October 1, 2012

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The 2012 Election

What Does It Mean for Utah’s Business Community?

LaVarr Webb

October 1, 2012

For Utah businesses, the Nov. 6 election is high-stakes drama. It may not be the most crucial election in our lifetimes, as some partisan national pundits like to say, but it’s hard to overstate its importance.

More than anything, businesses in Utah and across the nation need to feel a reasonable level of certainty and confidence that the nation’s and state’s big challenges are being addressed in reasonable and positive ways. The nation must get beyond gridlock and dysfunction. Such trust will provide courage to hire, make capital investments and otherwise take risks that will generate stronger economic activity. 

Will this election provide that certainty and confidence? Here are five clarifying questions, starting with national politics and working down to state and Salt Lake County elections, that will be begin to be answered on Nov. 6:
What philosophy of government will prevail in the White House?
Both President Barack Obama and challenger Mitt Romney promise to bring more certainty in addressing the nation’s most pressing problems, including growing the economy to create jobs; reforming the tax system; bringing the federal deficit under control; and ensuring the long-term viability of entitlement programs like Medicare, Medicaid and Social Security. But a gulf separates their beliefs regarding government’s fundamental role.

Obama’s record indicates he would take a traditionally liberal, government-oriented approach to resolving the nation’s challenges, while Romney would rely more on the private sector with less government activism. Business leaders locally and nationally have voted their support for Romney by contributing financially to his campaign and related political action committees, keeping the challenger financially competitive with the incumbent for the first time in many elections.

As an adopted “favorite son” with strong Utah ties, and with close advisors like former Utah Gov. Mike Leavitt likely to play major roles in a Romney administration, the former Massachusetts governor will enjoy an enormous win in Utah, and Utah would have influence in his administration.

Will divided government, stalemate and dysfunction continue at the federal level?
Congressional control is nearly as important as who wins the presidency. In 2008, Democrats won big, controlling the White House and both houses of Congress, and the nation had one-party rule. But the Democrats used their window of opportunity to pass a massive overhaul of the healthcare system (Obamacare) and a large stimulus program. Both proved highly unpopular with citizens, and one-party Democratic rule was repudiated in 2010 when passionate Tea Party-inspired voters turned against the Democrats, giving the GOP control of the U.S. House and several more Senate seats.

The result has been highly-partisan, closely-divided, gridlocked government for the last two years, with little accomplished. Republicans will likely maintain control of the House this year, while the Senate and presidency are up for grabs. If Republicans win all three, they will have their chance to govern and will have a short window to achieve economic progress before voters get impatient. If Obama wins, but Republicans control one or both houses of Congress, expect more monumental partisan battles, with perhaps some degree of compromise and progress.    

Will there be any surprises in Utah’s congressional elections?
The biggest development in Utah politics is the turn away from Tea Party, far-right politics, toward more a more mainstream, practical, less ideological brand of politics. Sen. Orrin Hatch, for example, easily dispatched his Tea Party challengers. Many business leaders hope the future focus of Utah politics will be more on problem-solving and less on ideological purity.

Utah’s congressional delegation will, no doubt, remain Republican-dominated after Nov. 6. Utah’s Democrats have nominated excellent candidates for Congress, including former Utah Sen. Scott Howell for the U.S. Senate. The Democratic candidates are business-oriented and would be good leaders. But the electoral math just doesn’t add up for most of the Democrats, especially in a year when Mitt Romney will be at the top of the Republican ticket.

If Sen. Hatch wins, as expected, and Republicans win control of the U.S. Senate, he will become chair of the Senate Finance Committee, becoming Utah’s most powerful member of Congress ever. He will be in a position to have great impact on heathcare reform, entitlement reform, tax reform and a host of other issues.  

Rep. Rob Bishop will also move up and have significant influence on public lands issues. Rep. Jason Chaffetz has worked very closely with the Romney campaign and will be a leader in Congress, or take a meaningful spot in a Romney administration.

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