Obama Effect on Consumers and Retailers

Surviving the Economic Contractions Ahead with a Recession Plan

Oct 24, 2008 Martha R. Gore

Obama has laid out an economic program that may deepen the recession now in progress. Will he repeat the mistakes of the Carter administration?

Obama and a Democrat Congress may repeat the failures of the Carter Administration ending up with making mistakes in the middle of an economic downturn. There are similarities between the two administrations.

Carter came into Washington thinking he and his political allies had wrought a political miracle and it turned out to be a failed presidency. The same thing could happen to Obama if he carries out the economic program he has offered during the last two years.

Obama Economic Plans

Obama will begin his presidency with an economy and stock market already in deep trouble. There is thinking among some economists that the emphasis on more taxing of business and investors may deepen what is already showing sign of a deep recession. Obama’s plans for business to underwrite the social and welfare programs for non-taxpayers may drive what is left of the manufacturers in the United States to move their operations to Mexico or overseas or increase their investment in automation to eliminate workers. If unemployment continues to go up, it will affect the retail sector profoundly.

Obama and the Retail Sector

The retail sector, according to Meghan O’Brien, an economist with the Iowa State’s Regional Capacity Analysis, writing in a report, “Retail Economics 101: Lessons and Strategies of a Recession” said: “With the rash of recent retail bankruptcies, store closings, and increasingly vacant retail space it is apparent the retail industry is facing tough times. Because retail is the second largest sector in the U.S. in number of businesses and employees and accounts for 8.3 percent of the GDP, the implications of a retail recession and numerous and far reaching.” With the problems retail business are already having, the additional taxes that the Obama economic plan has in store for them, especially in providing health care for all employees, could create a “tipping point.” Cutting expenses, accepting smaller profit margins and firing employees may be the only way retail businesses will survive.

Surviving the Recession

Consumers and retail shoppers who are aware of how the recession will affect them can protect themselves. These include:

  • Take some time to shop around for the best prices on products and services. Retailers will offer lower prices to keep customers shopping at their stores. Many products will be discounted heavily in order to move them out the door.
  • Be willing to change your shopping habits and watch for the specials at stores that you have not frequented before.
  • Use common sense in shopping for bargains. If you have to drive extra miles to save a dollar, it is probably not worthwhile.
  • Use layaway plans instead of putting merchandise on the credit card.
  • Limit credit card use and avoid paying interest charges by paying the balance monthly. If there is really an exceptional price cut on a product you need, it may be worth paying for it monthly.
  • Stay out of debt, no matter how tempting a purchase might be. If it is not a necessity and you can’t pay cash for it, leave it in the store.

With an inexperienced, untried new President at the helm, questions remain as to how this will affect the recession already in progress. If Obama's tax program effects the stock market and retail sales, only the wise consumer and retailer will survive financially intact.

The copyright of the article Obama Effect on Consumers and Retailers in American Affairs is owned by Martha R. Gore. Permission to republish Obama Effect on Consumers and Retailers in print or online must be granted by the author in writing.
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Comments

Oct 24, 2008 7:02 PM
Kristie Davis :
Some economists are saying that just the THREAT of an Obama presidency is what is part of what is driving the market down right now.
Nov 4, 2008 8:23 PM
Guest :
Well he has won and I know our country is in for the worst economic downturn since the depression. The American people deserve what they get. We have elected a man who was the most liberal seneator in recent history, embraces socialist applications, waqs trained as a muslim as a child, and according to his paternal grandmother, was born in Kenya. He has never produced an original birth certificate, and according to the constitution cannot hold the office of Seneator, let alone President. But when our corrupt Media annointed him, with General Electric (via NBC) backing the most expensive and corrupt campaign in history, Americans ate his spoonfed lies and impossible promises.......poison will soon enough sour our stomachs. 2008 the year journalism died. 2008 the day the USA elected her destroyer. We will never recover if Obama lives to carry out his foreign agenda.
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