Economist calls on Congress to head off possible financial crisis

An Oklahoma economist predicted that the United States is guaranteed a renewed, financial Armageddon after next month’s presidential election if the wrong economic decisions are made by policymakers.
“There is just so much uncertainty. Not just with respect to the outcome of the election, but about whether Congress is going to extend the Bush era tax cuts, whether they’re going to extend the payroll tax cuts, whether they’re going to enforce the mandated federal spending cuts that are supposed to take effect in January,” said Steven Agee, director of the Steven C. Agee Economic Research and Policy Institute at Oklahoma City University.

So far, there has been no indication of any action or sense of urgency on Capitol Hill and that concerns Agee.

 “If they don’t take any action, which they haven’t done so far, and just sit on their hands and do nothing, we’re going to go back into a recession. It’s a mathematical certainty,” he said.
“Government spending will be cut quite dramatically. Our discretionary income will drop because those (Bush era and payroll) tax cuts will expire. And 70 percent of gross domestic product is consumer spending.”

Agee was on the board of directors for the Oklahoma City branch of the Federal Bank of Kansas City, which advises the Federal Reserve about the economy to help ensure the nation’s economic stability.

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