Busch: The End of the Longest Election Ever
First up, the end of a two year US political campaign. For the first time in modern political history, we had a state primary occur in the year prior to the election year. In the great wisdom of "Me First", individual states all began to move their primaries forward to enable them to remain relevant in the campaign.
This created a race to be first and Iowa was threatened. Iowa moved forward their primary to December and the rest is history...including campaign finance reform. The sums of money that have flowed into the campaign coffers is simply staggering and will forever change the methodology of getting elected president in the United States.
The election has come down to money, advertising, and messaging. The polls show that Democrat Barack Obama has a commanding lead in the national polls with an average of 6.9 points according to Real Clear Politics with the latest 3 polls showing 8.6 point lead. In the break down by swing states, Obama only has to capture one out of the big three, OH, PA, and FL, to win. McCain has to run the table to make it competitive. It can be done, but the margin of error is extremely small.
More importantly, the US Senate races are critical for future programs under either a McCain or Obama administration. The US House of Representatives passes bills by simple majority. The US Senate mandates a 60 vote majority to cut off debate before proceeding to a majority vote. Normally, this acts as a mechanism of compromise and to cool the emotion of the "Peoples House" from passing laws that are the whims of the crowd or the latest fad of policy. This can occur even prior to the US House passing the bill if they know the US Senate won't pass it. With a 60 seat majority, the US House will be unleashed to generate legislation from regulation to taxes that is according to popular demand. This is why we should all stay up late and watch the returns for Senate seats in Oregon, Colorado, New Mexico, and Alaska. An early Obama tsunami would tilt these races all strongly in favor of Democrats.
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My nightmare scenario for this campaign has been that Obama wins the popular vote and McCain wins the electoral vote. I put this at 15%, but this is the most likely scenario for a McCain victory. This would be lawyer heaven and country hell as the nation would be thrown into limbo as court cases mount and the outcome remains in question. Think back to 2000, the six week's of uncertainty over the outcome generated a large risk aversion theme in the markets as US equities were sold, the US dollar was sold, and US bonds were bought. While I don't anticipate this occurring, keep this in the back of your mind to understand and anticipate. On the flip side, we should see the opposite occur in the short term should we have an Obama victory and therefore clarity of an outcome.
The best I can say for whomever wins: good luck! Why you would want this job at this juncture is beyond my pay level. The challenges are beyond daunting and the new President will be presiding over 2 wars, massive budget deficits, and an economy in a deep recession. By the way, this year was the first time a baby boomer took a retirement check from the government. This is truly the nightmare scenario for the next President as he will have to face a new reality: fiscal austerity or the abyss. This is the true untold story of the election of 2008. Expect the pages on this book to begin turning in late 2009-2010 with less spending and higher taxes most likely to be the unhappy ending.
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