June 24, 2009

"A Republican comeback?"

"At first blush, this sounds absurd.... But..."

55 comments:

garage mahal said...

Shorter Politico
Polling shows no comeback and the party is as unpopular as ever, but here's how a comeback could theoretically happen.

Fred4Pres said...

If the economy does not improve by 2010, the Republicans will definitely gain some seats. If by 2012 things are still bad, Obama will lose and Republicans will make significant gains in Senate and House.

This is less about Republicans than Democrats. Republicans should be smart and rethink what it means to be a conservative.

John said...

The only reason we don't have inflation now is that we are in a severe recession. The loss in income and value associated with the recession has offset the huge increase in the money supply. The problem is that eventually asset values will stablize and the economy will stop contracting. When that happens, there won't be anything to offset the increase in the money suppply. And then away we go to big inflation. Once that happens, the FED will have to raise rates like it did in the early 80s, which will send the economy into a double dip recession. We have two choices at this point, stagnation with big inflation or a double dip recession. Of and by the way, Obama plans to destroy the economy with cap and trade and massive tax increases so even after the fed tames inflation, growth rates will still suck. There will be no Obama boom to follow taming inflation like there was a Reagan boom.

In 2010, unemployment will be over 10% and inflation is likely to be starting to go through the roof. All the fun people had arguing about social issues and global warming hysteria will end. People are going to vote on one thing, the economy. Further, there will not be any maladjusted guilty white people working through their racial neurosis by voting for a black president. It is going to be ugly for the Democrats in 2010.

Arturius said...

If his cap and trade bill and health care 'reform' actually pass, rest assured you'll see the GOP filling seats. That of course assumes the dollar doesn't completely collapse when enough countries wise up enough and stop buying Treasuries.

Chase said...

It will happen - everything goes in cycles, it's only a matter of when.

Obama's handlers can't be happy with the Rasmussen - the most accurate pollster of the last 3 Presidential elections - Presidential approval ratings. The last 4 days Obama's been at 0. He came up to +2 this morning.

Not good for the Dems. Not good at all.

Hee Hee Hee Hee Hee.

Randy said...

The odds are the GOP will gain seats. The out-of-power party usually does in mid-term elections and the Democrats don't have all that marginal GOP seats to pick off. Still, it is far too soon to tell what will happen in 2010.

Sloanasaurus said...

One would think that the Democrat strategy of cushing debt and taxes on America's middle class would aid the opposition party.

The left wing media keeps repeating the made up fact that the public still blames the GOP for the deficit. Yet, it's the democrats and Obama who are running up the deficit and proposing never ending debt on the American people. The GOP needs to start fighting back.

Dust Bunny Queen said...

And then away we go to big inflation. Once that happens, the FED will have to raise rates like it did in the early 80s, which will send the economy into a double dip recession. We have two choices at this point, stagnation with big inflation or a double dip recession.

Which is exactly why I do not invest my income oriented clients in debt instruments with anything longer than a 5 year duration, shorter if possible. In anticipation of the steep increase in interest rates we will most likely see in the next few years, we will be able to take advantage of the situation by having monies available to roll into the higher yielding instruments. Holding long term debt will be a disaster!! In addition, to hedge against the steep decline in the dollar and purchasing power, we are expanding our allocations into global debt and equities in countries that are anticipated to have stronger currencies.

I remember the Carter years and so do many of my clients. Some of us CAN learn from history. We may not be able to change what is going to happen but we certainly can try to make the best of this coming very bad situation.

Of and by the way, Obama plans to destroy the economy with cap and trade and massive tax increases so even after the fed tames inflation, growth rates will still suck. There will be no Obama boom to follow taming inflation like there was a Reagan boom.

Again. A reason to look overseas for growth within countries that aren't suicidal and more realistic about the mythology of "man made global warming". While our economy has been put into a straight jacket by misguided and venal political kowtowing to special interest groups, businesses that can (manufacturing) will be moving out of the country or going out of business because the competition hasn't been so shackled.

Original Mike said...

Still, it is far too soon to tell what will happen in 2010..

Actually, I think 2012 is easier to predict than 2010. 2010 is too close to the implementation of Obamanomics for the full impact to take hold and for people to connect cause and effect. But by 2012, especially if Obama gets the rest of what he wants, we are going to be in a world of hurt.

John said...

DBQ

Eventually the government is going to have to balance the budget and massively cut its costs. Once, the government is no longer running a deficit, people will be willing to buy T-Bills again. We are facing an incredible looming fiscal crisis of biblical proportions. And all Obama can do is think of ways to spend more on healthcare and cap and trade. It is insanity. We have a President who appears to be in complete denial of reality. I was always circumspect about the election because I thought the Democrats at least had some grasp of reality. No sane person could try to increase taxes, spending and regulation at the start of what could be another Great Depression. I guess I gave the Dems' sanity a bit too much credit.

Original Mike said...

What countries do you like, DBQ?

Bart DePalma said...
This comment has been removed by the author.
Bart DePalma said...

Historically, the party in control of the government loses seats in the President's first off year election. Even if the President is personally popular, the governing party loses an even larger number of seats during a severe recession. (See 1982). Thus, the GOP would have to majorly screw up not to gain seats.

A year and a half out, the polling shows Obama and the Dems are losing steam faster than Clinton and the Dems before 1994. Rasmussen's polling of likely voters has the generic congressional poll tied for the first time since the 2002 GOP Congress and Obama's job approval is barely above 50%. Quite a feat only five months into the term. It would be remarkable if these numbers improved as unemployment breaks 10%, the deficit tips $2 Trillion and interest rates keep rising on inflation fears.

The GOP will probably do well in 2010 because they are not the Dems, the same way the Dems did well in 2006 because they were not the GOP. If the GOP wants to make serious hay, they need to get back to conservative first principles as they did in 1994.

bagoh20 said...

There will be a significant comeback, because it's really out there and the press will not talk about it, which will help. Much of the pro-right energy is derived from anger at the media lameocraty.

TosaGuy said...

The Dem majority has been built by running acceptible moderate to conservatives Dems in traditionally republican districts. There were many races where the margin of victory was 1 or 2 percent. Pick the right candidate and hammer the Dem for their vote on the Porkulus and budget votes and watch the Dem majority shrink.

Political tides shift faster than ever before and no one can predict what will happen in 2010.

bagoh20 said...

Dust bunny queen,

I'm not smart about this stuff, but isn't it true that taking on long term debt now at 5% means you will be paying it back at low interest with much lower valued dollars later, thus getting a deal on whatever you buy?

Sloanasaurus said...

The GOP needs only one issue to campaign on, and that is the government debt. Every day the GOP can talk about how much more debt the government is issuing that day and how the middle class will pay for it all either through taxes or inflation.

Blame it on George Bush! His deficits over 8 years were less than Obama's deficit in 2009 alone. And Obama plans to repeat 2009 over and over again. We are going to double or triple the debt, with no return on our investment. Obama is turning America into a banana republic built on mob rule and populism.

The GOP can solve this problem by stopping the insane policy to grow the federal government to insane levels.

Government debt impacts all of us. It can destroy our standard of living. It will either produce crushing inflation that gets reflected in interest rates, or massive tax increases. Either way Obama has assured a reduction in our standard of living through his pet programs to bailout unions and increase the control of government over the people.

Dust Bunny Queen said...

Eventually the government is going to have to balance the budget and massively cut its costs. Once, the government is no longer running a deficit, people will be willing to buy T-Bills again. We are facing an incredible looming fiscal crisis of biblical proportions.

Until then (deficit under control) the coupon on the treasuries will continually have to be priced at a return that makes the risk aceptable to the buyers. That higher return will result in a cascade of much higher rates across the board further depressing the economy.

You would think that the rational business person would realize that the solution to deficits is to cut spending, however....we are dealing with the Government and idiots like Obama who haven't a clue how business or the real world actually works. Their solution will be to raise more revenues (they think) by increasing taxes, instead of cutting costs. Cutting costs would mean that their special interest supporters will have to sacrifice something. Just look at what happened with GM and the UAW fiasco.

So, when the economy is tanking, taxes are rising and inflation is starting to spiral....people are going to look at just who is in charge and how we got here. Blaming Bush can only work for a while and eventually the man behind the curtain is going to be blamed.

If the Republicans run some REAL fiscal conservatives who stand their ground and show some backbone, by 2010 there will be more Rep seats in Congress and by 2012 they will likely take back the Presidency. The likelihood of the economy having a recovery by 2012 is slim.

john said...

As Bart said. To pick up mid-term seat, the GOP doesn't have to do any more than say they are not Dems. I doubt if they will (do any more).

Arturius said...

I'm not smart about this stuff, but isn't it true that taking on long term debt now at 5% means you will be paying it back at low interest with much lower valued dollars later, thus getting a deal on whatever you buy?


That is quite true. However, DBQ I believe was referring to her clients being shortchanged in purchasing that kind of long term debt. Getting paid back with 5% interest is a crappy deal if interest rates double that which is not unreasonanle given the current environment.

The flipside to the government issuing bonds at 5% is that they won't be able to continue doing that. We're periously close to the point of losing our AAA rating. To top it off, we'll be forced to raise interest rates on our treasuries in order to make them more attractive to purchasers and even then, that's no guarantee anyone will buy. Bonds are only as valuable as the trust the buyer has that we'll make good on them. Our money is backed by the 'full faith and credit of the United States' and right now, that faith is being shaken.

Zeb Quinn said...

"Absurd?" Not really. It was a mere four years and 7 months ago that the Repubs were returned the White House and both houses of congress _again_. Before Obama Dems held the presidency for only 12 of the last 40 years, and in even then one of the two Dem presidents in those 40 years was an unmitigated disaster and the other one was impeached. Obama is now in the process of reminding everybody why the last 40 years have been thus and so.

john said...

"Can Mitch McConnell and Co. lead the GOP out of the wilderness?"

Theoretically, once you are in the middle, any one step starts getting you out of the wilderness. Unless you are just walking in circles, as McConnell's GOP has been doing. Given that the Republicans are only a couple years into what needs to be a 40-year banishment, McConnell should be well over 100 years old when he emerges from this wilderness. Seems about right.

Dust Bunny Queen said...

I'm not smart about this stuff, but isn't it true that taking on long term debt now at 5% means you will be paying it back at low interest with much lower valued dollars later, thus getting a deal on whatever you buy?

I was talking about buying debt. Buying bonds or pass through debt instruments. Not taking out loans. That IS a good idea right now to refinance into the lower interest rates now for your own long term debt.

Owning long term debt (anything over 10 years IMO) at these low rates is ensuring that your income stream is not going to be able to rise in the future unless you are willing to sell your debt at steep steep loses. When interest rates go up, the value of existing bonds will go down.....a lot.

@Mike: I can't make recommendations, only discuss general trends. Rule 405

Original Mike said...

OK, DBQ. General question. What are the markers or properties or characteristics of a country that lead it to have a strong currency? Lower debt-to-GDP ratio? Lower taxes?

Jim said...

The ads are already running in Republican primaries: running against Pelosi and Obama.

Pelosi's approval ratings are bottom basement-level, and there are 49 seats held by Democrats that John McCain won last year. That's 49 seats that are vulnerable right there. Even if the Democrat in that seat is voting with his constituency most of the time, all Republicans have to do is remind voters that he/she is another vote to keep Pelosi as Speaker of the House.

As far as Obama goes, according to Pew and Rasmussen (both of whom were far closer to the mark in the last election than Gallup and others) his support right now is hovering right around where his vote totals were in the fall. He has lost the "benefit of the doubt" from voters who didn't already support him. Any further erosion in his support amounts to "I want my vote back." Given that even Obama is saying unemployment is headed higher, this is terrible news for Obama.

Speaking of unemployment, TalkLeft did an analysis of Reagan's approval vs. the unemployment rate and found a striking correlation even for the Gipper. If Obama follows historical patterns, he's going to be a deeply unpopular president by next year and a pariah within his own party by 2012.

Also, keep in mind that much of what the Politico cites as dissatisfaction with Republicans is coming from the right: not the left. Most conservatives are unhappy with the GOP because they feel they've been too complicit in out of control federal spending, so it's laughable to think that the currently low Republican ratings are going to translate into Democratic success in 2010 or 2012.

The TEA parties are gaining momentum no matter how many Leftists deny the grassroots nature of them. They've already been seeing success in getting their candidates elected in local elections, and that's only a precursor to elected offices at higher levels.

This should be the phenomenon that scares Democrats the most. People who aren't beholden to a national party who got elected on fiscal conservative platforms. I continue to warn Democrats that their policies are self-destructive, and they continue to ignore the advice at their own peril.

grackle said...

Polls show that the GOP is wise to focus most of its attacks on spending, government intervention and job losses.

The above covers 2 of the 3 mainstay issues of the GOP of the past – Limited government and a free market economy. The 3rd issue, a strong national defense, could be brought into play before the next election by international developments or a major terrorist incident.

And just as importantly, GOP leaders on Capitol Hill privately recognize the need to distance themselves a bit from George W. Bush, Dick Cheney, Sarah Palin and Newt Gingrich — even though they've done poor job of doing so thus far.

In other words, toss away the “party of moral scolds” mantle that has alienated so many voters. It was good for some limited, temporary gains but in the long run it gets you where the GOP is today.

Yet I think this is somewhat off the mark. It’s not Bush, Cheney, Palin and Gingrich that have done the damage. It’s Limbaugh, Coulter, Ingraham and Malkin that have defined what the GOP stands for in recent years. The mindset they represent is thoroughly embedded and will not be easily purged.

If you live by demagoguery you die by demagoguery.

Original Mike said...

Positive balance of trade?

bagoh20 said...

Thanks guys. I'm now slightly smarter about the issue. Where do I send the check?

Sloanasaurus said...

TalkLeft did an analysis of Reagan's approval vs. the unemployment rate and found a striking correlation even for the Gipper.

There is a huge difference between the 1982 recession and this one. After 1982 the landscape looked great for business and economic growth. Interest rates were coming down. Inflation was defeated. Regulations were being eliminated and taxes were being reduced. All this translated into people wanting to invest and take risks because the future was bright.

Now everything is the opposite. Our future is all darkness. The future is higher interest rates, more inflation, higher taxes, more regulation. Less economic growth and more unemployment. Plus we have weakness in our standing abroad as well from Obama's appeasment campaign. All this translates in Americans not wanting to take risk. That is bad bad bad for all of us.

I predict that we will recover from this recession with a low growth 1-2% high unemployment outlook (7-9%).

Will Obama win reelection with those numbers?????

campy said...

I predict Democrats will hold their majority, and maybe even increase it in 2010. Obama is a lock for a landslide reelection in '12.

ACORN will see to it.

Sloanasaurus said...

The high unemployment, high taxes, more regulation, and inflation environment will result in a new nasty perpetual malaise in America. This malaise will start to take hold in 2010 when these facts become obvious to everyone. The malaise will doom Obama's re-election chances in 2012.

The malaise creates the opportunity for a new Reagan. One who is optimistic to the core.

Aaron said...

obama is an economic incompetant. between that, his socialized medicine plans, his dubious supreme court pick, etc. it is going to be hard to make the case for one party rule. if the republicans blow this opportunity it would be truly pathetic.

Dust Bunny Queen said...

@Mike

Yes. What you said.

Rising GDP

Stable currency

Stable government

Low taxes for both Corporations and populace.

Business friendly, not a lot of onerous regulations and red tape

Rising standard of living: that will attract a technical workforce and credentialed professionals

Good level of education or rising educational level with multi lingual workforce at least at the managerial level.

Willing and non unionized workforce.

Diplomatically neutral or at least not hostile.

Infrastructure and communications in good shape or improving.

Material resources available (energy and raw materials) at reasonable costs.

Now then. How many of those positives are going to be applying to the United States in the future. How many apply now?

Is it any wonder that businesses that CAN are rotating out of the US? And all of the Obama solutions are to raise taxes, increase business costs, limit resources, raise the cost of energy with cap and trade and create even more layers of regulations, rules and government bureaucracy.

Big Mike said...

Shocking as it may seem to the less historically-literate over at Politico (not to mention those commenting on this thread), the Republican Party has been much worse off than it is today, and for that matter so have the Democrats, and fairly recently.

Prediction: Harry Reid to lose in 2010.

Jim said...

Big Mike -

Politico is doing what they usually do: trying to calm the spooked horses in the Democratic stable. Reality is rearing its ugly head, and we all know the "reality-based community" is ill-equipped to handle it.

Original Mike said...

DBQ - I wouldn't think anybody meets those criteria.

LarsPorsena said...

John:

"...I thought the Democrats at least had some grasp of reality. No sane person could try to increase taxes, spending and regulation at the start of what could be another Great Depression. I guess I gave the Dems' sanity a bit too much credit."

I was operating under the same delusion and my 401k paid for it.

Great post.

Eli Blake said...

No sane person could try to increase taxes, spending and regulation at the start of what could be another Great Depression.

Actually, that's exactly what FDR did in 1933, and it worked-- that was the year things turned around and we began to come out of the first Great Depression.

Only a blind ideologue would assume that what worked in the past can't possibly work again.

Dust Bunny Queen said...

DBQ - I wouldn't think anybody meets those criteria.

True. Not all of them, but they are criteria that are worthy of attention.

Also it depends on the business that we are discussing as a possible refugee as to what parts are significantly important.

Original Mike said...

Eli - I thought he raised taxes later and stalled a nascent recovery. Is that incorrect?

Fred4Pres said...

Seems less likely with Sanford blowing up.

Sanford Fans Today

Original Mike said...

Thanks, DBQ. I need to figure out my investment strategy for the next 5-10 yrs. The one thing I know it won't include is long-term U.S. debt.

LarsPorsena said...

"Thanks, DBQ. I need to figure out my investment strategy for the next 5-10 yrs. The one thing I know it won't include is long-term U.S. debt."

You and the rest of the world except for maybe Eli.

Steven said...

Actually, that's exactly what FDR did in 1933, and it worked-- that was the year things turned around and we began to come out of the first Great Depression.

A dead cat bounce is not a recovery. Only a "blind ideologue" could look at FDR's handling of the Depression and pretend it worked.

traditionalguy said...

Governor Sanford has comeback after his coming on his trip to Brazil. Is that the topic?

Arturius said...

Only a "blind ideologue" could look at FDR's handling of the Depression and pretend it worked.



A political science professor I had in college remarked that the Japanese Imperial Navy did more in 2 hours to end the Depression in than FDR did in 8 years.

knox said...

I think the only way this will happen is if Obama's policies implode by 2010. Otherwise, no chance unless they start communicating really differently. read: halfway competently. And then they need to start behaving differently or they're really, really screwed.

Pogo said...

"A Republican comeback?"

I hope not the current GOP crop.
Ain't much difference between them and the Dems.

Same old corrupt corporate socialists.

bearbee said...

To varying degrees, everything moves in cycles including destruction and formation.

But one party rule is a terrifying thing.

Jeremy said...

Maybe in Argentina, but not here.

The Republicans will lose more seats in 2010 and Obama will wipe them out in 2012.

Delusion.

Methadras said...

Cap and Trade coupled with a national healthcare system will be the death-knell for this country and there isn't a damn thing republicans much less conservatives can do about it. Even if they win back the house, the senate, and the white house, it's over. This country will be no different than Sweden or any other socialist state. Enjoy it while you because the fat lady is getting ready to sing and turn off the lights when the party is over. Congratulations President Marxist, you finally got your wish for a revamped America while your cadre of other marxists ride your coattails. Fuck you and fuck them. I hope you rot in hell for what you are about to commit my country too. You know what, fuck ever Obama voter out there. God damn you for what you have voted into office.

Bruce Hayden said...

I agree with those who suggest that it is highly likely that Republicans pick up seats in 2010. As Jim (I think) pointed out, there are a lot of seats where McCain won the district and the Republican Congressional candidate lost. But there are even more, where GWB won in 2004 by a decent margin.

What the Democrats had in 2008 and the Republicans did not was excitement, turned into turnout. But the excitement was almost entirely with Obama, and he won't be running in 2010.

So, the Democrats picked up a lot of swing, and even Republican, districts in 2008, which is why, everything being equal, would be likely to lose a lot of those in 2010.

But that doesn't take into account how the Democrats are running the country right now - from flushing trillions of dollars down the drain and spreading it out to their constituents, to piling on the debt like there is no tomorrow, to being weak on defense, there is, and will continue to be, a lot to dislike.

Also, keep in mind that with Obama not running in 2010, not only is there no "historic" reason to go to the polls for a lot of his voters, they also won't be voting against him when they vote Republican for Congress (or, as likely, just don't vote).

The polls I have seen have shown that while the Republicans are not gaining adherents, the Democrats are losing them in droves. Of course, polls are like tea leaves, and if you look at enough of them, you can often find whatever you are looking for in them.

Eric said...

The GOP can solve this problem by stopping the insane policy to grow the federal government to insane levels.

The GOP ran as a fiscally conservative party for more than 20 years, and then when they actually got into power they spent like Democrats. Somehow they're going to have to convince voters they really mean it this time.

Now the Democrats are drunk on tax dollars. They've handed the Republicans the keys to the House, but there's still that credibility gap to overcome.

If the Republicans can convince voters they'll return to fiscal sanity they can recapture the House next year. Personally I think it's unlikely, since the guys in safe seats won't do anything to upset the status quo.

Bruce Hayden said...

Well, my expectations of a Republican comeback just took another jump up, after seeing the Drudge headlines about the Democrats getting worried about passing the tax and bribe (aka cap and trade) bill, and asking the question whether Congress will get to review the final bill before being asked to vote on it.

Both "tax and bribe" and health care reform are unpopular with the voters, and not considered all that important by the voters. And that is before the voters really understand what is being foisted upon them, and what they are getting.

My guess is that any first or second term Democrat from a swing district in the midwest, west, or south who votes for cap and trade, and it becomes law, is toast in the next election. What are they going to say to their constituents who are going out of business because of it? "I didn't get to read the bill because Nancy was in such a hurry to pass it, so I voted for it because she told me to"?

What must be remembered is that the bill would be bad for farmers, and bad for any small business that uses a lot of transportation or energy. They aren't going to get the free carbon indulgences that the big companies will who have lobbyists to make sure that they don't get screwed. While most of the "taxes" being raised by the bill have disappeared, not all have, and those will fall almost exclusively on small businesses and farms.

That is before we get to the socialization of our health care system. Again, it looks like the Democrats are going to ram something through, because they won and because they can - despite the fact that it is becoming ever more obvious that most Americans don't want what they are about to get.

So, there is a good chance that the Democrats with go into the 2010 election having: borrowed more money in one year than Bush did in 8; flushed trillions of dollars down the toilet and to their constituents; created significant inflation for the first time in almost 30 years; destroyed the dollar as the world reserve currency; destroyed significant national wealth and numerous businesses in a misguided attempt to salve Al Gore's guilt; destroyed possibly the best health care system in the world, and definitely the most innovative; all while encouraging the type of corruption that they ran against in 2006 and 2008, but on a much more massive scale.

And some of the posters above think that the Democrats may pick up seats in Congress.

brett said...

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