Geithner: U.S. deficit problems undermine future economic strength
2011-05-18 18:45:25
The U.S. fiscal problems are "so pressing" that they "threaten to undermine the foundation of our future economic strength," said U.S. Treasury Secretary Timothy Geithner on Tuesday.
Speaking at the Harvard Club in New York, Geithner said that the United States are able to fund its deficits at unusually low interest rates just because of the lack of other investment alternatives and its relative better economic situation.
"There is no way of knowing how long financial markets will give the American political system to get ahead of this problem, but it makes no sense for us to wait until they force action upon us," Geithner said.
According to Geithner, in order to cut the deficit to a sustainable level of below 3 percent of U.S. GDP by 2015, Congress needs to impose a "debt cap" that would lock in the necessary reductions in deficits over the next several years.
"We need a debt cap so that politicians cannot choose to live with unsustainable deficits," said Geithner.
"The economic and political question is not whether but how best to achieve this objective," said Geithner. "We have to find a way to return to living within our means."