US debt ceiling must be raised, the IMF warns
THE International Monetary Fund (IMF) piled pressure on US lawmakers yesterday, with the group urging parties to end their political feud and quickly raise the nation’s debt ceiling.
“The federal debt ceiling should be raised expeditiously to avoid a severe shock to the economy and world financial markets,” the IMF said.
The US Treasury already has hit the existing $14.3 trillion legal limit on the nation’s debt and has warned the debt ceiling needs to be raised by 2 August to avoid a default.
President Obama looked to turn the heat on opposition Republicans by calling for higher taxes on “millionaires, billionaires, corporate jet owners, hedge fund managers, oil companies”.
Republicans could help reduce the deficit by agreeing to “take on their sacred cows”, Obama said. In an extensive news conference, the President also shrugged off criticisms over military action in Libya as “just politics”.
Earlier in the day Obama’s treasury secretary Timothy Geithner dismissed Republican suggestions that the government could prioritise some payments in order to delay a default. “There is no credible budget plan under which a debt limit increase can be avoided,” Geithner said.