Obama Magic Words

In August 2008, the US Congress approved without any major discussion the Pentagon budget for the following 12 months a budget totaling $700 billion. US joint expenditure for Iraq and Afghanistan amount to about $12 billion per month. A month later, in September, the Federal Reserve and the US Treasury succeeded in committing another $700 billion of taxpayers' money to save Wall Street from a financial meltdown. The new president will take office with $1.5 trillion already committed by his predecessor. This is money he does not control, money that will be insufficient to win a war in Iraq and Afghanistan and save the world economy. These budgets will have to be increased.

The war will take priority over social reforms, because money is scarce and the US is running a $10 trillion deficit, which means that 70% of what will be produced in 2009 has already been spent. Obama has a few choices; 

1. Increase the debt hoping that the world in recession will continue to subscribe to US treasury bonds that have virtually no yield and 
   
2. Print money, worrying about inflation later; 
   
3. Drastically reduce social programs and 
   
4. Fail to meet expectations a la Clinton "sorry providing health care to everybody is a dream, so we carry on as usual," a move which will make him very unpopular. At the time of Clinton the economy was expanding and his excuse was expected, now it is contracting. 
5. Or President Obama could drastically cut military expenditure, bring the troops back home and focus on healing the country from the social holocaust of the Bush years.

Change will come only if this last option is be embraced. Change for a politician can mean many things, big changes, small changes, cosmetic changes. The change Obama promised is the real thing, a great transformation. Let's hope he has the courage to transform his magic words into facts.

Text taken from Bush Legacy.