Fox Business' Charles Payne falsely claimed that the 16-day government shutdown helped increase economic growth, despite direct evidence to the contrary.
On January 30, the U.S. Department of Commerce's Bureau of Economic Analysis released its report on gross domestic product (GDP) for the fourth quarter of 2013. According to the report, the U.S. economy grew at an annual rate of 3.2 percent, down from 4.1 percent growth in the third quarter. Despite GDP growth falling, a number of economists agreed that the number was impressive.
Discussing the report on Fox News' America's Newsroom that day, Payne asserted that the 16-day government shutdown -- which occurred in the fourth quarter of 2013 -- helped spur economic growth:
PAYNE: Our economy has gotten so much traction since the government shutdown, which the mass media has said is an evil awful thing and it hurt us, well, during that period, more jobs were created, during that period, the stock market was up and we continue to see, as government gets out of the way, the private sector comes in.
Payne is completely incorrect.
While it's true that the GDP report showed a relatively strong increase, it is important to note how much better it would have been absent the government shutdown. According to MSNBC's Steve Benen:
The congressional Republicans' government shutdown, for example, shaved about 0.3% from the overall total. That's a difference, in other words, between 3.2% growth and 3.5% growth. It's still not clear exactly why GOP lawmakers did this, or what they hoped to accomplish, but there's evidence now that the gambit took a toll on the economy.
And despite Payne's claim that the shutdown helped job growth, Jason Furman, head of the Council of Economic Advisers, previously claimed that it reduced private sector employment by 120,000 jobs in October, 2013.
Furthermore, while Payne claimed that less government spending helped grow the economy, evidence suggests otherwise. Absent government spending cuts, economists estimate GDP in the fourth quarter would have risen an additional 0.9 percentage points.
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