Monday, March 10, 2008
Personal Aside: Fosters Election Validates an Old Tradition The Religion of the Strong Dollarand Why Its Sometimes Helpful to Stray from Virtue (a Helpful Heresy).
Democrat Bill Fosters election as 14th district congressman over Jim Oberweis by a margin of 5,000 or so votes winning 53 to 47 proved several thingsto me at least.
1. Are we going to have to wait until Big Jim Oberweis spends ALL his money in primary election after primary election for the purpose to determine if hes lovedwhich for anyone who really knows him understands that this, not political issues, is the reason for this experiment? This is the real story why Oberweis has been running. I endorsed him the last time for governor but begged him not to run for Congress this time so as to allow Chris Lauzen a chance. No soap. And its for sure that Oberweis will be dominating the field for a rerun eight months hence. His money stunts anyones success in challenging himyet his money is never sufficient to carry him through any general election. The cumulative results show that Oberweis plain-and-simple is not liked. What has to happen before we understands thissomeone to drive a political stake through his heart?
2. The astoundingly low turnout was caused by several factors butr certainly one major thing: the Republican electorates getting sick and tired of Oberweis, having been through his first race as a pro-cboicer, his second as a pro-lifer, his third where he sought to negotiate Bill Brady out of the governorship race by a system of drawing straws where Oberweis had more straws than Bradywhich really was confounding. Sure there is a Republican morale downturn with a sluggish economy and Hasterts failure as Speaker to rein in GOP House spending but a majority of the turnout problems seemed to turn on Oberweis fatigue. But theres more.
3. The juvenile, sulk-in-his-tent attitude of Chris Lauzen who refused to endorse the winner because Lauzen felt he was slandered by Oberweis campaign tactics. Sure the Oberweis commercials were rough which is Oberweis style but someone should have told Lauzen that politics aint beanbag as Mr. Dooley said. I urged Lauzen to endorse him so as to spare Lauzens wearing the collar for an Oberweis defeat. No, Lauzen insisted on an apology that would approximate the Japanese surrender on the deck of the battleship Missouri. Well, now Lauzen IS wearing the collar, bearing some responsibility for the loss. Tell me, does stubbornness and refusal to listen to advice come with a CPA? Or does the certification come equipped with a whine: I have given up so much for public service; how dare anyone say bad things about me? Comon Chris, its politics. Nobody forced you to run at any time, did they?
4. Oberweis has been notable for paying lavish fees to campaign consultants who are less than bright. The first time it was to a consultant that insisted Oberweis had to be pro-choice. The second time it was to a consultant who devised a TV commercial that didnt just make a statement on immigration but which was bound to inflame. Now we have a consultant who told the media on election night (Bill Pascoe) I think everybody was surprised. We did not see it coming. HUH? Evidently everybody saw it coming but you, Mr. Pascoe. The word on the street, far from the precincts of the 14th and the headlines in most newspapers was that Oberweis could easily lose. Where were you? And are you going to continue raking down the money for the next lucrative Oberweis loss eight months hence? Really a neat industry for you and others, isnt it?
5. Enough already. When Oberweis allowed himself to be shown on TV mimicking the halting speaking style of Foster, it shows one thing: this guy has an MBA, is a bright entrepreneur but was is and forever will be laden with a tin ear for politics. Now as for the august Tribune.
6. For the second straight time, the Tribune has invaded the campaign business to justify its guilt-ridden were-Republican-but concept that has shaded its integrity since April 1, 1955 when the Colonel died. The newspaper undertook a decidedly partisan election shading role is prying loose private and confidential material concerning a Jack Ryans divorce in 2004 which had utterly no implications for public policy whatsoever. By doing so the newspaper was as malicious and as mean-spirited as the National Enquirer. Ryan was a major league candidate with talent, smarts, looks and funds to go all the way. The paper purposely bumped him out of the way as a service to the Democrats with the newspaper looking skyward in fake innocence, claiming that when a husband propositions his own wife it is a news story. What rot. Had Ryans divorce involved drunkenness, lechery, infidelity, wife-beating or any serious character assassination, the paper would have been justified in breaking the court code of secrecy. . It did not. Instead it was an insidious invasion into a candidates private life in an obvious attempt to skew the field of Republican candidates.
The editorial in the Tribune endorsing Foster, the work of Bruce Dold, was a masterpiece of duplicity. It started off by saying that the paper agreed heavily with Oberweis on the issues and then dragged allegations from earlier campaigns Oberweis ran to justify that Oberweis ran bogus charges. When Foster came out with an ad that falsely implied Oberweis had hired illegals when in fact a store cleaning company on contract had, there wasnt a peep from the august dozing sentinel of political correctness. It should have been enough to cause another editorial that at least would be qualifying of the earlier endorsement of Foster. The fact is that the Tribune follows a pattern advocated by its marketing people: the purposeful crafting of mushy-moderate positions so as to not lose exurban readers or embarrass its heavy advertisers despite the fact that on item-after-item on economic policy where Oberweis and the newspaper agree, the Tribune savaged him. The Foster endorsement smacks, indeed smells, of political manipulation contrary to the issues for the sole purpose of racking up another Democratic victory, after which the newspaper, turning its eyes skyward, claims it had no stake. Not much.
The Religion of the Strong Dollar.
Many years ago as an assistant Commerce secretary who had only a cursory understanding of the deadly dull science from Economics 101 at St. Johns in Minnesota, I spent a lot of time with old-hand department experts on the dollar who had served in the department under Republican and Democratic secretaries for many years and had no partisan axe to grind.
They told me that a strong dollar was always the political goal (doesnt it sound patriotic and make you want to doff your hat as well the national anthem is played?) but occasionally and here they bit their tongue a weaker dollar (youll pardon them and me) also helps. It boosts our exports relative to imports for one thing. Then as when I served in Commerce this factor is an aid to avoiding recession. They taught me that the doctrine of the strong dollar isnt always an index into economic health. How? A weaker dollar stimulates the prospect of good investment strategies at home which means future strengthening of the dollar. Attracting foreign capital, they said, stimulates dollar purchases by foreign investors. They showed me charts showing that in the past that showed capital inflows from large trade deficits. When I was at Commerce, 1969, I remember the Japanese yen was 360 to the dollar; not long ago it was 110 to the dollar and how are the Japanese doing today, you may ask?
Sure, all of us consumers are helped by the dollars gaining greater purchasing power but after that designation we fall into separate categories. Exporters benefit from a weak dollar because foreigners buy more of our goods. A free market works out the balance but thats the nature of the free market. And sometimes it is tragic i.e. higher ethanol production here means spiraling cost of corn which hits those fading away in malnutrition in Africa. Remember what we learned in Economics 101?the price of a loaf of bread rotates up and down until it settles down to equal the quantity supplied at the price. At that point we say it is the approximate rate it will go far and assign to it the baseline which governs future movements that are rated strength or weakness. As a floating exchange rate ceases fluttering and the needle hits steady after a time we assign to it the norm in the market for foreign exchange.
While the status of the dollar is a major consideration in foreign trade, the dollars expected future movement is more essential for foreign investors. Why? Because they want to come in here when the dollar is cheap and scram when the dollar is strong. As they said at Commerce so many years ago: The faster the dollar devalues the sooner the expectation that things will change and it will zoom up again. This, after all, is par for the most vibrant economy in the world. Translated to today it would seem to indicate that a quick zoom up for the dollars value would short-circuit trade adjustment and cut trade as a tool of increased demandnot helpful as we try to avoid a serious recession. All of which means, we shouldnt let panicky headlines scare us to think the dike is cracking. Which was ratified by an oldster a sprightly 75-year-old legendary free market advocate I had dinner with one night after a long days work at Commerce.
He said, thats the free market and how it works, son.
I said: Yes sir. Ill remember that.
His name, by the way, was Henry Hazlitt.