Was just listening to commentary on one of the cable channels about who gets furloughed in a government shutdown, who has to show up for work and doesn’t get paid, etc. And then at the end of the segment the news reader said, “And in case you think this helps the economy …” Then she described a study by some accounting firm explaining how it takes X amount of GDP out of the economy.
Now, this is really a testament to how perverted the public discussion has become that anybody wouldn’t realize that pulling almost three million incomes out of the economy at once wouldn’t be really bad for the economy. And I’m pretty sure that number does not include the US military which also wouldn’t get paid.
This is obvious. I don’t think any reputable economist would question this, though the longterm impact on the economy is certainly a matter of debate. (Obviously, it all depends on how long the shutdown lasts.) Presumably the shutdown will end and then at least those who were forced to work without pay will get back pay. So a sudden infusion of cash will follow a drop off. But again, would anybody think this was good for the economy if we hadn’t had this lengthy debate where we’re supposed to believe that big cuts in government spending is going to create jobs? It could help with the deficit; it’s not going to create jobs. Certainly not in the short term. Quite likely not at all.
Josh Marshall is editor and publisher of TalkingPointsMemo.com.