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Bill Virgin: Currency tinkering has impact

Here is some stuff I know, the “let’s rake away the leaves and political signs and see what we find” edition.

 • For those of you old enough to remember the 55 mile-per-hour Interstate speed limit, show of hands: How many of you religiously adhered to the double-nickel when driving?

Uh huh. Sure. Right.

Currency manipulation by national governments works much the same way.

Everyone professes not to do it, even as they’re madly scrambling to stay one step ahead of the competition. In this case, the competition happens to be the Japanese, the South Koreans, the Germans, the British, the Chinese, the Russians, the Brazilians – in short, anyone who might have a currency.

Such is the case with the Federal Reserve’s dumping billions of dollars onto the market with the putative intent to get Americans borrowing and spending again. The not-so-unintended consequence of this action, driving down the value of the U.S. dollar against other currencies, has not escaped the notice of other countries that are furious with the U.S. for attempting to do what they’re doing as well.

There’s a huge MEGO factor in this story – that acronym meaning My Eyes Glaze Over — for much of the public, which is not helped by obfuscatory jargon like “quantitative easing.”

But beneath those brain-numbing terms are very real impacts on your lives and wallets. That big-screen TV imported from Asia you have your eye on? More expensive. Those gallons of gasoline derived from oil imports you pump into your car? More expensive. The meals and rental car fees and restaurant tabs rung up by foreign visitors to Mount Rainier and other regional attractions? Less expensive to foreign tourists, good news for us. Grain and other agricultural exports that go out of ports like Tacoma? Less expensive to those overseas buyers, to the benefit of American farmers.

Or at least that’s the way it works until everyone else figures out how to chop their currencies down to remove the American advantage in their markets.

 • The governor and the Legislature face a daunting task of whacking away billions of dollars from the state budget.

Allow us, then, in the spirit of cooperation and public-spiritedness, to offer A Modest Proposal of our own: Let’s slice away one chamber of the Legislature.

The Wall Street Journal had a recent story about proposals in Maine, Kentucky and Pennsylvania, to convert to a unicameral, or single-chamber, legislature. So far, though, Nebraska remains the only unicameral legislature in the country.

The argument at the federal level for two legislative chambers in Congress was that they would constitute a check and balance for large and small-population states. In the Senate, at least, Wyoming gets the same say as California.

But that argument doesn’t work for Washington’s legislature, since representation in both chambers is proportioned by population. Garfield County does not get the same say as King in either chamber – although maybe it should.

The total legislative budget for 2009-11 is $153.9 million, with the House taking the largest share at 42.7 percent and the rest going to the Senate and various joint committees. That total represents half of 1 percent of the overall state budget. Still, every penny – or million dollars – counts. And perhaps the state might be able to rent out the vacant office space, and one of those chambers might make an interesting concert venue.

Or did they not really mean it when they asked the public for ideas on how to cut spending?

Bill Virgin’s column on business and economics appears Sunday in The News Tribune. He is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at bill.virgin@yahoo.com.

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