There's going to be a big change coming up in the next few weeks....Eileen's slated to move out of her long term temp position she currently has. Her bosses love her, but she's maxed out her stay per her workplace's policies; pleas up the corporate ladder for a waiver have gone largely unheeded.
Where she lights after that will have more impact on my life than who wins the election next month.
Yes, ponder that for a minute. For all the bluster in the Blogosphere about the election, we're more likely to see minor tweaking in how government is run rather than some massive revolution in our political and economic system. We're not going to see conservatives asking for political asylum in Ireland or Canada in 2009 and 2010, just as we haven't seen a rash of liberals follow through on their talk and take off to Canada after Bush's two wins.
Here are some not-so-random thoughts about where we sit.
(1) The economy isn't that bad. Yes, we have a stock market that is a bit loco, slightly shaky banks and a uptick in home foreclosures. However, the underlying economy is still solid. Seeing gas go down to $2.70/gallon is a relief; I feel like I'm living some sort of future history when I write "gas go down to $2.70/gallon." After the economy was starting to swallow $4/gallon gas levels, seeing oil back down to $70/barrel levels will give the economy a boost.
We've avoided a statistically-defined recession as of yet, merely stumbling through a no-growth year. Compare that to the stagflation of the late 70s or even the post-Desert Storm recession of the early 90s, and this is a sluggish, but solid economy. There is no where near the ennui that I saw back in the late 70s; thus, this is more 1992 than 1980 for political comparisons.
(2) Major change isn't required. Reform of lending laws is needed so as to avoid another sub-prime debacle, but what might be needed is to have the federal government or an agency thereof have some authorization for ready money to step in and help fix the next financial crisis. A lack of hands-on oversight and an inability to provide liquidity to a market that needed it helped get things unglued in the last few weeks.
This will require giving some rather open-ended power to Uncle Sam, something that free-market conservatives are loathe to do. However, our system is not a pure free market, for the government sticks its nose into a number of areas already.
If we focus too much on the sub-prime issue, we could end up like the stereotypical Pentagon type who are very well prepared to refight the last war; we need to prepare to solve the next crisis rather than merely make sure the last one doesn't reoccur. That will require some flexibility to be thoughtfully statist when the markets don't quite function properly on their own.
(3) Most of the "bailout" money will be self-financing. For instance, the current issue on the table is that the government will be putting $250B into preferred stock into the big banks; the dividend payments from the stock will pay for interest on the debt and the stock options that Uncle Sam gets with it will make this a profitable investment for the US.
Thus, we don't have to worry about the "Crowding out effect" that we normally see with government going gonzo with debt; instead of competing with businesses and consumers for investable funds, the infusion of equity into the banks will allow them to retire some of their long term debt.
(4) We aren't determining our entire future on November 4th. There's a sign up in the student lounge here at Sullivan-"Nov. 4-the day we determine our future." We'll be electing a president and a Congress that day, but as the pop song from a while back goes, the rest will still be unwritten.
That's not to say that the next president won't have a big say on how that future unfolds, but that the best laid policy plans can often be "overtaken by events." Also, our lives are often more effected by local issues or personal issues than what happens in Washington.
We had a change in governor here in Kentucky late last year, but life has change rather little; we had a budget crunch and saw a bit of cutbacks, but new Democratic governor Beshear presided over the cuts calmly without raising taxes. If anything, he shepherded the state through the processed better than his predecessor Ernie Fletcher probably would have, since Democrats can cut spending with less rancor than Republicans can; liberals are less likely to denigrate one of their own as a heartless tool of Big Business for presiding over budget cuts.
(5) McCain can still pull this thing out. At present, Rasumssen has Obama up 5 and Gallup has him only up 2 in their traditional likely voter model. However, it's state-by-state that really matters, and he'll need to win Ohio, Virginia and Colorado to get the job done. He's down 8 on average in Virginia, although Rasmussen has him only down 3. That means that he'll need to get 4% of the vote to switch sides to get back to even.
In Ohio, he's in a dead heat in the most recent poll, and he's 6% back on average in Colorado. North Carolina and Florida are still problematic, but if he's going to move the dynamic enough to win, those two will come around as well.
(6) McCain is ill-suited to pull this thing out. People are scared right now and want something other than the status quo. McCain, at least on a big-picture level, represent the status quo; he has a number of differences with Dubya, being a bit more of a deficit hawk and a bit more prone to a government solution to a problem, but Obama's meme of making McCain Dubya 2.0 isn't far from the truth.
What is far from the truth is Obama's assertion that the economy is lousy. We've not been banging our heads against the wall for eight years, except to wish that Bush would better articulate his visions.
However, that's a tough sell right now, doubly tough when Obama has hit a nerve on foreign policy, where quite a few swing voters are willing to see a more restrained foreign policy as an antidote to the neocon-on-steroids tendencies of Dubya. Iraq has improved quite a bit the last few months, but only enough to make it a non-negative for McCain rather than a positive.
When both the economics and geopolitics of the right are in bear markets, trying to sell a conservative package is about as easy as selling mortgage portfolios. McCain's best argument is that while the last year or two haven't been great showcases of conservative policy, the liberal policies that Obama would proscribe would make things worse, or at least tend to slow down any recovery that should develop on its own in 2009 and beyond.
2009 should be a good year economically, and I don't see an Obama administration screwing that up too much. Clinton pushed through a tax increase in 1993, and the economy perked along despite that, as the Web and logistics improvements, along with a "peace dividend" allowed the economy even as higher taxes had a contractionary effect.
What McCain will need to do is to say something like this
Yes, a lot of you don't like where things are at. However, if we 'bang our heads' at our current free market system a bit longer, we'll get through the nervous breakdown on Wall Street and the big spike in oil prices and get back to solid economic growth. If we start adding a lot of new government programs and the taxes that will be needed to finance them, we'll start to slow down the rate at which we can get out of this rough patch of the economy.
Are there people who need help getting money for college, or need help getting health insurance or need help getting retrained after getting laid off of a factory job that no longer exists? Yes. However, we need not do so in a way that takes the steam out of the economy and costs other people jobs in the process.
We also need to continue the better parts of President Bush's foreign policy, of expanding free trade and democracy oversees. Yes, Iraq could have been handled a lot better, and I egged the president on to get more troops in when they were needed. However, we must not overreact from our mistakes so that we retreat from the world or rush headlong into a world-wide system of regulations that are dictated from the UN rather than from the American people and their government.
You don't change course when you hit a pothole or two if doing so takes you miles out of your way. It may do a number on your shocks (and we have the government safety nets as shock absorbers) but you often need to go through them rather than detour around them. We need change, but not Senator Obama's scenic detour into internationalism and big government.
It's hard to boil that speech down into a 30-second TV ad. Also, getting people fearful enough of an Obama administration that they want to vote for McCain is hard for McCain to do, since he isn't a government-hater and isn't a UN-hater.
A more libertarian and more partisan candidate might be able to gin up the kind of fear he'll need to turn the tide in the next few weeks. However, McCain is a notch too decent to do that.
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