A guest post from Constantine von Hoffman, veteran business journalist and author of the blog CollateralDamage.biz, a humorous look at marketing, business and his dog.
No matter who wins today, the facts on the ground will not change. Currently the best-case scenarios are for a recession ending sometime late next year. Never a good sign when that’s the view from the rose-colored glasses.
- The government is expected to borrow a record $550 billion in the current quarter – $408 billion more than estimated three months ago. (Who the hell is loaning money to us?)
- In the last quarter the government borrowed $530 billion. (Repeat parenthetical question from above)
- Total borrowing for this budget year, which began Oct. 1, is expected to be a$1.4 trillion, nearly double the previous record.
- 10% unemployment is likely.
- Mortgage defaults will continue apace and likely increase.
- The companies that issue and service credit cards are going to see increasing losses,
Both candidates have come up with adroit verbal dodges to the question, “Which of your promises are you now not going to be able to fund?” Had either one answered honestly it would have been the end of their campaign.
Here are some possible ways the current fiscal nightmare will effect the major issues of the campaign:
- Any tax issues will have to be decided first and foremost on providing relief to individuals. The public wants its share after underwriting all these corporate bailouts.
- Lack of jobs will decrease illegal immigration.
- For the first time fiscal issues will be a factor in deciding whether to continue our foreign military expeditions. I expect a return of isolationism.
- Desperate companies will push the government to take over health-care costs, possibly resulting in some form of universal health insurance.
- Despite this, government will have to shrink in size. Cutting – not reigning in – benefits and services is the only option available.
Given all this it is difficult to imagine anyone — even Mike Rowe — wanting this job.
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