The United States economy is all sunshine and lollipops? Apparently so, says a survey of economists.
A new survey released Monday by the National Association of Business Economists (NABE) shows that a majority (53 percent) of these economists say the Federal Reserve’s stimulus program is “on the right track.” A little more than one-third (39 percent) believed the United States central bank was doing too much.
The semiannual survey also found that a strong majority of NABE economists think the U.S. will face little to no inflation risk at all within the next several years. Of course, these are the same economists who could not forecast a recession or housing collapse a few years ago.
Furthermore, a growing number of NABE economists are approving of the job done by the White House and Congress. According to the survey, 42 percent say U.S. fiscal policy is “about right,” which is up from 31 percent from the same period a year ago. Meanwhile, 34 percent said it’s “too restrictive.”
Economists were also asked how the U.S. government should handle the $17 trillion national debt. One-third of economists pointed to a combination of budget cuts and tax increases, seven percent cited raising taxes and one-quarter argued that Washington should only make budget cuts to deal with the debt and deficit.
Should the average person listen to these economists who have been proven wrong on multiple occasions? Well, one can allude to two primary points to suggest that these economists should perhaps be dismissed.
A Mar. 2007 NABE Economic Policy Survey discovered that one-third of economists purported that the greatest threats to the overall economy were defense and terrorism, while one-quarter listed healthcare. At the time, according to these economists, the biggest strength the U.S. had was its economy.
In 2009, another NABE survey highlighted that most economists presented the case that the worst of the recession is over. This is pretty difficult to agree with considering that unemployment remains high, part-time jobs are prevalent, overall debt levels are still soaring and the market is reforming bubbles on the verge of bursting.
“The good news is that this deep and long recession appears to be over and, with improving credit markets, the U.S. economy can return to solid growth next year without worry about rising inflation,” NABE President-Elect Lynn Reaser noted in a statement in Oct. 2009.
This is a perfect reminder of a Mises Institute article that criticized mainstream economists of always being wrong but claiming that “this time things are different.” Here is what Daniel J. Sanchez wrote in 2012:
“Austrian economists cannot retreat into the safe haven of epistemological nihilism when the logic of their arguments turns out to be faulty. Mainstream economists, on the other hand, when the facts fail to correspond to their hypotheses, can always claim that “this time things are different”, which is a straightforward implication of the fact that any given set of sufficiently complex empirical data is compatible with a number of mutually exclusive empirical (but not logical) interpretations.”
The 2014 NABE survey was conducted with 257 economists between Jul. 22 and Aug. 4.
If the Fed is good for business it must be good for workers.