Bernanke Urges Caution In Sharp Deficit Cutting
By Martin Crutsinger, AP Economics Writer | Associated Press – 19 minutes ago
WASHINGTON (AP) — Ben Bernanke is urging lawmakers to balance their desire to cut deficits with policies that could help boost the weak economy in the short run.
Bernanke told the House Budget Committee that he recognizes that huge budget deficits represent a serious threat to the economy.
“Even as fiscal policymakers address the urgent issue of fiscal sustainability, they should take care not to unnecessarily impede the current economic recovery,” Bernanke said. “Fortunately, the two goals … are fully compatible.”
The Federal Reserve chairman is testifying a week after the Fed signaled that a full recovery could take at least three more years. As a result, the Fed said it doesn’t plan to raise its benchmark interest rate from a record low before late 2014 at the earliest.
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