34% of Economists Expect US Recession in 2 Years, Poll

Yassmine Elsayed

A number of U.S. business economists expected a recession in the U.S. by the end of 2021.

34% of economists surveyed by the National Association for Business Economics (NABE), voiced their concern about the risks of some of President Donald Trump's economic policies.

In a report released today, they said they believe a slowing economy will tip into recession in 2021. According to numbers, that's up from 25% in a survey taken in February.

Only 2% of the 226 economists surveyed, who work mainly for corporations and trade associations, expect a recession to begin this year, while 38% predict that it will occur in 2020.

On his part, however, Trump dismissed any concerns about the US economy, offering an optimistic outlook after last week's steep drop in the financial markets. Trump said: "I don't think we're having a recession."

However, Larry Kudlow, Trump's top economic adviser, dismissed fears of a looming recession and predicted the economy will perform well in the second half of 2019. He said that consumers are seeing higher wages and are able to spend and save more.

"We're doing pretty darn well in my judgment. Let's not be afraid of optimism," Kudlow said. He acknowledged a slowing energy sector, but said low interest rates will help housing, construction and auto sales.

Kudlow also defended the president's use of tariffs on goods coming from China. The Trump administration has imposed tariffs on goods from many key U.S. trading partners, from China and Europe to Mexico and Canada. But they have simply retaliated with tariffs of their own.

Before he joined the administration, Kudlow was known for opposing tariffs and promoting free trade during his career as an economic analyst. Kudlow said Trump has taught him and others that the "China story has to be changed and reformed."

"We cannot let China pursue these unfair and unreciprocal trading practices," Kudlow said.

Earlier, concerns emerged that Trump's tariffs and higher budget deficits could eventually dampen the economy.

The financial markets last week signaled the possibility of a U.S. recession, adding to concerns over the ongoing trade tensions and word from Britain and Germany that their economies are shrinking.

The economists surveyed were skeptical about prospects for success of the latest round of U.S.-China trade negotiations. Only 5% predicted that a comprehensive trade deal would result, 64% suggested a superficial agreement was possible and nearly 25% expected nothing to be agreed upon by the two countries.