Consumers can’t return to their irresponsible precrisis levels of spending, either, and political stakeholders are handcuffed by partisan gridlock.

“Is the political system going to save us? Of course not,” he said. “The conventional wisdom that political paralysis is detrimental to the economy kind of flies in the face of the facts that in the last two years of most administrations, almost nothing get’s done. The pivot is towards agenda setting, not policy making.”

Oil prices are another unlikely source of economic resurgence, says Goolsbee—though the collapse in oil markets was driven in part by oversupply, weak global demand, especially in China, Europe and emerging markets, will keep prices low in the near term.

“It’s still obvious that our long-run prospect are superb,” Goolsbee said. “Over the next 12 to 18 months, though, it’s not going to be all that fun… but realize that it could be a whole lot worse.”
 

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