Election season is just around the corner in the U.S. and the country’s deep fiscal hole remains a political hot potato. If the U.S. Congress drags its feet again and does not meet a definitive agreement on the fiscal budget, aerospace and defense exchange traded funds will likely see turbulence.

Congress has until Jan. 1, 2013 to make things right or else a mix of tax hikes and $1.2 trillion in budget cuts are set to go off, reports Stacy Curtin for the Daily Ticker.

The aerospace and defense sector witnessed a similar scare last year when Congress dawdled ahead of raising the debt ceiling, which led to S&P’s downgrade on U.S. sovereign debt. [Budget, Spending Concerns Ground Aerospace and Defense ETFs]

Most economists estimate that without an answer to the country’s budget, there will be a $600 billion hole in the economy in 2013.