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But the economy is showing signs of holding its own against the fiscal drag.
Underneath it all is the fiscal drag from ill-advised and ill-timed austerity measures.
Their growing ranks show how the Treasury can covertly increase income tax through "fiscal drag".
This year, Goldman reckons fiscal drag will total just 0.4 points (see chart 2).
That so-called fiscal drag has been the single biggest weight on economic growth.
And lately, when you take out the fiscal drag, the private economy is clearly growing faster.
"We're still looking at some fiscal drag, but it's an amount the economy can absorb".
Finally, while the fiscal drag on growth is now lower, it is still a drag.
We may also hear a lot about fiscal drag from tax accountants.
This year, the government has intensified fiscal drag by freezing the tax-free personal allowance.In this section Future perfect?
Fiscal uncertainty matters for monetary policy as well, because the Federal Reserve will hesitate to start unwinding its expansionary policy if a serious fiscal drag seems imminent.
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