A blogger at Moody's Analytics notes that if Congressional Republicans get the cuts they want, out economy will suffer a grevious hit. Their proposal, he writes, "would reduce 2011 real GDP growth by 0.5% and 2012 growth by 0.2 percentage points This would mean some 400,000 fewer jobs created by the end of 2011 and 700,000 fewer jobs by the end of 2012."
Talking Points Memo also notes that an ABC News report last week predicted that the Republican approach would cut economic growth by 2 percent of GDP--an even more dire analysis than Moody's.
I keep hearing from my conservative friends that if we raise taxes, it will hurt job creation. But that's really a hypothetical. Job creation is driven by many things, and maybe taxes play a role, but demand, business climate, workforce conditions, all of those play a role as well. Cutting government spending will destroy jobs that families are depending on Right Now. Real jobs, not possible jobs. With cutting government spending, you are certain to do one of several things: cancel someone's health insurance, reduce someone's services, cut someone's job. These are not good outcomes.
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