Chicago, April 5 (IANS) US Secretary of the Treasury Timothy Geithner said Wednesday that despite a recovering economy, America should be wary of cutting budget too much, in particular in areas such as education and social security.
Speaking at the Economic Club of Chicago, Geithner said the US economy was on the right track and had made important gains in manufacturing and other sectors, reported Xinhua.
At the same time, the US economy is still weak in terms of high unemployment and household debt levels, he said.
For this reason, Geithner said that certain heavy cuts to the US budget were not the best course of action at such a fragile time for the US economy, and that the US must be selective about its deficit-reducing strategies.
According to Geithner, historical examples showed that cuts made too soon after a financial crisis could bring about economic difficulties.
In Geithner's opinion, the US should therefore express caution and consider the long-term effects of deficit-cutting measures that target the safety net, and especially how they could play out in a global economy.
"Cutting government investments in education and infrastructure and basic science is not a growth strategy," Geithner said at the Chicago event. "Cutting deeply into the safety net for low-income Americans is not financially necessary and cannot plausibly help strengthen economic growth."
"This strategy is a recipe to make us a declining power -- a less exceptional nation," Geithner added. "It is a dark and pessimistic vision of America."
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