Snow steps up warning over US budget deficit [View All]

[ze_dscherman]

John Snow, the US Treasury secretary, on Wednesday issued his strongest warning yet about the ballooning budget deficit, saying that it could threaten to crowd out private investment.

Speaking in London, Mr Snow described the deficit, forecast by the White House to hit $455bn this year - as "worrisome".

"The deficit is too large and it needs to come down and will come down," he said. The rise in the deficit, he said, "underscores the need for tight control of spending."

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Economists said there was little chance of fiscal restraint ahead of next year's presidential election in November. So far this fiscal year, total government spending is up 6.4 per cent on last year while revenues are down by 4.8 per cent , including a 26.7 per cent fall in corporate taxes.

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