February 2012 Investment Commentary by Richard W. Boyer, CFP®, CFA
When President Obama was running for election four years ago, part of his campaign theme had to do with the unification of America. You know, bring everyone together as patriotic Americans against common enemies and for common causes. Ironically, his attempts to increase taxes on “the wealthy” have not resembled anything remotely similar to unification and have basically amounted to class warfare. I don’t recall any president being as critical about the financially successful as Obama has.
As we head into 2012, it is time to start handicapping the election. Three years ago, when Barack and Michelle hopped out of the limousine and started walking down Pennsylvania Avenue, I thought there was absolutely no way he could avoid being a two-term president. The excited crowd lined both sides of the street and cheered for a new president like we haven’t seen in a long time. The economy was absolutely in the tank and there was no way he could be blamed for the economic crisis… it occurred before he took office and would almost certainly be better four years later. America was clearly looking for someone to unite us… it was looking for a “leader”.
Three years later, it appears he will be a two-term president but not for the reasons I expected. He virtually ignored the economy the first year of his term as he pushed for his vision of health care reform. Whether Obamacare is right or wrong is a separate blog… ignoring the economy while Americans were being laid off was a presidential blunder. He spent the next two years crucifying corporate jet owners, a move which did not unify Americans nearly as much as he thought it might.
Meanwhile, the GOP has been staging its own production of Beavis and Butthead, all but ensuring that Obama will not be changing addresses next year. The Republicans seem to be a few stocks shy of an index. However, as they have demonstrated, when the campaign gets down to debates, anything can happen (how is it that Romney’s campaign advisors hadn’t coached him how to answer the question, “are you going to reveal your tax return?” They HAD to know that question was coming. They HAD to have developed a response and rehearsed it, right? How could he be stumped for a response? What other debate questions will stump him?). Say what you will about the Republican debates (the word “embarrassing” comes to my mind), the seemingly weekly GOP version of “Survivor” should make the Republican nominee well prepared to debate Obama. Meanwhile, President Obama is not getting to practice his debating skills on anyone. If Romney ultimately becomes the nominee, debating President Obama might seem like child’s play after tangling with Newt Gingrich.
Obama’s efforts to polarize Americans have not worked in his favor as much as he might have hoped. Other than Occupy Wall Street’s protests against greedy and overpaid bankers, there has not been a groundswell against wealthy Americans. Maybe because a lot of people still aspire to be one of them. I think Obama is getting bad advice from his entourage. However, I still think Obama could get America behind him to increase taxes on the wealthy… to increase taxes on dividends and capital gains and to increase the marginal tax rate. After bashing greedy corporate jet owners for a couple of years, it may be too late but… I have the speech that Obama should have given… the one that would have made him a shoe-in for a second term… the one that unites Americans AND results in the tax increase he desires. Here is the condensed version of that speech: