Teri Hourihan believed God had called her to run for governor, and that when Arizona’s July primary election came around, He would help her win the race.
But the non-divine odds were stacked against her.
Her opponent in the No Labels Party’s gubernatorial primary, wealthy entrepreneur Hugh Lytle, had the backing of party leadership and a self-funded $2 million in his campaign coffers.
Hourihan had God and a cellphone.
The political newcomer joined the race out of frustration with Arizona’s government bureaucracy, and built a following through a relentless stream of social media videos accusing state officials and agencies of corruption.
Still, for all her religious conviction, Hourihan was surprised when the July 21 primary results showed her ahead of her far better-funded opponent.
“Not surprised in a way that I didn’t believe what God was telling me,” Hourihan said, “but surprised in a way that I just couldn’t believe that this was my life.”
Lytle’s loss was the most surprising upset of the July 21 election, and in line with his centrist campaign message of lowering political temperatures, he conceded gracefully.
But it was perhaps a greater defeat for Paul Johnson — the former mayor of Phoenix and current chair of the No Labels Party — as the latest complication in his decades-long effort to give Arizona’s independent voters more political power.
After several failed attempts to change Arizona’s election rules to benefit independents, Johnson took over the No Labels Party as another route to political parity — giving independent-minded candidates a recognized political party alongside Republicans and Democrats.
But when Johnson opened the gates, he couldn’t control who came through them.
Paul Johnson interviews Teri Hourihan after her No Labels gubernatorial nomination on his podcast, “The Optimistic American.”
If you can’t beat them, join them
Johnson has fought a long battle against the two-party system’s domination of Arizona elections, but his attempts to give independent voters more say have been stymied by both major parties.
This time, it wasn’t the two-party system that got in Johnson’s way, but Hourihan and her calling.
Johnson recruited Lytle, who launched his gubernatorial campaign in January under what was then the newly renamed Arizona Independent Party. (A lawsuit later forced the name back to No Labels.)
Before his detour into running a political party, Johnson had tried to change the system through Proposition 140 — a 2024 ballot measure that would have put every candidate on the same primary ballot, regardless of party.
The measure offered a promise that by changing the system, Arizona could weed out the extremists who dominate party primaries. And it was an attempt to eliminate the numerous disadvantages that independent candidates and voters face in Arizona elections. Those include much higher signature requirements for candidates running without a recognized party, and the need to file a request for a specific party’s ballot for unaffiliated voters — who rarely do.
Nearly 60% of voters rejected the measure, a loss Johnson attributes to the Republican and Democratic parties’ interests in preserving their advantage. His previous, similar attempts at reform also failed.
“We had to figure out: What do we do now? One way is to just say, ‘Well, that didn’t work’ and walk away,” Johnson said. “I’ve been doing this for 25 years, so I’m not walking away. This is too big of an issue.”
After Prop 140 failed, Johnson took over Arizona’s branch of the No Labels Party — a national centrist movement that had already secured a recognized party line in the state — pledging that the movement could bring some level-headedness into Arizona’s notoriously extremist politics.
He renamed it the Arizona Independent Party and helped draft a set of principles for candidates, including support for his open primaries initiative and a willingness to work across party lines.
And building a party meant recruiting candidates.
“I don’t like political parties. They act as gatekeepers, and they’re not in our best interest,” Johnson said. “I shouldn’t have to go out and recruit candidates to run in a partisan primary, but it’s the only option we have.”
Ironically, in trying to beat the gatekeepers, Johnson had become one.
Just as he was assembling his slate, Johnson’s party got dragged into court over its name change. Arizona’s Democratic and Republican parties, plus the Citizens Clean Elections Commission, argued the Arizona Independent Party name would confuse voters. A judge voided the renaming in March and forced the party back to No Labels.
The lawsuit made an already complicated effort more chaotic, Johnson said. Candidates wondered whether they would still qualify for the ballot after collecting signatures under a different party name.
And money the party had planned to spend on candidates went to the court fight instead.
Lytle, at least, had money of his own.
The wealthy healthcare entrepreneur founded three companies, including one he sold for $450 million in 2006. Lytle’s father, Ben Lytle, founded Elevance Health (previously known as Anthem), one of the largest health insurers in the country.
But Johnson said the businessman he recruited for governor “is very nonpolitical.”
“The good news to that was he understood that it’s really hard, on a statewide basis, for an independent to win,” he said. “But if you can change the trajectory, you can begin to change the debate.”
But Lytle’s deliberately mild campaign wasn’t a big hit with voters.
Conversely, Hourihan’s combative campaign, which 12News’ Brahm Resnik noted “mimics some similarities to President Donald Trump’s 2024 campaign,” broke through.
The bombastic social media maven, fueled by long-running grievances with the Hobbs administration, beat Lytle by 12 percentage points.
Now, the candidate who will carry Johnson’s experiment into November is the same one he tried to push out of the race.
Meet Teri
Before she decided to run for governor, Hourihan says she wasn’t “really a political person.”
“I mean, I was a Democrat simply because my parents were Democrats,” she said.
That changed in 2023, when her behavioral health company, Teri’s Health Services, was placed on Arizona Medicaid’s suspension list over what Hourihan says was an unfounded fraud allegation.
Her company remained on the suspension list for more than two years, she says, and it shrank from 250 employees to fewer than 20.
Throughout the process, Hourihan repeatedly reached out to various state government officials without much response. She posted Instagram Reels accusing state agencies of corruption tied to the Medicaid fraud crackdown.
Her targets included the state ombudsman, various state lawmakers, Attorney General Kris Mayes and, perhaps most often, Gov. Katie Hobbs.
“I love to say that had Katie Hobbs picked up my phone, had Kris Mayes picked up my phone call … I wouldn’t be here today,” Hourihan said.
After struggling with addiction, Hourihan says she got sober at 23 and “gave (her) life to Christ.” And her faith remains inseparable from how she views her candidacy and her feud with the institutions that she believes wronged her: as battles she’s been called to see through.
“I’m a Christian. I’m not doing this because this is fun for me. I’m doing this because this is what my life was planned to be,” Hourihan said.
After Hobbs and other state officials declined to help her as a private citizen, Hourihan decided she could effect much more change if she became governor herself.
She originally filed a statement of interest to run under the Republican Party, because it “drew more to my values,” she said. Plus, “I also strongly detest Katie Hobbs and Kris Mayes, who are both Democrats.”
But the Grand Old Party wasn’t a good fit, either.
Hourihan said she studied subjects including “LGBTQ and unfair treatment” and “suicide risk prevention for trans youth” during her PhD program. And when she showed up at a Republican event to gather signatures, she happened to be carrying one of her company’s rainbow-printed tote bags.
“I wasn’t like handing these bags out, like it doesn’t say ‘gay pride’ on it or anything like that,” Hourihan said. “This woman ran up to me — it was like five minutes of being there — and said, ‘Put away the gay bag.’”
She found out about the less-ideological No Labels Party, and signed up to run for governor under its banner instead.
Then she met Johnson, the party’s leader, who she said initially made her feel welcome. That changed when Johnson told her the party was backing Lytle and urged her to run for a lower office instead.
Hourihan responded with several social media videos accusing Johnson of dirty politics, and provided Capitol Media Services’ Howie Fischer a recording of the conversation, made without Johnson’s knowledge, in which he urged her to drop out.
The duo hashed it out on a nearly two-hour episode of Johnson’s podcast, aptly titled “The Optimistic American,” in a strange collision between Hourihan’s grievance machine and Johnson’s relentlessly even keel.
“I think that you’re a very nice person,” Johnson told Hourihan in the episode. “I think that you’ve suffered some trauma in your life. I think that trauma has driven you to have grievances, and those grievances, I think, sometimes are overpowering in terms of what it is that you’re trying to do.”
Still, Johnson said he wasn’t surprised when Lytle lost the primary. While Lytle had his sights set on the general election, Hourihan ran an unvarnished social media campaign.
In fact, Johnson doesn’t attribute Lytle’s loss to No Labels’ missteps or Lytle’s limited primary campaigning.
“It was the success of Teri,” he said. “And that should be respected.”
But even after her primary win, Hourihan doesn’t have No Labels’ backing, partly because she refused an interview with the party’s endorsement committee. She described that decision as not wanting to become “a box you check.”
For Johnson, Hourihan’s candidacy was a different kind of setback in his long-running push to give independents equal footing.
While his past election reform efforts faced organized opposition, the loss of his preferred gubernatorial candidate was, in many ways, a consequence of the party he helped build.
“That’s what we created here: the ability to have access to the ballot,” Johnson said.
Johnson achieved his goal of creating a new party and giving Arizona’s voters another option on their ballot.
But in doing so, he discovered two universal truths that most party leaders have stumbled upon: You can’t control which candidates join your party, and there’s no accounting for voters’ taste.
And this time, social media ax-grinding played better with voters than $2 million of moderate messaging.