This headline in Politico is either great news or terrible news, depending on your point of view,
‘DOGE and Musk were gonna have a big impact,’ Federal job cuts shake the Capital Region: State and city officials are opening local jobs to feds to try to lessen the economic fallout from a mass exodus of workers.
Politico elaborates,
The unemployment rate is inching up already in Washington, and the administration is exploring selling federal buildings in the city. The District’s budget projected as many as 40,000 fewer federal jobs, descending the city into a “mild recession” in 2026.
I’ve seen this movie before. After four years of Pres. Jimmy Carter’s “malaise,” in 1980 voters sent former California Gov. and movie star Ronald Reagan to the White House.
A brief, but deep, recession followed in 1981 as the Federal Reserve squeezed the 1970’s inflation out of the system. Reagan talked Congress into a massive income tax cut (marginal rates were as high as 70 percent).
What followed were two decades of nearly uninterrupted general prosperity and, eventual budget surpluses in the 1990’s. That first decade of peace, prosperity, big hair, and big shoulder pads was recast as the Decade of Greed.
At present, the federal government is suffering with a $2 trillion (with a “t”) deficit on a total budget of $7 trillion. Looming behind that is a nearly $37 trillion national debt.
There will be short-term pain as this long overdue bill gets reconciled. But after that, there is no reason that the remainder of the decade can’t be a New Golden Age.
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