A US economic recession is likely not imminent, according to Economist Dr. Charles Ballard who explained the current economic outlook at the May 24th Capitol Issues Forum.
The US is experiencing its second longest economic expansion at 107 months, which began in June 2009. The years 1991 – 2001 experienced 120 months of growth and, according to Ballard, could be overlapped by the current expansion before another recession hits.
“In the words of Yogi Berra,” Ballard joked, “‘it’s tough to make predictions, especially about the future.’” Ballard explained that the projections are not bad for the future, but that it is impossible to predict the impact of natural disasters or political maneuvers that could be disruptive to the economy. He described the economy as “not fabulous, but decent” and “the little engine that could,” which entails steady, slow, low growth numbers but not an economic boom by any means.
“I would be surprised if we were to get to 2022 without a recession, but I’ve been surprised before,” said Ballard, professor at Michigan State University, noting that it is probable the US would reach the middle of 2019 still in an expansion.
Ballard said some recent threats to the economy have subsided, like the stock market bubble in January or the possibility of a trade war. However, oil inventories are low, labor shortages exist in some part of the country, interest rates are rising, and recent tax cuts are putting pressure on the Federal Reserve. All of these situations could prove to hasten a recession.
His biggest concern for the long term economy is the great amount of national debt the US holds, and current proposals to limit tax revenue when there is crumbling infrastructure and unfunded liabilities.