In case it wasn’t already painfully obvious, here’s some more evidence the government shutdown is probably hurting the economy.
Jan Hatzius, Goldman Sachs’ chief economist, wrote in a note Friday that the shutdown could shave about 0.5 percent off the next quarter’s GDP growth. Hatzius’ 0.5 prediction may seem small, but if it proves true, it could have a big impact. Initially, Hatzius predicted the economy would grow by 2.5 percent, so cutting the forecast by 0.5 percent marks a 20 percent drop.
Congressional Republicans refused to pass a resolution to fund the government earlier this month unless it included provisions to defund portions of President Obama’s health care reform law. The shutdown entered its third week Monday as 350,000 federal workers are still off the job, some national parks remain closed and some government functions — like environmental inspections — are on hold.
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