Sunday, January 01, 2006

Day one

Well its the first day of the new year. It's kind of hard to believe that we are in the second half of the decade already. It only seems like yesterday that I was in the states, enduring a quiet new years and plotting my escape from drudgery. Now it is 6 years later and what a ride it has been!
The new year started off on an ominous note. The S.O. was sick this morning and not from too much booze ( regrettably), or too much sex (very regrettable), probably too much Red and White show. Whatever the reason she spent most of the day curled up into a ball on the couch or the bed. I tried to tend to her needs, then mostly curled up on either the bed or the couch when she was not occupying them. Not quite the banner holiday I had hoped. Hope this is not another omen of the year to come.

Its clear this year will bring changes for yours truly, exactly what those changes are, those are yet to be determined. I'm not a big fan of change unless it is something that works better for me. Clearly nothing could top the nice life I have had the last couple of years. Makes me wonder if this the beginning of the long slide down to inconsequence.......I sure hope not.

Its also the time of year that folks make their predictions for the new year. I've got some to make as well. Here are a couple of my takes on the life, politics and the route of the world in 2006:

-a) Iraq- Something has to change here and soon, or the United States citizenry is going to become truly enraged I think. And well they should be, since it will be 3 years since we began this little adventure and things are still not stable there, despite the President's rosy assertions to the contrary. Whether George Bush realizes it or not, the clock is ticking on the public's patience meter. They do not want to "cut and run", but at the same time they want this to be over with. So if large numbers of American troops do not start leaving the country in 2006, expect the approval numbers of the President, which have been rising lately, to take a marked drop again.
The problem is, as Jeff Greenfield points out:




From the start of this war, there's been one rule -- present and future conditions will define the American public's view of past decisions. When the insurgency grew worse, when reconstruction faltered, when American casualties grew, Americans' doubt grew -- not only about the conduct of the war, but why we got into it, and the president's honesty and trustwothiness. I believe that will true three months and six months from now. This speech is like a button on the last five speeches, but in terms of affecting public opinion, it is -- what did Everet Dirkson used to say? It is a snowflake on the bosom of the Potomac. What is happening and will happen will drive public opinion.
My own personal opinion is that the end of the year will find troop levels in Iraq about where they are now. There will be some non-withdrawal, withdrawals; units will not deploy that were scheduled, and so the overall numbers may appear to drop. But not by the significant numbers needed. And sadly, if the past is any type of prologue, American casualty numbers will have topped 3000 if that is true. That grim math will continue to be burned into the public's psyche. As well it should. As a result, Bush's popularity numbers will be worse than they were this fall....

As for the Iraqi government, well do we really know the election results or not? I predict Iraq will form a Shia dominated government. The Kurds will cooperate on the quid pro quo that they be left alone. The Sunnis and the Shias will become increasingly disaffected with the arrangement. However neither side will want to go to full scale civil war. They will limp along, using terrorist attacks as needed and the increasingly Shia populated Iraqi Army will also not develop as planned, relying on the crutch of American support. Sometime during the year an atrocity committed by the Iraqi Army on Sunnis will again be revealed. Weimar Germany lives again, waiting for its strongman to reveal himself..........

b) US midterm elections- When it is all said and done, the midterm elections will go one of two ways and it will be dependent on the perception of how Iraq and economy are going. If either goes south, the Democrats could pick up seats. But not enough to win control of either the Senate or the House. My personal opinion is that the Democrats are their own worst enemies here, they need to sack Howard Dean and the rest of the ideologues and get some serious leadership. It won't happen. They will underestimate Bush again and forget that campaigning is something he does better than governing. Plus they don't have a coherent message on the war and that hurts. They could have one and it does not have to be one of "quit now". They can support the war, while hammering home the opinion that much of the current troubles did not have to occur and were allowed to occur through gross mismanagement by the "cabal". That message, carefully delivered could resonate. The Democrats, like the Arabs in the middle east, won't get that though. True to form, they will screw it up.

c) Rumsfeld- The President will finally work up the courage to do something he should have done 3 years ago, give Donald Rumsfeld his walking papers. It will gradually dawn on the President and many others that Rummy's supposed "transformational" plans are really diminishing the flexibility of the armed forces to respond to various events and or be an instrument of national will. Programs such as this will continue to make the news, while at the same time the pressure to reduce spending will increase. Good riddance Rummy!

d) China and Taiwan- Nothing will happen here. China will continue to bide its time and continue to push the "one nation, two systems" nonsense.

e) While over in Hong Kong, the noise of democratic activism will continue. China will not allow it to get out of control however and will remind the Hong Kong people there is a point beyond which they cannot go. Taiwan will take notice of this, however.

f) US Economy- I hope for my sake, that the Dow goes well over 11,000, but I tend to doubt it. The real questions will be: how much of a drain the continued high price of energy be on the economy and will the long predicted housing bubble burst. Investors are going to continued to be puzzled by the inverse yield curve and its overall impact. The Fed will raise interest rates in 2006 in response to inflation signals. Bull or Bear? Nobody really knows for sure. I'm hedging my bets and investing broadly to be sure.

That's about all my crystal ball can hold. Hope every one had a happy new year and keeps coming back to my little place in Bloggerville. -Skippy-san

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