The deteriorated outlook from today’s Blue Chip Economic Indicators® proves one thing: uncertainty from the upcoming fiscal cliff will continue to drag the economy downward.
The Blue Chip consensus downgraded its forecast for real GDP growth by 0.1% for the last three quarters of 2012 and the entirety of 2013. However, this forecast assumes
that the expiring Bush tax cuts will be renewed, the Eurozone situation will not worsen, and China’s economy will have a soft landing.
Rep. Kevin Brady (R-TX), Vice Chairman of the Joint Economic Committee, noted, “The
President has continued to make poor economic policy decisions that are generating uncertainty. 88.6% of Blue Chip economists cited uncertainty over the future of the tax cuts as an important factor slowing economic growth and job creation. That’s the real issue here and, unfortunately, the President is ignoring the numbers.”
“If the Blue Chip consensus forecast turns out to be correct, there will be fewer payroll jobs in America at the beginning of November than when the President took office in January 2009. In fact, if the forecast is correct, the only month the unemployment rate will have been below 8% during President Obama’s term is the month he took office.”
Brady said, “It is alarming that almost a quarter of the economists believe that a recession will begin in the United States during the next twelve months and that’s if we don’t hit the “fiscal cliff” in January. We need to extend the current income tax reductions for everyone, repeal ObamaCare, and loosen the suffocating web of red tape to create new jobs.”