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The Week Ahead: Dancing on the edge of the fiscal cliff

We are beyond economic platitudes and broad policy strokes. Talking points of lower taxes, taming out-of-control government spending and tackling ever-rising health care costs are necessary waypoints on the campaign trail. As the Republican National Convention gets under way in the week ahead and the Democratic National Convention the following week, the campaign trail continues to point directly at the fiscal cliff.

The combination of expiring tax cuts and mandatory government spending cuts threatens to undermine what slow growth the American economy has been able to muster in recent months. On the eve of the presidential nomination conventions, the nonpartisan Congressional Budget Office raised the stakes. The CBO warned the fiscal cliff is steeper than originally thought. And we're already slipping toward the edge.

Its report predicts that if nothing happens to steer clear of the cliff, the economy will shrink and unemployment will jump. Unfortunately, these warnings have not led to any momentum on avoiding the avoidable. Instead, the political parties have approached their convention weeks with no signs of movement or compromise toward rescuing us from the drop ahead.

No matter. The warning signs are here. Investor confidence is fragile. Companies are becoming more frustrated, and consumers are more frugal. It would be encouraging for the economy to see a path away from the cliff emerge from the political cheerleading in the weeks ahead.

Tom Hudson, anchor and managing editor of "Nightly Business Report," can be followed on Twitter@HudsonNBR.