Hurricane Sandy permitting, on Tuesday November 6, there will be voting across the US to choose members of the Congress and the President of the US. Hopefully, the voter participation will be full and the postal votes already cast will not be overly decisive. An election campaign that started in a rather dull fashion has been ignited since Obama’s failure to sparkle at the first debate. Now every little shortfall in economic numbers looks menacingly large. Every idiosyncrasy in Obama’s style grates. It looks like the election is going to the wire and who knows who will be taking the oath on January 22, 2013.
Yet this does not really matter as far as the most serious problem facing the US is concerned. This is the budgetary problem. It is more the results of the Congressional elections that matter in this respect and not the identity of the winner in the Presidential election. In that respect, the present state of the two Houses is unlikely to change. The Democrats will continue to command a majority in the Senate, barring a landslide for the Republicans, which does not look very likely. The House of Representatives will continue to be controlled by the Republicans come hell or high water. Whether Obama or Romney wins will make no difference to the gridlock that will result.
The US faces the problem of tackling its budgetary deficits. In good times and bad, for the last 30 years, the US has run a budget deficit except for the two last years of the Clinton administration. In the past, Congress has legislated—as in the Gramm-Rudman Act—that budgets should be balanced. But again and again the political system has failed to tackle the budgetary question. It does not help that compared to a Westminster-type procedure, the budgetary process lacks any sense of urgency. The President sends a message to Congress laying down his ideas, but then it is Congress that constructs the budget and passes it. In the middle of all this, Congress needs on occasion to extend the ceiling on total national debt so the government can continue to borrow. Clinton was once faced with a shut-down because Congress would not raise the ceiling. Obama came close to this.
This time around, there is another challenge that Obama faces. The Bush tax cuts are about to expire in December unless Congress extends them. Obama wants to repeal the tax cuts