Now that the mid-term elections are over, what can we expect to see in the next few months? As I said in yesterday’s post, the advantage to the leadership of the two parties of so-called ‘divided’ government, where one party controls one part and the other party another part, is that they can blame lack of action on the issues their core supporters care about to this gridlock while they can be ‘bipartisan’ when it comes to serving the needs of the oligarchy.

When it comes to issues that the oligarchy does not care about (gays, guns, abortions, etc.), it is hard to predict what will happen, though there may be noisy and acrimonious debates. These issues serve to create the illusion that we still have a democracy. What is predictable is the outcome on those issues that the oligarchy (by which I mean the very wealthy, and the upper echelons of the corporate and financial sectors) cares about. There the debate is often, though not always, subdued and we have lots of pious rhetoric about needing to come together in the spirit of bipartisanship for the good of the country. The massive bailout of Wall Street financial powerhouses that was rammed through by both parties working together at lightning speed with little or no debate in the fall of 2008 is a good example of what I mean.

Based on this oligarchic model, here are my predictions for the next few months.

One area is taxes. It is likely that the Bush-era tax cuts will be extended even for the top 2% and that the estate tax will be repealed, key agenda items for the oligarchy. These two issues must be dealt with by the end of 2010 and will give us the first hint of what is to come. This will be interesting to watch because of the early deadline involved. If nothing at all is done, all the Bush tax cuts expire because of the sunset provisions in the original bill. As a result, it does not take a political genius to map out the political strategy for the Democrats to get what they say they want. The script practically writes itself. All they have to do is sit tight and refuse to compromise with the Republicans, essentially playing a game of chicken, saying that if the Republicans don’t give in and all the tax cuts expire, that the Republicans sacrificed the middle-class tax cuts because their real desire is to reward their Wall Street millionaire friends. Since even the tea partiers dislike Wall Street bankers, this message should be an easy sell.

But the Democrats won’t pursue this seemingly obvious strategy because it is against the interests of their oligarchic overlords. Obama is already talking of ‘compromising’ on this issue and ‘simplifying’ the tax code, a word that in the past has been code for giving more breaks to the rich. The Democratic Party will cave and all those pro-Democratic commentators who wonder why their party’s leadership seems to be so politically dense that they do not take their sound advice on what should be done are missing the central point: when it comes to their public espousal of policies that might harm the interests of the oligarchy, the Democratic party leadership does not want a winning strategy, they seek a losing one. Once you adopt this model, the seeming political ineptness of Democrats once they attain positions of power becomes easy to understand.

Another issue to watch is social security. Kevin Drum highlights a chart from the social security trustees report that shows that the cost of Social Security is projected to remain flat all the way from 2030 through 2080. There is no explosive growth and hence no problem with the social security system that cannot be fixed with minor tinkering. (The real problem is rising health care costs in Medicare and Medicaid.) But the oligarchy on Wall Street has long had its sights on raiding the social security funds and siphoning some of it towards themselves. The ‘Catfood Commission‘ that is due to present its report in December seems anxious to gut this program and now may feel more emboldened to do so.

A third issue will arise early next year around February when it will become necessary to pass legislation to raise the debt ceiling or risk sending the government into default. Despite Republican rhetoric about opposing the rising national debt, the oligarchy needs the government spigots to be kept open and so I predict the Republican Party will agree to raise the debt ceiling, all the while hypocritically wailing and gnashing their teeth at what a bad thing it is. It will be interesting to see how well their supporters respond to such a blatant betrayal of what they were promised.

I predict that there will be no repeal of the major elements of the health care reforms that were passed, although symbolic attempts will be made such as public hearings and bombastic speeches. The health care reforms legislation, despite all the absurd rhetoric, was crafted to satisfy the interests of the health insurance and drug industries and is a big bonanza to them. The Republicans in the House may pass a repeal vote to pacify the tea partiers, knowing that the Democratic Senate will kill it or that Obama will veto it, and everyone (i.e., everyone who matters, which consists of the oligarchy and their clients in both party leaderships) will be happy.

Meanwhile, unemployment will remain high and may get even higher as the states cut services and lay off more public sector employees in order to meet their growing deficits without raising taxes, the two major wars in Iraq and Afghanistan and the two minor wars in Yemen and Pakistan will continue and may even be expanded, and the infrastructure will continue to crumble as parks, roads, libraries, schools, and other services are starved of funding.

I predict that one area of major growth will be in rhetoric proclaiming that the US has always been, is, and always will be the greatest country on Earth, both in what it does and in the character of its people, even as it continues its slide into mediocrity. Because that is what political leaders always do to distract people from the disaster that stares them in the face.

Abraham Lincoln said that you can fool all of the people for some of the time. We are in that phase of national political life.