It may seem bold to make presidential predictions four years in advance -- especially during an election cycle when pundits can't even seem to decide what's going to happen tomorrow -- but one thing is for sure: whoever leads the Free World into the next four years is going to have his hands full. So full, in fact, if that man happens to be Mitt Romney, we may very well end up with two one-term presidents in a row.
The former Governor of Massachusetts doubled down on his economic platform during a rousing stump speech to a group of more than 2,000 supporters in Iowa last Friday, promising “Big Change” for America’s families, but if he wins the presidency the old “he inherited this mess” excuse may hit the GOP close to home before he and Ann unpack the first box at 1600 Pennsylvania Avenue.
Though The White House recently confirmed President Obama’s commitment to extending Bush-Era tax cuts to Americans earning up to $250,000, at least one group of professionals -- those at JPMorgan -- are less than optimistic that the renewal is actually forthcoming -- especially in the case of the Payroll Tax Holiday that was added as part of the deal to extend the Bush Era cuts last time. According to one of the firm’s recently released research notes, that increase in payroll taxes alone would reduce U.S. disposable income by approximately 125 billion dollars in 2013 and reduce GDP by 0.6 percentage points. Even spread over the course of several months, they note, “the headwind to growth should be noticeable.”
Add to it skyrocketing food prices, high energy prices that are expected to continue rising, and soaring healthcare costs despite promises to bring them down, and many economists say we're headed over a cliff. Food prices alone will take a gluttonous bite out of family budgets in coming years.
Already near its all-time high, the FAO’s Food Price Index rose 1.4% overall in September, as consumers and farmers began to feel the effects on this year’s drought on grain supplies -- effects that are only just beginning to rear their head, especially in the livestock industry. Dairy saw a staggering 12 point (7%) gain during the month of September, its sharpest monthly increase since January 2011 when hunger as a result of quickly rising food prices spurred the Arab Spring. The first of the animal agriculture sectors to wholly reflect the impact of skyrocketing feed prices, dairy is not an anomaly. Beef, pork, and poultry are expected to follow suit in due time.
Meanwhile, a tough 2013 would be followed up by an even harder 2014, the year in which the Obamacare "tax" will take effect, hitting families with one of the biggest individual-basis tax hikes in the history of the country -- no less than fifty dollars per month by the time it’s implemented in full force. When it comes down to it, we probably already know more about the state of the next four years than either of the presidential candidates has let on -- regardless of the policies they bring to The White House. As much as Obama's poor performance in this campaign has come as a surprise to his dedicated fan base, if the man's smart, he probably doesn't want the next four years -- they're not going to be pretty. If we thought Americans were unhappy about a stagnating standard of living, justimagine their displeasure for a rapidly dwindling one.
Diana Prichard authors Righteous Bacon and is the owner of the small farm Olive Hill.