Menu Close

GOP spending cuts would hit economy hard

GOP spending cuts would hit economy hard
By Jeanne Sahadi, senior writerFebruary 23, 2011: 6:38 PM ET

NEW YORK (CNNMoney) — The more federal spending Congress slashes this year, the greater the potential drag on economic growth, according to a new analysis from Goldman Sachs.

In a research note, economists at the Wall Street bank estimate that the House GOP’s spending bill — which would cut $61 billion between March and Sept. 30 — could reduce economic growth by 1.5 percentage points to 2 percentage points in the second and third quarters.

Last week, the Federal Reserve forecast the economy would grow between 3.4% and 3.9% this year.

The drag would be less if lawmakers decide to cut only $25 billion, which Goldman believes is more likely.

http://money.cnn.com…rowth/index.htm

Join the conversation and have a little fun at Capitalstool.com. If you are a new visitor to the Stool, please register and join in! To post your observations and charts, and snide, but good-natured, comments, click here to register. Be sure to respond to the confirmation email which is sent instantly. If not in your inbox, check your spam filter.

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

RSS
Follow by Email
LinkedIn
Share

Discover more from The Wall Street Examiner

Subscribe now to keep reading and get access to the full archive.

Continue reading