Memo To: Paul Gigot, WSJ columnist
From: Jude Wanniski
Re: The Silence of the Lamb
Your Friday [March 5] column on the frenzy among Republicans to endorse Texas Governor George W. Bush ["Bush-Mania Could Stand a Market Test"] was one of your best ever, cutting against the grain. I thought of it yesterday morning when I picked up the NYTimes and found a photo of George's exploratory committee, which includes George Shultz, who was Richard Nixon's Labor Secretary, Budget Director and Treasury Secretary and Ronald Reagan's Secretary of State. If there is anyone I instantly would identify as an invention of the Establishment, it is George Shultz. Because Shultz never was an idea man, he could always be trusted by the Establishment to do its bidding. He always was good at getting things done because of his pleasing personality and personal political skills. But unless George W. Bush can break himself from the grip of the Establishment that now surrounds him, he will be absorbed and subsumed by the status quo. The fact that all organized Republicans rush to embrace him before they know what he thinks about anything is evidence of the shallowness of thought in the GOP, not necessarily the shallowness of young George.
In announcing that he does not know what he thinks about anything, but will know on June 6, when the Texas legislature is scheduled to adjourn, he demonstrates a sure-footed knowledge of the bandwagon politics in which the organization excels. If you can get everyone to sign up for the cruise before they know where it is going, they are more likely to row in that direction even when they find out they aren't sure they want to go there. We know George is his father's son, and likely to be a chip off the old block, and that is comforting to the organization. We also know he is a popular governor, recently elected by a landslide. I'm not sure any of this will count when he is tested in the marketplace next year, because I'm afraid much of his success in Austin was due to the economic expansion that took place under his feet at the national level. That is, all governors, of both parties, could be popular during years when state tax revenues always were exceeding projections. It is easy to play Santa Claus in Texas when the Dow Jones Industrial Average is more than doubling on Wall Street.
In what direction will candidate George propose to take us? So far, he officially has told us only that he is against crime and in favor of ethanol. Being against crime does not tell us much, because everyone is against crime. He will be asked at some point what he intends to do about crime that makes a difference to the American people. Will he be kinder and gentler (conservatively compassionate), or will he be tough as nails, two-strikes-and-you-are-out? We have to wait for the unveiling on June 6. Now ethanol is a different matter. To learn at this early stage that he is for ethanol tells us that he wants to get the corn vote in Iowa, even though everyone knows ethanol is the most egregious corporate socialist scandal of the century.
The scandal began when George Shultz was urging Richard Nixon to float the dollar, upon the instructions of the Establishment -- that wing controlled by the Big Banks. When the gold price shot up in the ensuing collapse of confidence in the dollar, the dollar price of oil soon followed. The Establishment announced that the world was running out of oil, and that it was necessary for our national security to turn corn into fuel, i.e., ethanol. Archer-Daniels Midland was just the company to take on this task, with its CEO, Dwayne Andreas, eager to assume this patriotic chore. With the help of friends in high places in the Congress, some of them from Kansas, ADM for the following two decades has lubricated both political parties with evidence of Mr. Andreas's generosity. He has sponsored all the Sunday talk shows, which has cost him a pretty penny. The only media outlet that touches official Washington that he has not helped out appears to be Matt Drudge, poor fellow. ADM has annually dished out several million dollars a year, divided fairly equally to Democrats and Republicans. All the federal government has had to do is subsidize ethanol by not collecting taxes on it, and by making sure regulations push a certain amount of the stuff into our gas tanks. The cost to the American people has been on the order of $2,000,000,000 a year -- all those zeroes mean "billion."
Now, of course, with Alan Greenspan having deflated the dollar, so it is now worth much more in terms of gold, the price of oil has collapsed. It is half what it would be if Greenspan had not deflated, and the Texas oilmen in young George's jurisdiction are hurting badly. So are the farmers. There is no corn down there, but there is in Iowa, so the first thing we know about the inevitable Bush presidency is that he will be for ethanol. For more, wait for June 6, but meanwhile, I sent this note out to Polyconomics clients on February 22:
GEORGE W. BUSH: The son of the former GOP President almost certainly will run as the party organization's favored candidate. As Bob Novak indicates in his column today, the Texas governor already is assembling a brain trust. We can now anticipate his campaign agenda by the kind of people he is choosing for his team. Former Fed Gov. Larry Lindsey heads the economic unit and Harvard Prof. Martin Feldstein, who at one point was chairman of the Reagan council of economic advisors, also has signed on. Both are dreadful choices -- conservative Keynesians who styled themselves as "supply siders" to gain entry to the Reagan administration. Novak reports that young George has barred Michael Boskin and Dick Darman from his team, as both are identified with his father's 1990 tax increase. Bush also has attracted Paul Wolfowitz and Richard Perle as his national security advisors, as both were hard-line Reagan Cold Warriors. The problem is that neither is happy without a war. Bush will get all the money and attention he wants in his bid, and will be high in the polls only until the electorate pays attention. Either Gore or Bradley would easily beat this Bush team, which reminds us that in presidential politics, young George is as green as grass.
A footnote: My wife Patricia and I drove into Manhattan last night to see Rigoletto at the Met, and on the way in she asked what my website was for today. I told her it was about Bush, and how he is against crime, but for ethanol. Without missing a beat, she said: "How can he be for both at the same time?"