Ben Bernanke. Contra Moody’s and Goldman, the Fed chair isn’t sweating the House GOP’s hopes to slice $61 billion in spending this year.
“Two percent [reduction in growth] is enormous and would be based on $300 billion in cuts,” Bernanke told the panel in his semiannual report to Congress. “Sixty billion to $100 billion isn’t sufficient to create that kind of effect.”
Although Bernanke didn’t provide a projection of possible jobs losses from the spending bill, he said the proposed spending cuts aren’t likely to lead to the 700,000 job losses predicted by Moody’s Analytics chief economist Mark Zandi.
For what it’s worth, he also doesn’t think those cuts would do much of anything to the deficit.