Goldman Sachs: House Spending Cuts Will Hurt Economic Growth

[kpete]

Source: ABC

Goldman Sachs: House Spending Cuts Will Hurt Economic Growth

February 23, 2011 2:47 PM

A confidential new report prepared by Goldman Sachs for its clients says spending cuts passed by the House of Representatives last week would be a drag on the economy, cutting economic growth by about two percent of GDP.

“Under the House passed spending bill ,” says the report, which was obtained by ABC News, “the drag on GDP growth from federal fiscal policy would increase by 1.5pp to 2pp in Q2 and Q3 compared with current law.”

The report, which is signed by Goldman economist Alec Phillips, goes on to predict that the House-passed bill is unlikely to become law because it won’t pass the Senate and, in any case, the president threatened to veto it.



Read more: http://blogs.abcnews.com/thenote/2011/02/goldman-sachs-house-spending-cuts-will-hurt-economic-growth.html

[inademv]

1. The question is

Will the Repukes finally learn the lesson that spending cuts slow growth with big business coming straight out and saying it?

[SpartanDem]

2. Not likely, the Chamber of Commerce backed the stimulus

and that got three measly votes. The GOP will cross big business if doesn't fit their right wing political goals.

[GeorgeGist]

3. From those who know ...

how to destroy an economy.

[Kievan Rus]

4. Even a broken clock is right twice a day

[No Elephants]

5. The Plutonomist Poobah has spoken. Will D.C. listen? Will media trumpet this?

[RUMMYisFROSTED]

6. Best guess: Some goodies they enjoy are involved in the cuts.

And they're bad policy.