Cutting recovery short
Big budget cuts now pose an economic risk
By R.A. | WASHINGTON
REPUBLICANS are pushing to slash federal government spending in the present fiscal year. If they don't get their way, the government will shut down. And if they do get their way?
Spending cuts approved by House Republicans would act as a drag on the U.S. economy, according to a Wall Street analysis that put new pressure on the political debate in Washington.
The report by the investment firm Goldman Sachs said the cuts would reduce the growth in gross domestic product by up to 2 percentage points this year, essentially cutting in half the nation's projected economic growth for 2011.
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