I sent my absentee ballot in this morning, and it made me think about what will face the candidate who wins next fall. Certainly, the economy will not magically turn around by January of 2009. Even though the last two recessions were short-lived, it will take a while for any turnaround to take place. The budget deficit will see to that.
Daniel Gross, in a recent article in Newsweek Magazine, reminds us that the slowing economy brings its own set of problems...higher spending on unemployment benefits, and greater demand for social services, coupled with lower tax revenue. A worse fiscal picture will make it hard for the new president to keep his or her campaign promises, whatever they are.
Gross goes on to say that "the current crises in housing and credit aren't nearly as bad as the situation that Ronald Reagan inherited in 1981, when mortgage rates were nearly 15 percent."
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