The Buzz

August 23, 2014

EXCLUSIVE: How anger over 2010 race shaped Gov. Nikki Haley’s first term

Gov. Nikki Haley says she turned her anger over the 2010 election into a first term of luring jobs, restructuring government and boosting education. But, as she seeks a second term, critics see her administration as plagued by questionable ethics, and weakened by a hacking scandal and questions surrounding her oversight of the state’s child-protection agency.

The Buzz

A blog from The State's political team of Cassie Cope, Jamie Self and Andy Shain. Email tips to

Nikki Haley was angry during her first year in office.

The Lexington Republican was angry at the GOP establishment for failing to embrace her bid for governor. She was angry at legislators, after being punished by House Republican leaders for pushing on-the-record voting when she was a state representative. She was angry at the media for reporting unproven allegations of affairs.

“If you go back to how brutal my campaigns were, (it was difficult) to turn off the campaign switch and to remember to turn to governing,” South Carolina’s first woman governor said this month in an exclusive interview with The State newspaper. “You’re bruised and wounded and bloodied from everything that you have gone through. ... I could just feel the communication (from me) was harsh. So what I was getting was harsh back.”

Haley said she purged herself of her anger by writing her memoir and redirecting her emotions into luring jobs, restructuring state government and boosting education.

But, as Haley seeks a second term in November, critics see her administration as marred by questionable ethics and ineptness — scarred by the nation’s worst hacking of a state agency’s data and by questions surrounding deaths of children in the care of the state’s Department of Social Services.

Since winning as a near political unknown in 2010, the nation’s youngest governor has won over many doubters within her Republican Party. Haley approaches Election Day with a far higher approval rating among GOP voters — 78 percent this year, compared to 60 percent in 2012, according to Winthrop University polls.

Haley’s attention to winning job-promising new industry — and promoting her successes — also has galvanized her reputation in economic development. It even led to comparisons with Gov. Carroll Campbell, who helped lure a BMW plant to Greer in the 1990s. And her push for reforms to limit lawsuits and curb regulations has won her support from state business leaders, who shunned her four years ago.

“The proof is in the pudding,” said Senate Majority Leader Harvey Peeler, R-Cherokee, a powerful ally. “It’s a different state since she took office.”

Democrats think they have a shot at unseating Haley, however.

Her chief opponent in November, Democratic state Sen. Vincent Sheheen, hopes to make his rematch with Haley a referendum on her competency. Democrats note that Haley beat Sheheen by just 4.5 percentage points in 2010 — about half of the difference between S.C. voters who say they prefer the Republican Party over the Democratic Party.

And Haley has not won over all in the GOP.

“The state needs a different leader at this stage of the game,” said Bob Royall, a former state Commerce Department secretary under Republican Gov. David Beasley and the brother of one of Sheheen's law partners. “We need somebody like Vincent, who is very knowledgeable about the state and can work on a bipartisan basis.”

Still, Haley possesses a personal touch that has helped her connect to voters.

She is a constant presence on Facebook and Twitter, delivering messages about the latest jobs announcement or her weekend plans with her two children. A Facebook post last year, about Haley locking herself out of the Governor’s Mansion while wearing a robe, became a national story.

“It is my way, when I’m stuck in that office, to still be out there with the people,” Haley said. “I’m in a bubble here, and so it’s the only way I feel I can be real.”

Haley’s communication skills help deflect some of the criticisms lobbed her way. “She’s got a little bit of that — like Reagan,” Francis Marion University political scientist Alissa Warters said.

“She is very relateable,” Warters added. “She’s a mother and her husband was in Afghanistan (on a National Guard deployment). She reaches a lot of different segments of society.

“And she’s good at developing messaging.”

‘It hurt me’

After her brutal 2010 races, Haley has tried to shape a new narrative.

The daughter of Indian immigrants was the surprise winner of a Republican primary featuring a congressman, state attorney general and lieutenant governor. Her general election race was made difficult when the state’s main business group, the S.C. Chamber of Commerce, endorsed her opponent, Sheheen.

Hovering in the background during those races were Haley’s ties to her Republican predecessor, Mark Sanford. Haley backed Sanford’s limited-government policies when she was in the S.C. House and included mentions of Sanford on her campaign website.

Even after news of his affair led Haley to remove Sanford references from her website, lawmakers feared Haley would mimic Sanford’s combative relationship with the General Assembly.

“I became Sanford in a dress,” Haley said. “It didn’t help. It hurt me.”

Haley says the “Sanford protege” label was unfair. But she says she didn’t fight it because she didn’t want to waste energy.

“I had met with him on a handful of occasions,” Haley said. “We were never personal friends. What I was was a legislator that appreciated his fight. And I was a legislator who thought he was trying to move the state into the right direction, so I voted with him a lot because I thought it was the right thing to do.”

Before the GOP primary, a pro-Sanford political group paid $400,000 to air a television commercial featuring Haley, support that Haley says she appreciated. That ad, along with a visit from 2008 GOP vice presidential nominee Sarah Palin, boosted Haley’s lagging GOP primary campaign.

Sanford, now once again a congressman from Charleston, agreed the pair are not personal friends. But, Sanford said, he suggested she run for governor. That led to Haley asking for his financial help more than once, Sanford said, declining to say how often.

“I think it would be be obvious to anyone, who knows how guarded I am with a dollar, that it would take more than one visit to get $400,000 out of a group affiliated with me,” Sanford said. “It’s funny how oftentimes ... people will say one thing before they get what they need and something different after they’ve gotten it.”

While benefiting from Sanford’s war chest, Haley also eased fears among legislators that they were in for a second round of Sanford if she was elected governor.

Senate Judiciary Committee chairman Larry Martin, R-Pickens, said he thought, for example, that Haley was using her call for mandatory roll call voting on bills as a political issue to run for governor at the expense of fellow lawmakers.

Then, they met and Haley explained her position. “She showed me that she was very genuine in this issue,” Martin said. “She converted me.”

While Martin was won over, some GOP lawmakers wish they saw a little more of Sanford in Haley.

For example, state Sen. Kevin Bryant, a Republican budget hawk from Anderson, said Haley should have vetoed a bill this year that allows counties to vote on a penny sales tax to pay for school buildings.

“Her critics thought she would be another Mark Sanford,” Bryant said. “That was what I was hoping.”

‘Most therapeutic thing I did’

Haley entered the governor’s office with question marks.

She was a back-bench House member for six years. Lawmakers did not know how she would treat them. Business leaders did not know how she would follow through on creating jobs.

Haley’s first months were not easy.

She replaced the University of South Carolina’s biggest benefactor, Darla Moore, on that school’s board with a campaign donor.

Haley also poked at the General Assembly. She wanted a government restructuring bill passed so badly that she tried to call lawmakers back into session after they had left for the year. She was sued and lost in the S.C. Supreme Court.

Then, as she promised in her campaign, Haley issued report cards on how legislators voted on key bills.

“Some of the things she does are silly,” said Rep. Jim Merrill, a Berkeley Republican and former House majority leader. “It’s hard to govern with the same people that you spend a good time bashing. I think she’s realized that.”

The report cards, issued only once, have not reappeared. Haley says she became more willing to work with lawmakers and accept partial victories.

The government restructuring bill was passed, for instance, giving the governor more powers but not supervision over state purchasing of goods and services. Haley still celebrated with a huge bill-signing ceremony in the State House lobby.

Haley also said she realized that, before she could move forward, she needed to shed her anger over the 2010 campaign.

“It was really me telling myself, ‘OK, the establishment wasn’t with you, but holding a grudge is not going to get us anywhere. And, OK, the press wasn’t with you, but it’s not going to make them have any less ink. OK, the public wasn’t sure,’ ” Haley said earlier this month. “So the only way to satisfy all three ... was work. So I just knew, ‘Let’s prove results.’ ”

Haley wrote a list of goals for her administration. She also wrote a book during first year in office, “Can’t Is Not an Option.”

“That was the most therapeutic thing I did,” Haley said. “It allowed me to get all the anger of the campaign out and move that aside because, literally the second I finished writing that book, all that was gone. ... I was able to change my tone. I think I was able to change the way I delivered messages.”

While Haley says she has put 2010 behind her, she continues to remark about her failure to receive the backing of the GOP establishment and business even after she won the Republican nomination.

“We never got the establishment,” Haley said earlier this month.

“I got Henry,” the governor said, referring to former S.C. Attorney General Henry McMaster, the former state GOP chairman who endorsed Haley after losing to her in the primary. “Henry tried to introduce me to all his people, and they didn’t come. We pulled a few, but those big, hard-core establishment people went with Vince.

“I knew I had a lot to prove. I didn’t blame anybody for it. I actually understood in a strange way. I was female. I was Indian. I was young. I took it as more of ... I have to prove to them that they made the right decision. And that’s what guided me every day.”

McMaster said Haley was successful in gaining Republican backers at meetings where he introduced her.

“I don’t think she would have won the election if she did not win them over,” said McMaster, one of the governor’s closest allies and the Republican nominee for lieutenant governor this year.

S.C.’s ‘best salesman’

During her first term, Haley’s top success has been helping recruit companies that have promised more than 50,000 new jobs.

She makes sure the public knows about those job promises. Haley’s office emails news releases about job announcements just ahead of emails from the state Commerce Department. She also attends numerous economic development announcements across the state.

“She is the best salesman South Carolina could ask for,” Peeler said.

Haley has spread the job announcements across the state, getting the state Commerce Department to pay bonuses to recruiters for landing companies for job-starved rural areas.

“Those areas did not know Nikki Haley, but they found out she truly cares about their success,” Martin said.

Barry Wynn, a financier and former state GOP chairman who backed then-U.S. Rep. Gresham Barrett in the 2010 gubernatorial primary, said Haley has exceeded his expectations. “No governor since Carroll Campbell has focused so much on economic development,” said Wynn.

As a result, Haley has become a national political star, Wynn said. She spoke at the 2012 Republican National Convention and is in demand to speak to GOP and business groups, including Wal-Mart. She also has been able to raise huge sums of money for her re-election campaign at fundraisers across the country.

Democrats say Haley has not made it clear that not all the announced jobs have appeared. “We don’t give final tallies,” said House Minority Leader Todd Rutherford, D-Richland.

Some say Haley also takes too much credit when she cites statistics showing how the state’s economy has improved.

Clemson University political scientist David Woodard, who started a group questioning Haley’s transparency in 2010, says South Carolina’s falling jobless rate and rising job numbers are more a result of global factors than Haley’s salesmanship.

“Politicians don’t control that,” he said. “BMW does not expand because Nikki Haley is the governor or not the governor. But I think voters appreciate she’s been there for plant openings.”

Pivot to education

Haley deserves praise for winning policy battles, said Scott English, a former chief of staff for Sanford. They include creating the Department of Administration, which gives her office more authority over state resources; getting the governor and lieutenant governor elected on the same ticket, starting in 2018; and having the adjutant general, the head of the S.C. National Guard, appointed by the governor rather than elected.

“She has pushed a square rock up a hill,” English said. “You can’t say she is not getting anything done.”

Haley’s latest success was an $180 million education plan that includes new technology, reading coaches and more money for poorer schools. The measure sailed through the Legislature this year.

Haley said the plan’s success was the result of taking time to study education issues, and meeting with teachers and business leaders.

“I needed to educate myself on where the shortfalls were and how to get us back on track,” she said. “I needed to talk to the players. That was the one everybody said couldn’t be done, and that’s one I said, ‘We did it.’ Republicans and Democrats wanted to fix it. We showed them how to pay for it.”

Critics say it was easy to find money to improve schools, an issue popular with Democrats and most Republicans, since more tax revenue was rolling into the state from the improving national and S.C. economies.

Royall, the former Republican commerce chief who is backing Sheheen, criticizes Haley for waiting until her fourth year in office to launch an education plan.

“Is that putting education as a priority?” he asked. “The state has many weak areas that need attention. If you look at all those state rankings, we are still bringing the rear end in a lot of areas that affect quality of life in state – health issues, transportation issues.”

Haley has said she plans to roll out a plan to repair the state’s crumbling roads in January if she is re-elected. The governor also said she plans to work to improve workforce training “so (businesses) never have to worry about whether we’re good enough in South Carolina.”

The missteps

Haley calls the hacking at the Department of Revenue the biggest crisis of her first term.

But she has faced other controversies as well, including ethics allegations.

The governor had to reimburse the state for using state planes to attend press conferences and using state-owned cars during campaign events. She also took the unprecedented step of testifying at a House Ethics Committee hearing in 2012, called to look into charges that she used her position as a state representative for personal benefit. Haley was cleared of wrongdoing.

Subsequently, Haley made ethics reform a top priority.

A bill that would have broadened income disclosures required of lawmakers failed in the state Senate on the last day of the session in June.

“I know there have been missteps, but she's moving things forward with ethics,” said former Sanford chief of staff English. “She’s not shirking her responsibility. She’s given a forum for critics to take shots at her.”

And they have.

Sheheen targets Haley’s ethics mishaps in his campaign, including issues raised in the 2010 race. Haley did not disclose consulting work that she did for a Columbia engineering firm while she was a legislator. Questions also were raised about Haley’s fundraising job for the Lexington Medical Center Foundation at the same time that hospital was fighting to get state approval to perform heart surgery.

“They are going after Haley on everything having to do with trust,” Winthrop University political scientist Scott Huffmon said.

Meanwhile, Haley’s management style irks some lawmakers.

“She delivers edicts and expects people to deliver on them,” said Rutherford, the House Democratic leader.

Rutherford said those edicts are why Haley’s cabinet agencies are reluctant to request extra money in proposed budgets.

As an example, Rutherford cites former Social Services director Lillian Koller’s failure to ask for extra child welfare workers to ease case loads at that agency. Social Services now is the focus of a special state Senate panel that is looking into the deaths of children who had contact with the agency. Social Services’ interim director recently said she plans to ask for 200 more caseworkers in next year’s state budget.

Haley promises her administration will do more to prevent child deaths, but, she adds, not all the blame rests with her agency.

“How do you protect children from their own parents?” Haley said. “I know I can’t watch the parents all the time. DSS is very frustrating thing, but it’s a work in progress.”

As much effort as she has put into economic development, Haley also became involved in a controversial decision by a S.C. board that allowed Georgia to deepen the port of Savannah. The move angered S.C. coastal leaders who want to protect state ports.

Haley defends her actions, saying South Carolina can win battles with other states for industrial prospects regardless of the competition.

“You’ve got to look at the bigger story,” she said. “That’s the visionary side of me that says, ‘Think 20 years, when you’re gone, what do you want people to say?’ ... I want us to have so much flowing in and out of South Carolina that there’s no problem. I don’t think we need to cut our neighbors, competitors, at the knees to do that.”

Despite the dust-ups, Haley has avoided the type of first-term scandal that would derail her re-election chances, political scientists and experts say.

Plus, South Carolina voters also seemingly have become immune to mishaps.

“I worked for a governor who made a big mistake,” English said of Sanford. “People forgave him for that.

“He got re-elected to Congress.”

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