Addressing Fears of Recession
President Obama says the U.S. is not facing another recession. But he acknowledges an unemployment rate that is too high and an economy that's not growing fast enough. He has been criticized for not moving more quickly to ease regulations that business and industry view as overly burdensome. Today the White House announced new regulatory reforms to address those concerns. It expects the measures to save businesses billions of dollars, spurring them to hire workers. And the president will outline a jobs program after Labor Day. In this hour, economic experts weigh in on ideas to spark growth of the economy and jobs.
senior fellow, Center on Budget and Policy Priorities; former chief economist and economic policy adviser for Vice President Biden.
professor at the University of Maryland School of Public Policy, senior fellow Milken Institute and assistant secretary for economic policy at the Treasury Department from 2006 to January 2009.
Washington correspondent, CNBC.
economics editor, The Economist; formerly, economist at the International Monetary Fund.
a professor of economics at George Mason University, Distinguished Scholar at the Mercatus Center and a research fellow at Stanford University's Hoover Institution.
Although President Obama insists that we are not headed for another recession, many Americans consider the wild fluctuations in financial markets and poor economic indicators as harbingers of a double-dip. Our guests discussed some of the reasons behind the current economic crisis, including the housing bubble, and offered some policy suggestions they think will help get the country out of it.
- "I think the crisis of confidence is real. I think there is a lot of concern and legitimate concern about where the economy is heading. I think no good economist should predict a recession or not. I don't think we really have any idea of what's going to happen. There could be a bunch of good news that comes along, and suddenly things look rosier," Roberts said."
- "You have every reason to be frightened of the stock market right now when it's doing this kind of thing every day. But unemployment, still very high. I mean, if your brother-in-law is still out of work, and - you're going to feel it. And it's going to scare you that you might be out of work. And housing - this is an economic crisis that started in the housing sector," Javers said.
- "We are in a world where we had a huge housing bubble that's bust. We've got very over-levered consumers. We have consumers, therefore, that are reluctant to spend more, reluctant to borrow more. That's an ongoing drag on the economy. So people who've looked at those kinds of situations in the past - and there haven't been that many of them - said that this recovery was always going to be a weak and feeble one," Bedoes said.
- Diane asked the guests what one thing they would each do right now if they could to help spur economic growth.
- "There's no silver bullet. But here's an idea for you. It's called FAST, fix America's schools today. There are 100,000 schools out there, public schools. And almost every one of them is in an ill state of repair. They need insulation. Many need retrofits, new windows, new boilers. Think of the energy efficiency savings," Bernstein said.