November/2 - Implications

It is expected that we may all look for relief, for a break from the desultory polices of the far-left after Nov/2. That being the case, let’s consider the aftermath (leaving bond and equity prices, gold and the dollar to the seers).

Certainly major employers will be cheered as uncertainties and hindrances are removed, or appear likely to be removed. The more the odds increase in 2011 for this event, the more payroll will increase and the greater the transition from temporary to permanent help. That’s a good thing.

Next, US business investment spending (which for the last 2 qts has outpaced consumer spending, a good thing) will expand further because business confidence will grow. That’s a another good thing.

Next, consumer spending will increase. Recall that retail sales are not in the tank but have been fairly strong, considering. But consumers with a new job, or, at least relieved of the threat of higher near-term tax burdens might even buy a discretionary item or two or three, something they are not doing now.

Finally, major world credits will take note; most have come to understand that statism means failure. They learned the hard way and now they’re wondering what we’re up to, a one-time beacon now moving left as they’ve moved right?! Thanks to Obama they’ve lost respect.

Michael Boskin writes following the G-20 summit, “Obama was soundly rebuffed by Canadian Prime Minister Stephen Harper, Great Britain’s new prime minister, David Cameron, and German Chancellor Angela Merkel, among others, on his demand for additional fiscal stimulus (more government spending). They are instead pursuing fiscal consolidation...”

Once the paladin of free markets, once the world’s champion meritocracy we have become suddenly hostile to initiative and innovation, looking instead for bureaucrats, for levelers to plan our economy, and, as world leaders now predict, kill us with debt. Everyone else can see this is the road to serfdom except Obama. When his policies are thoroughly rejected Nov/2, when voters stop the damage and then look for repairs, foreign investors will once again flock to the US as a place for safe and sound investment. We will all prosper as a result.


Robert Craven