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Guest Post: Obama Will Lose In 2012
Submitted by Charles Hugh Smith from Of Two Minds
Obama Will Lose in 2012
Predicting that Obama will be a one-term president is easy: Americans vote their pocketbooks.
There is nothing remotely ideological or personal in my prediction that President Obama will lose the 2012 election. Both parties are equally out of touch with reality in my view, and both suppport the same things: a global Empire, an increasingly intrusive Savior State, a shadow banking system which is no longer under the control of State institutions (rather, the banks control the institutions), and various crony-capitalist cartels which fund political campaigns and partner with the Central State's bloated, unaccountable fiefdoms. The only visible difference between the two parties is slight variations in the relative growth rates of the most-favored cartels and fiefdoms.
President Obama seems like a nice guy. Many people said the same thing about George W. Bush. While a likeable personality is a plus in a media-obsessed society, American elections boil down to this: Americans vote their pocketbook, and their pocketbooks will be a lot lighter by November 2012.
President Obama has several key flaws which have doomed his presidency.
1. His leadership style is one of consensus and compromise. This works OK in a caretaker setting in which there are no crises and no demands for bold changes of course. Unfortunately, this era is defined by structural crises, and a leadership based on gaining consensus and compromise is basically a rudderless one in this environment.
2. He does not understand economics or finance, nor is he secure about making decisions on financial topics. As a result he deferred to the "experts," who just happened to be Wall Street cronies and insiders who easily swayed the President with their hobgoblin stories of financial meltdown and ruin if we didn't "save the banking sector from losses."
3. His grasp of history is poor. The same can be said of most presidents, but Obama failed to grasp the historic opportunity to set a new sustainable course for the nation's banking and financial sectors, and thus for its economy. He opted instead to save and protect the corrupt and embezzlement-based banking sector from losses, and he continues to do so with "extend and pretend" policies.
In a similar fashion, he has allowed the National Security State and the Global Empire to expand without any limitations.
4. He has no visible core beliefs beyond a vague sense that the Federal government and its extension, the American Empire, are forces for good. His policies can be boiled down to: support and expand the Savior State and its many fiefdoms, support and expand the Global Empire and National Security State, and allow the banking system and its Power Elites to set the agenda and control the oversight agencies and institutions.
His signature accomplishment, the "Obama-care reform" of the nation's sickcare system, simply extends the power of existing cartels and fiefdoms and delivers an ever-larger slice of the national income to their coffers. In its basic parameters, the "reform" could easily have been supported and passed by socially liberal Republican presidents such as Richard Nixon. There is nothing remotely progressive or radical about "pooling" insurance cartels and wet-paper-bag bureaucratic tests of "the most effective treatments."
These are simply technocratic layers added to a bloated, corrupt, venal and destructive system that already costs twice as much as those of our advanced-economy competitors.
In addition to these flaws, he has made fatal policy errors which doom the economy to implosion by November 2012. All of his administration's policies can be distilled down to these three points:
1. The banking sector is the most important foundation of the economy. The Central State and its proxy, the Federal Reserve, pumped some $14 trillion (by some measures, $23 trillion) in cash, credit, guarantees and backstops into the banking sector and its cloaked twin, the Shadow banking System.
Meanwhile, little to nothing was done for the cash-strapped consumer or citizenry. Why?
2. The "problem" is lack of credit and "confidence." If the State and Fed flood the banking system with credit and "restore confidence" by goosing the stock market, then people will start borrowing and spending again, and everything will be "fixed."
This presumes demand is strong, and all that's needed is credit for people to satisfy their thirst for more goods and services.
Meanwhile, back in reality, people realized they didn't need a third car, fourth TV, 17th "cute blouse," 23rd pair of shoes, etc., and now that their home is worth less than their mortgage (or their remaining equity is minimal), they can't really afford the luxury travel, boats, etc. they enjoyed when they thought their house would keep rising in value forever and tapping that rising equity was painless.
Demand is slack because everyone who could afford more crap already owns more crap than they need or even want. The percentage of the populace who would like more stuff cannot afford more stuff. Their household incomes and wages are declining, and their expenses for essentials are rising.
The Fed's largesse to banks (free money in unlimited quantities) doesn't reach them; all it does is boost assets held by the top 10%.
3. Boosting the assets of this top 10% (or 20% if you include those who have equity of some sort beyond the $2,500 in their IRA) will cause a "wealth effect" that will "trickle down" to the lower 80% as the top 20% buy more Coach handbags, enjoy fine dining at tony upscale restaurants, etc.
Unfortunately, this may help boost Coach's profit margins, but the vast majority of the "trickle-down" consists of low-paying retail clerks and busboys.
In other words, the "wealth effect" is bogus, a charade deployed to defend the pillaging of the economy via financialization and Fed intervention.
4. Pushing the dollar lower in a "beggar thy neighbor" currency war is the best way to boost the U.S. economy. Apparently no one in the President's team looked at financial history to identify the nations which grew rich and powerful by debasing their currency.
In a perverse blowback to this misguided policy, corporate profits earned overseas were certainly goosed, but so were import prices, one of the reasons (along with the Fed's easy-money quantitative easing) for rising costs to consumers.
If you set out to design a policy that impoverished 80% of the citizenry and channeled a larger share of the national income to the top 10%, then this is precisely the set of policies you would pursue.
Nothing important has been fixed; nothing important has even been addressed. The institutions of governance are captured and corraled by the monied Elites to the point that the government has lost control of its own institutions, which now rule as quasi-independent fiefdoms. The citizenry, bought off on the cheap by stale Bread (rapacious student loans, food stamps which offer the veneer of normalcy, extended unemployment benefits so no angry mobs form, etc.) and dazed and distracted by the Media Circus, keep quiet in their complicity, while the Power Elites revel in the freedoms offered by a caretaker Administration.
If President Obama had fought for fundamental structural reforms and lost, he would still have support. Yes, Congress holds the pursestrings, but let's not forget the President appoints his own staff and advisors, and wields great power via Executive Orders. He could have submitted a 5-page Financial Reform Bill and promised to veto anything else. If the Power Elites watered it down, then he could have vetoed it and gone directly to the public. But he did none of these things.
Courtesy of correspondent George B., here is a chart of public and private debt over the past decade, from the St. Louis Federal Reserve. Notice that all the Administration and Congress have done is boost Federal debt to replace the "missing" private debt (missing because incomes are declining, housing equity has crashed and the consumer overborrowed for a decade).
This is mindless Keynesian policy on auto-pilot. As I have reported before, the Federal Government is borrowing and spending some $6 trillion in a mere four years, almost doubling the nation's debt, and all that's been accomplished is the Power Elites' share of the national income has risen and GDP has flatlined.
The structural dislocations and imbalances remain firmly in place; a financial sector dependent on fraud has been "saved," and an economy sick with an addiction to rampant financialization has been given plenty of smack to keep it from going through a desperately needed withdrawal.
The Keynesians have no answer as to when the economy will "recover" without the Central State borrowing 11% of GDP every year to prop up its various cartels and fiefdoms. They have no answer because they have no understanding of the imbalances, the fraud, the financialization or of the feudal partnership of the State and crony-capitalist cartels.
Obama has lost his "progressive" base, because he's done nothing remotely progressive. He has lost the middle because his Administration has overseen their gradual impoverishment at the hands of Financial Power Elites. He has offered them phony facsimiles of reform slicked down with the tiresome "soaring rhetoric" of a con artist so besotted with his own story that he actually believes the BS himself.
He can count on the public-union vote and a few of the State fiefdoms he's enriched and enlarged at the expense of the common good, but as the addict (the economy) goes downhill, slowly destroyed by the ever-larger doses of smack administered by the Fed and the Central State, then the consent of the governed will be irrevocably lost--not just by President Obama, but by the entire Status Quo.
The President is now a candidate hoping to scoop up a cool $1 billion to blow on another long, greasy media blitz, but I would be surprised if he rakes in much from the commoners and serfs straining to keep the wheels of their household finances turning. He will of course collect big bucks from various crony-cartels and contractors who have benefited from his bogus "reforms" and unstinting support of the banking sector, but his true-believer supporters will be thinned down to a few Elites, die-hard Democratic hacks and the delusional by mid-2012.
His opponents may fare little better unless they are willing to tackle the dominance of crony cartels, government fiefdoms and Financial Power Elites whose fat fingers remain firmly on the throat of the fast-expiring nation.
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He can switch parties and become THE REPUBLICAN FRONT RUNNER
Obama will win again in 2012. The reason is the alternatives will be far worse. If you think Progressives have a case of buyer's remorse, have a look at the Conservatives who voted in this last bunch of clowns. I agree with everything you wrote, don't get me wrong--but there is no one--not Ron Paul, not Paul Ryan, not even Tim Pawlenty--who will be able to overcome the anti-GOP backlash that is taking place after the "Great Republican Over-reach" of 2011.
Yea it seems no matter how bad the Dems screw things up the Repubs are always ready to top them. 2012 is a long way off yet many more things will hit the proverbial fan.
Is Max Baer jr still alive...could he not stand against Obummer?
Obama Will Lose In 2012
Who wins the election will be up to the voting machines to decide.
I think Trump has a chance:
http://powerandcontrol.blogspot.com/2011/04/donald-trump-for-president.html
OTOH he is well tied in with the real estate interests. So he is probably a crook. But he may be a more benign crook as he will be going after his own interests rather than some one elses.
As to an honest politician? I like Palin. Who at this point seems to have no chance.
I couldn't have said it better. Spot on, nail on the head, choose your phrase, it's true. Obama had the chance and screwed the pooch. I'll bet he had good honest intentions. Then when they wouldn't let him stay at Blair House, instead they took him to Site R. He was escorted to a dark office, and when he proceeded a few steps low and behold Dick Cheney was staring the President-Elect in the face: "What I have to tell you, you won't like." Dick said. Obama turned to leave and Cheney interrupted, "You'll not do that so easily. What we have planned for your next few hours is known as a "Come to God" meeting. Let me start by letting you know, I'm still in charge. Have been since Bush 1. You follow my orders, and you and your family will do just fine.".
I hope this is fantasy, but now more than ever, we need Batman.
Remember when Obama had his black eye from getting "elbowed while playing round ball"? That was actually from the beat down part of the Executive Briefing by the ruling elites, same as George W.Bush choking on a pretzel and passing out and hitting his face on the coffee table, Executive Briefing BeatDown.
Its why Bernanke trembles and nearly cries whenever he has to speak publicly. They probably have a couple of his family members targeted for a takedown if he fucks up and say the wrong thing.
Its why Obama promised hope and change and gave us all the same old shit just extra portions extra hot and steamy.
Close Gitmo, this lying motherfucker couldn't close his bedroom door without permission of the oligarchy.
Obama,Bush,Clinton,Bush,Reagan - different day, same old shit. They are sock puppets appearing on your TV so that you never know who owns the hand that actually runs this country.
We have been at war with Middle East Islam since 1794. Anyone care to tell me why we don't just finish them off? Ron Paul sure isn't going to do it as much as I like him on domestic policy. I voted for him in '88.
whos we?
the american people or the people in charge of the military industrial complex.
perpetual war benefits one group at the expense of the other . . . do you see where i am going with this?
Re-elected? The guy should be tried for treason and swinging from a light pole like Mussolini.
Thank God this will be my last US election. By 2016 I'll be out and living in South America where I can watch the Titanic slowly slip beneath the sea. American sheeple, you earned the world's contempt!
Thank God this will be my last US election. By 2016 I'll be out and living in South America where I can watch the Titanic slowly slip beneath the sea. American sheeple, you earned the world's contempt!
I'd like to junk you for rubbing it in our faces that you're leaving the Great USSA, and double rubbing it at that.
But tell me about how South America is going to be so much better.
What about Rick Santorum? I think he's credible, young, full head of hair, average height...
<sarc/on>
Lessee, Kang or Kodos? (Tosses Silver Eagle into the air...)
The question is: will he lose against another puppet who won't change anything, or will we get real change, like Ron Paul?
A+
Keep up the good work !
To all those who say the campaign money will buy the sheeple, I say to you, Meg Whitman.
Sometimes a turd cannot be polished.
Ah yes, but I fully expected this 16 months ago. It was that obvious to a non-American
EDIT: notice Perez talks and photo-ops this week? This is how you secure GS and JPM funding in 2012. Sucks to be Palestinians
It's all about Trump in 2012! Seriously, let's get somebody in office who knows how to make the bankers suck it. of course Obama is going to lose, nobody's happy with this clown.
www.forecastfortomorrow.com
It all depends on who the rich capitalists want to win. If the republicans dont raise the debt ceiling Obama might be their best bet. Of course who cares, cause both sides are corrupt.