The election is over and there have been shake-ups in both Washington and Raleigh. There will be many new faces in the U.S. Congress and the North Carolina General Assembly.

Although I’m an economist and not a political analyst, I think it is obvious many voters were unhappy this year, and this unhappiness had a big impact on their votes. Polls showed voters’ displeasure focused around three areas: the economy and jobs, government spending and debt, and taxes.

So what can our new leaders do about this discontent, especially in these three areas? Unfortunately, there are some economic realities — or constraints — that may either limit what may be done or present unpleasant alternatives for change.

The Economy: While “officially” the recession is over — because we have seen an increase in the productive output of the economy since June 2009 — the pace of economic growth has been anemic. Job improvements have been agonizingly slow. A significant part of the decrease we’ve seen in the unemployment rate is simply a result of jobless workers dropping out of the labor force and, therefore, not being counted as unemployed.

So the refrain heard in political campaigns was “jobs, jobs, jobs.” But what’s holding back job creation? Is it the fear of public debt and taxes? Is it lack of confidence by consumers? Or is it something to do with what the recession did to household finances?

Although a case can be made for each, I and many other economists pick answer No. 3. The recession devastated household wealth, destroying $15 trillion of net asset value at its peak, and this wealth is just beginning to come back. Households entered the recession with record high levels of debt (supported by the record levels of wealth).

However, with wealth down, households have been forced to pay down on debt and save more. What’s left out is household spending. Households won’t be able to spend like they used to until they get their debt situation back under control. Yet, since our economy is largely driven by household spending, frugal households translate into slow economic growth.