The New Year

The Emperor is very worried about the coming new year. While 2009 was a slight improvement economically for the realm, the Emperor believes the improvement will be short lived. The individual provinces are the bellwether. The individual states already grapple with overburdened budgets and revenues from state sales taxes and property taxes will not be able keep up with the difference. Individual states are slashing public services to try and stem the flood of spending on Federally mandated yet unfunded entitlement programs and state government payrolls. The states are at the point where they are going to have to terminate essential services to have any hope of surviving. The other option is to increase taxation, however, the people are in no mood for this and states will not be able to pass the required legislation. Look for the states to call for massive bailouts from the Federal government which will, in turn, cause an increase in federal income taxes. The Order of the Donkeys, who hold supreme power in Washington at the moment, know this is their last year to pass their liberal agenda. The November elections will remove their unassailable majority in Congress so time is of the essence. Having just mortgaged the future of the American economy with the new health care bill, the Donkeys must act quickly to impose their environmental initiatives on the economy and release the remaining terrorists from Guantanamo Bay. The costs of both of these legislative initiatives combined with the effects of the health care bill will likely drive the American economy back into recession. Look for increased costs in Homeland Security as the Federal government tries to solve it's security problems through more procedures and expensive, but useless, technology. Look for increased energy costs as the Donkeys try to force the nation to use inefficient and unreliable energy sources. Look for increased health care costs as insurance companies and medical equipment manufacturers jack up prices to cover the costs mandated by the new health care bill and the number of people on Medicare increases exponentially. In short, be ready for increased taxation at all levels of government combined with a sudden rise in inflation. All of this will likely stall and possibly reverse the recovery in 2010.