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Archive for December 30th, 2008

Will the age of Obama become the age of austerity? As the president elect enjoys a family vacation in Hawaii we are drawing ever closer to the end of a year that may portend the beginning of the end of an economy dominated by rampant consumerism.

In less than a month,  the world will witness the transfer of power in America from a Republican administration and a President that for most of the American electorate , can not go quickly enough into that good night of post presidency speaking engagements at friendly venues hosted by various industry trade associations,  to the recently anointed messiah on the global political stage Barack Obama.

President elect Obama will be front and center in the global economic crisis that has a choke hold on consumers around the world. Expectations for this nation’s GDP growth in the fourth quarter are dismal and approaching a negative 6%. Many economic prognosticators are suggesting that the worst is ahead of us, as the fall out of rising unemployment, the continued crisis in housing and asset valuations and a decrease in consumer demand will lead to further declines in economic performance through 2009.

The President Elect will work with Congress to inject a massive stimulus into the economy to provide a jolt to an economic engine that is on life support while at the same time professing the benefits of personal sacrifice and calling forth the memory of Camelot.

The underpinnings of an economy that has relied on consumerism that began, following the robust economic growth of the post war period in the 1940’s and accelerated into warp speed during the  1980’s and continued into this decade,  has been fueled by the belief that the American dream is about bigger, better, and bolder. It has been the dream that has been emulated by economies around the world.

In the Age of Austerity,  the Obama administration will attempt to realign the American dream so that sacrifice and stewardship are at the forefront of American values. The accumulation of wealth will be tolerated, providing the wealth is properly distributed among the broader population through aggressive taxation. Public programs and policy will provide economic stimulus as opposed to traditional capital formation by the markets.

Lofty ideals are virtuous provided they are in balance and tempered by the reality of present. The American economy is the greatest economic vehicle the world has ever known. It may be time to realign the tires but, with fuel costs declining we should pull up to the pump fill up the tank and push our way to a bigger , better and bolder economy.

The new administration must remember that the American economic model is the envy of the world. American entrepreneurship must be encouraged and provided with appropriate incentives to continue to build on a platform on which the foundation was laid by Thomas Edison, Henry Ford, J.P. Morgan and John D. Rockefeller and in later years further enhanced by Walt Disney, Ray Kroc, Sam Walton,  Bill Gates and Steve Jobs to name but a few.

President Elect Obama comes to power at another of America’s pivotal points in history. We are at a crossroads in which we can rise up and lead the world to a new economic prosperity or we can continue to lick our wounds and recede into what might have been.

 The President Elect should set a tone for the American electorate by heralding the virtue of American entrepreneurship to instill confidence in consumers and  promote economic innovation  as opposed to supporting an agenda that promotes the malaise of the left.

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