There is much to be said for the end result of America’s corrupt, expensive, tedious and hard fought election of 2012. Much can be written about it and much will be. The fact that it is over enables us to turn our attention to Federal Reserve Chairman Ben Bernanke’s much touted fiscal cliff. If you did not hear about this during the election it was not Bernanke’s fault. It was that neither candidate had an answer. And that also sums the election.
Bernanke’s fiscal cliff is the American budget that Congress and the President have to approve before January 1—less than two months from now. Without a new budget that enables the U.S. Government to function and allows a more reasonable tax balance, the U.S.could spiral rapidly into a recession that will impact the world’s economies. We would all be caught in the domino effect.
While most observers consider the Republican members of the House of Representatives to be committed to cooperating with newly re-elected Barack Obama, the markets are already expressing doubt. There is little trust.
It is like the Canadian government needs to fast-track getting the new Windsor-Detroit bridge underway before billionaire Matty Maroun comes up with new ways to try to block it. His expensive proposition on the Michigan ballot last Tuesday to block the bridge was defeated by about three to two but he is unlikely to give up the fight. Canadian business wants that new bridge to move things across the border faster. Maroun just wants to make more money.
Speaking of making money, many believe that President Obama will now move quickly on approving the TransCanada XL Pipeline to the Texas coast now that he is re-elected. If the environmentalists fighting this pipeline understood the real purpose of it, they might have a better chance to prevent it. Everyone assumes that the Texas refineries will process this bitumen into oil products. That is unlikely as long as there is enough North Dakota and Texas crude to keep the refineries going and the Canadian tar sands version of crude can be shipped to other markets.
It is like the con job that has been done on NDP leader Thomas Mulcair to convince him that by shipping the tar sands product east, it will provide cheaper gas in Eastern Canada. Reality is that it will remain cheaper to use U.S. refineries to provide us with gas while the bitumen product is piped further east to where it can be loaded on tankers at Saint John, New Brunswick. Mind you, the tar sands people are whistling if they think anything will ever come of their Enbridge pipeline to the west coast.
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Copyright 2012 © Peter Lowry
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