With less than one week until the election, we wanted to take this opportunity to update you on the potential legislative scenarios that might result from a Romney or Obama victory. National polls are looking dead even, and although the road to 270 electoral votes looks more difficult for Romney that it is for Obama, this election could still easily go either way. In fact, according to analyst Charlie Cook, the chances of a split popular vote/Electoral College vote are very real, with Romney looking to be “at least an even-money bet for the popular vote” and Obama having an edge in the electoral vote. Toss-up states like Colorado, Florida, Iowa, New Hampshire, Virginia, Ohio and Wisconsin will be pivotal in determining the outcome of this election.

Regardless of who wins the presidential election, several factors, including the outcome of the Congressional races, the shape of the debate, the winning margin and party strength, will all impact what the next administration is able to accomplish. For example, if Romney is elected president and Congress remains divided, the GOP House will move on the Romney agenda but a Democratic Senate will resist. Tax cuts and tax reform, health care repeal, energy exploration and re-writing Dodd-Frank could all run into filibuster scenarios, handcuffing Romney on big-ticket items. Additionally, the Ryan budget and its entitlement reforms would likely run into opposition from a Democrat-controlled Senate. According to National Journal, the competition for the White House in 2012 “could produce the greatest issue divergence between the parties in decades.”

Energy

Though Obama’s “cap-and-trade” bill failed previously in the Senate, if reelected, he will likely continue to pursue elements of climate-change and carbon-reduction policy. He used his executive authority his first term to issue EPA regulations to cut fossil-fuel emissions from power plants and to ramp up fuel-economy standards for vehicles. Additionally, in an April interview, Obama said, “I will be very clear in voicing my belief that we’re going to have to take further steps to deal with climate change in a serious way.” Some of those steps could include the expansion of oil and gas drilling. Also, Obama is cautiously supportive of hydraulic fracturing, aka “fracking,” although the EPA has issued new regulations for the process. Further, Obama has continued to push for loan guarantees, cash grants, and tax credits for the production of wind and solar power, and tax breaks for the purchase of hybrid and electric vehicles. He has also ramped up the Pentagon’s use of renewable energy through major purchase agreements for wind and solar power and for biofuels.

Romney would like to overhaul the Clean Air Act to streamline environmental controls on coal-fired power plants and oil refineries, and would eliminate EPA’s authority to regulate carbon pollution. Romney would also have the Interior Department conduct an inventory of the nation’s oil and gas resources, and he would permit drilling “wherever it can be done safely.” He says he would streamline drilling permitting with a “one-stop shop” for approval of common activities. To encourage states to allow more exploration, Romney would allow coastal states to share in revenues from offshore drilling. He would promote “fracking” of gas and oil trapped in shale, allowing states to regulate fracking without enduring “overly aggressive interventions” by the EPA. Finally, Romney would want to end loan guarantees, cash grants, tax incentives, and other such spending on clean-energy research; he would instead redirect the money toward basic research in programs such as the Energy Department’s Advanced Research Projects Agency-Energy.

Obama vs. Romney: Energy

Transportation

President Obama has favored stimulus-style infrastructure spending plans in the past, talking up highway, bridge and rail repairs as job creators, and pushed for innovations like high-speed rail and a national infrastructure bank to finance projects with the help of private capital. However, while his transportation reauthorization proposal and annual budget plans have called for increased spending, they have failed to identify funding sources or support an increase in the gas tax which pays for most transportation projects. Congressional opposition to increased General Fund spending and higher taxes resulted in a compromise reauthorization bill which funds transportation projects at current levels plus inflation for the next two years.

Mitt Romney favors increased private sector investment in the nation’s transportation infrastructure, preferring to let states lead the way and rejecting stimulus-style spending as a good way to jumpstart the economy. According to Romney, decisions on worthy projects should be based on need and potential returns. Romney also wants to privatize Amtrak by ending federal subsidies for the money-losing passenger rail system. He’s OK with borrowing to pay for megaprojects if there’s a revenue stream to pay the money back, like tolls or port fees. A recent Politico article provides insight into Mitt Romney’s top transportation advisors and potential priorities. The article is online at http://www.politico.com/news/stories/1012/82302.html.

Deficit Reduction and Spending

Obama believes in deficit reduction over the long term and taxing the wealthy to raise additional revenues. He would like to trim military spending, Medicare, federal pensions, and farm subsidies, while increasing spending on transportation projects, nondefense research, and teacher training. He also calls for a tax break for manufacturers that bring jobs back to the U.S. and for small businesses that hire new workers. Unlike Romney, Obama opposes a cap on spending as a share of GDP, arguing that such a cap would restrict the government’s flexibility to increase spending in tough times. If he is reelected, Obama would likely work with Congress to attempt a “grand bargain” deal that curbs entitlement spending, overhauls the tax code and trims Bush tax cuts for upper-income taxpayers. However, entrenched party positions on entitlements and taxes may prove too difficult to surmount. Some deficit reduction could continue through automatic sequestration.

Romney and a GOP Congress would likely fashion major deficit-reduction measures, reforming Medicare and Medicaid, cutting spending for many domestic programs, and overhauling the tax code to cap federal revenues as a percentage of GDP. If elected, Romney would likely pursue much of the Ryan budget proposal which would turn Medicaid and food stamps into block-grant programs, and give Medicare recipients a subsidy to either buy private health insurance or stay with the traditional fee-for-service program. The Romney budget plan would cut tax rates across the board for individuals, paying for the lower rates by eliminating yet-to-be-specified tax loopholes.

Defense

Obama previously announced plans to cut $487 billion from the Pentagon’s budget over the next decade, partly by cutting 100,000 troops from the Army and Marine Corps, shrinking the troubled effort to field a fleet of V-22 Ospreys, and reducing the Navy’s fleet by 14 warships. The “sequester,” or across-the-board automatic budget reductions, slated to kick in at the end of the year would slice another $500 billion from Defense Department coffers. Obama has made it clear that he doesn’t want to see those cuts take effect, but he says he’s willing to suffer the consequences rather than let Congress off the hook on a deficit-reduction deal. He says he would veto Republican efforts to remove the defense cuts from the sequester. Obama also plans to bolster special operations forces, to expand cyberwarfare capabilities, and to pour money into more-advanced drones, including undersea variants and models that can take off from aircraft carriers.

Romney has promised to reverse Obama’s “massive” defense cuts and boost the Pentagon’s budget. He wants to add 100,000 ground troops, increase the Navy’s ship-buying budget from nine to 15 vessels a year, and maintain the current fleet of carrier battle groups. Romney also wants to purchase more F-35s, a next-generation model of amazingly advanced, but staggeringly expensive, stealth warplanes. He has promised to devote more money to missile defense—including systems designed to shoot down intercontinental ballistic missiles—to protect the U.S. from potential attacks from Iran or North Korea. However, Romney hasn’t specified how much the new programs would cost, and if fully implemented, they would amount to billions of dollars in new spending. He has also called for protecting the Pentagon from the sequester and allowing the full budgetary ax to fall solely on domestic programs. The proposals please the Republican base but run counter to the advice of the Joint Chiefs of Staff, which supports Obama’s budget-trimming proposals.

Obama vs. Romney: Defense

Health Care

There is no doubt where Obama stands on health care, and if he wins the White House, the Affordable Care Act remains intact and will likely remain the law of the land for decades. Even if Republicans secure both chambers of Congress, an Obama veto would block any GOP attempts to reduce funding for core elements of the health care law through “reconciliation.” The Obama administration will be fully occupied with implementing the most sweeping provisions of the act.

Romney, on the other hand, has vowed to let states opt out of the law’s requirements as soon as he becomes president – and to push for legislation to repeal it outright. He wants to let states pick and choose among the rules that the federal law puts on insurance plans, such as limiting how much they can spend on overhead or requiring reviews of premiums that increase 10 percent or more. Romney also proposes capping medical-malpractice awards and enabling individuals and small businesses to join together to buy insurance coverage. Additionally, he wants to allow insurers to sell policies across state lines, a change that advocates say will increase competition and lower prices.

Obama vs. Romney: Health Care

Financial Reform

The Dodd-Frank financial reform law, put in place by Obama and Geithner in hopes of preventing a repeat financial crisis, also remains intact if Obama is reelected. Romney has criticized Dodd-Frank for sowing uncertainty among businesses and financial institutions and for chilling lending, particularly by smaller banks. He wants to scrap the law and replace it with a “streamlined regulatory framework,” although he has offered few details on what that might look like.

This post was origionally published by Keystone Public Affairs.