Debt Ceiling Issue Needs To Be Resolved Almost Immediately After Start of Obama's Second Term
Earlier today, President Barack Obama officially started his second term as President of the United States after taking the oath of office at a swearing-in ceremony at the White House.
President Obama will repeat the ceremony once again on Monday, this time in front of hundreds of thousands of people. According to the Constitution, Obama's second term officially started at noon on Sunday afternoon.
There are a wide array of different issues that President Obama will have to deal with in his second term, including the very polarizing issue of gun control in the United States.
In terms of the economy, President Obama's second term will start with the US economy on much better footing compared to four years ago. In January of 2009, the US economy (and global economy, for that matter) was in a complete shambles, with the country losing hundreds of thousands of jobs each month. Credit markets were essentially frozen, businesses were cutting back and millions of Americans were hitting the unemployment lines.
Having said that, the unemployment rate in the country is still 7.8%, and millions of Americans are still out of work. Many people were willing to give President Obama the benefit of the doubt in his first term in office, as the US economy was in full implosion mode when President Obama was first sworn in. People aren't going to be quite as patient during Obama's second term, and how the unemployment rate moves over the next four years will go a long ways towards determining President Obama's legacy.
One of the most immediate and pressing issues that President Obama will need to deal with is the nation's "debt ceiling". The Treasury is currently utilizing "extraordinary measures" to allow the country to continuing functioning in a normal manner, but these measures will only last so long before the nation starts defaulting on some of its obligations. Depending on who you ask, the United States needs to raise its debt ceiling by anytime between February 15th and March 1st.
The Republicans are demanding that spending cuts be included in any measure to raise the debt ceiling, while President Obama has said that the Republicans "will not collect a ransom in exchange for not crashing the American economy." Following a contentious battle over the "fiscal cliff", the Democrats and Republicans are going to be taking the gloves off once again as they spar over the nation's debt ceiling. The stakes are very high in this battle, as the nation risks a credit downgrade, or worse, if the two sides can't quickly reach a deal.
The battle over the debt ceiling highlights another pressing issue - the nation's rapidly increasing debt load. We are currently in the midst of a string of four straight years of $1 trillion+ deficits in the country, and 2013 could come very close to making it five straight (early estimates are for the country to post a deficit of $900 billion in the current fiscal year). The country currently has a debt load of nearly $16.5 trillion, a number that has increased dramatically since President Obama took office four years ago. Can the nation get a handle on its runaway spending over the next four years? Seems unlikely.
President Obama begins his second term with a nation that is as polarized as it has ever been.
In terms of the economy - will things be better, worse or the same when Obama leaves office in four years? What is your best guess as to what the unemployment rate will be in January of 2017?
Filed under: General Knowledge