President Obama spent much of the last week warning about the dire consequences of sequestration, but yesterday’s stock market gains have made many question the rhetoric that painted the sequester as a doomsday threat to the U.S. economy.
In fact, as Larry Kudlow stated in a recent article on townhall.com, “What, are we to believe that lower spending and smaller government damage the economy? Doesn’t that run counter to virtually every reasonably objective study in recent years — including ones from a number of U.S. academics and the OECD in Europe — that describe how countries with lower government spending grow more, and how countries with higher government spending grow less?”
Many are painting yesterday's stock market surge as showing that the sequester is pro-growth because it takes a step to lower spending and decrease the size of government.
Email: mhartvigsen@desnews.com
Read more about the sequester on Town Hall.
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Clinton took office: DJIA around 3,310
Clinton leaves office: DJIA around 10,900 (roughly tripled)
Bush took office: DJIA around 10,900
Bush leaves office: DJIA around 7,950 (down about 30%)
Obama took office: DJIA around 7,950
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Nothing says growing an economy like firing a bunch of people... was this letter written by a Bain executive?
The DOW is only one indicator of the health of the economy, and it only reflects how strongly investors feel about the strength of business.
The effects of sequestration are going to take longer than a weekend to be sorted out.
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