I will shut down the government. I will take that mantle

alternate view

https://www.wsj.com/articles/the-shutdown-wont-stop-growth-11548200838

The Shutdown Won’t Stop Growth
It’s painful for federal employees but has little effect on GDP.
101 Comments
By
Harold Furchtgott-Roth
Jan. 22, 2019 6:47 p.m. ET

Does the U.S. government shutdown endanger economic growth? It has led to missed paychecks, a source of enormous pain and anxiety for furloughed employees and their families. Yet these employees represent approximately 0.5% of all American workers (although a much higher share in Washington and its suburbs). The effect of the furloughs on gross domestic product is likely small.

Nonetheless, some economic forecasters have reduced their estimates of first-quarter annualized economic growth by 0.2 to 0.4 percentage point due to the partial government shutdown. This would amount to a loss of GDP in the first quarter of 2019 of between $10 billion and $20 billion—substantially more than President Trump demands for the border wall.

Such forecasts are too pessimistic. U.S. GDP is more than $20 trillion annually, or approximately $55 billion daily. The daily compensation of furloughed federal workers is about $52.5 million, or less than 0.1% of GDP. This figure does not include affected government contractors, but even doubling or tripling this figure yields only a small share of GDP.

Moreover, legislation signed Jan. 16 guarantees government employees that their paychecks will be fully restored once new appropriations are passed. Although some contractors may not be able to make up lost work, others will. The net effect of the partial shutdown on direct salaries and wages will primarily be to delay, but not reduce, income for the affected families.

And furloughed workers are not necessarily idle during the shutdown. Some take part-time or temporary jobs in the internet economy. Although these positions don’t pay as well, they still add to U.S. economic activity.

The U.S. economy grew more than 3% in 2018, or roughly $1.65 billion daily. Little if any of that growth was in the federal government. Growth sectors of the economy like high-tech, professional services and health-care are unlikely to be affected by the shutdown.

Maybe that’s one reason the stock market, a barometer of expectations of future economic growth, has been unperturbed by the budget impasse. The Dow and the S&P 500 are up nearly 9% since the shutdown began Dec. 22.

Experience also gives reason for optimism. The last major government shutdown occurred in 1995-96. It affected the entire federal government, not only part of it. Yet U.S. GDP growth increased from 2.7% in 1995 to 3.8% in 1996.

There are serious obstacles to growth in 2019, including the slowing global economy, trade tensions with China and the Federal Reserve’s interest-rate increases. The partial government shutdown is not one of them.

Mr. Furchtgott-Roth is a senior fellow at Hudson Institute.


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Seems like a fudgy commentary. Must be why it is in a "commentary" section vs first page or on national TV. It presents only one precise data point. Other data points are overlooked as if government serves no purpose but to pay federal workers (is he a libertarian).. It fails to try to address and repudiate why other economists are expecting a significant gdp drop IF shutdown persists. It compares a quarter of a year shutdown to 3 weeks shutdown and doesn't say what the average expectations for growth were in 1996, Furthermore a single data point used to predict how shutdown effects GDP is just laughable.
Market was moving on a rumors of shutdown for a while - so it certainly does care about it, but just like with economy, market has many variables to it and right now it is probably all about earnings season and trade war/global economy.

Still. Thanks for the read.

 

Keep it shutdown for 2 more years.

 

I wonder how the "Let them eat cake" thing is going for the trump admin?

 

These mother****ers are totally clueless. Agent Orange destroying our country. Mission almost accomplished.

 

Clueless appears to be a requirement for a job in the Trump Administration.

 

"Let them eat cake."

 

after hearing other trump cabinet members say horrible things re: shutdown and impact on people,trump's director of national economic council larry kudlow says, "hold my beer"

 

Wilbur Ross, our supremely qualified Commerce Secretary, just doesn't "really quite understand why" unpaid federal workers were going to food banks.

Trump aides set off furor with out-of-touch shutdown remarks
By POLITICO Staff

Commerce Secretary Wilbur Ross argued with loans backed by the guaranteed back pay, federal workers should be able to find the money to carry them through the government shutdown. | Nicholas Kamm/AFP/Getty Images

Democrats pounce after Wilbur Ross said he didn’t 'really quite understand why' unpaid federal workers were going to food banks.

One of President Donald Trump’s top aides likened the shutdown to a “vacation.” Another called it a “glitch.” And on Thursday, Democratic leaders pounced after Commerce Secretary Wilbur Ross said he didn’t “really quite understand why” unpaid federal workers were going to food banks.

As the government shutdown stretched into its 34th day and as roughly 800,000 federal workers are bracing for their second missed paycheck, the White House is facing an intensifying backlash over seemingly out-of-touch comments from Trump’s group of largely wealthy advisers.

Story Continued Below

 

Always a tweet from the past...

 

Meanwhile the President's own chief Economic Advisor Kevin "Dow 36,000" Hassett, went out yesterday and predicted 1st quarter GDP growth as clocking in at "zero" due to the shutdown

That's the definition of the shutdown stopping growth. Predicted by teh PResident's very own man. But yeah, sure, it won't stop growth, says random WSJ editorial chud. It will just drive it downward. Totes differentes.

 

People will continue to be hurt, our economy will be hurt, and ironically our security will be hurt because he wants his damn vanity wall...

 

LOL from mexico paid beautiful wall to layawall

 

Meanwhile, trump is touting his aptly named FART Act...