The Rittenhouse Review

A Philadelphia Journal of Politics, Finance, Ethics, and Culture

Tuesday, November 15, 2005  

Dusting Off Book Value

I was reminded yesterday, apropos of nothing whatsoever related to the subject at hand, that the analysis of a corporation’s financial position or value, in times past and quainter than these, regularly involved calculating its book value (or equity value), a somewhat out-of-favor measure that is equal to the firm’s assets minus its liabilities. Sort of daydreaming at the time, I thought that were one to measure the Bush administration’s “book value,” from day one way back when to the present, one would find, by nearly any reasonable standard, “prudent man” or otherwise, rapidly declining equity at 1600 Pennsylvania Avenue, particularly given the heavyweight who has been pressing down so adamantly on the regime’s liabilities side, namely Vice President Dick Cheney.

It was fitting, then, that the stand-out article in today’s Philadelphia Inquirer, by one of the paper’s Washington correspondents, Ron Hutcheson, “Cheney’s Image Takes a Beating,” so clearly delineated how poorly served the administration, and the country, are by Cheney’s hardheadedness, even his strangeness. Hutcheson writes:

Most politicians in Cheney's situation would scramble to change course, but he isn’t like most politicians. Days after [I. Lewis] Libby resigned, Cheney replaced him with David Addington [Google link added.], another longtime adviser, who helped draft a 2002 memo defending the use of torture in some circumstances.

Cheney courted more controversy by taking the lead role in trying to exempt the CIA from a ban on cruel and inhumane interrogation techniques. …

When Bush first came to Washington, Cheney was widely viewed as the experienced, steady hand in an untested White House. Now he is more likely to be pilloried as the hawk who helped push Bush into a messy war that could drag on for years.

Better, though, are the bad-mouthing quotes Hutcheson gathered from former friends and allies of the vice president, to wit:

Says Brent Scowcroft, “I consider Cheney a good friend; I’ve known him for 30 years. But Dick Cheney I don’t know anymore.”

Meanwhile, according to Hutcheson, Larry Wilkerson, once an aide to former Secretary of State Colin L. Powell, “accused Cheney and Defense Secretary Donald H. Rumsfeld of leading a secretive ‘cabal’ that hijacked foreign policy.”

And here’s a nice one from an independent observer, Joel Goldstein, a law professor at St. Louis University:

When was the last time he went on the Sunday talk shows? He increasingly seems limited to Rush Limbaugh or campaign appearances. Any time a vice president's prestige goes down, it has some impact on his influence in the West Wing.

Clearly, Cheney is a major liability, and one tied to a variable interest rate -- Appropriate, given how small a down payment the Republicans asked Americans to make when betting on their various policy schemes, and how recklessly the Bush administration has financed its follies. -- that is skyrocketing just when the Federal Open Market Committee is raising short-term rates to put the brakes on a supposedly inflating economy.

We can’t count on President You’re the Enemy to refinance his number-two man, and so applying Graham & Dodd balance-sheet analysis to the present political situation tells us this team’s book value is rapidly headed toward negative -- irreparably negative -- territory, if it’s not there already.

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