Monday, August 11, 2008

What Does the Next U.S. President Face?

With Labor Day, the unofficial end of Summer, close at hand, it won't be long before the Presidential race becomes the main focus. Soon the Conventions will occur, then the debates and in less than 90 days, the election. It is hard to understand how any person would want to be elected President in this cycle. The next President will face challenges not seen by a United States President since FDR.

On the Home Front the Economy teethes on the verge of a very deep recession if not a depression. The Credit markets are a mess, on the one hand the serious slow down in economic activity cries out for low interest rates, but the rise in commodity prices foreshadows an inflationary period which would call for higher interest rates. Banks are loan shy because of the abuses that have put them in a precariously fragile asset state. Housing sales are slumping and prices falling, foreclosures are at record highs with many more to come. The Housing market can not recover because banks aren't lending, which causes housing prices to fall more, which causes more foreclosures, which causes more bad debt for the banks.

Energy prices will force more American Families to cut back on shopping and fore go items that they would normally have purchased. Retailers are suffering from the cut back in shopping, with their margins cut to try to spur on sales. As margins grow thinner retailers must make choices, lay off workers or commit less to other expenses. Either choice creates a slower economy.

The next U.S. President will meed to have the wisdom of Solomon. The problems afflicting the Nation are many, without easy solutions. The Nation has been sunk into a morass of a no growth, high priced Economy, which will not readily be steadied. The Nation needs an Energy Plan, a plan that will carry us to the next Era. The next President will need the courage to stand up to the entrenched fossil fuel energy companies, rich with lobbyists, and overflowing with wealth and put the Nation on a path to renewable, sustainable, alternative energy sources, and he must do it with a commitment and a goal. Getting started on a massive energy restructuring will add jobs to the Economy at all levels, from PHD's to Laborers, from skilled Electricians to unskilled manufacturing labor. An Energy solution is also an Economic Solution, the nest President must have the fortitude to commit the Nation to move to the next era of energy.
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