I recently traveled to Nashville, Tennessee for a conference organized by the National Conference of State Legislatures (NCSL). The conference brought together leaders in fiscal policy from all 50 states. One of the speakers at the conference was Joyce Chang, an economist from JP Morgan Chase, who provided us with an insider’s view of the country’s economic outlook. The presentation was full of data, charts, graphs, and useful information I wanted to share with you!

The issue that was top of everyone’s mind was inflation. Unfortunately, Chang believes that inflation will probably continue at the current rate of 3% per year. Inflation on “goods” has hovered around 0% for the last year. Most of the inflation we are still seeing is coming from the category of “services”, which are still rising at 4% annually, such as housing, healthcare, and restaurants. She also said that the high interest rates we have been experiencing lately will likely be the new normal. Growth in gross domestic product (GDP) is forecasted to be 2% annually. 

One of the areas of the economy Chang was most optimistic about was our energy independence. The United States continues to be the world’s largest producer of crude oil. Our ability to produce more energy than we consume allows our economy to be resilient and to better weather storms in international supply chains. 

Next, we took a look at the average consumer. Chang explained that the “average” consumer is doing quite well right now, but some consumers are not. This is because assets such as houses and investments in the stock market, which make up a significant chunk of many people’s wealth, are growing. Those who have those assets are doing well in this economy, while those who lack them are struggling. 

Chang finished her presentation by looking at the relationship between the United States and China. She showed us that China’s trade with the rest of the world is increasing even as the United States becomes less reliant on that relationship. China has also begun to stockpile commodities such as corn, wheat, and soybeans as well as rare earth minerals needed to manufacture phones and batteries.  

As I reflect on this presentation, I believe it is more important than ever for us to be prudent with our finances at a state level. If 3% inflation and high interest rates are the new reality, then we must do our best to avoid inflationary policies at the state level and put money back in the hands of taxpayers. Providing meaningful tax relief is the best way to combat rising costs and ease the burden of big purchases, such as buying a home and being able to afford services that continue to increase in price. 

As always, if you need assistance with any state-related matters, please call our team at the State Capitol — 608-266-0703 — or email me — Sen.Marklein@legis.wisconsin.gov. My team is ready, and willing, to help navigate your state government, clear obstacles, and receive your input.

— Sen. Howard Marklein represents Wisconsin’s 17th Senate District.