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The McGovern coalition pulls out a win
By Nixonomics | November 20, 2008
Barack Obama was elected to be the 44th president of the United States. Obama as everyone except the cave dwellers know is the first person of African and American descent to be elected president of the United States. Obama’s election is a monumental feat from numerous perspectives. Obama is the first sitting senator and first term senator to be elected since John F Kennedy in 1964. Obama’s primary victory over Hilary Clinton was then thought to have destroyed the Clinton lineage in Democratic politics and in the aftermath of the election, the media is gleefully calling it curtains for conservatism, capitalism and Republicans more or less in that order. Obama’s primary victory over Clinton also made fools of those who suggested that Iowa and New Hampshire would not play a critical role is deciding the ultimate nominees. Obama won Iowa, launching his candidacy and McCain won New Hampshire, resurrecting his nearly defunct nomination bid. Super Tuesday did not have the impact that everyone expected and states that moved their primaries forward punished themselves as the Democratic contest ran on till the very bitter end.
The country is justifiably proud of Obama’s election in light of the long and difficult road it has traveled to arrive at this moment. As Obama stated in his acceptance speech, his election is an embodiment of the fact “that America is a place where all things are possible.” However, for some, including many who voted for him Obama’s election poses a multiplicity of problems. He is by quite a few measures the most left- leaning, pro-government/regulation, anti-growth/free trade candidate to be elected as president in recent history. His platform contains progressive and redistributive tax policies, including higher taxes on capital gains and dividends. He is in favor of a windfall tax on oil companies, when the long-term supply-demand imbalance argues for policies to stimulate production of this vital energy source. Higher taxes dampen innovation and risk-taking, constraining the commercialization of new ideas that are predicated on a few very large gains offsetting numerous losses.
If one were to measure the business communities reaction to Obama’s election by the best known indicator the stock markets, it’s unequivocal: two thumbs down. Since Obama’s election US stock markets have dropped by nearly 15% as investors anticipate the rise in taxes on dividends and capital gains.
The expectations for Obama’s presidency can only be described as unreal, delusional and impossible. The coalition that he cobbled together to elect him is unlikely to settle for something like Clinton lite. Unions, environmentalists, economic interventionists, socialists, social spending advocates, political correctness advocates etc., etc., are just waiting to sow the seeds of a long reversal that they hope will revert the US back to what it was before Reagan took office. Against the odds, the McGovern coalition that was destroyed by Nixon in 1972 has cobbled together a win for Obama. However, many would agree that current financial crisis may have been the biggest single factor in his victory, creating an irresistible force for voters looking hit the purge button for anything remotely associated in creating it.
The voters now have what they want. Hope. Change. In time our sense they will get what they deserve.
The coalition that Obama has put together, built around his life story and the historic nature of his presidency make him a prohibitive favorite for 2012. From a measurement perspective, his first term will be judged as undoing the mistakes of George W Bush and he’ll get a pass even if hope and change have not come to the land yet. But his second term will be judged and it’s our sense that by the delusions will have ended, the reality of our predicament all too clear and the disappointment great. Then as now, the sentiments will be the same: hope, change.
Topics: Politics |
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