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WASHINGTON (Reuters) – Federal Reserve Chairman Ben Bernanke said on Tuesday the country's budget deficit is on an unsustainable path and requires near-term action from policymakers to avoid dangerous outcomes.... "In the absence of further policy actions, the federal budget appears set to remain on an unsustainable path," Bernanke told the 18-member National Commission on Fiscal Responsibility and Reform.
Bernanke said the nation's heavy debt load risked putting upward pressure on interest rates.
"Given the significant costs and risks associated with a rapidly rising federal debt, our nation should soon put in place a credible plan for reducing deficits to sustainable levels over time," Bernanke said.
His remarks come as investors around the world fret over a worsening debt crisis in Greece, which forced the country last week to ask for financial aid from fellow European Union nations and the International Monetary Fund.
Not all economists agree the U.S. deficit is too large given the size of the economy and given the need for continued stimulus in the wake of the worst recession since the Great Depression.
COMMENT: Just to be sure you're clear on this: not all economists agree that there is "need for continued stimulus," or that there was a need for any stimulus to deal with the recession.
