News / USA

IMF Urges Repeal of Large US Government Spending Cuts

International Monetary Fund Managing Director Christine Lagarde speaks during a news conference at IMF headquarters in Washington, D.C., June 14, 2013.International Monetary Fund Managing Director Christine Lagarde speaks during a news conference at IMF headquarters in Washington, D.C., June 14, 2013.
x
International Monetary Fund Managing Director Christine Lagarde speaks during a news conference at IMF headquarters in Washington, D.C., June 14, 2013.
International Monetary Fund Managing Director Christine Lagarde speaks during a news conference at IMF headquarters in Washington, D.C., June 14, 2013.
VOA News
The International Monetary Fund is urging the United States to repeal large government spending cuts from earlier this year, saying they are a drag on economic growth.

In its annual review of the world's largest economy, the IMF said Friday that the reduction in the U.S. budget deficit in 2013 has been "excessively rapid and ill-designed." The IMF said the cuts, known as the sequester, should be replaced by longer-term reductions in government spending programs, as well as higher taxes.

Washington cut the federal budget by $80 billion in March after U.S. President Barack Obama and his Republican opponents in Congress were unable to agree on an alternative plan.

Despite the IMF's concerns, the Washington-based agency says the overall U.S. economy is improving. IMF chief Christine Lagarde said there are signs that the U.S. recovery is "gaining ground."

"In terms of outlook, we see that the recovery in the United States of America is gaining ground and becoming more durable. The housing market, the household balance sheets and the labor markets are generally doing better," said Lagarde. "The private sector is leading and easing financial conditions have helped; however, the economy has a way to go before it returns to full strength. Unemployment has fallen, but is still too high at about 7.6 percent and the effect of the sequester and deficit reduction more generally are already affecting the economy.''

The IMF says it expects U.S. economic fortunes to slow this year, down to 1.9 percent from 2.2 percent growth last year, before accelerating in 2014.

But the Washington-based agency said the American economy would have advanced this year by as much as one and three-quarters of a percentage point more if the sequester did not go into effect.

The American economy has been recovering sluggishly from the 2009 recession, and its chronic government budget deficits are declining.

You May Like

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. More

Video Sudan School Becomes Target of Aerial Attacks

Dropout rate at an all-time high in South Kordofan state because many schools have been destroyed during 3-year civil war More

Tennessee Songbirds Fly Coop Long Before Tornadoes Arrive

Researchers say birds apparently alerted to danger by sounds at frequencies below range of human hearing More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US: Response to Sony Hack Will Be Proportionali
X
Aru Pande
December 19, 2014 1:45 AM
The White House says President Barack Obama considers the cyberattack on Sony Corp. a serious national security matter and that the U.S. will counter with an "appropriate response." VOA correspondent Aru Pande reports.
Video

Video US: Response to Sony Hack Will Be Proportional

The White House says President Barack Obama considers the cyberattack on Sony Corp. a serious national security matter and that the U.S. will counter with an "appropriate response." VOA correspondent Aru Pande reports.
Video

Video Sudan School Becomes Target of Aerial Attacks

The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video Nigerians Fleeing Boko Haram Languish in Camp Near Capital

In its five-year effort to impose Islamic law in northeastern Nigeria, the Boko Haram extremist group has killed thousands of people and forced hundreds of thousands to flee. Some of those who ran for their lives now live in squalor on the edges of the capital, Abuja. Chris Stein reports for VOA.
Video

Video Putin Says Russian Economy Will Emerge Stronger

Russian President Vladimir Putin has said his country's sinking economy will not only recover but also become stronger, despite falling oil prices and Western sanctions over Ukraine. VOA's Daniel Schearf reports.
Video

Video Detained Turkish Journalists Follow Teachings of US-Based Preacher

The Turkish government’s jailing of critical journalists has sparked international condemnation and is being seen as an effort to undermine the followers of an ailing Turkish preacher based in the United States. VOA religion reporter Jerome Socolovsky has more.
Video

Video ‘Anti-Islamization’ Marches Increase Tensions In Germany

Anti-immigrant rallies in Germany have been building in recent weeks, peaking Monday night in the city of Dresden where tens of thousands of people turned out to demonstrate against what they call the ‘Islamization’ of the West. Germany has offered asylum to more Syrian refugees than any other country, and this appears to have set off the protests. Henry Ridgwell reports from London.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.
Video

Video Refugees Living in Kenya Long for Peace in the Home Countries

Kenya is host to numerous refugees seeking safe haven from conflict. Immigrants from Somalia face challenges in their new lives in Kenya. Ahead of International Migrants Day (December 18) Lenny Ruvaga has more for VOA News from the Kenyan capital.

All About America

AppleAndroid