After Barack Obama's victory, what now for business?
'America’s long term fiscal health cannot be repaired by either tax increases or spending cuts alone,' says CBI international director
Barack Obama is facing many tough decisions to restore the long-term economic health of the US after he today won his second term as president, the CBI international director has said.
The US will have to "re-learn the art of compromise", said Rhian Chilcott, to overcome the hurdle of a divided congress and successfully tackle challenges such as the coutnry's looming "fiscal cliff" .
"Congratulations to President Obama on his re-election," said Ms Chilcott. "This is certainly a historic victory – a second victory for America’s first black president. But it’s now that the hard work begins.
"The election results do demonstrate that the US is a divided country. And the President will have to work with a divided Congress.
"That means everyone will have to re-learn the art of compromise. For example, America’s long term fiscal health cannot be repaired by either tax increases or spending cuts alone: there will have to be elements of both."
Ms Chilcott spelt out the key issues that Mr Obama would have to confront to reassure business on both sides of the Atlantic.
"If Congress doesn’t act by the end of the year, the US will go over the so-called fiscal cliff," she said. "Automatic spending cuts and tax increases will take as much as $560bn out of the already-fragile economy next year. US politicians can’t allow that to happen.
"Then, in 2013 and beyond, there’s a shopping list of important issues to deal with – fundamental tax reform to restore America’s competitiveness, a trade deal with the EU to negotiate, and of course climate change – which Hurricane Sandy has brought back into political focus."
The CBI’s Washington team will be monitoring the election, and producing an “Election Insights” e-mail for members this week. Ms Chilcott will be speaking to members in Brussels on 22 November and in London on 29 November. For more information on any of these services, contact firstname.lastname@example.org