Recent decisions irk Hollywood politcos

On Larry King’s penultimate show last week, he asked guest Barbra Streisand what she thought of President Obama’s much-maligned tax cut compromise with the Republicans. “Well, I think it’s unfair but necessary,” she said.

Her answer probably reflected a grudging acceptance of the deal, one that provoked anger and angst on the Hollywood left, and even the occasional declaration of nonsupport, “I’m through.”

But as disenchanted as donors and supporters may be — there’s been a wave of stories of those threatening to not open their wallets — it doesn’t necessarily mean that Obama’s showbiz base will split apart come 2012.

What Obama has going for him is time — time for tensions to cool, the GOP to unleash its agenda and, most important, for the race to actually ramp up.

“All of the punditry is premature,” says political consultant Andy Spahn, an Obama bundler in 2008 who represents such entertainment clients as Jeffrey Katzenberg and Steven Spielberg.

He added, “This will take a while to play itself out. Nothing brings more clarity than the passage of time.”

The entertainment community has been one of the most loyal and reliable bases of support for Obama and the Democrats, showering money on midterm candidates this year at an even greater level than in 2006, when the terrain was in the party’s favor.

That’s not to say there isn’t disenchantment on the left, to an even greater degree than when Obama decided to increase troop levels in Afghanistan and when the public option was dropped from healthcare reform.

Personalities like Michael Moore and Arianna Huffington have long been suspect of the administration’s economic policies, and the dismay over the new tax plan only seemed to crystallize their fears.

As faithful as its donors have been to Democrats, Hollywood still loves to rally around a winner. The tax compromise is disconcerting to some supporters because of the fear that it sends out a message of weakness. Even Streisand alluded to this point in her interview with King, noting that George W. Bush and Ronald Reagan showed that “people admire real strength, even though it is misguided.” Yet praising Obama’s “open heart” and intelligence, she wondered why more didn’t recognize his accomplishments, and left little doubt that she’ll continue to support him.

Mike Medavoy, who along with his wife, Irena, hosted Obama at their home for an October 2007 fundraiser, expresses worry that the tax deal only will embolden Republicans.

“Nobody wants to be held hostage, and no country should have to pay for hostage takers,” he says. “While I believe in compromise, I don’t believe in compromise with people who put a gun to your head.”

He adds that the compromise reflects a White House in need of better messaging. “I don’t believe the administration has done a very good job at putting out what they have done except for saying that they have saved us from what could have been a worse position. And that is no answer at all.”

Many Hollywood figures are likely to benefit from the extension of tax cuts for the rich, an irony not lost on many who argue against them. The concern is that Obama has given away not just a central part of his campaign agenda, but leverage in the months to come.

Literary agent Mitch Kaplan, an Obama donor in 2008, says of the tax deal, “I sort of vacillate back and forth, but if I really have to be true to myself and my school, I don’t like it.” He was particularly worried about the cut in the payroll tax, as it raises doubts about the viability of Social Security; Kaplan’s on the board of the National Committee to Preserve Social Security and Medicare.

“He has not been as strong a negotiator as we would have wished,” Kaplan says of Obama. “He wants to be bi-partisan, but you have got to play the same game. They just look at (the compromise) and say, ‘There is more weakness and it is working.’ ”

Yet that doesn’t mean he’s Kaplan is about to withhold his support of the prez, he says.

Following the announcement of the tax deal, Obama’s feisty press conference, in which he called some progressives “sanctimonious,” evoked memories of what President Clinton faced after huge losses in 1994. The result was a queasy relationship between Clinton and liberal Hollywood, especially when he signed welfare reform into law in 1996. That year, the ACLU of Southern California even honored Peter Edelman for resigning from his administration post in protest.

“This is tame in comparison” with that period, Spahn says.

As political circles buzz about potential Democratic primary challengers, the better question may be about enthusiasm. Traditional showbiz donors turned out in 2008, but that year also saw a flood of industry figures on the trail, working phone banks and fueling perceptions that Obama’s campaign was about something new and momentous.

“No one’s happy about it,” says political consultant Donna Bojarsky, who runs the industry org the Foreign Policy Roundtable, of the compromise. “It is very hard to swallow. There’s no question about it.”

She is not ready to predict that it is certain to create lasting fissures, she says.

“It depends on if he can produce something that will show that the compromise was worth it,” she says. “If he can pull it off, he will see people rethink this moment.”

Obama also will have to show he has Clinton’s political deftness in governing at the center and yet holding his coalition together for his reelection, she says.

Tennis Channel CEO Ken Solomon, Southern California finance co-chair for the Democratic National Committee, says that he’s also concerned over how things play out, but believes that in the long run there will be a recognition of the pragmatism that Obama “did the right thing. He did what he had to do.

“This is going to continue to be debated,” Solomon says. “There are very clearly different sides to this, and it will be front and center in the next presidential election.”

Solomon says the furor over the compromise reminded him of a quote from another early Obama supporter, David Geffen, having to do with Hollywood dealmaking. “The definition of a great deal is one where no one is happy. This is certainly the case here.”

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