LEWISBURG — Economist Anirban Basu said there are bright spots in the economic world for the United States, which is five years out of the recession and whose economy is expected to grow about 2 percent.
But Basu, chairman and chief executive officer of the Baltimore-based Sage Policy Group, said that’s still not a great performance, referring to the United States as simply one of “the least worst,” economies in the world.
“It’s like living in one of the nicest homes in a really bad neighborhood,” he said.
Basu returned Thursday as the keynote speaker at the Greater Susquehanna Valley Chamber of Commerce’s annual economic forecast luncheon held at La Primavera in Lewisburg. He said the economy is in a fragile place right now, seeing good
developments, but some concerning issues.
The United States’ and world economy has grown and “things are getting better,” but “America has a debt and deficit problem,” he said.
“We’ve got an issue,” he said.
Another potential problem: America is becoming “a part-time nation,” Basu said, referring to the fact that while the United State has not added back the number of full-time jobs lost during the recession, the number of part-time positions
continues to grow. One of the major reasons is healthcare and the looming Affordable Care Act.
“All (employers) know ... is that the ultimate liability is based on the number of full-time employees,” he said.
And Pennsylvania is lagging behind the rest of the nation in job creation, ranking 48th in the nation in job creation this year, Basu said.
But the Valley has been doing well in terms of unemployment, with unemployment numbers for all four counties down from last year, Basu said. One reason is that the “health care and education” category is the fastest growing in the nation, and this region is packed with opportunities for those fields.
“It’s the preeminence of education and health care,” helping those numbers in the Valley, he said.
Overall, Basu predicts the coming couple of years could be great for the economy, but could be fraught with challenges, due to the growing national debt.
“The next few years are going to be treacherous and we need good leadership,” he said, referring to the fact that the term of Ben Bernanke, chairman of the Federal Reserve, is almost up.
But there could be a bright future ahead.
America is once again “a fashionable place to produce things,” and companies are bringing production once outsourced overseas back into the country, Basu said.
The generation of young people currently in high school and college make up a large population group, which should be able to support some of the nation’s entitlement programs, and the group is the most educated in generation in the
“We could be in a very fine place (in five to 10 years),” he said.