Congressional Brinkmanship Kickin’ Up Fiscal Whiff

So the long drawn out process of selecting a US President is over. Barack Obama won a second term, quite comfortably in fact, with nearly a 100 more electoral
college votes and 2% more of the popular vote.

The process of picking over the caucus of the GOP had already begun live on air during the announcing of the winner. Fox News seemed to go into meltdown. Karl Rove, in particular seemed to have great difficulty grasping the result of the state of Ohio.

However, the presidential race was only one factor being decided that night. The House of Representatives was also being contested. The results proved contrary to that of the Presidential race with the Republicans winning an impressive victory.

In terms of power, the President may be able to control foreign policy but, domestically the House of Representatives have the upper hand. Hopefully, Obama will have the hindsight to learn important lessons from the last 4 years and seek to put aside the Chicago style politics. As the FT put it on Wednesday, America needs a leader who can put the ‘can do’ spirit back into the country.

Oh and there’s one other small issue for Obama to worry about: the looming fiscal cliff. A toxic mix of spending cuts and tax hikes that will come into force in the new year unless the Dems and GOP can collaborate and come to an equitable resolution. History tells us that the Republicans will not budge too much on this subject and are willing to force a shutdown or collapse of the economy over it! There hasn’t been a budget passed in the country for over 1000 days.

Could Americans face another Mexican standoff on the issue of debt and taxes? It is all primed for that situation. As President, Obama faces tough choices ahead in the form of his mandate being shrunk and a high level of hostility from the House of Representatives.

 

Commentary by Aaron Callan, @acallan87.

Here’s an infographic produced by the Wall Street Journal breaking down what exactly makes up the now infamous fiscal cliff:

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