This interesting news comes courtesy of the Wall Street Journal editorial page:
The underreported economic news of the week is that Barack Obama favors a stronger dollar. Even better, he thinks a stronger greenback would help to reduce oil prices.
That at least is what the Democratic Presidential candidate told a town hall forum in Parma, Ohio, on Tuesday. “If we had a strengthening of the dollar, that would help” reduce fuel costs, he said, according to a Reuters dispatch ignored by most of the media.
Barack Obama won’t get many cheers from the Wall Street Journal, but he’s completely right about the dollar. Frankly, I’m surprised he hasn’t stressed the dollar issue more. It’s hard to think of a more powerful symbol of American decline under George W. Bush than the destructive and embarassing devaluation of the dollar.
The value of the dollar and the turmoil in the Middle East are two important factors in the rise in oil prices. Yes, increased demand is also part of the problem, but everything costs more if the dollar declines in value, the the sabre rattling with respect to Iran and the fiasco in Iraq have also driven up prices.
Now we have some Republicans crowing that oil is down to $120 per barrel now that they are talking about drilling. That’s beyond ridiculous. The bubble in oil occured under the “watch” of a Republican president who promised to control oil prices.
Obama needs to pound this theme of the value of the dollar. It’s the easiest way to explain why we need a change.
