The stage is prepared for Wednesday's debate.

The stage is prepared for Wednesday's debate. David Goldman/AP

Jobs and deficit likely to dominate debate

Some of the 90-minute discussion will focus on the role of government, and governing style.

Wednesday evening’s presidential debate is a chance for voters to see where President Obama and his GOP challenger Mitt Romney stand on key domestic issues such as job creation, the budget, and health care policy. The 90-minute event, moderated by PBS’s Jim Lehrer, will be divided into six 15-minute sessions—half on the economy and the rest on health care, the role of government, and governing style.

Here are some of the issues likely to come up:

Job creation. Both candidates are likely to be grilled on how they would bring down the nation’s 8.1 percent unemployment rate, including their strategy to push measures through a gridlocked Congress. Expect Romney to be asked how he’ll create a promised 12 million jobs, and how that number was calculated. Obama offered a series of job-creation proposals in his State of the Union address at the beginning of this year. He might be asked what he's learned from his struggles to pass those proposals and his difficulty in bringing down stubbornly high unemployment.

Deficit reduction. The Congressional Budget Office has forecast that debt held by the public will surge to 90 percent of gross domestic product in the next 10 years. Plans put forth by Romney and his running mate Paul Ryan would rein in entitlement spending and overhaul the tax code while bringing down income-tax rates. But Romney has provided few specifics on the tax plan, and independent analysts have questioned whether it could achieve all of its goals without adding to the deficit. Expect him to be grilled on the details. Obama has offered a plan to reduce the deficit by $4 trillion over the next 10 years. But the number counts savings from the winding down of the wars in Iraq and Afghanistan. The president will likely be asked how he can achieve such a high number without significant changes to the three main debt drivers: Medicare, Medicaid, and Social Security.

Financial regulation. Romney has said he would repeal the 2010 Dodd-Frank financial-reform law. But he has not said what he would put it its place, and a natural question would be whether Romney’s plans would enable banks and businesses to grow without risking another financial crisis. The Dodd-Frank law is a key achievement of Obama’s first term, but critics contend that the regulations are too complicated and have the potential to hamper economic growth. Obama may have to respond to this charge.

The Federal Reserve Board. The central bank has been in the political crosshairs ever since it embarked on a series of extraordinary measures to boost economic growth in the aftermath of the Great Recession. Romney denounced the Fed’s most recent action—a new round of bond-buying intended to drive down long-term interest rates—as a “sugar high” and cautioned that it risks causing a rise in inflation. He has said he wouldn’t reappoint Fed Chairman Ben Bernanke, whose term expires in 2014. Romney could be asked to discuss potential successors. Obama’s White House rarely comments on the politically independent Fed. But in 2010, Obama reappointed Bernanke, who was initially tapped for the Fed by Republican President George W. Bush. A fair question, then, is whether he endorses Bernanke’s methods, and whether he would appoint the Fed chief again or seek a fresh leader of the central bank.

Immigration. Citing the economic benefits, Romney and Obama have both said they want to lift quotas on visas for high-skilled immigrants and to grant permanent residency to foreign students in science, technology, engineering, and math fields. Due to the similarity of their positions, the candidates may be more likely to be pressed on specifics on illegal immigration, where they differ. Romney offered few details on his plan to reform immigration, particularly what would happen to the 12 million undocumented people currently living in the United States, although he told The Denver Post earlier this week that he would not repeal temporary visas for children brought to the U.S. illegally by their parents. Obama, on the other hand, has focused on so-called pathways to citizenship for illegal immigrants, but has failed to get Congress to pass any legislation to that effect. Obama vowed this spring in an interview with Univision to pursue comprehensive immigration reform in the first year of a second term, but he could be pressed to detail how he would overcome Republican congressional opposition.

Energy jobs. Both candidates have been singing the praises of the energy sector as a potential source of jobs. Romney has touted jobs tied to oil, gas, and coal, also known as “brown” jobs, while Obama has emphasized "green" jobs tied to renewable-energy development. Romney could face questions on the environmental consequences of expanded development of fossil fuel industries. Obama could face questions over government loan guarantees provided to failed solar-panel-maker Solyndra.

Health care reform. On health care, Romney has alternately praised and criticized the approach to expanding health coverage at the heart of his Massachusetts plan and Obama’s health reform law. He will need to answer which provisions, exactly, he thinks are right for the country and what policies should replace "Obamacare" if he persuades a new Congress to repeal it. Key among the questions he must answer: Does he want to expand health insurance coverage to Americans who don’t have it? Obama will need to defend the costs of the unpopular health reform law. While it saves money on paper, Republicans have been hammering the law as a new entitlement program and a budget-buster, and the Obama administration’s chief Medicare actuary argues that the law’s Medicare savings are unrealistic.

Medicare. With Paul Ryan’s addition to the Republican ticket, Medicare has become a hot topic in the election. Romney and Ryan support a plan to convert Medicare from a government insurer to a program in which the government subsidizes a variety of private plans. When he talks about Medicare, Romney typically criticizes Medicare cost savings that are part of the Obama health reform law instead of discussing his own plan. A tough moderator will ask him to explain how his proposed system would work and why it would not harm seniors. Obama should, similarly, be pressed to explain how his law can rein in Medicare spending without reducing patients’ access to care. Both Obama and Romney may also be asked to address whether their plans would actually resolve Medicare’s long-term budgetary problems. (Hint: they don’t.)

Role of government. The moderators have set aside a 15-minute block to ask about the candidates’ views on the role of government, a fitting topic in an election in which visions differ so significantly. Romney will need to explain his “47 percent” comments, presumably defending his ticket’s critique of growing government entitlements while explaining when and how government programs should intervene to help Americans in trouble. Obama drew criticism this summer with his "you didn't build that" remark referring to businesses, which aides said was a reference to how public structures enable commerce. The incumbent must also counter concerns that in areas across the domestic policy spectrum—in health care, environmental protection, fiscal policy, financial regulation, and student loans—he has sought to expand the role of government. Each will need to explain where they believe government helps and hampers individual success and economic growth. Expect sharp contrasts.

Relations with Congress. The fiscal cliff, a combination of tax hikes and automatic spending cuts that will kick in at the end of the year without action by Congress, will provide a test of presidential leadership for Obama when lawmakers return to Washington for the postelection lame-duck session. Obama has taken heat for his failed attempts at a deficit deal last year, a failure that led to a credit downgrade for U.S. debt. More broadly, both candidates are likely to face divided government, if current polls are any indication, and both should be able to spell out a strategy for working with their opponents in Congress’s increasingly polarized environment.

Executive authority. Frustrated by a paralyzed Congress, the Obama administration has been making the most of its executive authority to enact domestic policy, including deciding to allow young undocumented immigrants to avoid deportation, requiring the Environmental Protection Agency to regulate carbon dioxide emissions, and allowing states flexibility in interpreting welfare-to-work rules. Romney has promised to use the presidency to issue waivers to undo Obama’s health reform law “on day one.” The candidates are likely to be asked about their visions of the proper roles for the president and Congress, and their views on the limits on executive power in the domestic sphere.