Sunday, November 4, 2012

An early look at President Obama's 2nd term


How will a second Obama term go?  Is it too soon to make a prediction considering the 2012 election outcome is still unknown?  Will congressional gridlock be the same, not as bad, or sadly worse?  Will Iran develop a nuclear weapon?  What will the cabinet look like?  How about the supreme court?  Will we go over  the fiscal cliff or just hang dangerously close to the edge?

I believe President Obama will champion deficit cutting and attack the building debt.  Contrary to the pundits on the right, the president is not a tax and spend liberal (as opposed to a borrow and spend Republican).  He believes in fiscal responsibility, but also realizes that during deep recessions where the credit markets have seized, that it is up to the government to provide necessary stimulus.  However, unlike FDR, President Obama has fought the pressure to turn to austerity too soon, and as the economy continues to heal in 2013, expect the temporary measures to come to a close.   I imagine his first major policy speech will include legacy building topics such as energy independence, immigration reform, long term debt reduction, and entitlement reform.

The biggest threat to accomplishing a lasting agenda will still be Congress.  The GOP will retain the House, thanks greatly to redistricting in 2011, and the Democrats will hold the Senate.  The most critical factors to collaboration:

-          Congressional leadership whipping the ranks to accept tough medicine.  We need leaders like LBJ, Tip O’Neill, and Bob Dole to push back on ideologues and accept what’s best.

-          Several prominent Republicans will have to denounce the likes of Grover Norquist and other lobbyists in the name of national interests

-          Nancy Pelosi will likely pass the mantle of Minority Leader to Steny Hoyer.  Will that impact how the caucus acts?

The Obama cabinet will also face some significant changes.  Hillary Clinton will step down as SecState (John Kerry?), Tim Geithner could move on and perhaps be replaced by a Clintonite such as Summers, and what about Leon Panetta, Eric Holder, Steven Chu, and Ray LaHood?  Does David Petraeus stay on at CIA?  Yes, like all second terms, there will be shake ups in the cabinet and the silly season will kick the rumor mill into high gear including such names as Debbie Wasserman Schultz, Bill Richardson, Chuck Hagel, and perhaps some big names from the private sector into key commerce roles,

There will also be focus on the Supreme Court.  Justices Ginsburg, 79, Kennedy, 76, and Scalia, 76, could all be considering retirement over the next four years, though one could see Scalia staying on until a Republican reclaims the White House.   But one shouldn’t forget the District and Appellate benches as well as these jurisdictions are critical especially in contesting some recent controversial laws passed by reactionary state legislatures and signed by equally reactionary governors.

Of course, like all things in life, the best laid plans do not survive 1st contact.  Did anyone forecast the Arab Spring?  Deepwater Horizon?  What is important is having the right team in place to effectively and efficiently deal with domestic and foreign crises.  But there is a lot the U.S. can do proactively to dictate events as humanly possible.  The President will build a rapport with the new Chinese leadership based on global growth, coopetition for regional stability, and account and currency balances.  I expect President Obama and Prime Minister Netanyahu’s frosty relationship will NOT thaw anytime soon, ties with Europe will strengthen, expect a pivot to Latin America, and more hawkish position with an increasingly imperialistic Russia.  But everyone will  be focused on Iran and whether a U.S. sanctioned or led attack takes place.  At the end of the day, I do not see the U.S. launching large scale attacks on Iran, but the chances of surgical strikes, cyber-attacks, and crippling isolation are likely.

There will be crises and hot spots for sure.  The European fiscal situation while stabilized is not yet sound and our long term economic restructuring is far from being organized let alone completed.  That being said, President Obama needs to build upon his Race to the Top education program, continue long term renewable and alternative energy sources development, curtail unnecessary regulation, and make sure that healthcare costs are contained.

Perhaps I am premature.  Perhaps I am reaching too high.  Perhaps things will get worse.  But based on what I am seeing, the US economy will continue to build up steam and expand and the best part is it could lead to further Democratic victories in 2014 and 2016.

A guy can hope right?

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