ATLANTA — Georgia’s top economist believes we’ll see a recession before the end of the year, but also believes it will be mild, and that Georgia is in a good financial position to weather it.
Channel 2′s Richard Elliot spoke with Dr. Bob Buschman about how the state’s economy is looking as lawmakers prepare the latest state budget at the Georgia Capitol.
In what may be a first, Gov. Brian Kemp wasn’t physically present at the capitol, instead he was at an international economic conference in Davos, Switzerland and attended the budget hearing via Zoom to ask for approval of a $36 billion budget next year.
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In the Georgia General Assembly, a room full of lawmakers hoped for the same thing as Kemp, that the technology to allow him to attend the hearing would work as he submits his budget plan for the state.
Kemp asked lawmakers to approve his amended budget for the 2025 fiscal year, including $1.5 billion for Georgia Department of Transportation road maintenance and construction.
According to the presentation to lawmakers, it’ll focus on freight highways. Another $1.4 billion was earmarked in the budget plan to give teachers raises, fund training, safer schools and new infrastructure.
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Kemp also wants to have lawmakers fund his proposal for an accelerated income tax cut, along with cost of living adjustments for state employees.
“I believe that in times like these, when our state is on strong financial footing, we should make careful and strategic investments to ensure we’re prepared for when times are lean,” Kemp said.
According to Buschman, the next year is an open question.
He believes lean times are coming, and that there’s a better-than-average chance the nation will go into a recession sometime in 2024, though he told Channel 2 Action News he believes it’ll be mild.
Buschman said Georgia is well-positioned, financially, to weather the recession, with billions of dollars in reserve.
“We’ve had large surpluses for the last few years, so there’s room for some downside on revenues before it starts pinching spending,” Buschman said.
Democratic lawmakers insist there’s enough money in the reserves to fully expand Medicaid in the state, something this budget doesn’t do, even though there are whispers of a potential deal to do so.
Atlanta Sen. Nan Orrock said “the state’s got plenty of money to expand Medicaid.”
However, an expansion of the state-funded health insurance program hasn’t been a priority of Kemp’s.
Instead, Kemp proposed and passed a change to state Medicaid programs through the Georgia Pathways program, which added work requirements to eligibility for coverage. While the new program was expected to have hundreds of thousands eligible, only about 2,300 were actively enrolled in December.
In November, about 1,800 were enrolled, according to state data available at the time. By comparison, hundreds of thousands of Georgians lost their health coverage during the Medicaid unwinding process, prompted by the end of a federal pandemic-related health benefits program.
The past two governors’ administrations have said expanding Medicaid would be too expensive for the state. Orrock disagrees, especially while Georgia has billions in reserve.
“The state has plenty of money. It’s not a money thing, it’s the political will,” Orrock said.
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