Congress Stands in Way of Economic Growth: Sen. Gregg

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The only thing that stands in the way of a boom in economic growth is fiscal policy, former Senator Judd Gregg said on Thursday.

“If this Congress with presidential leadership can step up and make some tough decisions and reach a comprehensive settlement on fiscal policy, you’re going to see this economy explode,” the New Hampshire Republican told CNBC’s “Closing Bell.”

Gregg still doesn’t expect a comprehensive solutionto emerge from the lame duck session after the November elections. “Hopefully, what you’ll get is a process in place for reaching a comprehensive agreement which will allow Congress to justifiably put off the fiscal cliff event,” Gregg said.

(Read More:US Fiscal Cliff Trumps EU Crisis as Top Worry: Survey.)

He expects reality to set in and force Congress to finally do something to address the fiscal situation. “It will be pretty obvious relatively quickly that the economy is going to stall out or go into reverse if they fail to execute,” he said.

Ben Bernanke also made a mistake by embarking on another round of Federal Reservebond-buying, or quantitative easing, because it takes the pressure off Congress to act.

But once an agreement is reached on entitlement reform and tax reform, Gregg expects the long-term fiscal certainty will lead to an explosion in economic activity.

“I think the opportunities for a real robust economic event are right there,” he said, noting the country’s vast energy resources and leading edge in technology.

“The only thing that stands in our way is fiscal policy,” he said.