Predictions for an Obama Presidency — Revised

ORIGINAL POST “BELOW THE FOLD”

It turns out that one of my presumptions has been incorrect:  the death of “paygo,” we can start to make sense of the writing on the wall:

  1. The Blue Dogs as a faction were either insincere while campaigning, or else do not have the power that I had hoped — this coupled with their existing only in the House, when it looks like the Dems will be able to more-or-less run the Senate.  The “budget straightjacket” (see link, above) comment indicates that the Blue Dogs will be indistinguishable from the rest of their party.
  2. Rahm Emmanuel was not hired in order to aid the President-elect in charting a moderate policy, but rather because he’s tough, knows the ropes, and is loyal.  This means one should expect an extremely aggressive set of moves by Obama in the first six-ten months, and that Democratic Overreach is a very real likelihood, depending on how well the coastal media, which jettisoned even the pretense of objectivity in the past ten months, is able to provide support and cover.
  3. Whether this is an openly Marxist agenda, or merely the sort of Hyde-Park chicago liberal style that Diane Rehm would find to be cautious and moderate, remains to be seen.  However, recent suggestions that Congress’ next fight, in conjunction with executive orders, will be to repeal recent opening in oil production, will guarantee that energy prices return to early-2008 levels.  Unlike the Bush administration, this will also involve beating up on coal.  Meaning that energy spikes will be reflected in electric as well as transportation costs.
  4. This, one must remember, also has a great deal to do with the value of US currency.  Since Congress’ solution to “spend spend spend” will inevitably involve further currency weakening, $4, or even $7 gasoline is a distinct possibility. 
  5. The Republicans will fight this in Congress — whether they go down in flames and use this as a hammer to beat on the Democrats in the hopes of repeating 2004, or whether they’re so snowed under that they become functionally irrelevant, is anybody’s guess. 
  6. Democrat reluctance to grant Colombia a free-trade package (which is longstanding, since the Democrats generally favor the marxist Chavez and Morales regimes, will mean that much of the progress in creating a middle class in South America will be seriously endangered.
  7. The Silver Lining:  Under the circumstances above, inflation will be a threat while growth is in the toilet, and a Japan-style economic situation looks likely.  The Fed will not dare to jack interest rates under those conditions.  Inflation is a good time to get out of debt, so those who can stay employed will find this a very, very good time to tighten their belts and kill off revolving and mortgage debt.

It is possible that McCain will pull it out — but I”m not planning on it. The electoral map is simply too miserable for McCain, who’s playing defense in all the areas he should be able to ignore. Possibly Murtha will single-handedly win the election for him by delivering PA while simultaneously pissing off NC, VA, and CO.

(Seriously: judging by both RCP and Pollster, McCain could pick up every tossup state, and every Dem-leaning state, and still go down in flames at this point.)

Here are my sage, prophet-like predictions for 2009-2011. You can hold me to these, and mock me later.

    1. We *will* have a foreign crisis, and Obama will initially be too slow to react, and then follow up with enough force that it disillusions significant chunks of his base voters. Certainty: 35%, b/c falling gas prices weaken the hands of most of our enemies.
    2. Obama has overpromised, and will under-deliver the progressive red meat, b/c the blue dog democrats will limit the degree to which true new tax policies are able to be passed. Tax hikes WILL happen, but to nowhere near the degree that Frank & Co. prefer. Certainty: 95% — some supposed Blue Dogs, like Chet Edwards, are actually close Pelosi allies on the down-low … I don’t have enough data to predict how many will fall into this category post-election
    3. Interest rates are low, and will stay there for the forseeable future, as the Obama administration’s only other way to make things happen will be a Greenspan-like print bonanza… but without daring to be able to jack rates due to economically moderate-weak numbers. Certainty: 100%
    4. #3 will be due to Pelosi, Reid, etcetera, overplaying their hand and facing a Blue Dog backlash, as notable chunks of their own party realize that they’re facing a ’94 rerun in 2010. Certainty: 100%
    5. Comedians will be rehashing old Dan Quayle jokes and using them on Biden by the end of 2009, as it becomes less and less possible to get Mr. Gaffe-omatic out of the limelight. Certainty: 1 billion %.
    6. Obama being relatively indecisive by nature, will defend himself against charges of inaction by consistently passing the ball to Congress, using it as his foil. Certainty: 100%.

Thus, given that Obama will continue to receive favorable media coverage, and suffers somewhat from Kerry-like indecision, he will generally be viewed as having governed pragmatically, and the degree to which he blows it on any key issues will be largely a factor of whether or not he is capable of actually throwing his weight around in the party vis-a-vis Congress. That’s possible given Congress’ pathetic approval rating. If it came down to Obama vs. Pelosi, the media will hurl her under the bus so fast she won’t even have time to scream before the bones start crunching.

Oh.  And the dude at Lemurland will recoil in horror as the worst parts of both Greenspan and Bernanke are simultaneously put into play.  Certainty:  enough that I have held onto my variable-rate mortgage!

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24 Comments

  1. Mike

     /  October 30, 2008

    I predict a load of anti-military stories from the White House. I second the foreign crisis part. I predict he will continue the Iraq draw down and take total credit for everything we have done. And he will probably give us someone who will come no where near Gates ability as SECDEF, and will get a pass. I hope his choice beats MacNamara, but I doubt it.

    Reply
  2. celogo

     /  October 30, 2008

    hmmm would this be the “best case scenario?”

    Reply
  3. Zathras

     /  October 30, 2008

    1. It’s hard to say that Obama’s Defense Sec will be nowhere near Gates, since it is 50/50 that Gates will be the Obama’s Defense Sec.

    2. There will definitely be a clash b/t Obama and Congress. Obama is not nearly as left as many on any side think. He will do much early to piss off the old guard Dems. Not sure how much specific progressive red meat was ever promised.

    Reply
  4. Zathras

     /  October 30, 2008

    3. One other thing: behavioral economics will become for Obama what supply side economics was for Reagan.

    Reply
  5. Zathras:

    #1. I see Obama as fundamentally Wilsonian in a way that not even Bush truly rises to: he’s going to base his foreign policy not on any particular expertise (it’s widely acknowledged that he has none), but on his advisors combined with his gut moral sense. Usually, that means combat. Bush has exemplified this in a way that Clinton (who I admit that in some ways I very much under-rated while he was in the office) did not.
    2. He tacked quite a bit left during the primary, “going Nixon.” Like all Nixonian plays, this means he supports his raw-meat brigades.
    3. I also would expect you to be correct on this.

    Reply
  6. Celogo: It very well may be. I’m not a fan of his (nor McCain, for that matter, who I think is running a fundamentally dishonest campaign, pretending to be MUCH more conservative than he actually is). But what a lot of folks looking at what his presidency could mean miss is that he’s going to be coming into office with some serious constraints:

    1. No ability to do better than keep the status quo on the Supreme Court
    2. A budget that will not allow him (or Congress) to pass nearly the spending that Pelosi & Co. would like.
    3. A congressional majority (likely) that would have a significant moderate-to-mild-conservative (mostly fiscal) wing.

    I interpret Obama less as a real radical than as a classical political opportunist. Radical when that was what was needed to advance, ready to tack to the middle if that’s required, more than willing to throw people under the bus if need be. Clinton, with about the same level of shady, but less glib. We can survive 4-8 years of that. Especially if it pulls the race card out from the deck.

    Reply
  7. Zathras

     /  October 31, 2008

    To get a glimpse about the behavioral economic methods that will be employed by the Obama administration, you should look at Nudge by Thaler and Sunstein. Cass Sunstein is one of Obama’s closest advisors, and so this book is crucial for understanding what will be happening soon.

    They use a phrase to encapsulate their methods which is bound to set your teeth on edge: libertarian paternalism.

    Reply
  8. I’m familiar with it — it’s an interesting theory. In the end, it seems like Bentham, reheated with different buzzwords, to me. But, I could be and probably am wrong.

    Reply
  9. celogomama

     /  October 31, 2008

    hc: you wrote:

    “more than willing to throw people under the bus if need be”

    This bothers me intensely, especially after 8 years of Bush throwing us all under the bus re: civil liberties.

    Scientia est potentia is great, until the economic and social scientists, along with TPTB, decide to play a trick and screw with many hearts.

    Reply
  10. Of course it’s not good — but had Obama said “no, I”m sticking with these guys” then it would have been an indication that he takes his ideology more seriously.

    Believe me, I’m not saying I like the guy. I don’t, not at all. This is just my shot in the dark at how his administration will run.

    Reply
  11. Mike

     /  October 31, 2008

    I still can’t square myself on the “Civil Liberties” complaint that so many people have. I don’t see any of this Police state (having seen the real thing up close, I can say we are a LONG way from that), I can’t say that I have lost anything or any rights. I still see these protests all the time, and they all follow the general rule: if you don’t act the moron you don’t get beat on. That is also something of trick for me, if you REALLY want to stick it to the man (whoever that exactly is), then you had better be ready for some throwdown. No one wants to (especially the so called anarchists), so its hard to take them seriously. Of course, if they riot then I would call them morons when they complain about getting beat up by the cops. But I might take the complaint of Civil Rights losses a bit more seriously (okay, the protest zones are BS granted, but then again is rioting to shut down the convention the way to go? Especially if you are doing it to the party who is most likely to agree with your position?).

    But I fully agree with the above statement of “we can survive 4 to 8 years of this”. Certainly we can, this isn’t a killer meteor strike we are talking about, its an election. Quite frankly, we should really be blowing this off in order to bring everyone back down to earth and get the press to stop acting like four year olds in a candy store. Maybe the press would act a bit more normal if we stopped buying into every sensational news story they blather about in this thing. Its an election, the new party stands to get elected, who ha. It isn’t the second coming, it isn’t the end of the world, it called the Republic in Action.

    Here is another prediction, my hippie aunts and uncle will be in my face constantly if Obama wins trying to get me to show how narrow minded I am about it. And then they will be sorely disappointed when my reaction is “Eh, I got through 8 years of Clinton, this shouldn’t be a problem. Given O-man’s foreign policy experience and his focus on Afghanistan, he is going to give me more job security than anyone.”

    And i LOVE my job…

    Reply
  12. Mike

     /  November 2, 2008

    Another Predection (based off an article I just read about Hollywood). If Obama loses, Hollywood will (unfortunately) NOT move to Canada or Italy, they will just stay here and bitch more.

    Heh, that right there is enough to make me vote McCain…

    Reply
  13. My prediction: if Obama loses, that puts the anti-coalition Republicans in deep kim-chee. I don’t know if it’ll be enough for libertarians to be re-included in the republicans or not (speaking as someone who got redifined into RINO-hood in the ’90s), but there’s hope if they lose the RNC.

    I don’t know about the indicisiveness of Obama, but if the Palin nomination’s an example of the alternative, then Carter-esque incompetance doesn’t sound too bad to me. Y’all already know my calculus in favor of Obama, but here’s my pessimistic prediction:

    He’ll pass legislation requiring union-membership voting to be non-secret, so that union-bosses can threaten the unwilling and their families.

    Reply
  14. Vis-a-vis Bernanke/Greenspan, that’s all fine so long as we’re motoring away from Scylla, but once we’re at the maw of Charybdis, expect whoever’s in charge to follow in Volker’s footsteps, even at the cost of stagflation.

    Reply
  15. Mike

     /  November 3, 2008

    Bleah. I’ll just follow my own saying from the last election. No angles in politics, only devils. Find your devil, make your deal.

    Addendum: Then deal with the consiquences…

    Reply
  16. Yeah, and the consequences’ll suck. But my one hope for getting the libertarian wing back into the Repubs is complete disarray in the RNC. I’ll happily say y’all told me so, ‘cuz you’ll have been right. (Not that my vote really matters in CA)

    Reply
  17. Uh, hang on a minute…

    We have nothing like the spectre of inflation looming over us. The Japanese-style doldrums you cite are the result of deflation, which’s exactly what’s happening to the economy. I know that the anti-money gold folks think the gnomes are Zurich are manipulating gold, but the failure of gold to hit $2000/oz is entirely due to the fact that monetary expansion has effectively stopped flat. (Those M3 figures lately are due to big corporations tapping their lines of credit to build cash-reserves just in case they can’t tap them later.)

    Energy prices are low not because of drilling prospects, but because the recession has tanked demand. We don’t have remotely enough inexpensively recoverable reserves (coastal or otherwise) to affect prices by drilling. If you don’t believe me, go hang out on The Oil Drum for a while.

    Currency-wise, it’s a mixed bag. Our currency is weakening fast, but many other nations (esp. the Europeans) are fighting to debase theirs even faster.

    OK, now that those two things have been said, yeah, absolutely. Now that there’s no need to court moderates, Pelosi will throw the Blue Dogs under the bus just like Hastert did with libertarians.

    I think you’re also right about PayGo — it’ll be kept and cited as the reason we “must” raise taxes to cover all the hand-outs that Obama’s going to give folks.

    Reply
  18. happycrow

     /  November 11, 2008

    I’m not assuming that the current world economic situation will remain static — my “crystal ball” assumes a recovery.

    Reply
  19. My previous assessments were predicated on the assumption that Pelosi would attempt to throw them under the bus, and then recoil in the face of a threat to vote with folks across the aisle — traditional “we’re the guys who can make you or break you” politics.

    It’s quite surprising to me that they have not stepped into that role… which suggest that they don’t really want to play kingmaker at all, but rather to simply get along.

    Reply
  20. I’m not sure you can do that with the dems, frankly, since they have so many coalition-members. It’s not like the blue-dogs represent a large portion of their constituency, yes? Or have they grown recently?

    Reply
  21. Alex

     /  November 12, 2008

    I think it is because the dems are not as “ideologically pure” as the repubs have become. So because they have such a wide range of liberal, moderate, and conservative (your blue dogs) types all in the party, they really have to try and get along otherwise they open themselves up to the divide and conquer tactics that repubs used to weaken their power over the past 12 years. Look at what Obama said recently about Lieberman and that Reid should not have rebuked him so – he should still be caucusing with the dems rather than “punishing” him for his support of McCain. So I’m not surprised they’re getting along right now. Later on though, we’ll see if the organization starts to split along ideologies.

    Reply
  22. Anna

     /  November 12, 2008

    The repubs are ideologically pure? That’s not the impression I got from this election…hmm.

    Reply
  23. I think the difference is that where the dems tend to form a circular firing squad, the repubs shoot the libertarians, then the religious back-stab the pro-business crowd to the extent that the foreign-policy wonks will let them (need to maintain a viable arms industry, plus, ship/tank/bomber-building buys votes). The true core of the republican party are the cultural conservatives they inherited from the dixie-crats (irony, anyone?), whereas the dems simply have different constituencies all saying “gimme”.

    Reply
  24. Alex

     /  November 12, 2008

    That’s what I was getting at. The ideological “purity” of the repubs is basically old core southern democrats – the left-overs of the democratic party from 1861 that thought slavery was a good idea. Now they’ve gotten past slavery, but they’re still basically dixiecrats – conservative to the point that any change from the status quo is very very bad in their view.

    Reply

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