Washington is killing the economy

Washington’s drag on the economy now springs from a multiplying array of sources, including the constant threat of devastating fiscal crisis, the blunt nature of the sequester spending cuts, the troubled roll-out of Obamacare and the now deeply strained relations with key economic allies over clandestine surveillance allegations.

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Taken together, Washington’s toxic politics and poorly executed policies have all but ensured that fourth quarter growth comes in soft after forecasters initially predicted a strong close to the year. And they mean that 2014, which initially looked like a possible breakout year for the U.S. economy, now seems like it will be a dreary rerun of 2013 featuring sluggish growth, modest job creation and stagnant wages.

“The fourth quarter is now going to be much weaker than I expected,” said Beth Ann Bovino, chief U.S. economist at Standard & Poor’s. “And now all these fiscal deadlines are pushed into January and February and that’s going to weigh on 2014. I don’t think we breach the debt ceiling next year, but it’s hard to see any long-term resolution given the very toxic environment on Capitol Hill.”

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