One of the ironies of public officialdom is that those elected officials who deal with budgets and tax policy rarely fully grasp the economic sea changes when they occur in the nation.
Whether it's due to habit, tunnel vision, groupthink, arrogance, ignorance, surrounding yourself with sycophantic staff, or some combination, congressional lawmakers are often the last to notice economic shifts that occur cyclically.
January 2009: A new era begins?
One of the key economic questions for investors and other stake holders is whether President-elect Barack Obama follows through with his campaign promise to be an eclectic, someone who tries a center-left policy here, deploys a center-right policy there because it works, and who does not implement typical party -- or partisan -- responses to problems; i.e., solutions from traditional sources of power in his party.
But an even more-telling economic question concerns what the Republicans will do. In November 2008, the Republican Party suddenly found out that it was very white, male, old, Protestant, and by-and-large economically and fiscally conservative. The aforementioned guarantees in the years ahead that they'll hold at least 20 or 25 Senate seats in a chamber of 100, and if they're not careful, about the same percentage of House seats. Meanwhile, the nation's electorate is increasingly nonwhite, female, younger, non-Protestant, and by-and-large economically and fiscally moderate, and in some cases, liberal/progressive.
As a result of the November election, a classic economic rift has surfaced in the Republican Party, between those who say the future lies in economic conservatism (cutting taxes, deregulation, cutting government services, and in general limiting the role of government) and the moderates who say a more middle-of-the-road economics approach is needed to deal with problems and appeal to more voters.
Of course, we're early in this new era, but the initial signs suggest that economic conservatives don't notice (for the reasons stated above) the changes taking place in the nation today. Some economic conservatives are asserting that the results of November 2008 can be easily reversed in two years. They appear to be a little like the monarchy of late 18th century France, dismissing urban peasants' lack of food by saying 'if they need food they can move to the country and grow crops.' To be sure, the U.S.'s economic situation today is not as serious as France's in the late 18th century (at least we hope it doesn't become as serious), but formidable economic problems nevertheless exist.
And those economic issues are at the core of Obama and the Democrats rise; it's a New York-California-Midwest coalition, with Florida thrown in for good measure. It's a formidable coalition; the demographics are in their favor. Moreover, Obama and the Democrats can fortify their coalition by solving the many economic problems facing the nation. Hence, the issue is not the Democratic victory in 2008, but victories in 2012, and 2016, and 2020, and 2024. So far, there's little indication that economic conservatives see this.
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Financial Editor Joseph Lazzaro is writing a book on the U.S. presidency and the U.S. economy.
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Reader Comments (Page 1 of 1)
11-21-2008 @ 6:20PM
jonathan said...
This all happened in eight years? No. The Republican Party backed a boob for the White House and they are paying the price. They will be the loyal opposition and they will be back,true to their core beliefs of less government intrusion. What does government do well? Not much-the next four years will prove that and the Republicans can reinvent themselves by then. Ok. Maybe eight years...
11-21-2008 @ 6:45PM
Chris said...
Sadly, for 8 years, so-called conservatives did the exact opposite of their rhetoric. They grew to the government at every turn.
Republicans are bigger Democrats than Democrats.
Obama will just keep the ball rolling...so to expect different results would be quite silly.
11-21-2008 @ 8:41PM
Mark said...
yeah, I noticed in the convention, there were few hispanics, few blacks, etc. I was wondering couldn't they have sprinkled a few around. There are conservative Hispanics and Blacks. My wife is from Nicaragua. I would have sent her.
Mark
http://mark24609.blogspot.com
11-21-2008 @ 10:47PM
Sherry said...
We need to get on about the business of becoming energy independent and using alternative sources of fuel. The high cost of gas this past year seriously damaged our economy and society. While we are doing the happy dance around the lower prices at the pumps OPEC is planning further production cuts to drive prices back up. We have the knowledge, we have the technology, what America lacks is a plan. Jeff Wilson has a new book out that is beyond awesome. The Manhattan Project of 2009 Energy Independence NOW. He walks you through every aspect of oil, what it is used for besides gas, our depletion of it. The worlds increased need ie 3rd world countries becoming more modernized and consuming more. He explains EVERY alternative energy source and what role they can play to replace oil. His research is backed up with hard data and even includes a time frame and proposed legislative agendas to wean America off oil.
11-21-2008 @ 11:50PM
J. Dupuis said...
Seldom, if ever, does the hype that is completely over the stop meet expectations. Obama and the rest of the Dems in office are "ticks" they produce nothing. Obama has never run a Kool-Aid stand. He has picked, to date, thirty-one ex Clinton advistors, most of them outright crooks. I feel confident all the Repulicans is wait for the next Carter type adminstration to take hold in America. I remember Carter, the American people couldn't wait to dump him. Like Obama, Carter had no idea how to run the country, he was totally against business.
11-22-2008 @ 12:28AM
JCH said...
Carter was a wealthy farmer.
Your statement that he was against business is complete lunacy.
Having inherited a rapidly growing inflation problem from the failed Republican Presidencies of Richard Nixon and Gerald Ford, Carter sought out and nominated Paul Volcker to be Chairman of the Federal Reserve. Volcker is the greatest inflation fighter of all time. If not for Carter, that would never have happened.
11-22-2008 @ 2:27AM
Isamu nakao said...
peanut nut man Carter was just a dumb US President,who talk so much and need to wonder why he ever was elected, may be be bought votes like Obama.
11-22-2008 @ 4:34AM
Rafael said...
Real change in how we will organize
ourselves only springs from a shift in
one of these 4 categories:
1.Technology
2. Topography
3. Microbes
4. Climate
All the rest is only sprinkles on the donut.
11-22-2008 @ 7:54AM
bob said...
This will be another Carter admin. Perhaps worse. Democrats think in a box. Create low paying jobs that allow more to just get by. Ignore mfg. Ignore technology, ignore production, goods produced and sold. Obama is already talking infrastructure, roads, highways, hard work, low wage jobs. nothing created and sold. Stagnation. Clinton created a lot of jobs---fast food, minimum wage, that was it. Let them buy half million dollar homes. 10 years later, here we are, and the cycle starts again. This time we are in very deep water.
11-22-2008 @ 10:17AM
JOHN said...
AFRICA WILL BECOME THE NEW SUPERPOWER AT OUR EXPENSES.
11-22-2008 @ 11:08AM
lolabull said...
Ever heard of an oxymoron? The title to this article alone is a classic oxymoron. The country is sinking into an economic abyss, and our Savior is no where in site. Another prime examlpe of a master politician at work. "Hey, I'll just vote present, that way I can't be held accountable for the outcome by any particular party". What a swell, new president we have.....tough times blanket the nation and he disappears without a peep. From the rhetoric of the campaign, you would've thought we'd all be living in some alternate utopia by now, where all the tree's stay green and lush year round, and everyone has permagrin from ear to ear 24/7. Yeah, this is going nowhere fast. But congratulations suckers, you got your wish, the least qualified person in history to be our Commander and Chief....oh wait, another oxymoron.
11-23-2008 @ 1:37AM
Jessy Scholl said...
What we need is a new party that will listen to the core values that we cherish and that is freedom and liberty. Obama is a crook pure and simple and will prove that if he becomes President. He may have won the election, but he will be found out as an illegal citizen before he is sworn in as President. Check out http://www.worldnetdaily.com for details.