incentives or workforce related. And she’s very professional, and she’s very good in discussions with these guys and gals who are bringing jobs here.”

Reach Smith at (803) 771-8658.

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