by J. Christoph Amberger
“Another one who keeps his wallet in his front pocket.”
As I laboriously fished my business card from the overly crammed crevices of my wallet, the business journalist I had been chatting with about joining our TaipanFinancialNews.com editorial team smiled, leaned back while stretching out his leg, and dragged his own pocketbook from a front pocket of his pants.
“I’m from New York City,” he explained. “Nobody there can afford to keep his money in a back pocket.”
“Same with Berlin,” I concurred. “Big city subways have a way of teaching you a lesson or two.”
On the morning after the midterm elections, it looks like putting your wallet out of reach will be good advice for many people. Democrats took control of the House of Representatives and the outcome of the Senate races will depend on a few hundred votes here or there -- with the possibility of another Democratic victory being quite distinct.
And if you listened to the various acceptance speeches, there’ll be plenty of hand reaching for those wallets. “Windfall profit” taxes (another word for nationalizing parts of private industry), additional taxes on gasoline, government subsidies for college tuition (through tax credits), and a reversal of the Bush administration’s tax cuts are being bantered about already.
All of which will redistribute wealth from private hands into government spending.
Wall Street is giving us an idea of what we can expect. Stocks opened sharply lower as the news percolated through the system. This may just be a temporary setback -- it may take months if not years to sap the American economy of its power. But for those who did not buy into the campaign mantra of “change,” the economic consequences of our political prospects are taking on shape.
“The liberal vision is a more attractive vision because it assumes away many of the painful and even brutal aspects of human life, especially the fatal dangers of relying on words when dealing with people who only respect force that is backed up by a willingness to use it,” wrote columnist Thomas Powell yesterday.
“Democrats have learned to avoid admitting to being liberals and this year are running a number of moderate candidates,” he continues. “If these new moderate candidates are elected and give the Democrats control of Congress, that control will be exercised by senior Democrats who will hold leadership positions -- and all of them are liberal extremists, whether people like Nancy Pelosi in the House or Ted Kennedy and John Kerry in the Senate. Getting people to vote for moderates, in order to put extremists in power, may be the newest and biggest voter fraud.”
This scenario has now become reality. It’s especially bad news at a time that requires an unprecedentedly large segment of the American population to step up to the plate and take charge of their own financial well-being and wealth-building... for their own retirement and long-term insurance needs.
The coming months and years will place a premium on initiative and responsibility for those of us who can see farther ahead in what our economic future will look like. It will require that you maintain self-discipline and determination to succeed against increasing odds.