IMF Chief: U.S. Debt Reduction 'Absolutely Inappropriate'
International Monetary Fund (IMF) chief Christine Lagarde blasted the United States for instituting “absolutely inappropriate” sequester-related reductions in the rate of budgetary growth that she says will retard economic improvement.
"The budgetary procedure that is in place in the United States, which leads to a budgetary adjustment, seems to us absolutely inappropriate...because it blindly affects certain expenditures that are essential to support medium and long term growth," Lagarde said to an audience in Southern France.
Lagarde said that the U.S. and Japan should devise new, better debt reduction plans.
"It is indispensable that these countries indicate for the long and medium term predictable, credible fiscal policies, anchored in legislation that will not be challenged, which will bring the deficit down in a way that will reverse the debt trajectory to a downward trend," said Lagarde.