Austin Businesses Welcome the Political Circus

By William Gest

AUSTIN – Restaurant manager Michael Batchellor had never seen anything like it. After a Feb. 22 rally at the Capitol for presidential candidate Barack Obama, a pack of customers overran Hickory Street Bar and Grill, Batchellor’s restaurant on Congress Avenue just three block south of the Statehouse.

“We got totally slammed,” he said.

An estimated 15,000 people attended the evening rally, and according to Batchellor, many of them, or so it seemed, ended up trying to score a table at his restaurant afterward. “We set sales records,” he said. “It was a very, very good night.”

As the state capital and a longtime Democratic stronghold in a mostly Republican state, Austin is a key battleground in the fight for Texas’ 228 delegates at stake in the March 4 Democratic presidential primary.

The electoral run-off has also been a boon to local businesses. Sen. Obama and his rival, Sen. Hillary Clinton, have each sweetened the pot by bringing to Austin massive rallies, competing and costly advertising blitzes, an internationally televised debate and hundreds of out-of-state staffers and volunteers backed by two campaign machines with millions of dollars to spend.

Defying expectations that the Democratic presidential nominee would be decided on Super Tuesday, both Obama and opponent Hillary Clinton remain in the race as Texas’ primary approaches. Obama, with 11 of victories behind him since Feb. 5, hopes that a win in Texas will solidify his nomination. For Clinton, the contests in Texas and Ohio are widely regarded as her best and last chance to remain in the race.

Long accustomed to the state’s late presidential primaries being a mere formality, Texas Democrats particularly are excited at the prospect of a decisive contest on in Tuesday’s hotly contested vote, and business owners are equally excited at the prospect of the increased profits the attention will bring .

The businesses that benefit most directly from the campaigning are restaurants, bars, hotels and other visitor services, according to Justin Sabrsula, an economic analyst at Angelou Economics.

“The direct office staff of campaigns contributes in terms of visitor spending,” he said. “Indirectly, any spending in the local economy helps to create jobs, which creates more tax revenue.”

Sabrsula said the entire city benefits from the increased tax revenue as well as prominent coverage in the news media (the Feb. 21 debate at the University of Texas was watched by 7.6 million people nationally). “It shows that Austin is a city big and important enough to have a presidential debate,” he said.

Sabrsula also said the coverage could raise the city’s prestige around the nation and abroad, potentially contributing to tourism, business and foreign investment. A visit from former President Bill Clinton, campaigning on behalf of his wife, also enhanced the city’s image.

Both campaigns have opened local offices in town, bringing in staff and volunteers from all over the country to coordinate efforts and, incidentally, to spend money. Obama’s campaign set up a main office on the second floor of a Congress Avenue office building, as well as offices in East Austin and on the University of Texas campus. Obama spokesman Nick Kimball, a Minnesota native, had never been to Texas before being assigned to Austin. “It’s been great so far,” he said. “The volunteer turnout has been wonderful.”

Kimball said that an informal poll named Tex-Mex restaurant Chuy’s as the favorite of the campaign’s staff and volunteers. Chuy’s director of operations Ted Zapp said he appreciated the business that the campaigns have brought, but was careful to avoid the appearance of taking sides. “They can all come in to our restaurant, Clinton, McCain, Huckabee, everyone,” he said. “We’re not preferential here.”

Although restaurants have benefited from the campaign activity, the real money may be going to local media outlets. The candidates have each contributed money into advertising on television, print and radio.

At Austin NBC affiliate KXAN, Obama’s campaign has spent $125,525 on advertising, and Clinton’s has spent $78,340, according to sales director Rachel Steading. Statewide, the candidates have already spent a combined $8 million for television ads, according to the Campaign Media Analysis Group.

Despite the money flowing into certain sectors, Sabrsula said that the campaigns’ reliance on volunteer labor reduces the impact overall. He also suggested increased traffic and road closures due to increased security at events may have hurt some businesses. “Taking all the factors into account, it may not be a large impact overall,” he said.

While refusing to speculate about the economic effects on the city as a whole, Batchellor said that the Democratic battle for Texas has at least made his restaurant a lot of money. “It’s been great,” he said. “I’m ready for the next one.”