Ahhhh, In The Good Old Days!

Ahhhh, in the good old days the United States and IMF would lecture irresponsible third world despots on the need for fiscal responsibility and sound economic policies. Now that the IMF is lecturing us, it would appear as if we have joined the rank of the irresponsible. And much like the third world intellectuals of old, I am sure that many of our own will decry the IMF's interference via the imposition of austerity measures. But, only we are to blame, for allowing yourself to become indebted to foreign nations and international bodies is always accompanied by an erosion of national sovereignty.

IMF Says U.S. Lacks 'Credible Strategy' On Debt

Eric Lach

April 12, 2011, 6:15PM

In what The Financial Times describes as an "unusually stern rebuke," the International Monetary Fund says that the United States "urgently" needs a "credible strategy to stabilize public debt."

An IMF analysis points to the United States as the world's "only large advanced economy" - with the exception of earthquake-ravaged Japan - that's looking at an increased deficit this year.

Further, the IMF's April 2011 World Economic Outlook, reaads:

[T]he right policy mix for the United States is one of continued monetary accommodation alongside moves to put fiscal balances on a sounder footing. A credible strategy to stabilize public debt in the medium term, and a down payment on fiscal consolidation in 2011, are urgently needed.

"It is a risk that if it materialises would have very important consequences ... for the rest of the world," Carlo Cottarelli, head of fiscal affairs for the IMF, told The Financial Times. "So it is important that the US undertakes fiscal adjustment in a way sooner rather than later."

In response, the U.S. Treasury told Reuters that the U.S. is committed to meeting its G20 deficit targets.

"We will meet our commitments to the G20 in Toronto and look forward to working with Congress to establish a credible, multiyear path to ensure our fiscal sustainability while delivering strong economic growth," a spokeswoman said.

President Obama plans to outline a long-term debt plan in a speech on Wednesday.

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