With just a year to go before the US Presidential election, things look very problematic for ordinary Americans. Unemployment refuses to abate and housing remains a crisis. Citizens are pulling their money from mainstream banks making more banks vulnerable. The US economy is a mess.
President Obama is losing his base in the black vote and the lower middle class – the very people who ensured his victory his victory. These are the groups most affected by the US economic challenges and are becoming less and less mobile, they key to economic prosperity in the US. They will determine whether or not Obama is a one term President or not. Right now, it looks as if he will probably be just that.
On the republican front, we have a "mess" of candidates. While Mitt Romney remains the likely candidate, he is facing challenges from the strange and sometimes weird bedfellows in his party. Tea Party favourites, odd balls and womanizers (Cain, Gingrich to name just two) seem commonplace in the list of would-be Republican Presidents. While Perry may be a solid and sound Texas Governor, as a potential President he looks weak and ill equipped, both intellectually and in terms of communications. Michelle Bachman is just very strange. The person with the most intellect and global experience - John Huntsman – is making no serious impression at all. It looks like the nomination is Romney's to lose.
Meanwhile what suffers is policy. As all shuffle around in the zombie mode of the walking dead, no one seems seriously to be working on policies that will impact jobs, housing starts, weak banks, fiscal responsibility, personal debt and a failing education system. Obama's jobs bill, for example, is largely a political exercise aimed at creating the impression that republicans don’t want to help to create jobs. The debt deal done earlier this fall is a smoke and mirrors exercise by both parties aimed at image management. No one is seriously looking at facing he crisis of confidence in the US economy head on. Canada’s former Prime Minister, Kim Campbell, famously said that elections are not a time for serious policy debate – there is no honesty when you are working hard to be elected.
While the Greek economic tragedy plays out, it should be seen as a precursor to the likely drama in the US when it begins the austerity work of tackling its $211 trillion in sovereign debt and unfunded sovereign liabilities as well as creating the conditions in which the $14.5 trillion in US personal debt can be lowered.
The US is in the most serious economic trouble it has been in since it was founded. One would never know it, listening to the political debate. None of these candidates, including President Obama, is up to the task and work of being President of the United States – a sad state of affairs indeed, sadly also the case across the Eurozone at this time. Don’t expect it to get any better by this time next year.