This, to me, is the money exchange from President Obama’s appearance last night on “The Daily Show” with Jon Stewart:
New York Times economics columnist David Leonhardt has been a dependable communicator of the White House take on domestic policy. And by those standards, today’s column was worth noting. In his own gentle way, Leonhardt takes the Obama administration to task for a bit of premature economic celebration:
Here’s the problem with President Barack Obama’s deficit reduction commission: Exploding debt caused by out-of-control healthcare spending is an Extinction Level Event for the U.S economy. By 2050, according to the Congressional Budget Office, the national debt will likely be three times as big as the overall economy with Medicare and Medicaid gobbling up half the budget.
I think John Podhoretz aptly sums it up:
We’ve had 18 months of data points from many different sources that all tell the same story: Americans who vote have radically changed direction when it comes to which party they prefer. In both 2006 and 2008, voters said they preferred Democrats by margins of 8 to 12 points, and on Election Day handed Democrats landslide victories. But Republicans have led in the so-called “generic polls” since March 2009 without letup — and the gap between the two parties has remained stable at a level comparable to the previous Democratic advantage. This means that, probably at minimum, 16 percent of the electorate has shifted from voting Democrat to declaring its intention to vote Republican. That is an astonishing degree of change, and it’s why you’ve heard so much talk about this being an unprecedented election.
Ed Yardeni thinks Tim Geithner is off point:
Tim Geithner thinks he can solve the world’s economic problems by getting countries with large trade surpluses to reduce their surpluses and by getting countries with large deficits to reduce their deficits. The problem is that fixing the world economy isn’t as simple as suggested by Mr. Geithner. Multilateral approaches rarely work because it is so hard to get universal agreement on what to do.
The U.S. Republican party will probably retake the House of Representatives from Democrats in the Nov. 2 elections and fall just short in the Senate. Whatever the exact electoral results, it seems certain the GOP is poised for a major upgrade in political influence. Herewith, Breakingviews offers a primer on how the shifting balance of power may sway key financial and economic issues in the coming year.