The International Monetary Fund has released a dire warning about the impact defaulting on the national debt could have, not just for the U.S. economy, but for the entire world.
The Hill reports:
The U.S. should raise its $14.3 trillion debt ceiling to avoid “a severe shock” to the global economy, the International Monetary Fund (IMF) has warned.
In an annual report card on U.S. economic policy made public on Wednesday, the IMF said the debt ceiling should be raised as soon as possible to avoid damage to the economy and world financial markets.
Ironically, the IMF seems to have just as much issue coming up with the perfect recipe for a deficit plan as Congress is. The group simultaneously warns about the pitfalls of “failing to achieve sufficient medium-term deficit reduction” as well as the dangers of “cutting too much too soon.”
IMF makes recommendations of a number of ways to raise revenue such as carbon taxes, value add taxes and stronger implementation of financial reforms, all of which are likely to be non-starters with the Republican House majority. It also advocates increasing spending on job training programs, yet another lost cause with the “cut it all” Congress of 2011.
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