September 29, 2003
Iraq is Still a Threat to the Bush Administration

“Bush’s approval rating now stands at 49 percent, the lowest point of his tenure.” MSNBC

After riding a hanging-chad halo into the oval office, President Bush’s luck quickly changed.  To be sure, Bush inherited an economy braced for a pullback after the longest expansion on record, a developing stock market debacle that not even Greenspan could alleviate, and a terrorist attack that claimed more lives than Pearl Harbor. With this in mind, you could say that President Bush has been one of the unluckiest Presidents since Hoover – who had the misfortune of being welcomed into the oval office by the 1929 Crash and the Great Depression. 

Even so, if Bush loses next year’s election it would difficult to argue that he is a victim of circumstance.  Rather, by enacting tax cuts aimed primarily at padding the pockets of the wealthy and by attacking Iraq without U.N. backing, Bush has outgrown the persona of the hapless and unlucky President, and has emerged as somewhat of a zealous activist.  Indeed, if Bush were to lose next year he will be able to take full credit despite his lack of luck.

Will Iraq Storm Back Into Voters’ Focus?

“Mr. Neil said that according to the source, the report will say its inspectors have not even unearthed "minute amounts of nuclear, chemical or biological weapons material”.  BBC

Last week was an eventful one with regards to Iraq despite the lack of any apparent impact on the financial markets. To begin with, President Bush gave a speech at the U.N. which was met with quiet disdain from the global community – as the Slate’s Kaplan put it, Bush told the World to “Drop Dead!”  Following Bush’s speech, and some rare ribbing from Anan, it was reported that the European Commission is ready to commit only €200m to the Iraq cause (less than the EC put into the reconstruction of Afghanistan), and that the U.S. may have to call up more reservists.  This sequence of events, including Bush’s declining approval rating, may be coincidental. Nevertheless, calls for help from the U.S. to the International community continue to go unanswered.

Incidentally, on the topic of Bush’s speech there was one concession made; a shocking statement considering what Bush stood for a few short months ago:

“The Security Council was right to vow serious consequences if Iraq refused to comply. And because there were consequences, because a coalition of nations acted to defend the peace and the credibility of the United Nations, Iraq is free.”

How does the U.S. defend the U.N.’s ‘credibility’ by defying the wishes of the U.N. and attacking Iraq?  Only Bush knows.  Regardless, what this seeming contradiction in U.S. international policy could mean – as the U.S. goes from suggesting that the U.N. is ‘irrelevant’ to authoritative - is that Bush is not so eager to ‘go it alone’ because of the unplanned for costs of the Iraqi occupation.  This is especially the case considering that Iraq’s oil output has been struck by saboteurs and is not thereby available to pay the bills as quickly as many had predicted.

Suffice it to say, Bush previously made it clear that the U.N. was little more than a nuisance.  Now, with no WMD found, and with few nations coming forward to pledge their support for the reconstruction of Iraq, Bush has changed his tune. The American public was willing to charge into battle with Bush a few short months ago, but will each new concession offered by team Bush weaken this support?

Stupid President – It’s Iraq!

Originally coined by Clinton, the ‘it’s the economy, stupid’ mantra will undoubtedly have an impact on next year’s election.  However, and assuming that the U.S. economy can at least stop shedding jobs for a moment, Iraq threatens to become the bigger election issue.  Why?  Because Bush’s defense on the economy – ‘I was unlucky to inherent this economy but things are improving’ - could end up being stronger than his defense on Iraq.

Incidentally, what is Bush’s defense on Iraq if no WMD are found, no new international support or U.N. resolution arises, and U.S. soldiers are still under attack next year? Although it is doubtful that the situation in Iraq will prove as dire next year as it is today, would voters approve of the below embellishment:

‘I know I gained congressional support and went against the U.N. because of a faulty WMD threat, but one day we will eventually force every Iraqi to embrace our brand of freedom and democracy’.  Reelect Bush!

Election Rally?

It is generally held that the stock markets rally in the year leading into elections (CIC study). However, historical correlations are not always predictive of future events. Moreover, it should be remembered that above all else the stock markets do not like uncertainty.

With many leading Democrats threatening to take back some or all of Bush’s recently enacted tax cuts this brings about a great deal of uncertainty.  Quite frankly, those that were calling for a massive rally in stocks (which has happened) following the dividend tax cut just a few short months ago could be arguing that historically low dividend yields are less attractive if a Democrat that wants to attack the wealthy sneaks into the White House. Granted, this speculation hardly warrants much attention now, yet the topic of tax cuts and deficits is, and will continue to come to the forefront ahead of November 2004.


That Bush cannot play the ‘unlucky leader’ angle with Iraq could be a threat to his Presidency.  To be sure, and whether employed or not, American citizens will not be as willing to charge into a lengthy and costly occupation if the global community continues to shun Bush.

“As an original signer of the U.N. Charter, the United States of America is committed to the United Nations.” President Bush.  September 23, 2003.

“Will the United Nations serve the purpose of its founding, or will it be irrelevant?”  President Bush.  September 12, 2002.

“The fundamental question facing the Security Council is, will its words mean anything? When the Security Council speaks, will the words have merit and weight?”  Bush.  March 6, 2003

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