Economy faces challenges, but University of Nebraska economist doesn’t fear recession
LINCOLN - A University of Nebraska economist says the United States economy faces a number of pressures, but he doesn’t see recession on the horizon.
University of Nebraska–Lincoln economist Eric Thompson points out we now are in the ninth year of the economic expansion.
“It’s been a frustrating expansion at times, because other than a quarter here, a quarter there, it has tended to be a slower economic expansion,” Thompson tells Nebraska Radio Network. “But it has been very long-lived.”
Thompson explains some of the pressures economies face are natural, such as rising gas prices, with some induced by public policy, such as the economic uncertainty produced by the Affordable Care Act.
While public policy such as tax reform and regulatory reform gave the economy a boost last year, some public policy this year has been less positive, according to Thompson, who says an increase in federal spending has put pressure on the economy as have trade uncertainties. Thompson says even if increases in tariffs have been used by the Trump Administration as a negotiating tool, they still have hurt Nebraska agriculture, business, and consumers.
The European and Chinese economies have cooled a bit, says Thompson, which puts pressure on the United States economy.
Recent moves by the Federal Reserve to push interest rates up have come at a slow and steady pace, according to Thompson, who sees the Fed moving to normalize its practices which would prepare it if the economy falters.
Those challenges might seem daunting, but Thompson says the economy typically faces such pressures.
“It’s certainly true right now as well,” Thompson says. “So, there’s always that potential out there the economy could slip into recession. I am not especially worried at this moment.”