'Potentially catastrophic': Trump's purge has DC reeling

The mass firings of government workers by the Department of Government Efficiency (DOGE) has business leaders in the Beltway fearing a localized recession could be on the way.

According to a report from the Wall Street Journal, restaurants, hotels and other businesses are witnessing in real-time sales plunging as workers lose their jobs or dial back spending due to a possible job loss.

As the Journals' Paul Kiernan and Rachel Louise Ensign wrote, "Economists believe government layoffs and looming budget cuts will push the Washington, D.C., metro area into a recession, challenging its reputation for economic resilience."

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In an interview, Julie Coons, president of the Northern Virginia Chamber of Commerce, painted a dark picture of the immediate future, explaining, "We see this as potentially catastrophic for the region," before adding, "This is our Detroit moment.”

The Journal report notes, "In Arlington’s Rosslyn neighborhood, bookings at the Residence Inn are 10% to 15% below target for the coming months, according to general manager Flavia Sampaio, who said local hotels rely heavily on business from government agencies. Across the Potomac River in D.C., Bluebird Sky Yoga co-owner Kristine Erickson has seen a slowdown in people seeking yearlong memberships," adding, "Sales at Cork Wine Bar & Market, a restaurant on a bustling stretch of 14th Street, fell about 15% to 20% in February compared with the same month last year, said co-owner Diane Gross. March sales were helped by a 'tariff sale' of bottles of wine but still ended down around 10%."

The report continued, "Oxford Economics projects gross domestic product in the Washington, D.C., metro area will fall 0.5% over the course of this year. This is the second-worst projected performance for any of the 50 largest U.S. metro areas after New Orleans, where tariffs are a significant risk, said Barbara Denham, lead economist for cities and regions."

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