Fed Chairman Ben Bernanke on Tuesday urged Congress to take four specific steps to lift the nation's economy, which is suffering from ailments more acute than he had previously realized.
Bernanke, in prepared remarksfor the Joint Economic Committee, said the financial crisis was worse than he had expected and taking longer to recover from than he had anticipated.
The recovery from the crisis has been much less robust than we had hoped, Bernanke said. Recent revisions of government economic data show the recession as having been even deeper, and the recovery weaker, than previously estimated.
He also urged lawmakers to play its part by doing four things:
- Achieve long-run fiscal sustainability. The federal budget is clearly not on a sustainable path at present, Bernanke said.
- Avoid fiscal actions that could impede the onginng economic recovery, a call for Congress to not cut short-term spending too much.
- Promote long-term growth and economic opportunity. As a nation, we need to think carefully about how federal spending priorities and the design of the tax code affect the productivity and vitality of our economy in the longer term, he said.
- Improve the process for making long-term budget decisions. Lawmakers must create greater predictability and clarity, while avoiding disruptions to the financial markets and the economy, the chairman said.
Among forces slowing the economy are weak consumer spending, the housing market, tight credit, a decline in government spending and falling business and household confidence.