Despite promising economic growth numbers in the last quarter of 2009, economics bloggers have a grim outlook, according to the first quarter 2010 Kauffman Economic Outlook: A Quarterly Survey of Leading Economics Bloggers. In January 2010, the U.S. Bureau of Economic Analysis released its advance report of a 5.7 percent growth rate (annualized) of gross domestic product during the fourth quarter of 2009. But even before the fourth-quarter estimate was published, 48 percent of economics bloggers said in the mid-January survey that the economy was "worse than official government statistics show." Most respondents rate the overall condition of the economy as "mixed," and 33 percent say it is still "facing recession" or "weak and recessing."
Research highlights include:
- The bloggers expect the greatest growth prospects over the next three years to be in interest rates, inflation, and the budget deficit. U.S. output and jobs are expected to increase, but with about half the intensity of growth in global output.
- The panel assesses conditions as “bad” or “very bad” for small business (52 percent) and bank lending to business (51 percent) and individuals (50 percent). The outlook for entrepreneurs is a relative bright spot, with opinions mixed between bad conditions (36 percent) and good (26 percent).
- Seven out of ten bloggers say the federal government is too involved in economic matters, and they share a clear consensus for action. Tax cuts, especially on payrolls, are recommended, and three ways to cut the deficit had overwhelming support: Medical entitlements, Social Security, and Defense should all be reduced.