WASHINGTON (Reuters) — The budget deficit has overtaken terrorism as the greatest short-term risk to the U.S. economy, and concern about the current gap is rising, a survey of U.S. businesses shows.
In a survey of 172 members of the National Association for Business Economics, 27% said the deficit or government spending is the largest short-term threat to the economy, up from 23% who thought so in August. (Related: Top economic forecasters.)
Terrorism dropped to second on the list, with 24% saying it is the biggest threat, down from 40%. Those most concerned about the deficit in the current account — the largest measure of U.S. trade with other nations — tripled, to 15% from 5% in August.
“Longer term, the costs related to the aging of the population dominate the challenges to sustaining economic growth. However, the panel is doubtful that this Congress will pass needed Social Security reforms,” said David Wyss, chief economist at Standard & Poor’s, who conducted the analysis for the report.