IMF warns US to take action on addressing debt
The International Monetary Fund issued a clarion call to bickering US politicians, urging them to solve the country’s debt problems before a still-vulnerable economy is tipped over the brink.
In a hallmark semi-annual report, the Washington-based fund warned policymakers on the other side of the US capital that, while the world’s largest economy is improving, they invite trouble by not addressing a looming debt crisis.
So far the United States has avoided the type of debt crisis that has ravaged Europe — with the dollar’s safe-haven status and moderate growth providing a sizable safety net even as agencies have downgraded the country’s credit rating.
But with Washington hurtling toward November presidential polls, and with the country’s politicians gripped by a culture of permanent campaigning, time may be running out to find a solution.
US debt is expected to balloon to 90 percent of total economic output by 2020, “an uncomfortably high burden,” according to the IMF.