Defense Spending Cuts Hit U.S. Economy Hard

Mike O'Brien

Chronic cuts in military spending – the biggest in 40 years – was one of the main contributors to the surprise shrinking of the U.S. economy in the fourth quarter of last year. The Commerce Department announced on Wednesday that the economy contracted at an annual rate of 0.1 percent from October through December, the first slump since the second quarter of 2009. The previous quarter in 2012 saw a 3.1 percent growth rate. The 22.2 percent drop in defense spending, the biggest q...
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