Is The US Economy Facing A Recession?

Fears of recession are overblown

Trump's trade war is taking its toll

 Unsplash: Sean Pollock

It is very unlikely that the US is heading into a recession, holds James Piereson of City Journal. Recent forecasts of an economic downturn are likely driven, in part, by detractors of President Trump, who hope to undermine his reelection campaign. Interest rates are low and declining, prices remain stable, as does economic growth. The US is involved in no major wars. This is not the setting for recession. America’s GDP grew by 2.4% in 2017 and 2.9% in 2018. While the US is somewhat underperforming economically, the fact the post-2008 recovery has been slow solid may make it more solid. A trade war with China would be bad but it will probably be avoided for this reason.

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75% of 226 economists surveyed by the National Association for Business Economics believe an American recession is coming by 2021, reports Jonnelle Marte of the Washington Post. As the global economy stutters, the growing trade war with China is likely to cause major economic damage. Germany, as well as 8 other major economies are on the edge of recession. President Trump’s tariffs on imports from other nations are affecting consumers, reducing their buying power. Tariffs on China could cost the US $650 per household every year, according to one estimate. These higher prices are also causing businesses to hold back investment, which will further economic stagnation.

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