A financial crisis is generally worse (politically) for a right-wing government than for a left wing one, for the same reason that strikes are worse for a left-wing government than a right wing one. Such a government finds itself closely associated with the people generally regarded as being to blame for the mess.

To add to this, McCain did not have much of a chance anyway.

But by the time our election comes around, the crisis will be over, and we will be living through the aftermath. It will be a time of tax squeezes, skyrocketing government debt and shouts of rage – if not outright rebellion – from public services facing spending limits.

And that sort of crisis is good for the right.

I think that Obama and Cameron will both have good elections.

I think we have a bit to go in the in this financial crisis. In either case, in about 4 years, it should be looking better and Obama, will receive praises for this regardless of him not having to do anything to solve the crisis. Just like Bush receives the blame for this crisis when it was actually Clinton’s policies that created the huge housing bubble and allowed banks to make so many subprime loans.

Its unfortunate that you think that the upside to the financial crisis is that Obama has more chance now, because his tax policies, if he were to have his way, would create even more problems. His intentions of raising corporate, capital gains, and dividend taxes are huge problems; let me explain:
Obama wants to raise corporate taxes, despite the US having the second highest corporate taxes in the entire world. People just equate corporations with huge sums of wealth, and therefore its all about greed and not being taxed enough. What they fail to consider is that these huge revenues come about from being the best at what the do, and from shear volume (being the US corporations have large international exposure). This is an issue being that with the economy look as bad as it does, taxing corporations are going to make it that much harder to make incomes to fund their huge operations. Also, liberals crying about corporations getting tax breaks apparently dont consider that its much more beneficial than to take the taxes. Example: Obama thinks we should be taxing energy companies alot more, so that we can use that money to research alternate fuels. What he doesnt consider is that in a free-market, corporations are much better at adapting to situations than big government. Is he aware that the oil/energy companies invest billions upon billions (close to 25 billion a year for the top 3 alone) in R&D for alt. fuels and energy? Everytime you fill up, your investing in alt. fuels, because these companies recognize they will need a different fuel soon enough. And chances are, these companies are the ones who will come up with the next fuel/energy supply; not the government. Americans are hurting enough already with the economy and fuel prices. So now Obama wants to increase taxes on fuel even more to further splinter the research into alt. fuels? Yeah, that really makes sense…..but anyhow, I digress….

He also wants to raise capital gains tax, despite the fact that after both Clinton and Bush cut the capital gains tax rate, there was a huge surge in tax revenue for the US from capital gains tax. How did a lower tax bring in more money? Because it promotes more people to invest and sell off stock, and so more activity, more tax.

And finally, he wants to raise dividend taxes, despite the fact that they should be repealed if anything. People who receive dividends are double-taxed (corp. taxes, and then div. taxes). If a person owns a store and earns a profit, that profit is taxed. Then from there, the owner can do what they wish; reinvest it or pay it out to himself. However, if that store is incorporated, the profits are taxed, and then if the owner wants to take some money, thats taxed too. If you try to argue that only the rich own stock and get dividends, your wrong. Over half the US population own stock, and the rich arent the ones who will be hurt. The middle class that own stock for retirement (in IRAs and other plans), hold stock for that little extra income, or are holding it there for college funds; these are the people who will get hurt.

So now the even bigger picture: how this will make the crisis even worse. America double taxes its payouts to share holders, its corp. taxes are second highest in the world, and Obama wants to raise these two taxes AND capital gains tax despite his democratic predecessor lowered them (from 28% to 20%. A 30% reduction). ? Anyone who owns US shares will be receiving much lower returns on their investment because of these taxes. Is anyone aware that there already is a flow of investment money out of the US because the returns arent as competitive with foreign investments? If holding a US stock doesnt give competitive returns to a foreign stock, why buy US stock when you can buy a UK or German company stock. If these three taxes are raised, so much money will flow out of this country; from US and foreign investors, to foreign companies. US companies will be facing alot less financing for growth and expansion to stay competitive with foreign companies. And then, at that point, youll really see some economic problems and crises here.

Sure, McCain admitted he doesnt know as much about economics as he would like, but at least he doesnt open his mouth about policies that demonstate a serious lack of economics. I guess Obama can get away with it since so many people are clueless on the big picture.

Dont sleep, bond markets were closed. deposits and despots. I gues Mayer Amschel Rothschild was right “Give me control over a nation’s currency, and I care not who makes its laws.”

“left-wing takeover of the state”

It is hardly a shock that government employees will favour big government, not so much a take over as a thoroughly understandable, if regrettable for non state employees, tendency.

Quite why so many people outside the US are keen on Obama I have yet to understand. The most significant impact the US election will have on those outside the States will be from trade. The last person we want in the White House is a protectionist keen to raise taxes.

As for our Dear Leader, if you have little control over a situation and you claim credit when things go right, you can hardly expect to avoid blame when they go wrong. Hubris is the appropriate term.

It is true the Tories have nothing substantial to say.

On the other hand it is Brown’s fault that UK regulation has been weaker than in many other (not all) countries and that we were heading into the downturn with such a large budget deficit.

This is quite amusing/pathetic, Brown clearly not taking any chances.

http://www.order-order.com/2008/10/no-more-boom-and-bust-double-plus.html

“The most significant impact the US election will have on those outside the States will be from trade”

No, WW3 is still slightly more important, and Palin appears easily mental enough to start it once McCain’s heart gives out. At that point, Obama’s slightly-less-trade-friendly rhetoric is pretty irrelevant.

“it is Brown’s fault that UK regulation has been weaker than in many other (not all) countries”

Like where, and evidenced how? (the fact that banks in a particular country haven’t yet failed, in case you were wondering, is not evidence that this is the case. Oz banks haven’t failed because Oz is in the middle of a commodity export boom, for example). Also, your Guido link doesn’t work.

The most significant impact the US election will have on those outside the States will be from trade.

Er, hello foreign policy?

Expect a very good Economy in 7 months!
Falling home values, rising unemployment, declining confidence among consumers and businesses and, lately, a swooning stock market…all these will change in another 7 months.
This is the prediction by a team of Scholars in Astrology. According to them, the world, especially the USA will have a better economy within 7 months. Signals of better changes will be visible by December 21 2008, and good results will be seen from that date. However, individuals should have a systematic planning to overcome this crisis period.
I addition to other advices already given I strongly recommend to plan your finances professionally. Books like, Act Now…Tomorrow may be too late by James Walker, Published by http://www.JTSbooks.com, Financial Shock: A 360º Look at the Subprime Mortgage Implosion, and How to Avoid the Next Financial Crisis by Mark Zandi, published by http://www.Amazon.com, The Dollar Crisis : Causes, Consquences, Curesby Richard Duncan published by Barnes&Noble are MUST READS.

Oooh a new Aaron.

*waves*

“No, WW3 is still slightly more important, and Palin appears easily mental enough to start it once McCain’s heart gives out.”

Even if McCain does give up the ghost the only way that Palin would be able to do something insane is if the US had such provocation that Obama would have to commit political suicide, (regardless of whether you agree with him or not, the man is a career politician and the chances of him developing a conscience are vanishingly slim), to avoid.

Meanwhile, an expansion of free trade would lift yet more people above the, (somewhat arbitrary I know), Dollar a day mark. Protectionism is likely to cause far more deaths than the US’s foreign policy.

Erm, yeah… Tony Blair and Bush developed a conscience and we know how that turned out…

The biggest downside to this financial crisis is behind the rise in Obama’s poll ratings. This downside is the growth in expectations that something will be done about changing the underlying realities which govern behaviour.

But expectation does not create political will if it confused about the practicalities.

While some Obama supporters want change, many want a specific type of change whether or not this is attainable or desirable. So when Obama gets into the White House he will immediately have to get on with the difficult job of balancing the expectations he has built up with his capacity for creating constructive changes he can achieve with the house and congress both behind him. If he can balance these needs it will prevent a spectacular downfall into a pit who knows where? A single-term ‘failed’ presidency, or a major war?

So while this election is looking more and more like it is headed towards a resounding victory, the chances that the next crisis will be prevented or exacerbated have both increased too.

Sunny, so kind of you to agree.

thomas, it is no great shock that Obama is going to run into trouble on the change front. That tends to happen if you chant non-specific change slogans at all and sundry.

“Obama wants to raise corporate taxes, despite the US having the second highest corporate taxes in the entire world. People just equate corporations with huge sums of wealth, and therefore its all about greed and not being taxed enough. What they fail to consider is that these huge revenues come about from being the best at what the do, and from shear volume (being the US corporations have large international exposure).”

Er Lehman Brothers, Bear Stern et al were “the best at what they do” ? There are arguments for unregulated, untaxed capitalism, but that is not one of them.

Nice article!
Good comment Matt.