The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK (
) -- Let's face it: America is a 50/50 country politically, with halfvoting Republican and half Democrat. Over a few years and decades,there are swings, and someone always has the White House and somecomplex Congressional majority. Even if you have a Congressionalmajority, however, you may need 60 votes in the Senate, and even thenyou may not get all of your party members to vote with you.
This leads to a political stalemate, broadly speaking. Neither partygets a majority sufficient enough to cause meaningful change. Ofcourse, this is the way James Madison and Thomas Jefferson designedit, deliberately so, in the 1780s. For them, they had just achievednear-perfection in government, so why make it easy to change thepolicies?
Whether you like it or not, things did eventually drift away fromJames Madison's and Thomas Jefferson's carefully constructed balanceof power. After the assassination of William McKinley in 1901, amovement began to increase government power on almost every level insociety. We soon got the income tax, drug prohibition, a central bankand a plethora of welfare programs. In this process, federalgovernment spending as a percentage of GDP increased from under 3% to20% a decade ago, and now most recently it jumped to 25% or more.
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Here is the problem today: There is almost total disagreement inAmerica as to where to go from here. Some people think 25% offederal government spending to GDP is way too little; other peoplethink it is way too much. Neither side is happy, and politicaldivision is as great or greater than ever.
In our current Republic, realistically much won't happen regardless ofwho wins in 2012. If a Democrat wins, Republicans in Congress willmost likely have sufficient votes to block most expansion ofgovernment. If a Republican wins, Democrats in Congress will mostlikely have enough votes to block most reductions in government.Neither side will be happy, either way.
Cut the Knot
In light of this total disparity of vision, there is but one way out, one solution that solves this otherwise perennial problem of two dramatically different and competing visions of America. This solution is to divide our country into two.
I don't see why either side would object to this. Democrats keepsaying that their political nirvana is a country with higher federaltaxes, more federal regulations and more federal government spending.Well, let them have it! If they had a decisive political majority ina country that's half of America, they could have all of that -- andmore. How could they possibly complain?
Same goes for the Republicans. They want fewer federal taxes, lessfederal spending and less federal regulation. Divide the country intotwo, and they could have it all. I don't hear a single Republican whowould complain.
How would this work, practically? One party could have no more than25 of the current states, where a minimum of 23 would begeographically consecutive, assuming the same entity also had Hawaiiand Alaska. It would probably have to leave room for each half havingat least one state on each of the two oceans. Practically speaking,that would, in turn, mean that California and Washington state could notbe part of the same country -- the question is which would be which.Other than that, almost every combination would be possible.
Clearly, this would have to entail moving, for close to half of thepopulation. The real solution here would be one of natural selection,where people would do it over some period of time. Americans movedbefore, such as in the 1800s when they headed West, and they stillmove today where some states show large net immigration numbers andother states have been de-populating for at least a decade or two.With more change and distinction, chances are that this new migrationwould be faster and more pronounced.
Big Enough to Split
The U.S. today is one of the world's largest countries, geographically. Our population density is relatively low. In other words, we have the luxury of doing this. Even in our smaller and oldest states in the Northeast, natural resources are vast and not cramped by most international standards.
This type of change would be difficult in the Netherlands or Austria. Thereis neither the population nor the land mass to support a split withgreat ease. That said, keeping a country together that's filled withdivision is also a great peril. Just look at the former Yugoslavia,where the only solution was to divide it into several tiny countries,in order to end a bloody civil war.
We won't want any civil war of any kind, let alone any bloodshed. Wewant a peaceful and amicable separation that will greatly satisfy bothpolitical sides of the spectrum. I hear from Democrats all the timethat they would prefer that Texas go off and be its own country,because it is just not like the rest of 'em. Likewise, I hearpolitical activists from other states say the corresponding same thingabout California and Washington, D.C. With a peaceful and amicableseparation, problem solved.
All of these political scores could be settled once and for all by both political sides to enjoy relative peace in each of their homes. We don't need a one-size-fits-all. We can have our cookies and eat them too. Just split the cookie in half.
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.
Anton Wahlman was a sell-side equity research analyst covering the communications technology industries from 1996 to 2008: UBS 1996-2002, Needham & Company 2002-2006, and ThinkEquity 2006-2008.