"We have a lot of work to do"

       

        When Mr. Barack Obama was reelected for another 4 years in November 2012, this was one of his key message statements to the faithful who voted for the Democratic Party over the GOP (Grand Old Party) Republicans.

        The USA has lost its mandate to lead the world economically, it can at best be an indicator of where the next 'Big Thing' will come but I think that Asia has its best break now to lead the world in cool gadgets and products, as Asia is where the mass consumers are. China, India, Japan and Korea have a combined population of over 3.5 billion with a middle class of easily 500 million to 700 million. Already popular culture is looking at the Korean Hallyou (or Wave) and PSY's Gangnam Style dance is insanely popular amongst Youtubers. (almost 900 million 'hits' at last count)

      First the Presient has to get both Houses to agree on raising taxes, else the Fiscal Cliff will impact the whole country if there is no agreement. The Government will then be forced to shut down, schools and public services, utilities and essential Government Ministries will be shut, and then the domino effect will hit the rest of the country. 

      There is no turning back, if they do not do something on the massive debt and continue to print money, and raise their debt, while hoping for the economy to continue its anaemic growth, then there will be another tepid or mild expansion for the next  4 years.

       So, for the US to reduce the deficit and national debt, it first has to generate jobs. To generate jobs, the US needs to borrow more money to create the new (renewable and clean industries such as solar and wind, as well as expand its drilling for oil in Texas as well as Alaska. Once that is done, then jobs relating to the new industries can be created. But then it means incurring more debt, and hopefully these new industries will be able to export massively and reduce the trade deficit as well as pay back the debt. But the US is not the leader in renewable and clean industries (China and South America are), so the chances of the US being able to export its way out of the trade deficit and massive debt is slim.

     Unless the US finds a new 'champion' product or service which it can claim to to be the global first leader, it will be still stuck in an anaemic growth path, and debt will still be as high as ever.