Economist Zandi: Recession odds high even with jobs bill

Zandi said in his report that the deficit supercommittee should also come up with at least $500 billion in deficit cuts over 10 years to appear credible to the financial markets. The supercommittee is charged with coming up with at least $1.2 trillion in cuts. 

Over the long term, Zandi said the debt needs to be reduced by at least $4 trillion, though “this can wait until after next year’s election.”

Political strife in Washington is one of three top threats to the economy, Zandi said, along with Europe’s debt crisis and the U.S. foreclosure crisis.

On housing, Zandi predicted a steep drop in housing prices next year once legal wrangling over foreclosure sales is resolved. He is hopeful, on the other hand, that the EU will find a way to bail out its banks.