A majority of business economists now view the government’s tax and spending policy as moving too aggressively to stimulate economic growth, setting up a potential increase in the deficit in the coming years, a new survey shows.
That view emerged from the latest economic policy survey by the National Association for Business Economics, polling 211 members at companies and industry groups. The survey by the professional association for business economists, academics and others who use economics in the workplace was released today.
The current NABE survey found 52% of economists consider the government’s fiscal policy “too stimulative,” compared with only 20% in the previous survey released in August. Also, 37% of respondents judged the government’s tax and spending policy as “about right,” down from 46%.
By contrast, the economists are more supportive of the Federal Reserve’s interest rate policy: more than 6 in 10 peg it as “about right.” That’s the highest percentage in eight years, according to NABE.
“Overall, the (survey) panel expects the deficit to grow as a percentage of the economy in the longer term,” NABE Vice President Kevin Swift, chief economist of the American Chemistry Council, says in a statement.
The NABE economists, reflecting the prevailing view of corporate America, continue to have a strong preference for more conservative fiscal policy in the long run.
