The Democratic Electoral Trap

 

Sometime next year — mid-2013 or so — the U.S. economy will crater.  The Weimar-Republic-like inflation we've been worrying about will finally become a reality.  The dollar will crumble.  The "world's reserve currency" will have gone the way of the Euro which will likely crumble this year.  The new "world's reserve currency" will be the Yuan and China will call the tune.

The Democrats are hoping they will be able to play the game for another inning or two, but they are probably wrong.  Whoever wins the White House in 2012 will preside over the disolution of the American economy.  Both the Republicans and the Democrats are hoping to be that someone.  It is clear they have a death wish, because the party left standing when the music stops will never thereafter win another national election.

I'm assuming here that Barack Obama will be the Democratic candidate and that Ron Paul will not be the Republican candidate.

There is a small non-zero probability that Ron Paul will secure the GOP nomination and go on to defeat Obama in November, but I'm not betting any actual money on it.  If such a miraculous thing happens and if President Paul really does yank all our troops out of foreign countries and if he manages to cut a serious chunk out of the bloated federal budget...  IF...  the economy might be saved at least temporarily.

The short odds are on Romney or Gingrich going up against Obama...  and losing.  The winner loses and the loser wins.  Could it be possible that the GOP is really smarter than we ever gave them credit for?  That they will back a known-loser so that Obama gets re-elected and is thus in a target position when it all comes tumbling down?

I don't believe that.  I believe the GOP is in denial:  they don't believe a meltdown is imminent and they believe they can beat Obama with the likes of Gingrich.  They will lose in November and thus save their party (accidentally) while condemning all the rest of us to Hell.

It will be a good time to be in debt.  The resulting inflation will wipe most of that debt out by allowing the debtors to pay it off with cheap dollars.  I may just refinance my house.