A couple of top notch economists have laid out their vision of what the economy will be on election day. "Ted Gayer, Domenico Lombardi and Darrell West are, respectively, senior fellow and co-director for economic studies; senior fellow; and vice president and director for governance studies at the Brookings Institution.
They paint a dismal picture for an incumbent president:
The economic outlook is not expected to improve much, if at all, heading into the election. Growth is likely to remain below 2 percent in the third quarter, while the unemployment rate will stay above 8 percent. Concern is growing that Congress won't act to avert the fiscal cliff of tax increases and spending cuts set to take effect in January, which the Congressional Budget Office has predicted would lead the United States into a recession.
The crisis in the euro zone is worsening, and the threat to the global economy is escalating. Government bond yields of Italy and Spain have peaked vis-a-vis those of Germany, fueling speculation about the economic and political sustainability of the euro as a common currency. Partly because of continued uncertainty in Europe, the International Monetary Fund has revised growth projections for China and India downward for this year and next. In turn, the outlook for U.S. exports to Europe and the emerging economies is deteriorating. Above all, the dampening effect of the European crisis is likely to delay investment and hiring decisions, further slowing the anemic recovery we have seen so far in the United States.
Game, set, match Romeny? Not exactly. As the economists point out, the election is actually 50 different elections and the economy is doing slightly better in some swing states. This could mean that unless Romney can decisively make his case to throw Obama out, voters in many states may figure that despite the fact the economy is in the toilet, it's safer to stay with the devil we know rather than take a chance on someone else.