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Does uncertainty cost the economy jobs? Fed researchers call it a big problem.

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The study sheds light on an issue that's already in the public eye. In the presidential election, critics of President Obama say he failed to provide clarity on several vital fronts – from the direction of tax policy and the national debt to whether an increase in regulatory legislation will continue if voters grant him a second term.

"Washington’s policies are not meeting our country’s fiscal challenges and are prolonging uncertainty among small businesses,” economist Martin Regalia of the US Chamber of Commerce wrote in July, for example, adding to an already loud drumbeat from the business community.

The research report, published by the San Francisco Fed, isn't an argument in favor of a particular fiscal policy, or against Mr. Obama's reelection. For one thing, Fed employees steer clear of offering policy advice outside the Fed's own sphere of monetary policy. Also, the report's definition of "uncertainty" is broad, going beyond what a president can control.

But one implicit message in the report is that it would help the economy if the president and Congress can clarify what will occur at the end of this year, when a "fiscal cliff" of tax hikes and spending cuts is scheduled to take effect. Businesses and consumers are widely expecting that policymakers won't send the nation fully "over the cliff" come January, but it's unclear what will actually happen and when.

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