No confidence in this government, said one respondent to the AMM survey of metal company executives. We need to make our own best decisions from a business standpoint no matter what Washington does or doesnt do.
This sentiment, and others similar to it, were common responses in the survey (see page 10), reflecting a continuing sense among industry leaders that the government is somehow directly responsible for the slow growth in business that surely keeps many of them awake at night.
In fact, more than half of all survey respondents said they believe the business environment in 2014 will be less certain because it is an election year. But there is another viewpoint. Anyone who blames market conditions on the fact that it is an election year is an idiot, said another respondent. Company sales are based upon demand for products.
So which outlook is closer to the truth? Perhaps some other results of the survey are instructive:
>> More than 80 percent of respondents said that recent events in Washington (surely including the government shutdown, the fiscal cliff near miss and the new health-care law implementation fiasco) made the business environment less certain.
>> By a two-to-one margin, respondents said that growth in the U.S. economy rather than foreign economies will play the most significant role in determining the price of metal products in 2014.
>> Three-quarters of respondents said the domestic economy will not fully turn around until 2015 or later.
The responses suggest a concern about government leadership as the fallout of the Great Recession enters its seventh year. More and more circumstances are beginning to resemble Japans so-called lost decade of the 1990s, a fate some economists tried to warn us about as Washington began its gridlock five years ago.
I think what were hearing from metal executives is similar to what were hearing from U.S. citizens overall: Something just doesnt feel right about where were at right now, and the government doesnt seem to understand that.
Yes, its true that the stimulus package should have been bigger, that we should have had at least one massive federal infrastructure program by now and that concern over the debt and deficit are all out of proportion to what historical experience and common sense should be telling us about how economies work. But at a certain level, year after year the government-is-making-things-uncertain viewpoint becomes a self-fulfilling prophecy, a distraction that psychologically keeps us from fully working our way out of this mess.