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If the government does not create jobs, then why did the economy shrink when the government spends less?

Economy in U.S. Shrinks as Defense Spending Slumps. The economy in the U.S. unexpectedly shrank in the fourth quarter, restrained by the biggest plunge in defense spending in four decades and dwindling inventory growth, as household purchases picked up. If Republicans are so correct, and the only way to improve the economy is to stop all government spending. then why does the economy suffer when government spending slows down?

Asked By: BigBubbaLove - 1/30/2013
Best Answer - Chosen by Asker
Some of the shrinkage in the fourth quarter can be tied directly to the aftereffects of Hurricane Sandy and the Republicans' hold-up of emergency funds for the four states directly impacted... More
Answered By: Armchair Goddess #1 - 1/30/2013
Additional Answers (9)
If the economy is shrinking, are you still claiming we're in "recovery mode" under Obama?
Answered By: Aunt Jemima - 1/30/2013
 
The government never spends less. Government is like entropy.
Answered By: Shovel Ready - 1/30/2013
 
Today, we see a reduction in government spending. We also see an increase ofalmost 200,000 private sector jobs. Clergy, big government cuts hurt the economy. Even when the private sector is growing,
Answered By: Jay - 1/30/2013
 
Then why has debt of a trillion dollars a year resulted in 2% or less GDP?
Answered By: IceT - 1/30/2013
 
Alright, here is what you need to understand... More
Answered By: DrinkDrankDrunk - 1/30/2013
 
when have they spent less they may have cut the military, but there spending raises each year so that will not float. The fact is the government can not grow the economy except through tax reduction which spurs growth in the private sector. You see it take about 12 tax payers to hire one government worker.
Answered By: wtinc - 1/30/2013
 
Actually what the Government does is stifle jobs by creating a business atmosphere lacking clarity. Like - Obamacare is the law. But no one understands the implications. Until they do, jobs will be on hold. That is it.
Source(s):
Answered By: Texas Mike - 1/30/2013
 
Absolutely no one has advocated cessation of ALL government spending... just wasteful government spending. As to why job growth slumps, in general, it's because businesses hire during economic certainty and hold back during times of uncertainty, because they don't want to take long-term risks that might be undercut by... More
Answered By: kathy_is_a_nurse - 1/30/2013
 
If you believe only superhuman man-gods with creation powers miraculously 'create jobs' from the dark immaterial void then you would automatically dismiss the idea that spending creates jobs. When government shrinks, it spends less money and that lowers demand just like when wages plummet and unemployment rises but you... More
Answered By: nokilleye version 2.0 - 1/30/2013
 
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