Austerity Policies Have Probably Cut Economic Growth in Half This Year

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In the past, I’ve extrapolated from a variety of CBO reports to estimate the effect of austerity on the U.S. economy. Today, via Paul Krugman, I see that Macroecomic Advisors has produced a comprehensive estimate of the total effect of bad fiscal policies. Their conclusion: austerity policies since the start of 2011 have cut GDP growth by about 1 percentage point per year—and the bad news got even worse in the first two quarters of this year as the sequester kicked in. Add in additional economic contraction caused by the budget/debt ceiling crisis, and the total hit to growth in 2013 might clock in at about 1.5 percentage points.

In other words, the combined effect of past budget deals + sequester + fiscal cliff + debt ceiling crisis is probably a reduction of about half in our economic growth rate this year.

Let me repeat that: Republican austerity policies have probably cut economic growth in half this year and raised the unemployment rate by 1.4 percentage points. Heckuva job, guys.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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