Americans are afraid of inflation

The very surprising election of a Republican to replace Senator Edward Kennedy, who died, in Massachusetts, one of the most Democratic states in the United States, is an indication of the degree to which the American people are becoming dominated by two emotions:  the first is the sense that although the figures show the great recession to be over, most ordinary citizens do not feel it to be so–particularly in the areas of employment, where unemployment continues high and continues to rise, though more slowly, and housing, where the number of homeowners who are losing their homes continues to increase. 

The second emotion has to do with the greatly increasing public deficit and debt, which has reached historically high levels in peacetime, and are set to increase in the near future.  The ordinary citizen fears that such a level of debt will be impossible to finance, and thus either there will be a large increase in taxes, or in the rate of inflation, or both.  As a result of these emotions, the Democratic Party and the Administration are becoming more a and more unpopular, as demonstrated by the election result in Massachusetts. 

Equally important, the election of a Republican to replace Senator Kennedy will make it difficult if not impossible for the Administration to achieve its goals, in both domestic and foreign policy.  There are general midterm elections scheduled for November of this year. The entire House of Representatives, one-third of the Senate and many state governors will be elected at that time, and if present trends continue, the Democrats will lose heavily, making the second half of President Obama’s administration extremely difficult.