'Rich Nation, Poor Nation' author sounds call for economic freedom at annual breakfast in Palatine

Economist Robert Genetski served up a cloudy forecast Thursday at the 20th annual Cornerstone National Bank & Trust Company Economic Breakfast at The Cotillion Banquets in Palatine.

"All the forces that I felt were in play last year to bring the economy down are still in play," said Genetski, a teacher, columnist and author of several books, including "Rich Nation, Poor Nation: Why Some Nations Prosper While Others Fail."

Giving the nation's forecast, Genetski predicted the economy would decline by 1% in 2024. Housing prices should be up 3%, while oil prices will be at $60 a barrel. He also expects a slight decline in the S&P to 4,000, he said.

"And if I'm wrong, I think I'm wrong by being too optimistic," he said.

Genetski painted a similarly gloomy picture examining local conditions.

"Illinois, and Chicago particularly, are in very dire positions," he said. "And what happens when you're in a dire position in terms of your finances? People leave."

Speaking about the Illinois budget, Genetski said the state doesn't use generally accepted accounting principles - GAAP - but rather uses politically accepted accounting principles, or PAP, he said.

According to Truth in Accounting, which examines the budgets of states on a GAAP basis, Illinois ranks as "the third worst state in the country in terms of putting together promises that won't be met," he said.

He added, Illinois' deficit per taxpayer stands at $57,000, while its credit rating experienced an uptick because "people are looking at the wrong type of accounting."

Genetski said the situation in Illinois is mirrored nationally.

Truth in Accounting shows the federal national debt is not $33 trillion, but actually $160 trillion - that's $940,000 per taxpayer, Genetski said.

Interest payments, he added, exceeded the national defense budget.

Amid this gloomy forecast, Genetski offered hope in the form of a return to principles of economic freedom that governed the nation's founding. That freedom has been compromised, he said, by government regulation and spending.

He cited the Heritage Foundation, which found the United States is the 25th freest nation in the world.

"We are now seeing our government, through its policies, through its regulation, telling energy producers what type of energy they should use and how they should produce it," he said. "They're telling manufacturing companies how to make cars, what type of cars to make."

And yet, he remains optimistic, "only because our government is so over-bloated, so overspent, so destructive ... (that) reform is really conceivable."