With The Economy On Obama’s Backburner, What About Home Buyers?
During both of President Obama’s presidency campaigns, the economy was the main issue at hand. In fact, he still claims that fixing the economy is his top priority, but recent events overseas and at home have overshadowed our economic issues and they seem to have been placed on the back burner for the time being. If you pay any attention to current events, or even open a newspaper, you’re sure to know about Syria and their political turmoil and our National Surveillance programs that have people up in arms. Dealing with these issues seems to have distracted our government from their “Number 1 top priority” into an almost non-issue.
Economically, Where are We Now?
Everyone can admit that our economic recovery has been slow, uneven, and perhaps even bumpy. It appears as though any more advances in our economy could be threatened by US airstrikes against Syria that could send already high oil prices soaring. Plus, with Obama’s term quickly coming to an end, he will find himself in a lame-duck position and his ability to aid the economy will be greatly diminished. Our unemployment rates are at 7.4 percent, which is still well above the typical 5-6 percent healthy economy, though it is down from the 10 percent rate from 2009. Housing prices are on the rise, as is consumer spending, and some big banks are reporting strong profits once again. Our exports are up and the budget deficit, reportedly, is inching down.
Current Factors that Have a Huge Impact on Economy
Even without the current crisis with Syria and the projected US led air strikes, there are other factors that could severely inhibit our economic recovery in the coming months and years. One important factor is a possible government shutdown if Congress fails to pass legislation to keep the government functioning beyond the September 30 fiscal year end. The other important factor is an expected battle over increasing the government’s borrowing capacity once again. Our overall debt keeps rising even as deficits come down since the government still spends more than it takes in. You may remember that in summer 2011, the White House and congressional Republicans fought for weeks over a debt-limit increase, which is expected to once again be a battle.
What Could this Mean for the Housing Market?
With all the current threats to our economic recovery, we could be finding ourselves taking a giant step backward when it comes to recovery of the housing market. Interest rates and housing prices have been creeping up, which is good news indeed, but with the future uncertain regarding fights between the GOP and the current administration, and neither side willing to back down, our economy could take yet another significant hit.
Thomas Mann, a congressional scholar at the Brookings Institution who studies governance, advised that, “Foreign policy events often overtake presidential ambitions as to opposition parties that manage to win control of one or both chambers of Congress. I don’t think the economy is less important to Americans. It’s more that they have come to doubt that anything constructive can emerge from Washington.”