Sequesters pain wont be as bad as predicted, noted economist says, but painful nonetheless

Sequesters pain wont be as bad as predicted, noted economist says, but painful nonetheless

George Mason University economist Stephen Fuller, an authority on the economy of Metropolitan Washington, whose dire predictions of the economic effects of sequestration were widely quoted in the press, has pulled back a little now that more information is available.

Those who might have argued that the federal government might be able to absorb these cuts without derailing the economy might be more right than they were first given credit for, Fuller told the Washington Business Journal.

Because federal agencies and contractors have said they will rely more on furloughs than layoffs, Fuller now says GDP will fall nationally by 1 percent, with 1.58 million job cuts. The main reason for the revision is that the furloughs are starting at the end of March instead of January 1, so the effects are delayed until next year.

The Washington area will still be hit harder than the rest of the country. Fuller projects that Virginia could lose 154,118 jobs (more than any other state except California), the District 92,545 and Maryland 84,156.