My 2011 Predictions

2010 Predictions

1) A year of bruising battles. There is some hope the New Year will build on the cooperation shown in cutting the recent deal on taxes and lead to more progress on deficit reduction. Don't count on it Both sides are gearing up for a nasty series of battles over spending. While this will lead to reductions in non-defense discretionary spending, the cuts are unlikely to be very deep. The good news: Once Republicans and the White House have scored points and fought each other to a draw, the possibility of a bigger deal that involves give on both sides - Republicans on taxes, Democrats on spending - goes up.
2) Federal Reserve on QE2. The Fed will finish its announced plans to buy $600 billion in bonds. But it is unlikely to go further. Given the tough political resistance on Capitol Hill and divisions in the Fed itself, the bar to further action by the Central Bank has been raised. The only way the Fed can expand QE2 will be if the economy is clearly weakening significantly. And who hopes for that next year?
3) Republican in-fighting will grab headlines. Yes, fights with Democrats are tough, but the battle within the GOP to control the Republican agenda - that's a death match. Senate Tea Partiers rallied under the banner of Sen. Jim DeMint who successfully battled back a bill containing numerous earmarks. This could be read as an implicit challenge to Senate Minority Leader Mitch McConnell. In the House, soon-to-be Majority Leader Eric Cantor and Speaker-to-be Boehner are already denying press reports they don't get along. Not a good sign. Reporters love in-fighting stories and will be looking for any excuse to run one.
4) Read up on your Constitutional trivia. Tea Party activists are already talking about moving forward on a "nullification amendment" to the Constitution. Under the amendment, if 2/3rds of the states voted to nullify a federal law, it would be repealed. If you're not familiar with nullification, read up on your Civil War history or the recent court case in Virginia overturning the Obama health care individual mandate.
5) The payroll tax cut will not be extended. Republicans didn't want to do it this year, and they will have the power to stop renewal next year. At best, the President gets a different tax cut or stimulus, but only if the economy is really hurting.
6) From Lawmaker to Rulemaker. Obama has already passed more legislation than most Presidents dream about. Now he can turn to writing rules and executives orders to get things done - without going through Congress. Regulation is a powerful tool and the President is already using his enforcement powers. Look for more action in 2011.
7) Feel like Presidential campaigns are never-ending? Well, the 2012 campaign shifts up a gear in 2011. Gov. Tim Pawlenty has a book tour scheduled for Iowa and New Hampshire in January. Newt Gingrich has practically moved to Iowa, he's been there so often. It you love politics, you'll love 2011. If you don't . . . sorry, that's just the way it is.

Source: http://www.pbs.org/nbr/blog/2010/12/my_2011_predictions.html

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