The unemployment rate in the United States is 7.8 percent. The country is more than $16 trillion in debt.
The banks received a bailout from the federal government. So did the auto industry.
At the end of the year, Bush-era tax cuts are scheduled to expire. Last year's temporary payroll tax cuts are also scheduled to expire, resulting in at least a two percent tax increase for workers, when the Budget Control Act of 2011 takes effect. When the nation reaches this so-called "fiscal cliff," the United States would also see the end of certain tax cuts for businesses, the beginning of health care taxes related to the Affordable Care Act and spending cuts to a number of government programs, including Medicare and the Department of Defense.
No wonder polls by Rasmussen Reports, Gallup, Bloomberg National Poll and numerous news organizations rank the economy as the top issue for many voters on Nov. 6.
Notre Dame economics professor Timothy Fuerst said all agree the country's budgetary policy cannot last as it is, but the presidential candidates differ on their strategies to bring about change.
"I think the broader issue is how to deal with the enormous federal budget deficits, on the order of $1 trillion a year," Fuerst said. "This is simply not sustainable. Even after the economy recovers, there will be substantial deficits because of the rapid growth in spending, primarily entitlement spending such as Medicare and Social Security."
Democrat President Barack Obama and Republican former Mass. Gov. Mitt Romney have both failed to explain what cuts they would make or how they would change entitlement spending, Fuerst said.
"President Obama claims that his health care law will lower spending on health care and thus reduce Medicare costs," Fuerst said. "Gov. Romney disagrees, but instead suggests other reforms such as higher retirement ages and insurance vouchers that would allow retirees to shop the private marketplace for insurance."
The candidates are opposed on tax policy as well, he said. Obama has proposed gaining revenue by taxing those with incomes about $1 million, while Romney wants to expand the tax base by eliminating deductions and loopholes that he has not identified in full.
Notre Dame economics professor Robert Flood said the candidates, no matter their different philosophies, would both have to take the same basic steps toward a stronger economy.
"Both need to move the budget toward balance," he said. "Both will have to raise more revenue and spend less."
Economist AustanGoolsbee is a professor at The University of Chicago's Booth School of Business and the former Chairman of the Council of Economic Advisors under Obama.
Obama has focused on cutting taxes for the middle class and letting high income rates rise, Goolsbee said, whereas Romney has called for "across-the-board" tax cuts that tend to benefit those with higher incomes, abolishing the estate tax and cutting capital income taxes.
"I think it's a pretty fundamental issue of the election," Goolsbee said. "Do you think economic growth comes from a small group of people at the top or from broad-based relief with investments in training, infrastructure and innovation?"
Goolsbee called Romney "factually incorrect" in his statement that the unemployment rate has been dropping because people have stopped looking for work and left the job force.
"Suggesting that nothing has improved since January 2009 is absurd," he said. ""We were in the middle of an epic downturn that almost careered into a depression. ... The route problem is that growth has been modest - around 2 percent - and that's not enough to really juice the hiring side."
Fuerst agreed with Romney's claim, saying the economic rebound after the recession has been tough on job hunters.
"The labor market recovery has been very, very, very weak," Fuerst said. "In my view, the best measure of [the job situation] is the percent of the population employed. This was just about 63 percent before the recession. During the recession, it fell to about 58.5 percent and has remained remarkably flat since then."
Shortly after Election Day, the nation could hit the approaching fiscal cliff, which Fuerst said will take consideration from more than just the president.
"My guess is that no matter who wins the election, that the Congress will push most of these issues down the road about six months so that the administration will have time to come up with a complete policy proposal," he said.
A mid-October poll from Rasmussen Reports found 50 percent of voters trusted Romney over Obama on the economy, while 43 percent favored the incumbent president. The race has only tightened as Election Day approaches, but one fact remains clear for the winner - after Nov. 6, one of these two men will have to put the money where his mouth is.
