Welcome to the Lone Star State, where the politics next year are shaping up to be as bizarre as anything else in Texas. Perry, who's been governor since George W. Bush ambled off from Austin to the White House in 2000, is seeking his third full term in office next year, extending a tenure that's already broken all of the state's records. Hutchison, the first woman to represent the state in the U.S. Senate, has been in Washington since 1993. She says she's so committed to the race that she'll resign her Senate seat to run -- but not until after the March primary. (Democrats are likely to coalesce behind Houston Mayor Bill White as their candidate, though he hasn't yet officially declared he'll run.)

In the process, the campaign could wind up going a long way toward helping the Republican Party determine whether it wants to try to appeal to swing voters, or double down on the tea party-loving, Glenn Beck-watching, Sarah Palin book-buying crowd that helped the GOP lose New York's 23rd Congressional District for the first time in over a century earlier this month. Facing a starkly conservative primary electorate, Perry has, well, gone rogue. Besides threatening to dissolve the United States over the Obama administration's policies while addressing a roaring tea party crowd in April, Perry also refused to take $556 million in unemployment aid as part of the economic stimulus package. He talks about the 10th Amendment with the kind of fervor most Republicans reserve for the gun-toting Second; at the GOP governors conference, he urged his colleagues to "stand up and push back against Washington, D.C."

Hutchison, meanwhile, hasn't exactly racked up a liberal record in 16 years in the Senate. But she's more of a country club Republican, firmly conservative on economic issues but not a full-on culture warrior. She voted for the first federal bank bailout last fall and has supported keeping abortion legal, though she also frequently votes to restrict access. If she can wrest the nomination from Perry, that could be a sign the GOP will resist the urges of its conservative id. If she can't, though, it could mean other Republicans will take Perry's pandering to the tea party crowd to heart, and turn the party even harder to the right than it's already heading.

Judging by the early indicators, at least, the conservatives may prevail. Hutchison's poll numbers have dropped steadily since she got into the race over the summer. Mississippi Gov. Haley Barbour, the chairman of the Republican Governors Association, tells anyone who will listen that he wants Hutchison to quit the race so Perry can win the nomination. Perry's first TV ad made it clear he plans to run against Washington as much as against Hutchison -- which could be the right strategy in Texas. "She's claiming, 'I'm from Washington, and I'm here to help you,'" says Austin-based GOP pollster Mike Bonaslice, who's advising Perry. "Good luck with that spin right now. Republican primary voters aren't too keen on what's coming out of Washington the last year or so."

Hutchison's campaign isn't exactly sitting back and taking the abuse. Her own first TV ad promises, "I'm going to do everything I can to stop the government takeover of healthcare." Her campaign comes down to vociferously opposing the White House on issues that matter to Texas conservatives, and bashing Perry for talking tough but not delivering. "Perry is all talk, that's all he's ever been," says Terry Sullivan, Hutchison's campaign manager. "He says what he thinks folks want to hear at any time in his political career."

But that hasn't been enough to endear her to the true believers. "Texas is really -- as I like to say -- a beacon of sanity, fiscal sanity, particularly compared to Washington," says Peggy Venable, Texas state director of Americans for Prosperity, the group that put together the April tea parties. "Most Texans support pushing back on Washington; we certainly don't want to see Washington's policies carried out on Texas." She's backing Perry personally, though AFP is barred from endorsing any candidate. "It'll be tough for Kay Bailey Hutchison to run against Gov. Perry without talking about what's wrong in Texas," Venable says. "And many of us feel like what's wrong is primarily in Washington, not in Texas, and so I think a lot of people aren't going to appreciate a negative campaign in that respect."

Meanwhile, the most hardcore conservatives may not support either Perry or Hutchison. The chairwoman of the Wharton County Republican Party, Debra Medina, is running a grass-roots campaign for the nomination well to the right of both of the major candidates. Her platform includes eliminating property taxes, nullifying federal laws that interfere with Texas sovereignty, banning all abortions and encouraging Texans to buy even more guns than they already have. (Except for the property tax bit, though, that's not all that different from what Perry is running on.)

What Republicans are dealing with in Texas -- and in Florida, where conservative darling Marco Rubio is challenging Gov. Charlie Crist for the GOP nomination for Senate, and in a handful of other races around the country -- is just more fallout from the last few years in politics. When Democrats took control of Congress in 2006, some Republicans figured it was because the GOP had lost touch with voters; other Republicans, ideological kin to the ones who would wind up hurling tea bags at the White House last spring, figured it was because the GOP had lost touch with itself. The elections in Virginia and New Jersey this fall offered one way forward for the party -- present candidates who stick to economic issues, keep whatever radical social agendas they might have in mind tucked firmly away, and don't let Sarah Palin come to town and alienate the moderates. Between now and March, Texas may offer another path, the same one the party's activists are increasingly insisting on following. It could be a bumpy ride for them -- but it should be fun to watch for the rest of us.

By itself, this would merely reinforce the identification of the Party Formerly Known as Lincoln's with the white South. But in a time of popular anger over banker bonuses and lobby-hobbled government, the themes of Jeffersonian and Jacksonian populism have appeal far beyond the Scots-Irish enclaves of the Appalachians and Ozarks. Witness the calls from Democrats as well as Republicans for President Obama to oust Treasury Secretary Tim Geithner and pay more attention to Main Street than to Wall Street.

In itself, American populism is neither left nor right. Translated into economics, Jacksonian populism spells producerism. For generations, Jacksonian populists have believed that the hardworking majority of small producers is threatened from above and below by two classes of drones: unproductive capitalists and unproductive paupers. While government promotion of public goods like defense, infrastructure and utilities that benefit all citizens is acceptable, Jacksonomics is suspicious of crony capitalists who owe their fortunes to political connections (can you spell B-A-I-L-O-U-T?). And Jacksonian producerism naturally is haunted by the nightmare of a class of the idle poor, who are capable of working but instead live off the labors of others and lack an ownership stake in the community.

Reform movements have succeeded in the United States only when their programs resonated with populist and producerist values. Lincoln's antislavery Republicans succeeded where the earlier Whigs had failed because the Republicans persuaded Jacksonian farmers that snobbish, parasitic Southern Democratic slave owners were a greater threat to white farmers and white workers in the Midwest than rich Republican bankers and industrialists in the Northeast. Lincoln's Hamiltonian program of aid to railroads and national banking had to be sweetened with the offer of Western homesteads for yeoman farmers before former Jacksonian Democrats would join his coalition.

In the 20th century, the most popular and enduring legacies of the New Deal have been the programs compatible with small-d Jacksonian democracy -- public spending on infrastructure like dams and electric grids and highways, the promotion of single-family home ownership, federal aid to education and Social Security and Medicare, two entitlements tied to individual work by means of the payroll tax. In contrast, welfare for the nonworking poor was always unpopular with most New Deal Democratic voters, who preferred public works programs like the WPA, CCC and CETA to relief payments for the poor and unemployed. Although he broke with the New Deal tradition in other ways, President Bill Clinton was true to its spirit when he collaborated with the Republicans in converting "welfare" from an unpopular federal entitlement to state-based workfare programs.

All too often in American politics the populist distinction between producers and parasites has been mapped onto the racial division between whites and nonwhites. But the Jacksonian republican concern about freeloaders is not, in itself, racist. And it has frequently manifested itself in anger at the freeloading rich as well as the freeloading poor. At the moment, populist anxieties about the nonworking poor or illegal immigrants receiving medical coverage are eclipsed by populist anger at federal bailouts for well-connected Wall Street bankers who pay themselves titanic bonuses for unproductive gambling with other people's money.

Here, one might think, would be an opening for the center-left. And yet the Obama Democrats, unlike the Roosevelt Democrats, cannot take advantage of the popular backlash against Wall Street. Why?

One reason is that the attempt of the "New Democrats" like Clinton, Al Gore and Obama to win Wall Street campaign donations has been all too successful. As Clinton's Treasury secretary, Robert Rubin helped complete the conversion of the Democrats from a party of unions and populists into a party of financial elites and college-educated professionals. Subsequently Obama raised more money from Wall Street than his Democratic primary rivals and John McCain. On becoming president, he turned over economic policymaking to Rubin's protégé Larry Summers and others like Timothy Geithner from the Wall Street Democratic network.

The financial industry is now to the Obama Democrats what the AFL-CIO was to the Roosevelt-to-Johnson Democrats. It is touching to watch progressives lament that "their" president has the wrong advisors. "We trust the czar, we simply dislike his ministers." Obama owed his meteoric rise from obscurity to the presidency not to any bold progressive ideas -- he didn't have any -- but rather to a combination of his appealing life story with the big money that allowed him to abandon campaign finance limits. According to one Obama supporter I know, the Obama campaign pressured its Wall Street donors to make their contributions in the form of many small checks, in order to create the illusion that the campaign was more dependent on small contributors than it was in fact. Even now President Obama continues to raise money on Wall Street, while his administration says no to every progressive proposal for significant structural reform of the financial industry.

There remains the progressive wing of the Democratic Party, represented more in Congress than in Obama's White House -- and more in the House than in the Senate, a dully complacent millionaires' club. Can congressional progressives compete with conservatives to channel popular outrage? Unfortunately, progressivism in the form in which it has evolved in the last generation does not resonate with populist producerism.

To begin with, most of the moral fervor of the contemporary center-left has been diverted from the issue of fair rewards for labor to the environmental movement. In theory, environmentalism ought to fit the populist narrative of defending shared goods against special interests. Indeed, clean air and water legislation and public parks and wilderness areas are broadly popular with working-class Americans, not least hunters and fishers. But many environmentalists insist that global warming must be combated not only by low-CO2 energy technology but also by radical lifestyle changes like switching from industrial farming to small-scale organic agriculture and moving from car-based suburbs and exurbs to deliberately "densified" cities with mass transit. Whether environmentalists propose to engineer this utopian social transformation by tax incentives or coercive laws, the campaign triggers the populist nightmare of arrogant social elites trying to dictate where and how ordinary people should live.

Even if it had not been eclipsed by moralistic lifestyle environmentalism, contemporary economic progressivism would be crippled by its own priorities. New Deal liberalism was primarily about jobs and wages, with benefits as an afterthought. Post-New Deal progressivism is primarily about benefits, with jobs and wages as an afterthought. This inversion of priorities is underlined by the agenda of the Democrats since the last election -- universal healthcare coverage first, jobs later.

It is only in the post-New Deal era that universal healthcare has become the Holy Grail of the American center-left, rather than, say, full employment or a living wage. Sure, Democrats from Truman to Johnson sought universal healthcare, and Medicare for the elderly was a down payment for that goal. But the main concern of the New Dealers was providing economic growth with full employment, on the theory that if the economy is growing and workers have the bargaining power to obtain their fair share of the new wealth in the form of wages, you don't need a vastly bigger welfare state. Having forgotten the New Deal's emphasis on high-wage work, all too many of today's progressives seem to have internalized the right's caricature of FDR-to-LBJ liberalism as being primarily about redistribution from the rich to the poor.

This shift in emphasis is connected with the shift in the social base of the Democratic Party from the working class to an alliance of the wealthy, parts of the professional class and the poor. And progressive redistributionism also reflects the plutocratic social structure of the big cities that are now the Democratic base. Unlike the egalitarian farmer-labor liberalism that drew on the populist values of the small town and the immigrant neighborhood, metropolitan liberalism tends to define center-left politics not as self-help on the part of citizens but rather as charity for the disadvantaged carried out by affluent altruists. Tonight the fundraiser for endangered species; tomorrow the gala charity auction for poor children.

At a recent event in Washington, I was surprised when a Democratic senator said, "The major threat facing America today is the class divide." The speaker was Jim Webb of Virginia, the self-conscious heir to Scots-Irish Jacksonian populism. He went on to attack the inhumane treatment of prisoners in American jails and the avoidance of military service by the American elite.

Populists like Webb are rare in today's Democratic Party, while the Republicans, for all their folksy rhetoric, offer nothing but the economic program of their Wall Street Journal/Club for Growth wing. If mass unemployment and slow growth persist for years, some sort of third-party, "Middle American" populist movement in 2012 seems possible. (Lou Dobbs: tanned, rested and ready?)

Could a new wave of populist independents be steered into the Democratic Party? Alas, that seems unlikely, if Democrats are viewed as the compromised, establishmentarian governing party. Moreover, the Republican Party benefited from the last two populist upheavals. Richard Nixon built the generation-long hegemony of the Republicans on the anger of George Wallace voters, and, following the campaign of Ross Perot in 1992, Newt Gingrich captured anti-system reformism to build a Republican congressional majority for most of the period between 1994 and 2006.

In each case, liberals and progressives indiscriminately rejected the populist voters. The Wallace voters, most of whom were New Deal Democrats, were dismissed by most liberals as though they were motivated by nothing but opposition to racial integration. In 1992 the New Republic published an idiotic cover with Perot dressed as Mussolini, implying that he and his supporters were crypto-fascists. Today ridicule of the bombastic Sarah Palin shades all too easily into loathing for the lower middle class.

It would be much easier for the Republicans to rebuild the conservative-populist coalition that dominated American politics from 1968 to 2006 than it would be for the Democrats to rebuild the kind of liberal-populist coalition of the New Deal era from 1932 to 1968. Will the Democrats be marginalized a third time rather than empowered by anti-system populism? In the next few election cycles we may find out.

National Committeeman James Bopp is leading the charge on the measure; he gained fame earlier this year when he sponsored another resolution, one that would have officially declared President Obama's agenda socialist. That resolution was watered down before it was passed, but Bopp has inserted similar language in this one; it, too, is likely to be toned down somewhat.

Here, via the New York Times' Caucus blog, is the list of principles candidates would have to abide by in order to get the RNC's endorsement and/or money:

1. We support smaller government, smaller national debt, lower deficits and lower taxes by opposing bills like Obama’s “stimulus” bill;
2. We support market-based health care reform and oppose Obama-style government run healthcare;
3. We support market-based energy reforms by opposing cap and trade legislation;
4. We support workers’ right to secret ballot by opposing card check;
5. We support legal immigration and assimilation into American society by opposing amnesty for illegal immigrants;
6. We support victory in Iraq and Afghanistan by supporting military-recommended troop surges;
7. We support containment of Iran and North Korea, particularly effective action to eliminate their nuclear weapons threat;
8. We support retention of the Defense of Marriage Act;
9. We support protecting the lives of vulnerable persons by opposing health care rationing and denial of health care and government funding of abortion; and
10. We support the right to keep and bear arms by opposing government restrictions on gun ownership

Win a couple of odd-year gubernatorial contests, it turns out, and the future suddenly looks a lot brighter. Bright enough, in fact, that the RGA had no problem Thursday morning showing attendees a "Saturday Night Live" clip spoofing Fox News Channel's coverage of the 2009 elections. The point of the skit was that the GOP and its friends at Fox were delusional, giddily declaring the 2008 elections overturned on the basis of two statewide elections with low turnout -- which the speakers at the RGA conference then proceeded to come close to doing themselves. It wasn't clear how intentional the irony was.

"For all the hype, [2008] was not a transitional campaign, it was not a transitional year," GOP pollster Ed Goeas said at a panel about the 2010 elections, after promising to pick apart some of the "many" myths about President Obama's victory a year ago. "After $700 million being spent by the Obama campaign, it was not a new electorate."

That was, in essence, the message of the RGA conference: So what if the only thing voters like less than the Democrats in Congress might be the Republicans in Congress? Who cares if the GOP has been reduced to a rump minority in the House and Senate, left on the sidelines with not much more to do than root for Democrats to fight among themselves? In politics, what matters is momentum, and right now, Republicans -- and quite a few Democrats, especially in private -- think they have it.

So Bob McDonnell and Chris Christie, the winners in Virginia and New Jersey a few weeks ago, were hailed as the heralds of a new GOP majority -- a majority of governors, granted, which doesn't really mean anything in terms of being able to pass legislation or implement policy on a national scale, but a majority nonetheless. (Both winning candidates demurred when asked whether Obama fatigue had helped them to the statehouse; it was local issues that won the day, they insisted.) No one mentioned that the party in the White House almost always loses the New Jersey and Virginia elections the year after a presidential race.

And Barbour came armed with a new poll by Zogby International that showed Obama's approval ratings and reelection numbers were perilously low in states with competitive gubernatorial races on tap for next year. Hawaii Gov. Linda Lingle said there was no reason the GOP shouldn't aim to win every single state. "There's no state that we can't win," she said. "Talking to a Republican from Hawaii -- the first Republican elected in 40 years -- I'm telling you, we could win in every state."

But the most telling numbers may have been the ones Barbour touted a little later, in a press conference, after he'd shared them with governors and Republican loyalists Thursday morning. Forget the polling; what really got the RGA excited was another kind of stat. "We spent $23 million in 2006," Barbour said. "We're going to start 2010 with $25 million in the bank."

Raising and spending money is, after all, the main thing a group like the RGA does. Which is why the big "Victory Barbecue" on Wednesday night was sponsored by the Corrections Corporation of America, whose Web site proclaims it's "the private corrections management provider of choice for federal, state and local agencies." And why Indiana Gov. Mitch Daniels apologized to "the vendors in the room" for boasting of his love of bidding state contracts out using reverse auctions. Everywhere you looked, corporate sponsors popped up. A mining company, an information technology company and a supply chain logistics company teamed up with CCA and the liquor lobby to sponsor a bash at Cindy's Gone Hog Wild, a bar down the road from the conference resort. A "trunk show and fashion boutique" was set up in one hallway Thursday afternoon, so attendees could take a break from hearing about the Obama administration's nefarious healthcare reform plans to get a little shopping in. (The governors, meanwhile, headed out for some skeet and trap shooting on the resort's grounds.)

That's not to say Democrats will have it easy next year, especially if the economy doesn't recover faster. Incumbents in either party are likely to struggle; fairly heavy losses in the House and Senate are probably on the horizon, though Democrats took so many seats in 2006 and 2008 that their majority in both houses is likely safe. Midterm elections almost never bring good news for new presidents, just like the New Jersey and Virginia results.

But the GOP crowing in Texas this week doesn't mean Republicans have it all figured out again, either. The candidates on the Republican line in major races next year may include Ohio's John Kasich, who was the House Budget Committee chairman after the 1994 elections; New York's Rick Lazio, who tried, and failed, to beat Hillary Clinton for the Senate in 2000; and Iowa's Terry Branstad, whom you may have heard of because he already served as governor of the state from 1983 to 1999. That lineup doesn't exactly scream out "new and improved," no matter how much Barbour talked up the GOP comeback.

"One of the things that really does separate this Republican Party from the Republican Party of 1993 is that this one is utterly devoid of ideas," said Nathan Daschle, the executive director of the Democratic Governors Association, the RGA's counterpart. "You can say a lot of things about Newt Gingrich, you can say a lot of things about the Republican Revolution; one thing you can't say is that it lacked some kind of ideological base or agenda."

By contrast, Barbour boasted Wednesday that Republicans in New Jersey voted for a moderate, Christie, and in Virginia, they voted for a conservative, McDonnell. The main thing they had in common was their party label. As GOP governors gathered to bash the healthcare reform bill Thursday morning, they ran through the same litany of Republican "solutions" to the problem that their comrades in Washington have offered for months -- tort reform, insurance portability, tax credits. Their most famous ex-governor, meanwhile, was running around on a book tour, talking mostly to tea party types who won't exactly help win swing voters over. Minnesota Gov. Tim Pawlenty, who's supposed to be a rising star in the party and is planning a run for president in 2012, stuck to bland pronouncements as he moderated a domestic policy panel on Wednesday. "Citizens are being asked to live on the same amount of money, or less, than they did last year," he said. "They think it's reasonable that government should tighten its belt as well." No one at the conference could open his or her mouth without declaring the states to be "the laboratories of democracy" -- Louisiana Gov. Bobby Jindal must have said at least a half-dozen times that unlike Washington, states can't print their own money. It was not, all in all, a rousing display.

What next year's elections may offer increasingly alienated voters, then, could be a choice between the Democrats, complete with their infighting and chaotic majorities -- who may not have done enough yet to fix the problems that they confronted upon walking into office -- and the Republicans -- who were the ones who helped mess things up in the first place. If the RGA gathering was any evidence, though, the GOP is aiming to win that choice by default. A win, after all, is still a win.