I’ve been thinking about “lame ducks.” Actually I’ve been thinking about our current situation(s), changes, QE-2, the old Congress, the new Congress, the wounded Obama, Seoul, and the G-20. We haven’t seen this many potentials for blow ups in my lifetime. Sure, we have faced crises both nationally and globally in the past sixty years. I have observed them, I have studied them, I have helped in the resolution of a few of them (corporate restructurings, banks that failed, and the S & L crisis), and I have chronicled them in my TH*NK*NG columns. Right now we have more ticking fuses than I can remember. We just went thru an exceptional election. Ok, the election was pretty normal in the scheme of elections, but the implications, results, and outcomes are potentially staggering.
You see every two years there are some newbie’s going to Washington, and there are oldies sent packing. What is different about 2010 is the extent of the changes in the bodies coming and going. We have just witnessed the greatest changeover of elected officials in roughly seventy years. True, some of the old farts have been there since the 1960s, but we also saw a significant number of those who only just came to town in 2008 sent home. In DC time, that is hardly long enough to learn where the restrooms are located. (The locations of the expensive restaurants and which lobbyists you want as “friends” are covered in the freshman class orientation.)
Change was/ is clearly needed. Our economic and financial problems have NOT been fixed – much less disappeared. Obama ran on “Change you can believe in...” His coattails carried many new faces to Washington just two years ago. Despite all the hype, pie charts, speeches, and news releases; the public perception of these “changes” did not alter. Our systems/ controls are breaking down. Deficits, debt, unemployment, and “negative” growth are still growing. The public on Main Street is well aware of this. The pendulum once again swung, it is just the frequency of the swings that has accelerated.
The Republican Party gained control of the House of Representatives and did gain more seats in the US Senate. We are now facing a potential for gridlock. Gridlock is (in and of itself) not bad. No policy is preferable to bad policy! Yes, you heard me. Recently, we have seen the so-called fixes help the well-connected few and make the situation worse in the long run. THAT has to cease and desist immediately! I am guarded optimistic that we will see some progress this time ONLY because if we don’t, the newly elected will be ousted in two years (self-serving preservation is a good thing).
What a difference a year can make. Obama, the rock star, has lost his glitz and glitter. Our pointless wars are still breaking US/ us. Real unemployment at 22% is still rising. The US dollar is dying as the world’s reserve currency. Our debt/ deficits set new records by the hour. Customers for new US Treasury Securities are evaporating. Obama did NOT succeed when his own party controlled the House and the Senate at near record majorities. He may try to regroup by moving to the middle, but just who is left in the middle? The parties are polarized, our nation is polarized, and the elected victors are polarized. His philosophical underpinnings and high brow rhetoric are NOT going to cut it any more. The new Quantitative Easing 2 (monetizing the debt by printing more fiat money to pay our bills) has never worked in the history of the planet. “We” know this, as do the political, financial and economic leaders globally. Still the US Treasury and the FED proceed ahead with QE2 at full speed.
Last week Obama’s change in US status was evident at the G-20 conference in Seoul, Korea. Obama did not walk on water, he was drowning --- worse for a major political leader, he was ignored. Almost the entire planet Earth is looking down the barrel of a double barreled economic shotgun with the possible exception of China. These leaders perceive the US as the problem, not the solution. The most typical US consumer can’t come to their rescue anymore because they are un(under)employed, maxed out, and looking down the road at pending foreclosure. Obama was ignored --- he got NOTHING! He couldn’t even get a revised trade treaty with South Korea. Look at the verbal and written outcomes. The body agreed to "get the global economy back on the path of recovery.” Well, big whoopee!!! There was no plan to “get” this accomplished. All their individual (and collective) arsenals for “fixes” are empty. They did stand for a group picture of smiling faces, and Obama was still in the front row.
The President returned home this week to deal with his coming Congress and to re-strategize the remaining two years of his Presidency. The lame ducks will be in DC “quacking” for another month yet. Don’t worry about those ousted from office, their “pensions” are way more than they deserve. The posturing for the incoming Congress has already begun. Those all-importance committee chairmanships in the House of Representative will revert back to the GOP come January. Will we then see NEEDED change? I hope so, but I am NOT holding my breath for anything substantive at the onset. Quack, quack, quack...
I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.
Copyright 2010 Questions, Inc. All rights reserved. Fred Cederholm is a CPA/CFE, a forensic accountant, and writer. He is a graduate of the University of Illinois (B.A., M.A. and M.A.S.). He can be reached at firstname.lastname@example.org.
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This story was published on November 15, 2010.