What the health-care debate means for budget talks

Source: Heathcare.gov

The rollout of the Affordable Care Act and the Healthcare.gov website has been nothing short of disastrous. This is like a technology company rolling out a product that was simply not ready for the market. It's been a major embarrassment to the administration and has given new ammunition for those who are critics of the new health-care law.

Remember that October was all about a showdown between those who wanted to repeal the health-care law and were willing to shut the government down to do it. In fact, the more draconian step of not raising the debt ceiling came into play because of the fervent opposition by some to the new health-care law.

(Read more: Get ready for the Obamacare fight in 2014)

With fresh evidence that the Affordable Care Act has issues, I believe you will see more vocal opposition even from some within the president's own party based on the initial rollout of the act. This means that the last chapter has not been written on how the health-care law will operate.

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It also means more leverage for those looking to cut spending in a mission to balance the federal budget. The Treasury Department announced that the deficit this year was only $650 billion; pocket change, some would say. And in fact, it is a smaller percentage of the overall economy than in previous years so a case could be made that we are moving in the right direction.

But the problem is not this year's deficit but the accumulated debts of $16 trillion that hang over the heads of Americans and their children. Combining that with the huge increase in entitlement costs that are undoubtedly on the horizon, something needs to be done. The health-care rollout will embolden those who philosophically disagree with significant government involvement in private affairs. So, expect more drama and more yelling.

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There simply will not be enough consensus to move the U.S. toward a resolution that will balance the budget and pay off the massive deficit. Inflation is likely to be the chosen path out of debt and I believe this policy is already in place on an implicit basis.

So as you watch the headlines, recognize that the political game impacts the economy and therefore impacts investment strategy. The next stop on this dysfunctional path will be in January.

—By Michael A. Yoshikami

Michael A. Yoshikami is the CEO and founder of Destination Wealth Management in Walnut Creek, California. He is also chairman of the firm's investment committee.