Economic Growth Downgraded as Sequester Looms
Posted at 8 a.m. on Feb. 22
As the government prepares to absorb across-the-board spending cuts starting March 1, economists estimate that sequestration “most likely would reduce growth by about one-half of a percentage point in 2013,” the New York Times reports.
“Many economists are particularly critical of the arbitrary nature of the cuts, arguing that Congress could reduce annual deficits by the same amount with far less economic damage by spreading the cuts across a broader range of programs, directing them at lesser priorities or giving government agencies more discretion in how they make them.”
“The cumulative effect of the sequester and the tax deal struck in January might slash economic growth by as much as 1.25 percentage points — from a growth rate that otherwise might have been more than 3 percent — in 2013.”