House Republicans’ $61 billion
budget-cutting plan would cost 700,000 jobs, according to a
report likely to inflame the debate over the U.S. government
deficit.
The measure would reduce real economic growth this year by
0.5 percentage points and by 0.2 percentage points next year,
resulting in 700,000 fewer jobs by the end of 2012, said Mark Zandi, chief economist for Moody’s Analytics. He said budget-
cutters should wait until the U.S. economy is stronger, saying
Republicans “would be taking an unnecessary chance with the
recovery.”
“Significant government spending restraint is vital, but
given the economy’s halting recovery it would be
counterproductive for that restraint to begin until the U.S. is
creating enough jobs to lower the unemployment rate,” Zandi
said.
The House approved its plan Feb. 19. Democrats who control
the Senate have said they wouldn’t accept the reductions.
A spokesman for
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