This political polarization, and related congressional gridlock, all but guarantees that no major legislation affecting taxes or the economy will pass before November when voters decide who will sit in the Oval Office come January.
Lack of clarity about the economy’s direction and European debt woes are keeping financial markets jittery and deterring businesses from hiring new workers or investing in plants and equipment, many economists suggest.
That isn’t helping either the recovery or the incumbent’s second-term prospects.
Adding to the anxiety on both Wall Street and Main Street: a looming year-end “fiscal cliff” of expiring tax cuts and automatic spending reductions if Congress fails to act.
Both Obama and Romney were campaigning Tuesday in battleground states.
Obama was in Cedar Rapids, Iowa, promoting his bid to get Congress to extend Bush-era tax cuts for families earning under $250,000 while letting taxes rise on wealthier people.
Romney, who would extend all the Bush tax cuts, was focusing Tuesday on jobs.
“The president’s policies are not creating jobs,” Romney told a town-hall style meeting in Grand Junction, Colo. Romney said his policies would create more energy-industry jobs.
But there is little national consensus on either tax or energy policy.
“It would be great if policy-makers could nail some of these issues down and that certainly would help. But even after the election, it may be tough,” said Mark Zandi, chief economist at Moody’s Analytics. “Expectations are very, very low.”
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EDITOR’S NOTE _ With 119 days left until Election Day, here are insights into today’s highlights in U.S. politics
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