Ben Bernanke: Growth now, deficit reduction later

It's too bad more politicians don't understand this:

"Bernanke raised concerns that a sharp, immediate push to reduce the deficit could harm the recovery in the upcoming months. In January 2013, he pointed out, the Bush tax cuts will expire, and the major spending reductions triggered by the Budget Control Act will take effect, absent any further action by Congress. As a result, “there will be sharp change in fiscal stance of the federal government. Without compensating action, it would indeed slow the recovery,” Bernanke told the committee members."

"However, Sen. Pete Sessions (R-Ala.), the highest-ranking Republican on the committee, pressed Bernanke to answer whether the country’s current deficit was itself holding back the recovery and discouraging key market players. “They’re not reacting to the current level of debt. What they’re attentive to is the process,” Bernanke said, pointing to the political dysfunction that lead to the Standard & Poor’s downgrade of the US credit rating last year."

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