Kerry:
Nearly the presumptive nominee going into last week's Wisconsin primary, Kerry has garnered attention good and bad.
1) Newsweek and the Associated Press have rolled out a series of articles documenting the appearance of improper relationships between Kerry and donors. These are especially damning because so much of Kerry's stump speech is dedicated to attacking, in vague terms, the influence of special interests on the Bush Administration. The articles show clear paper trails.
2) The "Cash and Kerry" stories have not slowed the front-runner's momentum in the nomination fight. His momentum is increasing. However, the stories, which include his lobbying on behalf of a Chinese military-owned company coincident with a lucrative fundraiser, give Republicans some ammunition for November. At least, they disarm his charges of undue influence.
3) Kerry has won the backing of labor unions that had previously endorsed Missouri Rep. Dick Gephardt-notably James Hoffa and the Teamsters. This makes his nomination even more certain while starting early his ability to fill his general election coffers with union dues money.
Federal Reserve:
Good news for Bush has come out of the Fed.
1) The central bank's staff has privately predicted 1.5 million to 2 million jobs will be added to the American economy this year. That is a sharp rebuttal to the major Democratic campaign theme of job loss under President Bush.
2) The Fed forecast is below the Bush Administration's prediction of 2.5 million new jobs, but the renowned Fed staff has an excellent reputation for non-partisan accuracy.
3.) At the same time, there is no sign of any inflationary danger. Consequently, a highly influential Federal Reserve governor has predicted to us that there will be no increase in interest rates in the immediate weeks and months ahead and there may be no increase for the balance of the year.
4) That confirms that the change in language by the Federal Open Market Committee (FOMC) did not signal an imminent increase in interest rates.
5) Fed Chairman Alan Greenspan is described by his colleagues as putting the power of decision in the hands of markets-particularly the bond markets-rather than attempt manipulation of the economy by the Fed. That is a classic central banker's stance.
6.) It is believed that Greenspan is cognizant of the Bank of Japan's mistake in the early 1990s when it raised interest rates too much and too quickly, failing to recognize the disinflation in the system. The Japanese economy has not yet fully recovered from that mistake.
U.S.-Trade:
Australian officials, acquiescing to U.S. intransigence, signed on to a trade pact over the weekend. Meanwhile, negotiators are working on a Pan-American trade deal.
1) The deal would immediately eliminate trade barriers on almost all goods, including the U.S.'s 25% levy currently in place on imported light trucks imported as well as the tariffs on metals and minerals.
2) Australia, which already imports high quantities of U.S. goods, would eliminate its 5% tariff on American manufactured goods. Industry analysts say this could increase U.S. exports to Australia by over 10%.
3) The weakest leg of the economic recovery has been manufacturing jobs. This is mostly due to increased efficiency in manufacturing, but the slow job growth in that sector has been a political handicap to President Bush in key states Ohio, Pennsylvania and Michigan.
4) The administration refused to raise its quota on sugar imports. The sugar industry is one of the most politically connected and economically protected. Bush's negotiators did give ground, though not as much as Australia wanted, on beef and dairy imports, raising its quotas in those markets.
5) The agreement must pass through Congress and Australia's cabinet. Under new fast-track rules, Congress may not amend the treaty, but only reject or accept it. Its odds of passage are strong, despite the strong protectionist rhetoric on the presidential campaign trail.
Judges:
Democrats won another victory in the judge battle.
1) Senate Democrats had already succeeded in killing the nomination of lawyer Miguel Estrada to the D.C. Circuit Court, and last week they knocked top GOP aide Manuel Miranda out of his job with the Senate majority leader.
2) Miranda had been at the center of the surveillance of Democratic memos that documented collaboration with liberal activist groups on the filibuster strategy led by Sen. Edward Kennedy (D.-Mass.).
3) Miranda resigned when it was clear neither his boss, Majority Leader Frist, nor his former boss, Judiciary Chairman Orrin Hatch (R.-Utah), would stand behind him. Hatch's initial cooperation with the probe into the leaking of these documents set the ordeal in motion.
