Spending cuts to hit US, weaken world economy
1 March 2013 7:42 AM IST
US President Barack Obama has cautioned that the looming automatic spending cuts or sequestration beginning 1 March will badly hit the country's economy and weaken the global economy.
‘This is going to be a big hit on the economy,’ Obama said in his address to the Business Council on Wednesday night ahead of the so called sequester that will trigger a USD 85 billion in spending cuts.
‘Both private sector as well as public sector economists are estimating that we could lose as much as six-tenths of a point, maybe a little bit more, of economic growth. And that means, inevitably, hundreds of thousands of people who are not going to get jobs that otherwise would get them,’ Obama said.
‘It means that you have fewer customers with money in their pockets ready to buy your goods and services. It means that the global economy will be weaker, because although we obviously still have a long way to go in recovery, we’re actually doing significantly better than some of the other developed nations,’ he said. ‘What I think everybody is concerned about is the enormous uncertainty in terms of the political framework, the tax framework, the debt framework within which all of you are going to be operating over the next several years,’ Obama said.
‘This is going to be a big hit on the economy,’ Obama said in his address to the Business Council on Wednesday night ahead of the so called sequester that will trigger a USD 85 billion in spending cuts.
‘Both private sector as well as public sector economists are estimating that we could lose as much as six-tenths of a point, maybe a little bit more, of economic growth. And that means, inevitably, hundreds of thousands of people who are not going to get jobs that otherwise would get them,’ Obama said.
‘It means that you have fewer customers with money in their pockets ready to buy your goods and services. It means that the global economy will be weaker, because although we obviously still have a long way to go in recovery, we’re actually doing significantly better than some of the other developed nations,’ he said. ‘What I think everybody is concerned about is the enormous uncertainty in terms of the political framework, the tax framework, the debt framework within which all of you are going to be operating over the next several years,’ Obama said.
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