Leaks, GDP and Bush

Larry Kudlow
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Posted: Oct 31, 2005 12:05 AM

So, who exactly leaked to columnist Robert Novak? That was the big question that was supposed to be answered.
 
The CIA leak probe was, after all, about a leak. In particular, it was about the leak of classified government information, namely the clandestine intelligence service of Mrs. Valerie (Plame) Wilson. (SET ITAL) That (END ITAL) was the mission of special prosecutor Patrick Fitzgerald. But after a two-year tortuous investigation, he failed to complete his assignment. Instead, he produced a five-count indictment of Lewis "Scooter" Libby, the vice president's chief of staff, on a Martha Stewart-like technicality of perjury, making false statements and obstructing justice.

 Libby's lawyer completely denies these charges, although it's probable that Libby did make a bunch of mistakes in the course of the investigation. Still, in America, you are innocent until proven guilty. And Fitzgerald may have a devil of a time drawing a curious he-said-she-said conviction out of a series of alleged phone calls between Tim Russert, Matt Cooper, Judy Miller and Scooter Libby.

 In the meantime, we still don't know the identity of the leaker.

 Perhaps Vice President Dick Cheney simply called George Tenet over at the CIA and said: "George, who the hell is this Joseph Wilson guy? I never sent him to Niger or anywhere else. Why is he writing this crazy stuff in The New York Times questioning whether Saddam was seeking nuclear material?"

 That's just my speculation about the origin of the leak. And whether it did or didn't happen that way, Cheney never told Scooter Libby to mouth off to various big-shot reporters. The White House should have merely issued a statement saying they had no knowledge of Wilson's assignment and left it that.

 But at least now we know there was no conspiracy running through the White House. Watergate-wishing Democrats will be sorely disappointed. There are no high crimes and misdemeanors.

 The president's chief strategist, meanwhile, appears to have escaped with his life. Fitzgerald bent over backward to allow certain Karl Rove "corrections" into the grand jury record in return for total cooperation in the investigation. There's more to be revealed on this front, but for now we have one indictment for allegedly not telling the truth in an investigation that seems to have not found any wrongdoing in the matter of the "outing" of a CIA operative.

 That was quite a long time for so little of a result. Did Wall Street even notice? Not at all. The stock market was too busy rallying on the sensational economic news that gross domestic product grew 3.8 percent (while core inflation rose only 1.3 percent) for the third quarter. That's a heck of a number when you consider the disruptions that two major hurricanes caused this country during the period.

 Let there be no doubt about it: President Bush's economy is recovered and roaring. His supply-side tax cuts are clearly working, and he has an excellent base on which to begin to recover his administration.

 To be sure, the second-term White House looks tired and could use an infusion of new blood in all the key areas, indictments or not. With the Harriet Miers pick having gone down to the cheers of constitutional originalists everywhere, the confirmation of a good, strong conservative Supreme Court justice is now a must. Bush's conservative base is still with him, but he must produce results.

 And while Bush has the economy working for him, he must take this opportunity to reinvigorate his entire policy machine. On the domestic side, the president needs to promote large spending cuts, tax-cut extensions and pro-growth tax reform, all of which will put even that much more firepower into a resilient economy. He needs to start talking tort reform again, must outline a tough immigration-reform plan and should also stop congressional Republicans from their Jimmy Carter-style anti-capitalist bashing of energy companies.

 On this last point, it's our maligned fuel producers who are essential to economic growth, and who would love to invest in new refineries and nuclear plants if only government regulators would step out of the way. Declaring war on business is a Democratic ploy, and the president should stand up and say so. A hundred million investors and 140 million workers will back him on this.

 Finally, Bush must keep the Iraq conversation alive, taking his message of freedom to the people, pointing out the success of the constitutional vote and combating the stream of antiwar negativity that flows from the mainstream media.

 Plamegate couldn't deliver a leaker. And on the same day Fitzgerald produced his findings, a fat GDP number greeted Wall Street. I'm getting the sense that the winds are turning back in the favor of this administration. Bush must seize the moment.