WASHINGTON -- Terrorism has replaced weak employment growth and the ballooning budget deficit as the biggest immediate threat to the economy, the National Association for Business Economics said yesterday.
The group said that terrorism and defense issues were picked by 40 percent of its survey panel as the biggest short-term threat facing the economy, well ahead of government spending and the deficit, which was selected by 23 percent of the 117 members surveyed.
''Terrorism produces the greatest short-term risk to the economy, and that's where NABE's members believe the next president should spend most of his effort," said Duncan Meldrum, president of the association and chief economist for Air Products and Chemicals Inc.
In response to a separate question on the top priorities for the next administration, the association survey respondents said the next president should devote 25 percent of his time to the Middle East and terrorism.
In second place, the survey group recommended 17 percent of the next president's time and energy be devoted to the budget deficit, which is projected to hit a record $445 billion this year.
The deficit needs to be brought under control primarily by cutting government spending, in the view of 51 percent of the NABE group, while 32 percent said tax increases should be emphasized.
On the spending side, cutting farm subsidies was favored by 50 percent of the panel while 21 percent recommended reductions in overall government spending and 11 percent said efforts were needed to trim government healthcare costs.
Both President Bush and his Democratic challenger, Senator John Kerry, have pledged to cut the deficit in half over the next five years
Meldrum said in addition to tackling the deficit, the association panel's priorities for the next president were dominated by concerns about the rising cost of caring for an aging population.
The current survey was conducted between July 23 and Aug. 5, a period dominated by news coverage of the Sept. 11 commission's report.