No surprise on the election results. Obama’s better ground machine and early start on campaigning paid off. The Republicans also chose a candidate who had no movement behind him. He never defined himself as to who he really was. The Republican Party will need to reinvent its party if it expects to win the White House in 2016. It also will have to grow the moderate wing of the party or it will become an irrelevant party.
The Tea Party did not do well in this election and it shows that Americans do not want the extremists to run the show. Women and minorities are a growing group in this society and will increase in numbers and power over the next four years. As I have said before, the white aging American male would feel more marginalized and it showed up in this election. Once we crossed over into the year 2000, the rise of the female power increases through all of the millennium. She will march through the board rooms the White House, the medical fields and all areas of society. This is a world-wide phenomenon. It lasts through 2999. Expect to see women demanding more recognition, respect and rights. Certainly the woman’s right to choose and other health care issues will be stronger.
It is healthy for Americans to have a strong two party system at this time. During the next several years, the Republicans will have to be more realistic and engaged in who they submit as candidates for office. Certainly some of the wacky candidates and their comments cost the Republicans dearly.
Don’t look for Super PAC’s to go away any time soon. They will be back in full swing and influencing all the campaigns, local, state and federal. The governorships of several states are Republicans. Remember that many of the laws and regulations of the individual states will be influenced under Republican control. This acts as a counter weight to strong Democrat control. From these states can come future candidates for federal office.
The fiscal cliff will not happen in the way we have been told. We should expect a deal to be hammered out by mid 2013. Everything will be kicked down the road further and much of what they hammer out will be retroactive.
There will be changes to Medicare. Expect the age to be rise to 67 with a new means test for more wealthy individuals. Medicare will begin to be in lock step with social security.
One thing for sure, the focus will be more on the debt both individually and collectively. Expect to make some sacrifices in either entitlements or taxes or both. There are many ways to raise income and it doesn’t have to be by raising taxes. It can remove or limit some of the entitlements.
•Here are figures for you to consider:
•1965—Government spent $21,893 per household
• Household income–$39,732
•2009—Government spent $47,255 per household
• Household income–$50,255
We do have to shrink the government. You should expect lots of yelling and screaming as these sacred cows get slaughtered or put on diets. The government will not be able to support all the social programs it now supports. Waste, fraud and entitlements will be addressed. Everything from school lunch programs, defense spending, Medicare, food stamps, unemployment insurance, corporate and personal write offs, subsidies and so many more will be under the microscope.
•Here are some other tidbits to ponder:
•Why Rome Failed:
•1 Loss of civic virtue
•2 Outsourced its military to barbarian mercenaries
•3 Romans themselves became soft
•4 Christianity came along with a better idea of the after-life hereby sapping the will to sacrifice for the Roman Empire.
It is up to the citizenry to strengthen its government through intelligent leaders and engaged citizens.
Purchasing power of the US dollar has dropped. From 1900 to 2010, the value of the dollar has been reduced 100%.
Follow the money supply, taxes and regulations instead of interest rates. This will tell you what the economy is doing. If the money supply is expanding, taxes expanding regulations expanding, expect a languishing of the economy.
•What drives money is politics! Pay attention.
•For the economy to thrive three things are required:
FOUR MYTHS by Prof. Alan Blinder
Almost a year ago, January 19, 2012, Alan Blinder (Dr. Blinder is a Professor of Economics and Public Affairs at Princeton University and a former vice chairman of the Federal Reserve) wrote an editorial for the Wall Street Journal. Basically, he said the following:
Myth # 1—“The American people now demand deficit reduction as never before.”—Americans have always hated a deficit but”….is nowhere close to being Public Enemy No. 1. People care far more about unemployment, the weak economy and the like.”
Myth # 2—“America’s deficit problem is so acute that government spending must be cut right now, despite the struggling economy. Any fiscal stimulus, even the payroll tax extension, must be paid for immediately” “the US government doesn’t have a short-term borrowing problem at all. On the contrary, investors are clamoring to lend us money at negative real interest rates….they are paying the US government to borrow their money.”
Myth # 3—“For several years now, our political system has focused exclusively on the 10-year cumulative budget deficit.” “What happens over the next decade hardly matters. Our deficit problem – and it is a whopper—is much longer-term than that.” “According to the most recent long-term projections from the Congressional Budget Office, the federal deficit as a share of gross domestic product will shrink from its current bloated level for several years even without further action. The real deficit problem comes in the 2020’s, 2030’s and beyond and it is huge.”
Myth # 4 –“America has a generalized problem of runaway spending, one that requires cuts across the board.” “No, the truth is that we have a huge problem of exploding healthcare costs, part of which shows up in Medicare and Medicaid spending.”
MY TAKE ON THIS
•Medicare will change in one or more ways:
•Requirement that drug makers offer bigger discounts for prescriptions similar to the discounts given to the Medicaid program (health care for low income citizens) It could save 137 billion over 10 years.
•Means testing: Those with incomes over $85,000 (twice that for couples) will be on the hook for higher payments (applies to current beneficiaries.)
•Push back in age of enrollment to 67 from 65—keeping Medicare in line with Social Security.
•No voucher system.
We are about to enter the No. 6 Universal Year (2013) and are leaving behind this chaotic and surprise-filled No. 5 year. I will speak more about the No. 6 universal in upcoming newsletters but the overriding energy of the year is “responsibility and service”. Expect to have more responsibility both personally and non-personally. Family, friends and the general welfare of society will be addressed in this year. More later……
“…..The journey of a thousand miles starts from beneath your feet.
Rushing into action, you fail.
Trying to grasp things, you lose them.
Forcing a project to completion,
You ruin what was almost ripe.
Therefore, the Master takes action by letting things take their course. He/She remains as calm at the end as at the beginning……….
Men/women are born soft and supple:
Dead, they are stiff and hard.
Plants are born tender and pliant:
Dead, they are brittle and dry.
Thus whoever is stiff and inflexible is a disciple of death.
Whoever is soft and yielding is a disciple of life.
The hard and stiff will be broken.
The soft and supple will prevail.
From The Tao Te Ching