In follow up to our blog of October 16, 2012, First Presidential Debate we bemoaned the fact that in the first presidential debate no significant discussion was had concerning fixing the housing crisis or infrastructure improvements, topics of concern to the construction industry. These topics were also absent from the second presidential debate on October 16, 2012.
The “debate” was more akin to a “bickerfest,” both the President and the Republican contender scrapping with a lack of decorum. When observing the two candidates, neither seemed to be the appropriate choice for the leader we need to work with Congress and break the present log jam.
President Obama’s highpoint seemed to be that he does want to be President (which was not clear from his behavior in the first debate) and he appeared willing to fight for it (which will quell the concerns of some that if he is not willing to fight for himself, will he be willing to fight for us). Governor Romney’s best point appeared to be when he continued to remind us that President Obama promised the economy would be better by now and it is not.
The most puzzling part of the debate for me came when the candidates gave us their views of China’s affect on U.S. jobs. The President tried to convince us that big business leaders such as Governor Romney are responsible for exporting American jobs to China. Romney maintained that the American jobs are being lost because China does not play by the rules (currency manipulation) and is stealing American jobs. November will tell us what view the people in the Mid-West, who have suffered most from outsourcing issues, believe to be the case.
The noticeably absent major issue was any discussion of the “Fiscal Cliff.” The Fiscal Cliff is the dilemma that the U.S. will face at the end of 2012 when the terms of the Budget Control Act of 2011 are scheduled to come into effect and other significant fiscal measures all converge. On December 31, 2012, the following will occur: (1) the temporary payroll tax cuts will be reinstated (resulting in a 2% tax increase for workers); (2) certain tax breaks for businesses will end (the Alternative Minimum Tax); (3) the end of the 2001 – 2003 tax cuts; and (4) the beginning of taxes related to “ObamaCare” will kick in. At the same time, spending cuts agreed to as part of the debt ceiling deal of 2011 will also go into effect. Many government programs will be in for deep cuts including defense and Medicare. It is estimated that the effect of these policies will be to cut the Gross Domestic Product by 4% percentage points in 2013, sending the economy into a recession (negative growth). One of the two presidential candidates will be faced with dealing with this Fiscal Cliff, surprisingly, no mention was made of this looming crisis was made in the debate.
Finally, the European debt crisis which is by no means resolved, may have a spillover effect in the U.S. and no provisions are being made (at least none are being talked about) to deflect the impact of that financial crisis on the U.S. economy. Let’s see where tonight’s debate takes us.