After government spending fell, industrial production, GDP, and consumption decline, and unemployment rises.
Reader Patrick R. Sullivan tries to argue that the US economy boomed immediately after the reduction in government spending at the end of World War II.
BLS reports nonfarm payroll employment up by 192 thousand, and prior months revised up.
(The can opener reference can be understood by clicking here)
The budget proposed by Representative Ryan touts the pro-growth impacts of deficit reduction ($5.1 trillion over ten years, according to Table S-2). It is instructive to actually read the documents that Representative Ryan’s budget cites (as it has in the past — read about the Heritage CDA previous assessments [1] [2], as well as Representative Ryan’s previous attempt to use CBO documents to lend a patina of respectability to his projections).
Today we are fortunate to have a guest contribution by Ron Alquist, Policy Adviser at the Bank of Canada, and Olivier Coibion, Assistant Professor at the University of Texas, Austin. The views expressed here are those of the authors and should not be interpreted as representing the views of the Bank of Canada or any other institution with which the authors are affiliated.
Philadelphia Fed revised coincident indices released today show the cumulative Minnesota-Wisconsin gap (since January 2011) has grown to 2.3% (as of February, in log terms).