GOP to Blame for Bad Economy, Dems Say
Republicans are to blame for the recent economic contraction, Democrats in the White House and Congress said Wednesday.
The 0.1 percent reduction in GDP in the fourth quarter of FY2012 was the first time the economy shrank since the end of the recession in 2009.
In his afternoon press briefing, White House Press Secretary Jay Carney pointed to positive signs in the economy, such as home prices, consumer confidence and consumer spending, and said, "But there's more work to do and our economy is facing a major headwind ... and that's Republicans in Congress."
Get Our Latest News for FREE
The reason the economy is contracting, Carney explained, is that Republicans are warning that they will let the sequester, scheduled spending cuts from the Budget Control Act of 2011, occur if President Obama and the Democrats do not agree to a long-term deficit reduction package.
House Minority Leader Nancy Pelosi (D-Calif.) issued a similar statement.
"Today's disappointing GDP report is a direct result of the economic uncertainty created by House Republicans' strategy of obstruction and manufactured crises," Pelosi said.
The negative growth came from reduced government spending, mostly by the Department of Defense, and companies reducing their inventories after a period of unusually high inventories. Averaged, the last two quarters show 1.2 percent growth.
Republicans countered that the high government deficits are part of the problem, so one of the best things government can do is to cut spending.
"The House has continually passed legislation that would grow the economy, address Washington's spending problem and provide responsible solutions to anemic growth that has plagued our economy over the last four years, but those legislative solutions have been met with silence in the Senate," House Majority Whip Kevin McCarthy (R-Calif.) said.
