In President Obama's first year in office the deficit is expected to reach $1.75 trillion. In President Bush's last year in office, 2008, the deficit reached $459 billion. So Obama is quadrupling the deficit. This is voodoo economics at its best. Oh certainly Obama has bought change to America but it is change for the worse.
In addition he is endeavouring to introduce a healthcare plan, which is financially unsustainable. Meanwhile inflation is set to take off. Taxation must rise to fund this Crazonomics. China has begun to question the size of the deficit and is no longer prepared to sign a blank cheque.
America may have a slight upturn but the long-term prognosis for the US economy is frightening unless the deficit is tackled immediately. Being master of the teleprompter is no substitute for economic expertise.
America has the worst of all worlds now. A big spending-economically illiterate Democratic President and big spending Democrat controlled Congress, which is addicted to pork barrel spending.
Thankfully the Republican Party has begun to learn the lesson that there is no such thing as a free lunch and is now preaching fiscal rectitude. It has begun to go back to basics.
Once Obama passes the 24 month period in office he will be in the run in to the 2012 presidential election. It is safe to argue that if he fails to tackle the deficit within the next 12 months, nothing will be done in 2011 and 2012. Of course foreign lenders may force his hand and refuse to fund the deficit. Then the US economy will bomb.
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