Will 2011 be the Year of Compromise or the Year of Paralysis?

The year 2010 was like a film that flickered before us with the usual events playing out on the screen – politician’s posturing for ultimate domination. Then in November, someone spliced in a surprise ending. We knew that the GOP would take back the House, but then suddenly President Obama began supporting the Bush tax cuts, the same tax cuts he campaigned so vigorously against. We didn’t see that coming. But here are five predictions that will be coming.

1) The Obama Compromise is a Ruse.
President Obama will use the Bush tax cut passage during the lame duck session of Congress to position himself as a man of compromise. However he will only pretend to compromise. He is fully committed to the progressive agenda. He will take one step forward then two steps backwards toward a bloated and intrusive government. Upon the swearing in of the 112th Congress major components of the Obama agenda will begin to unravel. Obama will launch a barrage of new regulations through the federal agencies such as the EPA on emissions.

2) Obamacare is doomed.
While predictions abound that the 84 – strong freshman House Republicans are fractured in their approach to the GOP agenda, there is one thing that unites them: repealing Obamacare. Regardless if they were elected with a push from The Tea Party, they understand they have been sent to Washington to ultimately stop and repeal the Obama agenda. They will take this mission very seriously and immediately schedule high profile, largely symbolic but still very important votes on the repeal of Obamacare and other progressive favorites such as Cap & Trade and Card Check.

The Supreme Court will take up Obamacare on an accelerated basis as lower courts rule the personal purchase mandate is an overreach of the Commerce Clause and violates the Constitution. The Supreme Court will quickly reach its 5-4 decision that major components of Obamacare are unconstitutional.

3) We are headed for political paralysis.
The Republicans will repeatedly state they cannot compromise with socialism. The Democrats will pretend to move to the center. Caught in the crossfire will be economic growth and the prevailing sense of uncertainty that will continue to negatively impact unemployment. Unemployment will not only not subside, it will hover around ten percent going into the 2012 elections. Our shadow unemployment will continue to exceed an unprecedented twenty-four percent. The jobless numbers will get worse before getting better.

The culprit will be the fear of higher taxes, higher healthcare costs, higher energy costs and an absence of working capital. Our small businesses (who are responsible for over seventy percent of new job creation) will continue to sit on the side lines.

4) The four years between 2008-2012 will be known as America’s “Lost Years.”
We will soon be referring to the four years between 2008 and 2012 as the Lost Years – the time when America lost its way; when the government turned to socialism, crippling the economy while turning its back on the American people.

5) Ultimately entrepreneurs will drive America’s economic rebirth.
The drumbeat has begun. Starting with the long delayed ratification of the U.S. – South Korea Free Trade Agreement, a rise in U.S. exports and a slight shrinking of the U.S. trade imbalance, American small businesses will eventually find their footing. However their ultimate engagement will not be possible until a government that understands their needs is elected.

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