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Memo: To George W. Bush

From: Jude Wanniski

Re: A Perfect Fit

You probably did not know that I was not happy that you had given
Dick Cheney the job of finding you a running mate. That’s because of his
friendships with the old Cold Warrior gang, to which I once belonged. I
thought he would have a bias toward one of the “bombers,” as Colin
Powell refers to those Republicans who prefer to shoot first and ask
questions later. I certainly was depressed last week when word came that
John McCain — a bomber if ever there was one — put himself back in the
running. So you may be surprised that, when I actually heard you were
thinking of Cheney himself, all of a sudden I felt much better.

It is widely assumed that he is part of the old crowd. Rumsfeld
certainly is, to a large degree. But Cheney is a different kind of man
and I doubt he would allow you to be managed by the military-industrial
complex. He knows it all too well. I’ve known Cheney for 30 years, since
he worked for Don Rumsfeld, when Don was director of the Office of
Economic Opportunity, and think of him as very patient, very methodical,
very logical, and most of all, fair-minded and open to alternative
views.

When I separate the Cold Warriors from the Diplomats, my litmus test
is what happened at the end of the Gulf War. The Iraqi army was in full
retreat, on its way out of Kuwait, and a decision had to be made by the
high command — your father in particular — on whether or not to pursue
the army into Baghdad and rip out Saddam Hussein. Gen. Norman
Schwarzkopf was all for storming into Baghdad. Gen. Colin Powell was all
for stopping at the border. It was Dick Cheney who broke the tie, siding
with Colin Powell.

Ever since, the shoot-first crowd has criticized that decision. My
old pals at The Wall Street Journal editorial page bring it up a couple
of times a year. But it was a great decision, as it elevated our nation
in the eyes of the Islamic world — which allied with us in the
coalition to expel Iraq, but which opposed further action and a march to
Baghdad.

The Islamic world has not forgotten that critical decision and
appreciates the role Dick Cheney played. There are a billion Muslims in
the world, governor, and if you make it to the Oval Office — as I
believe you will — they will feel more comfortable knowing there is a
Cheney at your side, who showed his stuff with Colin Powell back then,
and can be trusted to do so again. If you are going to be the president
who makes sense out of this new world, where the U.S. clearly has the
responsibility to “manage” the world, not “police” it, having two men
near you who know how to use force, but prefer diplomacy first, will
serve you well.

Here is the quick brief I sent out to my Polyconomics’ clients
Saturday in the few minutes after I realized how serious you were about
Cheney. It has some other surprises:

July 18, 2000

The report that Dick Cheney is now the frontrunner to be Bush’s VP
pick is very good news. I was really alarmed to think it would be John
McCain or even Sen. Fred Thompson. That is because they represent
distinct factions of the GOP and are hard-liners on military matters.
Cheney was SecDef, but worked well with Colin Powell, who would be
SecState. The two would be careful about a costly, gung-ho expansion of
an ABM and prudent in the use of force in foreign dustups where U.S.
involvement would be questionable.

Cheney also understands and appreciates supply-side economics better
than any of the other veep candidates, having been present at the
Creation, so to speak. I would not call him a supply-sider, because he
is not that confirmed in his policy views, but it would be much easier
with him on the
team to persuade a President Bush to name someone like Steve Forbes to
be Treasury Secretary. This would be necessary to force badly needed
reforms of the IMF and World Bank.

By the way, the Laffer Curve was first drawn by Laffer to demonstrate
to Dick Cheney, then deputy White House chief of staff to Rumsfeld, in
December 1974, that tax rates could be lowered without loss of revenue.
I was sitting at the table at the Two Continents Restaurant with Laffer
and Cheney, saw the Curve sketched on a cocktail napkin, realized its
importance, and subsequently named it the “Laffer Curve.” At the time,
the message got through to Cheney at least to the point he and Rumsfeld
persuaded President Ford to drop his push for a tax increase and switch
to a tax cut, albeit one poorly designed by the Treasury. It was
actually a “tax refund,” with no supply-side effects.

With Cheney in the White House, Bush could not be manipulated by one
faction of the party or another and there would be a balance in the
cabinet. For the last year, I had worried that the advisors he had
chosen on economic policy and national security were for all practical
purposes
the same that controlled the Dole campaign in 1996. Cheney understands
internal checks and balances, which means with Cheney in the transition,
there would be an unusual openness in a GWB administration, which is
what this move seems to be all about. With a military hard-liner on the
ticket, Bush would still be favored to win, but would have a harder time
bringing in a GOP Congress. With Cheney, I think the electorate would be
a bit more comfortable with the idea of giving the GOP the White House
and the Congress.

A footnote: My wife Patricia, a Reagan Democrat, said yesterday she
would vote for Ralph Nader when Friday she heard McCain indicate he
would go on the ticket if asked. This morning, she saw the report on
Cheney and immediately said that this ticket would get her vote. Under
no circumstances would she vote for Gore.

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