With an economy this bad, Obama is likely going to be defeated in November. Intrade and the beltway pundits are currently predicting a Community Organizer victory, but lest we forget that Carter was leading Reagan in the polls in the summer of 1980. Romney is going to be elected president, and before he's even had a chance to unpack his bags he's going to be challenged with the second leg down of this economic depression. Investor Marc Faber says there's a "100%" chance of recession in 2013, and several notable economists and financial pundits agree with "Dr. Doom's" gloomy forecast. (Even the CBO admits the possibility of an early 2013 economic tailspin.)
Romney and Ryan might not even be inaugurated when GDP growth officially dips below zero, but Obama supporters and the MSM will blame the prospect of the new administration's "austerity" (i.e. slower growth of Big Government) for the second act of the Great Recession. They'll remind us again and again that reduced government spending has a short-term negative impact on GDP, and they'll be telling a half-truth. However, whatever cuts Romney and Ryan propose will be relatively small, won't even reduce the debt/GDP ratio below the critical 90% threshold (the point at which government debt becomes burdensome to an economy), and certainly won't be the cause for the second round of recession. In reality, the knockout blow to the punch-drunk economy will be a result of global pressures (particularly from Europe), Taxmageddon, and the end of the illusion of recovery as credit is exhausted. But facts won't stop Obama supporters and the MSM from reveling in the blame game. Romney and Ryan should prepare themselves.