After arriving on Capitol Hill nearly 24 hours after his announcement, McCain huddled with three of his closest political allies: fellow senators Lindsey Graham, Joe Lieberman and Jon Kyl. Later that day at a White House meeting convened by Bush and also attended by Congressional leaders of both parties as well as both candidates, McCain said almost nothing, even when House Republicans declared that they were not yet willing to sign onto the administration’s $700 billion proposal. Despite the fact that the deal maker had produced no deal, McCain announced the next day that his campaign would resume  “optimistic that there has been significant progress towards a bipartisan agreement,” as a campaign statement put it  and traveled to Mississippi that Friday afternoon to debate Obama. On Sunday morning, Schmidt went on “Meet the Press” to insist that his boss’s foray had been crucial in bringing “all of the parties to the table,” with the result that “there appears to be a framework completed.” The next day  Monday, Sept. 29, the day by which Schmidt had earlier warned the crisis “has to be solved”  the House Republicans played the key role in defeating the bailout legislation.

Scene by scene, McCain failed to deliver the performance that had been promised. Of course, this was no mere movie. America was in crisis. Perhaps with the Bush theory in mind, Steve Schmidt had advised McCain to “go in all the way” on the financial crisis so as to reveal his candidate’s true character. But given a chance to show what kind of president he might be, McCain came off more like a stymied bystander than a leader who could make a difference. Judging by the polls, the McCain campaign has yet to recover.

In reporting on the campaign’s vicissitudes, I spoke with a half-dozen of McCain’s senior-most advisers  most of them more than once and some of them repeatedly  over a period that began in early August. I spoke as well to several other midlevel advisers and to a number of former senior aides. Virtually all of these individuals had spoken with me for previous articles concerning McCain. Their insights and recollections enabled me to piece together conversations and events. My repeated requests to interview McCain and his running mate, Sarah Palin, were denied, and with only a couple of exceptions those who spoke to me did so with the stipulation that most or all of their comments not be attributed to them.

Despite their leeriness of being quoted, McCain’s senior advisers remained palpably confident of victory  at least until very recently. By October, the succession of backfiring narratives would compel some to reappraise not only McCain’s chances but also the decisions made by Schmidt, who only a short time ago was hailed as the savior who brought discipline and unrepentant toughness to a listing campaign. “For better or for worse, our campaign has been fought from tactic to tactic,” one senior adviser glumly acknowledged to me in early October, just after Schmidt received authorization from McCain to unleash a new wave of ads attacking Obama’s character. “So this is the new tactic.”

NARRATIVE 1:

The Heroic Fighter vs. the Quitters

Steve Schmidt is 38, bald and brawny, with a nasal, deadpan voice and a relentless stare. He is also a devoted husband and father of two young children, introspective and boyishly vulnerable for someone of such imposing stature. On mornings, he can be seen standing outside the McCain campaign headquarters in Arlington, Va., smoking a cigarette while he scowls at his BlackBerry. After campaign events in the evening, he often hangs out at a hotel bar drinking beer with fellow campaign workers and members of the media. Whenever possible, he flies back to California to spend the weekend with his family. He is not a hothead and tends to hesitate for several beats before offering a well-tailored, often wry answer to a question. Though commonly described in the press as a Karl Rove protégé, Schmidt was a Republican operative for a dozen years before he ever worked for Rove. When Bush returned to the White House, Schmidt was not among those from the 2004 re-election effort who were rewarded with plum jobs, despite his well-regarded work overseeing the campaign’s rapid-response unit. After spending the first half of 2005 heading up the press office for Vice President Dick Cheney, Schmidt was sent to Baghdad to improve the administration’s anemic communications strategy in Iraq. He also orchestrated the Senate confirmation hearings of the Supreme Court nominees John Roberts and Samuel Alito and their presentation to the outside world. Along the way, Schmidt never really developed the personal relationship with Bush that would have enabled him to advance in accordance with his talents. In early 2006, when an opportunity came to jump ship, Schmidt took it, departing the Bush administration to spearhead the successful re-election campaign of Gov. Arnold Schwarzenegger in California. He still lives outside Sacramento, far from Washington. Though Schmidt often brandishes his geographical remove from the Beltway and his lack of interest in another White House job as proof of his equanimity, you get the sense that a McCain victory would bring him no small measure of personal vindication.

For a man who seems to relish Rove-like alley fighting, Schmidt is not an ideologue and claims he harbors no ambition of delivering the Republican Party to a state of lasting supremacy. He also displays great nuance in office politics. Until Schmidt consolidated his power this summer, McCain, it’s fair to say, was not a big believer in organization. The important decisions were all made by him, with various confidants of ambiguous portfolio orbiting around him and often colliding with one another (and often staying in the picture well after their departure  as was the case of Mike Murphy, a strategist from the 2000 campaign, who remained close enough to McCain that rumors of his return persisted until fairly recently).

A year earlier, in the summer of 2007, the McCain campaign all but collapsed under the weight of financial woes, vicious infighting and the conservative base’s fury over his moderate stance on immigration. Among the senior staff members who walked out were McCain’s longtime political guru John Weaver and several alumni of the well-oiled 2004 Bush campaign. Schmidt  who until that point was not particularly influential  decided to stick around, even without pay. He began to earn McCain’s trust while also befriending the senator’s two closest advisers, who happened not to care for each other.