A senior economist at Wells Fargo told the state's largest business group that government belt-tightening is aggravating the nation's economic problems.
Scott Anderson, who addressed the annual meeting of the Minnesota Chamber of Commerce Tuesday, said state and local government expenditures have fallen 3 percent over the past year, and that's cut about half a percentage point off of the nation's economic growth.
"The tendency is for people to want to cut back, to cut government budget first, but at the macro level, that's the absolute wrong thing to do," Anderson said. "What I think we need to do is get the unemployment rate back to more normal levels — get people working again and paying taxes, rather than collecting unemployment benefits."
Anderson predicts the nation's economic growth will slow somewhat next year and Minnesota's growth will slow along with it. Anderson forecasts that Minnesota's job count will grow about 1 percent next year, and that the state's unemployment rate will fall only slightly.