Why I’m strangely complacent about tonight

Byline: | Category: 2012, Above the Fold, Culture, Economy, Foreign Policy, Government | Posted at: Tuesday, 6 November 2012

As polls begin closing in the Eastern time zone, I am actually rather complacent about the outcome.  Yes, I voted for Mitt Romney, and yes, I want him to win.  But I guess I have a fatalistic view about what happens regardless of which man wins tonight.

Here is what I envision over the next four years: 

The bond yield is going to skyrocket as inflation begins to take hold.  That will push up the deficit because of the increased interest the government will have to pay to its creditors.  The effects of inflation will be horrible.  We’ll do something stupid to forestall this, like feed even more debt to the Fed.  It won’t work.  Inflation will find our door.  But if I’m wrong, and inflation doesn’t come, that is almost as bad, as it means another four years of super low interest rates and a corresponding dearth of interest income and saving.  Four more years of baby boomers retiring with no increase in interest rates is very bad indeed.

Regardless of who is in charge, America will still be held back by the sclerotic state of the nation’s bureaucracy.  As Meghan McArdle pointed out recently, there have been plans for hardening the essential infrastructure of the NY/NJ area for years.  It would have been nice to have last week.  Those plans are still in review.  They will still be in review a decade from now.  This, in a city that saw the Empire State Building go from a hole in the ground to completion in less than 14 months.  Obamacare is just the latest circle of bureaucratic hell through which America’s entrepreneuers must wade, and even if Romney is elected, much of it, I am saddened to report, will remain intact.  At some point our economic engines are like Napoleon’s troops invading Russia: supply lines were so long that there was no room for anything else in the carriage but the fodder for the horses pulling the carts.  There was nothing left to do then but to eat the horse.  I fear that we’re nearing that point.

An even bumpier economic ride is overdue overseas.  China is on the edge of a cliff; its coming catastrophe will either be economic or cultural.  Probably both.  Japan is nearing the end of its free money holiday.  With the highest debt load in the developed world as well as the oldest population, Japan is not just an economic mess, but serves as a warning to others who are quickly tracing the same path.  Even more concerning is that China and Japan are both still very closed societies;  they are unlikely to search earnestly and inwardly for blame or solution.  It is easier to look outside for blame.  And then there’s Europe:  beset by unbridgeable divides, it will collapse with rippling economic, cultural, and perhaps even military effects upon the United States.

Unfortunately our competitors and enemies will not bide their time these next four years.  Our foolishness in the Middle East and in North Africa has placed America in a damned if it does, damned if it doesn’t situation.  But of the two, doesn’t–disengagement–offers the least potential downsides.  Regardless of who is elected, we won’t disengage.  Instead we will continue to reinforce failure overseas just as we have for years.  As for Russia . . . enough said.

We are an nation divided evenly between two irreconciable ideologies.  On the one side is the collectivist progressive who knows that by centralizing control in the hands of leaders empowered by special powers, that America will be a fairer place.  On the other side is the rugged individualist who knows that if he were freed of extraordinary restrictions that he could accomplish extraordinary things and that will make America a stronger place. 

This is not a new conflict.  In fact, it’s the conflict that gave birth to our nation, when we left England and an anointed elite behind.  But we didn’t leave it entirely behind.  And by degree, collectivism has returned.  For decades we have been able to paper over the differences between the two camps through the incredible surplusses that we have amassed.  But those surplusses are soon to come to an end.

We could forestall that day, perhaps even reverse time.  But unfortunately, even if Mitt Romney wins tonight, he will not win with a mandate for real change.  Thus we will toddle down Japan’s path to our own end.  At least that beats sprinting there.

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12 Responses to “Why I’m strangely complacent about tonight”

  1. Instapundit » Blog Archive » JAMES TARANTO: The Case for Obama: Re-election would ensure he is accountable for the mess he inhe… Says:

    [...] Related thoughts from Bob Krumm. [...]

  2. ez Says:

    I too have been trying to grasp how Romney could even begin to undertake the changes needed and just cannot find the answer.

    Still holding out for my 20% 30 year CD…

  3. JeremyR Says:

    The trouble is, look at FDR. He basically did the same thing, taking a recession and made it much, much worse. Yet people still kept electing him and blaming his predecessor for the problem.

  4. SongDog Says:

    The Republicans have been unable and the press has been unwilling to hold Obama accountable for much of anything in his first term. Unless that changes he and the Democrats will continue to sell the same old snake oil. It’s Bush’s fault.

  5. Lorenz Gude Says:

    I agree with your analysis of the seriousness of the problems America faces, At the risk of falling into Spengler’s “Optimism is cowardice” trap I would point out that state and local governments of both parties are reacting to their fiscal crises. Heck even Jerry Brown admits to seeing it. But Washington and, evidently the American people are still asleep. I emphatically agree that it was a long shot that Romney could have reversed the situation. He couldn’t stop deficit spending to keep state and local government workers employed for a start without causing riots. The US has been too fat too long and it will take the shock of collapse to take the fat out. For example, it has huge public/private institutions that are way too expensive. Health care costs 16% of GDP – in Australia it costs 8.5% of GDP and we cover everyone, have a private system too and get better health outcomes. Obamacare caps spending to 16.5% of GDP by 2017. That’s paving the road to ruin. Higher education is probably even less efficient and is producing too much counter productive indoctrination and too little education. Many of our companies are also fat and inefficient, but of course nothing trumps the public sector as an unsustainable percentage of the economy. What Walter Russell Meade calls the Blue Model has reached its limits here and in Europe. Since FDR we have grown the size of the public sector such that the private sector can’t sustain it. The problem is that there is no way to gracefully back off and the country just rejected the ticket with Paul Ryan – the guy who was willing to try. I don’t think the American left understands that – yet. I know Christie is not in good odor with Republicans right now, look how well he has done walking NJ back from the abyss with cooperation from Democrats. They are beginning to get it. For the most part I think the left is still lost in the Marxist ideological cloud of unknowing. That is a direct result of the educations system and not easily reversible. But Americans are a practical people. For example, I know of a Democrat in a very Blue area who has attacked her very Blue local government over inefficiency and corruption with great vitality. The ideological divide does appear unbridgeable, but there are some signs of hope that when things get serious we will recover our native ability to muddle through – together.

  6. It Ain’t Over till the Fat Lady Sings, But… | The Skeptic Conservative Says:

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  7. Brandon Says:

    I want to start by saying, I really appreciate your in-depth political EV analysis. It’s always good to have someone try to refute someone else with a good argument. In light of the events of tonight, do you think you need to reanalyze your approach? Do you think you were wrong in your assumptions that undecideds always break towards the challenger in a presidential race? Or that polls are systematically biased against Republicans?


    Ed:
    Brandon, I don’t think I concluded that polls are systematically biased toward Republicans. I also didn’t base my analysis on undecideds breaking toward the challenger. I took the polls and looked at the effects of oversampling. And I did conclude that oversampling unlikely voters–at least in this election–pretty substantially biased the results in favor of Democrats. And I don’t yet see anything from last night that makes me want to swerve off that view. In other words: if turnout had been as high as last time (or as high as even the polls were projecting), based on my conclusions, I think that Obama’s lead would have grown even more. In that case, the question about the polls is why were the they biased against the Democrats that they showed the election closer than it was? But an even more important question is why has happened to the Republican brand that Barack Obama left almost ten million votes on the table and Mitt Romney couldn’t pick up even a single one?

  8. Ampontan Says:

    “Even more concerning is that China and Japan are both still very closed societies; they are unlikely to search earnestly and inwardly for blame or solution.”

    I can assure you that the debate in Japan both about blame and solution is long, sophisticated, and ongoing. There have been two lower house (most important house) wave elections in a row, and there will be a third before next summer is over.

    In fact, the Japanese could not be any more different than the Chinese in this regard.

    I suggest you limit yourself to opinions on subjects on which you have expertise. On this one you have none.

    Ed: I hope you’re right. I fear you’re not.

  9. Tom Says:

    The non-honest Democratic Press is biggest failure of the US experience.

    Not quite dis-honest, non-honest is CBS not showing Obama’s full interview, where he denies terrorism. Non-honest is not clearly showing how Obama has been lying. Non-honest is the LA Times not showing their video of Obama’s remarks in 2008.

    It’s the non-honesty which is so annoying — the Republicans need to get better press, by more of them being in the press. And/or creating a better press (PJmedia, Breitbart, Powerline).

    Too bad the Koch brothers didn’t buy Newsweek and make it a more balanced magazine that would be worth buying. Or some rich Republicans.

  10. The Strata-Sphere » The Obligatory “You’ll Eat Your Crow And Like It” Post Says:

    [...] Update: Curious about that economic storm coming? Here is one bleak outlook worth reading. [...]

  11. Jim White Says:

    I find it sad that you have all this negativity about the US. You yourself feed at the government trough as an employee of the government, getting the very kind of healthcare you rail against.

    I work as a PA in a hospital and I see the injustices the hospital staff must take in pay cuts to absorb the costs people without insurance incur. The current system doesn’t work, you complain about Obama care and yet like your candidate, you fail to offer any real solutions. Lets see what happens when we start seeing some of our hospitals going bankrupt, then what will your answer be. Obama is trying something to fix the problem, what are you doing? Collecting another government check?

    If you are truly worried about the deficit, how about you go out and get a job and start paying taxes instead of working for the government.

    As for your predictions about the economy, you have been way wrong about just about everything, I suspect you will be wrong about hyperinflation.

    I will be watching to see if you have the courage to print this rebuttal of your hard right opinions.

    Ed: Post it? Of course I will. And congratulations on your win. Nice to see your magnanimity on display in victory. BTW, are you Jim White or Kevin Born?

  12. Earl T Says:

    Republicans need to adopt just one simple strategy for every set of elections:

    WIN FIRST! Then do good.

    There are no sportsmanship/Ms Congeniality trophies handed out after an electoral defeat!
    Yet the GOP candidates act as if they are happy with being good losers, if they fought a fair fight. No more “Mr Nice Guy” tactics, fight to win!