E Pluribus Unum ... Three Things President Obama Can't Change ... It's Going to Take Time So We the People Need to Get Started

Cheer up, Romney supporters. At least he won't have to clean up a mess he didn't start. And besides, he needs a well deserved rest after all that long and hard campaigning.

And don't get too cocky, Obama backers. You wished for his reelection, and now you've got it. And all the problems that existed yesterday are still there today. More of the same policies won't do much to get millions of Americans back to work, and on top of that, you'll probably have to stop blaming Bush now for the lousy employment situation, high debt and deficits our nation faces and will continue to face for years to come.

And then there's the fiscal cliff, energy policy, foreign relations and lots of other issues awaiting resolution.

And We the People should consider this just another day on the way to a better future as we pursue our happiness, however each of us may define happiness. We should internalize fully that that our future happiness and well being will be largely what each of us makes it, and it won't make much difference who we elect from time to time to be our public servants.

So my advice this post-election morning to one and all is simple --- Don't worry. Be happy.

The "silliness" of the presidential campaign is behind us, and that's a great way to start the day. President Obama has time now to help focus the nation's attention on helping the economy recover and getting our debts and deficits under control. He'll also have to deal with the unaffordable entitlements, high unemployment and the need for a complete overhaul of our public education, health care system and make sure our national defense remains unimpeded as well. Lots of things to do in his second term. That's for sure.

Of course, the little matter of the year end fiscal cliff, tax policy and other topics can't wait for another four years either, so Mr. Obama is going to be a very busy man indeed. Maybe Mitt Romney was last night's lucky one.

But there are some things the President simply won't be able to do anything about, and 3 things a president can't change has the story:

"Here are three things the President cannot change that citizens and investors alike need to be fully aware and accepting of.

 

1. Demographics

The leading component of the American economy is the vast change in demographics that is taking place. Today, the largest generation, the baby boomers, is age 50 to 65, and just beginning to retire - placing enormous stress on national entitlement spending. For decades the boomers have pushed the economy with their consumptive demand. Today, most are short on retirement savings. As a result, the demand they provided for goods and services has waned. This circumstance will not change. The baby-boom-demand-driven economy is done. It is not coming back.

"Being president is like being a jackass in a hailstorm. There's nothing to do but to stand there and take it."

—Lyndon Johnson

Further complicating matters is that the generations behind the boomers do not have the demand juice to drive the economy. The "X" generation while doing fairly well, is small, however, and thus cannot fill the demand hole of aging boomers.

The "Y" generation, or echo boom, or millenials, or "generation next" or whatever you know those from college age to early thirties as, has little money. With baby boomers holding onto their jobs longer out of necessity, the echo boom is running into persistently high unemployment. So, although the echo boom is sufficiently large enough to provide a demand boost to the economy at some point, they are simply too young and low-earning to do so now.

 

2. The financial collapse happened

There is no going back on the fact that the financial collapse happened and that it was massive. From what I can tell, America has not gone into a deeper depression due to some combination of corporate strength, government policy, personal resiliency, accumulated wealth and plain old luck.

While avoiding a repeat of the financial collapse is a matter that the President will influence, undoing what happened is not possible. We need to stop acting as if it could be undone . . . .

3. Accumulated debt is huge and growing

The U.S. debt right now is about $16 trillion dollars, or roughly the size of the nation's annual GDP . Future unfunded expenditures dwarf the debt by about quadruple. Those obligations will need to be paid over about the next 40 years and frankly are not able to be easily reduced regardless of who is president. 

Here too many people suffer from a condition which is one part lack of math skills, one part ideology and one part refusal to live in reality. The president has no chance to influence the quick (emphasis on quick) balancing of the federal budget and pay down national debts. None. Believing that he can or that it is even his primary job is frankly ignorance and/or insanity. That is Congress' job.

As such, we need to be fully aware that scarcity of the nation's resources will drive politics and economics for at least a decade and probably longer. We have hard choices to make and those choices are well beyond the president. We will have to find ways to allocate medical care, police and fire protection, education, defense and other necessities of life without bankrupting more of our cities and states, or the nation as a whole, and do so without causing social upheaval. For more on that, read " The Age of Austerity " by Thomas Byrne Edsall, it's a great book that discusses where we are today.

 

A Few Thoughts for Investors

 . . . America's key tools in keeping inflation at home from becoming overbearing is that we have vast newly discovered oil and natural gas resources and tremendous agricultural capacity. . . . Most likely, we will use our energy and agriculture resources to improve our balance of trade dramatically and sustainably over the next two or three decades . . . preserve a reasonable level of dollar strength despite our massive debts."

SUMMING UP

To recap, we're getting older, have experienced a once in a lifetime (and for the sake of future generations, hopefully not even that often) worldwide financial collapse and are deeply in debt.

None of these is an easy or quick fix, and none of these is within the control of the President.

That said, America's energy resources are abundant and our agricultural sector's output is unequaled. Most important, our unique brand of private sector led free market based American exceptionalism has provided us with the highest standard of living in the world.

We're indeed a prosperous and blessed nation of hard working, free and self governing people. And lest we forget, we're the greatest military power the world has ever known as well.

So Mr. President and members of Congress, as well as my fellow citizens who make up We the People, our assets greatly outnumber our problems. And our similarities vastly outweigh our differences. The idea of America binds us together.

So let's fix those problems we have and enable future generations of Americans to experience what it's like to live in the greatest nation in the history of the world.

The people have spoken. The election is over. We have elected a President and a Congress.

Let's encourage them to get to work. There's lots to do.

E pluribus unum. Out of many, one. What a great country!

Thanks. Bob.