It's extremely unlikely the federal government would ever completely bow out of economic policymaking. But with the American Jobs Act likely to stall in the Senate—a victim of opposition over stimulus spending and a tax surcharge on millionaires—more uncertainty and more economic stagnation could be on the way. After all, messy politics lead to messy policymaking, and while the U.S. economy might not be technically in recession, for many Americans and businesses it sure feels like it.
"Our government officials need to switch from treating fundamental economic problems and treat confidence," Paulsen says. "Corporations don't need more cash at this point. They need the confidence to employ that cash."