Mar 06, 2009
Most years in the first month, I make predictions for the year ahead. There is so much uncertainty right now, my crystal ball is fogged over. To me, there are a lot of questions about where the Obama Administration and Democratic Congress will take us. Also, we can only guess about where the global economy is headed.
I would like to say that I have been encouraged by the early international actions taken by the Obama Team. I thought Secretary of State Hillary Clinton was correct in her conciliatory approach to China. We need China and they need us.
We depend on China to keep lending us money. And looking at the Obama budget, we will need a lot of money. I think it is a good idea to work out our differences with Russia as the President has suggested. We don’t need to try to isolate Russia and establish missile sites on their border. Also, President Obama told the Canadians that he didn’t intend to push for a rewrite of NAFTA. That’s good.
My biggest worries are with the domestic programs. The President’s budget plan is big and bold and scary.
I already said my crystal ball is cloudy. But with the economic meltdown that we are fighting, I find it hard to contemplate a series of huge new programs. Universal health care, massive expansion of education, a cap and trade energy plan which equates to a costly tax increase, more regulation relating to livestock production, and EPA always makes me nervous.
My overriding concern is the explosion in spending. The Congressional Budget Office projects a 1.4 trillion dollar deficit this year. And although it declines to about 600 billion dollars by 2012, it rockets back up to 1 trillion dollars by 2018.
On the revenue side, I don’t think the tax collector will ever bring in the amount of money the budget plan projects. The rich don’t have that much money, even if the government takes all of it.
Hopefully, the Congress will scale back the President’s wish list. We are shoveling money out to anyone and everyone – giving billions and billions to the states, rewarding them for irresponsible spending. California is broke. Whose fault is that? Not mine. Not yours. Why do we have to bail them out?
Until next week, I am John Block from Washington.