As folks count the blessings of the past year and look ahead to 2009, Iowa State University economist David Swenson suggests Iowa’s economy was more blessed than cursed in 2008. "We had some really good performance in the ag sector; we had some really good performance in manufacturing exports that seems to have propped the Iowa economy up over the latter part of last year and the early part of this year and made us look a little bit better. We haven’t been shrinking in terms of employment like the national pattern," Swenson says. "Our employment has held up so what we’ve had is a lot more positives carrying us through than much of the rest of the nation."
Over the past few decades, economists often argued Iowa was among the last of the 50 states to see its economy slip and among the last to see it rebound. Swenson says that’s not the case nowadays. "One of the processes of our economy diversifying out of the troubles that it got (into) in the 1980s was our economy became much more aligned with the national economy…When it goes up, we go up and when it goes down, we go down," Swenson says, "and so that’s what our best expectation is for this economy here in Iowa."
Creighton University economist Ernie Goss predicts the economy in Iowa and the rest of the Midwest will rebound soon. "This recession, in my judgment, is going to be over toward the end of 2009," Goss says. "…If you look out beyond the current recession…if Iowa and this part of the country, if we see open and relatively free trade, we’re going to see agriculture growing at a really good pace."
Another reason Goss predicts a quick rebound in the Midwest in particular is banks here are sound. "They’ve got very good balance sheets out there and if you look at the farm sector…Farm income is holding up pretty well," Goss says, "and the companies that have close ties to agriculture are doing well."
Goss rejects the notion the current economic downturn rivals the Great Depression. "We Americans are blessed and somewhat cursed by this economic amnesia," Goss says. "Most Americans don’t remember the last recession of 2001 and that’s a good thing, in some ways."
Goss and Swenson made their comments during a joint appearance on "The Iowa Journal" on Iowa Public Television.