Leading Economics Bloggers Share Bleak Outlook, According to Kauffman Foundation Survey

Kauffman releases findings in its inaugural 'Economic Outlook: A Quarterly Survey of Top Economics Bloggers'

(KANSAS CITY, Mo.), Feb. 2, 2010 – Despite promising economic growth numbers in the last quarter of 2009, economics bloggers have a grim outlook, according to a new Ewing Marion Kauffman Foundation survey released today. Just last Friday, the U.S. Bureau of Economic Analysis released its advance report of a 5.7 percent growth rate (annualized) of gross domestic product during the fourth quarter of 2009. But even before the fourth-quarter estimate was published, 48 percent of economics bloggers said in the mid-January survey that the economy was "worse than official government statistics show."  Most respondents rate the overall condition of the economy as "mixed," and 33 percent say it is still "facing recession" or "weak and recessing."

In the inaugural Kauffman Economic Outlook: A Quarterly Survey of Top Economics Bloggers, the Kauffman Foundation sent invitations to more than 200 top economics bloggers, most of whom were on the Palgrave's econolog.net December 2009 rankings. The Foundation will be surveying the bloggers about their views of the economy, entrepreneurship and innovation every quarter to provide a new gauge for the nation's fiscal health.

"As independent thinkers who are immersed in discourse through the innovation of blogging, these economics writers have a unique voice and perspective, and potentially profound influence," said Tim Kane, senior fellow at the Kauffman Foundation and author of the study. "While they individually express themselves virtually every day, we think their collective voice needs to be heard."

Research highlights include:

The bloggers expect the greatest growth prospects over the next three years to be in interest rates, inflation and the budget deficit. U.S. output and jobs are expected to increase, but with about half the intensity of growth in global output.

The panel assesses conditions as "bad" or "very bad" for small business (52 percent) and bank lending to business (51 percent) and individuals (50 percent). The outlook for entrepreneurs is a relative bright spot, with opinions mixed between bad conditions (36 percent) and good (26 percent).

Seven out of 10 bloggers say the federal government is too involved in economic matters, and they share a clear consensus for action. Tax cuts, especially on payrolls, are recommended, and three ways to cut the deficit had overwhelming support: Medical entitlements, Social Security and Defense should all be reduced. 

Ten core questions and seven topical questions were designed in coordination with a distinguished board of advisors, which includes:

Robert X. Cringley – I, Cringely

Brad DeLong – Grasping Reality

Laurie Harting – Palgrave Econolog

Scott Jagow – Marketplace Scratch Pad

Paul Kedrosky – Infectious Greed

Lynne Kiesling – Knowledge Problem

Donald Marron – DMarron.com

Mark Perry – Carpe Diem

Wade Roush – Xconomy.com

Allison Schrager – FreeExchange

Nick Schulz – Enterprise Blog

Yves Smith – Naked Capitalism

Alex Tabarrok – Marginal Revolution

For the survey's full report, click here: http://www.kauffman.org/uploadedFiles/econ_blogger_outlook_q1_2010.pdf