From the Federal Reserve, explaining why the economic recovery remains sluggish:
Household spending and business fixed investment advanced, and the housing sector has strengthened further, but fiscal policy is restraining economic growth.
This is an unusually straightforward statement from the Fed. They’re basically saying that the fiscal cliff deal and the sequester spending cuts are acts of idiocy. We should be spending more and taxing less right now, not the other way around. Belt tightening needs to wait another couple of years.
But tighten we do. Economic growth is not in the political interests of the Republican Party at the moment, so they’re not going to allow it. End of story.