April 22, 2009

Geithner: U.S. bears ‘substantial’ blame

U.S. Treasury Secretary Timothy Geithner said Wednesday the United States was dependent on a global recovery to prosper again.

Speaking at The Economic Club of Washington Geithner said the United States bore a substantial share of the responsibility for the current economic crisis. He also said the rest of the world needs the U.S. economy and financial system to recover in order for it to revive.

In turn, we need the rest of the world to recover if we are to prosper again here at home, he said.

Geither said the International Monetary Fund's forecast of a global economic decline of 1.3 percent decline was a sharp deterioration from the normally expected 4 percent growth pattern. The lost output could be as high as three to four trillion dollars this year alone, he said.

Geithner said the $787 billion U.S. economic stimulus plan would save or create 3.5 million jobs and raise the U.S. gross domestic product 3 percent.

An international agreement reached in London in April at the Group of 20 summit would add up to a $5 trillion fiscal boost over three years, he said, raising global output 4 percent over where it would otherwise have been.