Thursday, January 27, 2011
THE ERA OF POLITICAL UNREALITY
The only big difference between our current era of political unreality and most financial bubbles is that many more of us know we're in serious trouble, and have the means to talk about it without sounding like we're batty pessimists saying the sky is falling. An entire election this past November appeared to turn on a section of the electorate understanding that we're totally hosed without bold action. Me, I've been following politics very closely for 25+ years, and I've never remotely been as pessimistic as I am now. Obama's State of the Union speech this week might have been the final straw for me. It was an "unreal" as anything I could have scripted for the films that will be made in 15 years lampooning this president. We'll make some hard choices - but not right now. We need to cut spending - but how about another round of billions of spending on high-speed rail (!) and the chimera of "green jobs"? We don't like debt - but let's spend a bunch of cash we don't have anyway, in search of a "Sputnik moment" that will never, ever come.
This article by Peter Suderman on Obama's bizarre speech - and the subsequent Congressional Budget Office warnings that we're doomed, largely in part to his and his predecessor's policies - is required reading. We are broke. Bad things are about to happen. Major political and social shake-ups that will negatively affect this country - and by extension, the world - are on the way. It's the only thing that matters right now, as far as I'm concerned, and all politics should be subservient to ensuring that the blows we're about to take are as painless as possible for the greatest number of people. As Matt Welch has written, "the only real policy issue in America right now is that we are on the verge of fiscal catastrophe because we cannot afford the government we're paying for today, let alone the one we're promising for tomorrow."
Here's what I strongly believe lies in our immediate future, since the sniveling, cowering political class can only find the will to talk about problems, but not actually do anything about them:
1. Key states - like my own, California, will go into default, and ask for a federal bailout, which they are likely to get. Which will make things worse, and reward the states' fiscal stupidity. (The only thing that might prevent this is if the Feds allow them to file for bankruptcy first).
2. Thousands upon thousands of people will be thrown out of work, particularly at the state level. The government(s), reaching a breaking point, will barely be able to help.
3. The US government will have its credit rating severely downgraded, and find it difficult to borrow more money. Think Iceland, Greece and Ireland. I unfortunately believe this will happen before the end of 2011.
4. Due to huge public pressure on pension reform, unions will mount an all-out blitz to save their long-growing perks. They'll see a backlash the likes of which has never been seen in the US before, and the era of public-sector unionism will (finally) begin to wane, rapidly.
5. The federal government will repeal most, if not all, of the 2010 Obamacare bill (the parts that won't have already been struck down by the courts).
6. Republicans will bluster and make microscopic cuts here and there, perhaps even boldly rolling spending back to 2009 levels (whoa!), and will then have their asses deservedly handed to them by the electorate for being such cowards. More "radical" spending cutters - likely from the Tea Party, or from newly-spooked Democrats looking to shore up their ridiculous political party, will be elected to take their place.
7. Obama will be a one-term president, trounced in 2012, probably by some other clown. He will be memorialized as one of our worst presidents in recent memory, along with George W. Bush and Jimmy Carter.
8. High-speed rail, "green jobs initiatives", overseas entanglements in the Middle East - all of the big spending areas and "Sputnik moment" projects will be drastically cut or eliminated. Social Security, Medicare and state-based Medicaid will finally be dramatically - but hastily - reformulated out of necessity, with certain promises made dozens of years ago being broken, affecting the lives and livelihoods of millions of elderly.
And maybe - just maybe - all of these things I'm fairly certain will happen in the next two years will also lead to some sort of reckoning - one that might keep my son and his generation from being saddled with taxes and obligations that will surely drive America into second-rate status, after so long a "reign" as one of the most sound and prosperous nations that ever existed. Yet I look across the political leadership and the media landscape and I feel nothing but sadness, to be honest. I can't stand the way the media changes the subject when sacred cows like unions and social security are brought up; I can't stand the fact that a US deficit commission recommended the first bold concrete steps to get us out of this mess, and Obama and both parties totally ignored it; and I surely can't stand that the reckoning is so stone-cold obvious and yet we mostly pretend that it isn't.
It's going to be a very weird couple of years. The Air Force might finally have to hold that bake sale to buy some bombers before they're through.