Geithner Hints At State Bailout; Says “There Is No Way [A US Downgrade From AAA] Is Going To Happen”
Courtesy of Tyler Durden
Just reading between the headlines:
ROMER: STATE, LOCAL BUDGETS TO REMAIN ‘VERY VERY BAD’
GEITHNER: V.STRONG CASE FOR ASSISTING STATES ON SIGNIF SCALE
GEITHNER: NEED REFORMS FOR STRONGER ECONOMY IN THE FUTURE
GEITHNER: NEED TO CONTINUE TO REINFORCE ECONOMIC EXPANSION
In other news Geithner warns just who makes the pink slip decisions over at Moody’s. From Market News.
U.S. Treasury Secretary Timothy Geithner declared Tuesday there is “no way” the United States is going to lose its ‘AAA’ credit rating, arguing that policymakers just need to show that they possess the will to make “tough” fiscal choices.
In testimony before the House Appropriations Committee — alongside CEA’s Christina Romer and the OMB’s Peter Orszag — Geithner was asked about the recent Moody’s report and the likelihood of the U.S. losing its ‘AAA’ rating. “There is no way that’s going to happen,” he replied. “There’s not a chance that’s going to happen to this country.”
Still, he warned, future growth will be weaker if policymakers do not do a better job over time to demonstrate that they are able to make tough choices.
This is why the recently created fiscal commission is so important, Geithner said.
Anyone who cares about the U.S.’s long-term fiscal condition, Geithner told the panel, also has to care a lot about getting the
economy back on track and repairing the damage caused by the recession.“If we don’t achieve that, then our long-term fiscal problems will be much more difficult,” he said.
He added that if Congress were to act on the budget proposals of the Obama administration — such as healthcare reform — it would result in a “dramatic” improvement in the U.S. fiscal position.
This will not solve everything, Geithner continued, not with the U.S. still facing long-term unsustainable growth in the committment of
the governments — which is why healthcare reform is needed.
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