Time to Get to Work
With the 2012 election over and a familiar face in office it’s time to get to work. We are, and always have been, a land of opportunity for those willing to put in the time and sweat. Now is the time to make it happen.
So what do we need to do?
Americans are craving unity. Our nation has been divided for far too long and the political polarity of the past four years hasn’t helped. In order to get back on the right track I think there are three key areas that need work:
The Fiscal Cliff
I believe our representative leaders in Washington are using a Russian roulette strategy to “compromise” on our budget and it is impacting our economy and markets. The bottom line is that we are spending $3.6T and taking in $2.4T, creating a shortfall (a deficit) of $1.2T and neither side, democrat nor republican are budging.1
We need a compromise.
That might mean some tough measures on spending (farm subsidies, tobacco subsidies, etc.) but it could also mean raising taxes to increase the income side of the equation. It might be higher tax rates, or more people paying taxes, or even means fewer tax deductions. It has to happen in one form or another. That means we need unity, not division.
Some Level of Deregulation
I think the regulatory wall from Washington is growing and stifling business conception and business investment in the process. Our government needs an active positive attitude toward business, not negative. This emphasis can go a long way in putting America back to work. If we can take active steps to help small businesses we could create jobs, reduce the deficit and grow our way out of this sluggish economy.
In my opinion, jobs are created by business owners and until we stop attacking certain businesses and giving preferential treatment to others, the job creators are going to sit on their hands – which does nothing for our economy. Regulation is a tax – we need encouragement in the economy. I agree that we need regulation, but it needs to be smart regulation.
For years our country has been tremendously dependent on other countries to help supply our energy. But now we have the chance to make a huge impact on the world with recent energy discoveries in this country. The application of technology to energy has led to significant innovations such as directional drilling. We are finding more energy today than we would have dreamed about 10 years ago. The natural gas in the Marcellus formation in the east, or the Bakken formation in North Dakota, or the Niobrara just east of Denver are all significant discoveries leading to lower energy costs.
Lower energy cost means cheaper manufacturing and transportation. With natural gas priced at $2.50 – $3.00/Mcf, versus upwards of $10/Mcf around the world we have a competitive advantage.2
Energy costs are a huge component of manufacturing costs. It makes sense: when energy is cheap, it costs less to create goods. This creates a competitive advantage for America over manufacturers like those in China. The more policies we have to encourage energy production and manufacturing in America, the more likely we are to grow jobs, revenues, and help our overall economy.
In essence, if we could:
Unite our People
Plus Encourage Business
Plus Compromise on Spending and Taxes, it could
Equal America’s Finest Century
Thank you for the investment of your time today – Now let’s get to work!
Securities offered through LPL Financial. Member FINRA/SIPC
Wall Street Journal, Department of the Treasury, Office of Management and Budget, Congressional Budget Office
Yahoo Finance, LPL Research