The panelists said “disappointing” is probably the word that best describes next year’s economic outlook, with Witte laying the brunt of the blame on Washington, D.C.
The post-recession economic malaise could be attributed to the crisis itself, international economic turmoil such as the European bond markets, and the phase-out of the federal stimulus, Witte said.
“Frankly, we’re five years out from the recession, and all of those excuses are getting a bit long in the tooth,” he said.
With those issues fading, the lone culprit standing seems to be the lack of a coherent federal fiscal policy.
“For 16 days, the government was shut down, and in a couple of months, we get to do it all over again,” Witte said. “How many of you think it’s going to be sweetness and light this next time?”
Conover estimated the state economy could possibly double the national economic growth next year, but said growth is expected to remain anemic until the latter half of 2014.
Inflation is expected to remain low, but the panelists said they were perplexed by endgame scenarios for the Federal Reserve’s quantitative easing program. To keep interest rates low and to calm bond markets, the Fed has been purchasing about $85 billion in bonds each month, a policy Conover called “completely unsustainable.”
If Congress can overcome the current policy deadlock and the Fed can “taper” down its purchases of securities without interest rates skyrocketing, the U.S. could see 3 percent growth next year, they said.
Conover called this year’s 2 percent growth rate both “below sub-par” and “unacceptable.”
Scott Smith is on Twitter @JasonSSmith1; email him at firstname.lastname@example.org.