How close were the predictions of 2008?
Written by Michael Vass
Recently the past came up in a conversation. Specifically the predictions made on November 11, 2008 about the Obama Presidency. That prediction was focused on the fiorst 100 days. But in fairness (and in no small part the fact we have been busy) let’s look at the array of things that we predicted 2 years ago.
To start it off, the predictions made were:
So how good are we at M V Consulting, Inc.?
Well, good but not fantastic. Almost none of the events we predicted happened in the first 100 days. But to expect such a whirlwind of action from the Government was beyond real expectations anyway.
Forgetting the timeframe failure, we were about as spot on - in fact better - than almost every pundit in America. Certainly more accurate than the Democrat Party and the Obama Administration. And we are sorry that we were on the mark.
In the past 2 years the national debt has rocketed forward, along with the unemployment rate. More money is spent in a year now than ever in the history of the Government. But there is less to show for all the spending.
Unemployment has remained at an average of 9.4% or higher since the Obama Administration took office. That number is significantly higher if we factor in all the people that are on ever extended unemployment check roles (now at a remarkable 99 weeks), and the number of people that have used up the Government payments and therfore are no longer counted. In Government math, those people just evaporated. Therefore we accept that underemployment rate of 16.4% as being deadon, if not an underestimate of reality.
Partisanship is at a level of divisiveness almost unseen before. The unending mantra of blaming everything on President Bush and Republicans continues without stop. It has also lead to several Bills from Congress that can claim 2 Republicans (and several if not dozen Democrat defectors) at best for bi-partisanship. This from a President that nearly guaranteed co-operation with the other side of the political line.
That partisanship also extened to the public. Initially in the manner in which the Stimulus was passed, without reading, without knowledge of effect, for $787 billion (it’s cost has since gone higher). It then was consumated in the Health Care Reform. A law that was almost universally opposed outside of Washington D.C., and still the majority of Americans want it repealed.
That partisanship has also lead to the attempts to sneakily pass a repeal of Don’t Ask Don’t Tell, and a backdoor deal for amnesty and illegal immigration reform in the guise of the DREAM Act.
So we got partisanship, a myopic Congress, Stimulus, increased debt and unemployment correct. What else?
Well there is the effect of the Stimulus. We said it would fail. President Obama, VP Biden, and Speaker nancy Pelosi all say it is a success. Democrats up for re-election won’t even talk about it. But with unemployment far exceeding promised levels, and with multiple smaller stimulus clones being proposed, we stick with the opinion that we were right.
Of course we were completely wrong about the Health Care Reform. Our fault for thinking that Democrats would not stoop to pulling every legal trick and form of bribery to get it passed. Our fault for assuming that when 60%+ of the nation says don’t do something, politicians would listen to voters over their political Party. By the way, how many Democrats are running on that decision? Might be a clue to how good it is. Again we are sorry were were wrong about that, would have been better if we were right.
Another sad thing that was right was the result for homeowners across the nation. We knew mortgages would fail even more, and that the number of people in foreclosure would grow to include non-sub prime homes. The rate today, and for the past 2 years has only increased from the rate 2 years ago. Not surprising that has also lead to dozens of smaller banks failing - though it is less publicized these days.
One surprise we hit spot on was the Dow Jones Index. By Feb 17, 2009 the Dow was under 7600. It would ultimately bottom at 6626 in March 2009. Well within our 100 day target. We really hoped that would not happen. But since that time the Dow has corrected - without any real good reason - and is currently rising on a tide that indicates a massive victory of Republicans in the mid-term elections.
We missed on the inflation estimate, though the cost of real goods (or the fact that may goods are being sold at the same price for less quantity) has been flattish. We could argue the issue, but instead we’ll accept that we are wrong. The same can be said for the auto bailouts. Time magazine stated the cost was $80 billion and growing in March 2009, today it is generally accepted that it cost about $90 billion. We missed, but boy were we close. Which is a shame considering the contract law that was violated and the pitiful return we got for the bailout.
Speaking of pitiful returns, Fannie Mae and Freddie Mac. No more need be said.
Lastly, we were wrong about the Fairness Act. Congress just hasn’t had time to get to it. Considering that they have had to wrestle with finding a way to pass the unwanted Health Care Reform, try to slip past an Immigration Reform, rebuked Arizona as the majority of the nation praises it, and generally ignore job creation while touting it, you can’t hold it against them for not following through with that.
There is just one more thing. We predicted that president Obama would lose in 2012. We didn’t factor the massive backlash that is the 2010 mid-term elections. So while we still think President Obama should and will lose, it will be a far more difficult proposal. But we will stand by the accuracy we proved above.
Hopefully, in all earnst honest, we want to be wrong going forward. We really do still want to be wrong, because if we are life for the nation will vastly improve. But we aren’t counting on it any more than back on November 11, 2008.
