Alexi Giannoulias, the 30-year-old Democratic candidate for state treasurer, rejects the premise of the "Peter Principle," which posits that people, in the corporate and political world, rise to their level of incompetence.

Instead, Giannoulias advocates the "Alexi Principle," which is that genes, dollars and familial connections outweigh competence. Only 4 years out of law school, Giannoulias is a senior loan officer and vice president at Broadway Bank, which was founded by his father, Alexis Giannoulias, who died in June. Giannoulias expects that the world is like Broadway Bank, and that he can just mumble and fumble his way through.

"I have financial experience and an economic background," Giannoulias said. "Illinois needs a financial watchdog."

Republicans scoff at that assertion, dismissing Giannoulias as a financial dunce and Democratic lapdog. "I'm mystified as to why he's running," said his opponent, state Senator Christine Radogno (R-41). "He has absolutely no experience. He's been a lawyer only 4 years. He has no credibility." After 4 years in college, 3 in law school and a year playing basketball in Greece, Giannoulias has a thin resume. "I worked many summers (at the bank)," he said.

Radogno, age 53, who has been a west suburban legislator since 1996, charged that Broadway Bank "does business with known felons and people with ties to organized crime." She added that Giannoulias "has questionable judgment and should not be state treasurer." A Chicago Tribune article before the primary alleged that Broadway Bank made millions of dollars in loans to two convicted felons and one indicted money launderer and that Giannoulias was the loan officer. According to press reports, Giannoulias admitted his "inexperience" and a "cavalier" approach to the loans.

"We give loans to 10,000 customers annually," Giannoulias said. "In a perfect world, we would only give loans to morally upstanding applicants. But those who applied were credit-worthy and commercially viable. Those loans were approved by me." But the Tribune noted that in 2005 a convicted bookmaker and prostitution ring promoter got $12 million in loans from the bank, some of which was used to acquire a casino in Myrtle Beach, S.C. Giannoulias had told the Tribune that his bank never financed any gambling and that his brother, Demetrios, approved the loan. Press reports indicate that Giannoulias called the alleged mob figure, Michael Giorango, a "very nice person."

"Is this the kind of guy we should put in control of $13 billion in state investable funds?" asked Radogno.

"It's just desperation," Giannoulias said. "She's down by 15 points and she's just taking wild shots."

Indeed, polls show Giannoulias in the lead. A mid-September Chicago Sun-Times poll put the race at 36-23 for the Democrat, with 36 percent of voters undecided, a Saint Louis Post-Dispatch poll put Giannoulias up 47-37, and, according to Giannoulias, his campaign's internal polls put him up by 13 percent. Neither candidate is well known, undecideds are high, and either could surge to win.

In the March Democratic primary, Giannoulias spent $2 million and beat the slated candidate, Paul Mangieri, 475,428-298,907, getting 61.6 percent of the vote. Giannoulias's ace in the hole was U.S. Senator Barack Obama, to whom he liberally contributed in 2004. To reciprocate, Obama endorsed him in the 2006 primary, enabling Giannoulias to win a large black vote, and the hugely popular Obama will endorse him again in November, which will boost Giannoulias's vote among blacks and white liberals. Giannoulias is expected to raise and spend $3 million for the November contest, and Radogno $1 million.

On issues, Radogno will stress what she calls the "four C's" -- character, cash flow, credit-worthiness and collateral. "Alexi comes up short on all of them," she said.

Of Illinois' $56 billion budget, roughly $13 billion is invested by the state treasurer in revenue-producing funds. "I will get a better rate of return," Giannoulias said. Yet he is vague in his criticism of 12-year incumbent Republican Judy Baar Topinka, who is the Republican nominee for governor, saying that he will be "more proactive" -- whatever that means. Giannoulias promises "more community reinvestment and development" and "more aggressive investments," which is contradictory: Does he want to maximize interest returns or does he want to use the treasurer's investments to spur economic development? "I will be an advocate, not just a custodian" of the state's money, Giannoulias said.

Radogno said that the state's short-term borrowing is "out of control." She noted that the state borrowed $5 billion over the 23 years prior to 2002 and $4 billion from 2003 to 2006 under the Blagojevich Administration. "That's risen to a problem level," she said. "We can't borrow to satisfy short-term needs. We can't have an open revolving account." Giannoulias agrees, saying that state borrowing must be at "a minimal level" and that he would "not hesitate to oppose" the Blagojevich policies if he were treasurer. "I will be a fiscal watchdog," he promised.

Radogno also pledged to oppose the sale of state assets such as the lottery, the tollway and state buildings to satisfy the fiscal crunch. "We cannot dispose of long-term revenue-producing assets," she said. Giannoulias agrees, noting that the lottery generates $527 million in revenue annually and grows by $27 million per year.

Illinois House Speaker Mike Madigan, the Democratic state chairman, engineered the slating of Mangieri for the March primary and strongly backed him. Since then Madigan has made no effort to assist Giannoulias, leading to speculation that he views Giannoulias as a future rival to his daughter, state Attorney General Lisa Madigan, who surely will run for governor in 2010 or later. If Giannoulias wins in 2006, he's on track for higher office, either attorney general or governor, in the next decade.

But Madigan also must be careful. If Radogno wins in 2006, she could be a formidable contender for governor in 2010, and if Blagojevich serves another term that is suffused with scandals, then a Republican likely will win in 2010, much as Blagojevich coasted to victory in 2002 in the wake of George Ryan's scandals.

Giannoulias's assertion that Illinois needs a treasurer with a banking background has no foundation in history. Past occupants of the office have been lawyers, state legislators or Cook County office holders, not bankers. And they seemed to be competent. A Democrat has won seven of the 10 treasurer elections from 1966 to 2002, usually quite handily. Notably, in recent elections, there is no correlation between the outcomes of the races for governor and treasurer. In 1978, 1982, 1986 and 1990, a Democrat was elected as treasurer while a Republican won for governor. In 2002 the opposite occurred.

Topinka, a Berwyn state senator, won the job in 1994, buoyed by Governor Jim Edgar's Republican landslide. Edgar beat Democrat Dawn Clark Netsch by 914,468 votes, getting 63.9 percent of the votes cast, while Topinka beat Democrat Nancy Drew Sheehan by just 77,018 votes, with 50.4 percent of the vote. A Republican won every statewide office that year, and the treasurer's race was the closest.

Topinka was no shrinking violet. She criticized Edgar's Medicaid borrowing, and she was criticized for settling a delinquent $43 million state loan to two Springfield hotels for $10 million. In 1998 Orland Park Mayor Dan McLaughlin lost to her by just 62,279 votes. In 2002, against Tom Dart (now the Democratic candidate for Cook County sheriff), Topinka won by a hefty 396,965-vote margin, getting 54.8 percent of the vote as the only Republican to win statewide that year.

Blagojevich will not beat Topinka in 2006 by Edgar-like numbers. That means no Democratic sweep.

In 2002 Topinka won Downstate by 277,965 votes and the suburban Collar Counties by 291,469 votes, while losing Cook County by 172,469 votes -- a lot less than Joe Birkett's Cook County loss for attorney general by 394,419 votes and Jim Ryan's loss for governor by 468,974 votes. In Chicago, Topinka got 28.6 percent of the vote, compared to Ryan's 19.2 percent, and she got nearly 20 percent of the black vote. Can Radogno do likewise?

My prediction: Radogno ain't no Topinka. She won't win unless she goes negative on Giannoulias in a big way, and Giannoulias will spend millions to portray himself as "Mr. Wonderful." Giannoulias will win by more than 100,000 votes.

In city politics, it's gumshoe time on the Northwest Side. Sept. 19 was the first day to circulate nominating petitions for alderman in the 2007 election, with 300 signatures needed to secure a Feb. 27 ballot position. Under Chicago law, a voter who signs a petition cannot sign for another candidate.

In the 45th and 36th wards, Terry Boyke and Nicholas Sposato are challenging Aldermen Pat Levar and Bill Banks. According to Boyke, cars full of Levar circulators followed him wherever he went on Sept. 19, fanning out on whatever block he worked. Ditto for Sposato. Boyke got 1,400 signatures on Sept. 19, and he now has 2,500; Sposato got 600 on Sept. 19, and he now has 1,000. They will be on the ballot.