re: #304 Targetpractice

US economy contracts for the first time in 3-1/2 years (-0.1%) w/lower govt spending, Sandy responsible for half point nbcnews.com/business/econo…

— lawhawk (@lawhawk) January 30, 2013

A closer look at the numbers reveals a few things.

Sandy is responsible for what looks to be a 0.5 point hit. Without Sandy, the economy would have grown by an anemic 0.4% instead of shrinking 0.1%.

Government spending cuts and slower inventory growth subtracted a total of 2.6 percentage points from growth. Both are volatile. And they offset faster growth in consumer spending, business investment and housing.

In other words, the quest to cut government spending resulted in the contraction - austerity in action. And the economy will continue to see those effects, not from higher taxes, but from reduced spending if and when the sequester takes effect. And the GOP knows this - which is why they’re now screaming about jobs (even though the private sector is doing everything imaginable to keep their costs down by wringing out still more efficiency from their current workforce and not hiring); it’s the reduction in government jobs are why the unemployment rates are still as high as they are.

Yet, any proposal to do any kind of stimulus such as an infrastructure bill will be met with claims of pork and waste, rather than getting it done to fix our crumbling roads, bridges, highways, transit and power and water delivery systems.