The International Monetary Fund Criticizes Growing Dangers In The US Economy

(PatriotPostNews.com) — The annual report and evaluation from the International Monetary Fund (IMF) applauded the United States economy for its growth but also warned of serious problems that need to be addressed immediately.

Specifically, the organization called out the American government for its problematic trade policy and deficits. The stark criticism was made after a general acknowledgement that the world’s largest economy had accomplished a “remarkable performance” and showed promise to continue growing in the future.

But the report quickly got down to brass tacks, beginning with the “too large” fiscal deficit. According to the IMF, the “public debt-GDP ratio” has “sustained [an] upward trajectory.” Similarly, the ongoing trend to limit trade combined with “insufficient progress” to resolve the bank system’s weaknesses in 2023 threaten the economy with “important downside risks.”

When it comes to national debt and deficits, the IMF expressed the need for urgent action, warning of expansive repercussions in both the United States and the world. By 2032, the chronic deficits will result in an anticipated 140% debt-to-GDP ratio. Based on estimates from America itself, the country’s national debt is expected to rise to a staggering $56.9 trillion by 2034. This number is far greater than previous estimates showed.

Another issue highlighted in the recent report is the lack of financial stability amid soaring interest rates. The United States government is already on track to finance its debts due to the borrowing cost, and some American money experts have warned that this scenario will lead to an eventual fallout.

The IMF responded to this problem by recommending that those responsible for making financial policies effectively use discretionary spending as well as increase both income and indirect taxes. Additionally, the organization noted that partisan disputes over funding will need to stop, if the country’s economy is going to improve.

The report cited a 2023 incident in which both political parties engaged in a funding standoff that nearly resulted in a default. The IMF recommended that the United States establish “institutional changes” to positively impact the debt ceiling as well as more strict banking systems to provide greater financial stability.