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The Shutdown Won’t Stop Growth
President Donald Trump debates with then House Minority Leader Nancy Pelosi Senate Minority Leader Chuck Schumer as Vice President Mike Pence listens during a meeting in the Oval Office of White House on Tuesday, Dec. 11, 2018 in Washington, DC. (Photo b
(Photo by Jabin Botsford/The Washington Post via Getty Images)

The Shutdown Won’t Stop Growth

Harold Furchtgott-Roth

Does the U.S. government shutdown endanger economic growth? It has led to missed paychecks, a source of enormous pain and anxiety for furloughed employees and their families. Yet these employees represent approximately 0.5% of all American workers (although a much higher share in Washington and its suburbs). The effect of the furloughs on gross domestic product is likely small.

Nonetheless, some economic forecasters have reduced their estimates of first-quarter annualized economic growth by 0.2 to 0.4 percentage point due to the partial government shutdown. This would amount to a loss of GDP in the first quarter of 2019 of between $10 billion and $20 billion—substantially more than President Trump demands for the border wall.

Read the full article on the Wall Street Journal website here

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