The Guest Blog

Farrell: If It's Tuesday it Must be Massachusetts

World Wind Vacation Tour number 225 planned on seven countries in eighteen days and was the story line for a wildly successful movie in 1969 called "If It's Tuesday, It Must Be Belgium."

The chaos was maniacal and the only way the "vacationers" knew where they were was to look at the day of the week. Thus if it was Tuesday, the schedule said it had to be Belgium. The jet lagged tourists had no idea.

The Democratic party must feel the same sense of chaos as Tuesday dawns and the "safest" spot in the Senate, the late Ted Kennedy's seat, goes to the voters with the outcome very much in doubt. A defeat for Democrat Martha Coakley, the well regarded Massachusetts State Attorney General, would mean the end of the filibuster proof majority in the Senate and could spell trouble for President Obama's signature domestic health care initiative.

With his prestige on the line even more than it was in the recent Virginia and New Jersey special elections, President Obama pulled out the stops and spent Sunday campaigning in the Bay State. So did former President Clinton and Ted Kennedy's widow. Democrats are worried that they misjudged the mood of the electorate over the past year which could have profound implications for this November's midterm election. A Republican victory, or even a very close election, would raise the question of whether Mr. Obama has squandered political capital by focusing so much time and energy on health care with economic stress and high unemployment pervasive.

This past week a Rasmussen Report poll showed Ms. Coakley with a slim 49% to 47% lead over her opponent, State Senator Scott Brown. A Suffolk University poll showed Brown with a slim lead. Both campaigns are spending big bucks. The Democratic Senate campaign arm, which the NY Times says usually doesn't spend money on safe seats, has poured $800,000 into ads - more against Brown than for Coakley. The AFL-CIO (American Federation of Labor/Congress of Industrial Union - you could win a bar bet knowing that) moved into the state this past week after striking a deal with the Administration to limit a tax on certain "Cadillac" health insurance programs. The union is sponsoring automated phone messages to union members to get out the vote, which could be the key to the outcome. The Service Employees International Union is spending $685,000 on ads attacking Brown. An email fund-raising effort by Vicki Kennedy, the Senators widow, raised $400,000 for Coakley in just a few hours.

But Brown has launched his own renewed effort. The U.S. Chamber of Commerce is airing pro Brown ads and he raised more than $1 million last week with an internet appeal that shocked both parties. He recently went on a state wide bus tour with former Governor Bill Weld.

More voters in Massachusetts are registered as Independent than with either party combined. Getting out the party faithful will be important in the final tally and swinging enough Independents is crucial. Democratic strategists referenced in the NY Times, but not named, warned a "Republican victory in Massachusetts could fundamentally alter the outlook for the 2010 Congressional election season by sparking retirements among vulnerable Democrats." They say "control of the House could be at stake if enough Democrats saw the Massachusetts race as evidence they were headed for defeat in November." Another Democrat, Vic Snyder of Arkansas said he was retiring and would not run for reelection a few days ago.

If Brown were to win, the Democrats are faced with the issue of what to do with the health care bill. They could try to ram through a vote in the two weeks or so it might take a new Senator to get seated so they could use their 60 vote majority. That could pose political risks. They could try to persuade the House leadership to pass the Senate version to avoid another vote in the Senate. That might not work if the Democratic membership decided affiliation with the health care proposals is not a safe place to be. Or, Coakley could win so big we'll wonder what we were fussing about. But anything that resembles a close race is going to be fodder for the Republican public relations mill that the Obama Administration is out of touch with the electorate.

Vincent Farrell, Jr. is chief investment officer at Soleil Securities Group and a regular contributor to CNBC.