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Sequestration's impact on economy much higer than some claim

InvestorInvestor
edited March 2013 in Off-Topic
http://blog.yardeni.com/2013/02/us-fiscal-policy-excerpt.html

"We shouldn’t underestimate the ability of the sequester to slow the economy and weigh down GDP. The $85 billion cut in discretionary spending this year is only 2.4% of total federal outlays over the past 12 months of $3.58 trillion. However, those outlays include $2.19 trillion in spending on entitlements, which are a redistribution of income that doesn’t have a direct impact on GDP through its federal government component. Federal government spending in GDP, in current dollars, was $1.20 trillion (saar) during Q4-2012. That’s where the sequestration cuts will hit, as they account for 7.1% of this total."

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