Competitive Intelligence

Total Recall: Schwarzenegger Wins; Democrats & Davis Dealt a Surprisingly Strong Blow

Failing to resist the temptation for Monday-morning quarterbacking alongside a similar yearning to steer away from media hype, I’ve decided the competition over the Governor’s seat in California offers a few takeaways that would be worthwhile examining from a business strategy perspective…

… so, with that…

Bodybuilder-turned-actor-turned-Governor-elect, Arnold Schwarzenegger might be a political rookie, but he’ll get no honeymoon from California state Democrats as he deploys his considerable assets – largely extending from those of political advisor former Governor Pete Wilson, not to mention an economic team formerly headed by billionaire investor Warren Buffett (who fell out of favor after he said Californians should pay higher property taxes) – to the task of fixing the $8 billion California state budget deficit. And, he’s not going to help matters by rolling back the reinstated vehicle registration fees that contributed to his election – that’s a $4 billion added cost if he gets it passed!

But, he did get his mandate, capturing a million-plus more votes than runner-up Cruz Bustamante, whom he’ll now have to work as his Lieutenant Gov.. But, the reason I’m writing about this subject isn’t because it’s just hot news; it’s because the Schwarzenegger campaign took advantage of key strengths on his part, weaknesses on the part of competitors, and dynamics present in the “marketplace” in pulling off what could be called the biggest political surprise in recent memory.

Schwarzenegger was not only well-known, he is well-known as an “action hero” that, despite notable weaknesses in the area of recent accusations of sexual harassment, misconduct and general tawdriness that surfaced as Democrats started to get desperate, is thought of as a “fixer” than can get things done, albeit, primarily on the silver screen if somewhat less so in real life. Likewise, in an era of “politics of dissatisfaction” where we have been consistently disappointed by our political leaders and now seek to kick the bums out, the market was seeking action of a kind they could predict might overcome the general malaise that had seemed to settle over Sacramento. Schwarzenegger is the devil Californians know (or at least think they know) who can, it is believed, get things done; while Davis and Bustamante were just devils, in the eyes of the majority of voters yesterday.

The timing was impeccable and, in my opinion, I don’t foresee a replay of Minnesota’s experience with Arnold’s friend Jesse Ventura, who left a bad taste in the mouth of voters who brought him to office by his apparent disregard of political decorum. I think there’s far too much riding on success to let those lessons go unlearned and Schwarzenegger stands an even chance of being successful in the short term - and is a sure-thing for re-election if (and it’s a big if) he can fix the budget problems faced by his predecessor.

- Arik