Presidential Politics and the Falling Dollar
It's been a long time since the dollar was a big presidential campaign issue. Probably not since Bryan vs. McKinley in 1896. And I've noticed that whenever CNBC's Larry Kudlow brings up the possibility that the tumbling greenback—or the "U.S. peso," as he likes to call it—may return to political prominence in 2008, the political smarties on his show always scoff, like Americans are rubes or something and don't "get" the fact that their national currency has become a global joke.
But who can forget TV images of celebrating Canadians when their "loonie" hit parity with the dollar last year? And guess what, Americans make some 30 million trips out of the country every year. Those folks sure know what the dollar is doing. The state of the dollar has even invaded popular culture. Comedians are making jokes about it, like this one from Stephen Colbert:
Anyway, it's official, the troops will be in Iraq until Bush leaves office. And that is not passing the buck to the next president. That is ridiculous. With the current state of the dollar, it's more like passing 85 cents, tops.
And then just the other day, I saw a McDonald's commercial that also made fun of the dollar as it promoted its "dollar menu." But the falling dollar isn't really too funny, not when you consider how its decline is driving oil and other commodity prices higher. Indeed, one recent analysis says that oil would be $65 a barrel today instead of closer to twice that if the dollar had stayed strong.
Is the dollar helping exports? Sure, but depending on a weak dollar to boost gross domestic product numbers is a shortsighted policy, because you are simultaneously reducing your own purchasing power. In the long run, a currency reflects economic fundamentals. The falling dollar is flashing a worrisome warning sign the presidential candidates should pay attention to—since I am guessing that more and more voters already are.
Tags: dollar | economy | presidential election 2008
Tools: 
Share
|
| Comments (2)
Reader Comments
politics and the dollar
I believe politicians have run our economy down. Some is because of their own selfish desires and spending. Much I do not believe they are in touch with the American people as their focus is their own agendas. I do not know what they are gaining, but they must be gaining a lot to make so many illogical decisions. As far as gas prices, I find it horrendous. News talks about some people cutting back and some keeping their habits. I did not do much "extra" traveling in order to cut back. I drive to work and home mostly. I need to work to make money. I cannot quit in order to save on gas. I cannot take off a day every week to try to save money. I cannot just sell my home and move closer to work - not only do I not want to move to such an area, but considering the falling prices on homes, I do not believe I could sell my home for a reasonable price no matter how well it is kept and the improvements I do to it. Perhaps Congress can cut back their spending - have local meetings; don't charge taxpayers for luxury trips; have lower cost meals. They must have too much money because if they could put themselves in many working families' shoes and live the struggles they do, they would more greatly control spending and not allow things such as gas that people need to get to work to have money to have food for their families to raise to levels that can destroy them. I am not talking about people who choose to act irresponsibly. Many are honest, hard-working citizens who face homelessness. The average person cannot just go golfing, to the beach, or some glorious outing. If Congress had to face what many American people did, they would stop lining their own pockets, budget more wisely, and put a cap on charges.
Add your thoughts
Your comment will be posted immediately, unless it is spam or contains profanity. For more information, please see our comment guidelines.advertisement
Falling dollar, politics and health care
The "falling dollar", now especially noticeable against oil, gold and other currencies is just the proof that our Republican-led government has intentionally under-reported real inflation via phony-baloney manipulation of the CPI index and that your Federal Reserve has wrongly held interest rates too low too long . The same dishonesty and mismanagement also contributed to the housing "bubble", then the bust. The dollar's value on free world markets is now revealing the truth---but too late for you, the poor schmuck with a bank savings account held in dollars.
Now Republican John McCain plans to take the health insurance risk out of the workplace group model and put it not in the public sector (where it belongs) but rather just dump it in your private lap. There, your badly-shrunken dollar can buy you some badly shrunken care, not dissimilar to how you used to get a gallon of gas for a dollar but now you only get about 5 ounces. Wake up, people. You're being "had".
Apr 22, 2008 10:07:35 AM [permalink] [report comment]