Canadian Finance Minister: US economy 'simply not sustainable'

(NaturalNews) The United States may own the world's biggest economy -- though that is now being debated by some economists who say that China has now taken that spot -- and as such is essentially carrying the global economy. But that won't last, says Canada's finance minister in recent days, because it is simply not sustainable. As such, he says, other nations must step up and accept more of the load.

Minister Joe Oliver said in a speech earlier this month that the world economy has had a choppy start to 2015. Moreover, he had said, "kick-starting global growth will be front and center" at a Group of 20 meeting of finance ministers and the heads of central banks at a mid-February meeting in Turkey.

"Though America is carrying the world economy at the moment, that is simply not sustainable. We need key pillars of global growth to reassert themselves," Oliver told a meeting of mayors from the Toronto region, as reported by Reuters.

The Britain-based newswire service further reported:

The G20 came into its own during the 2007-09 financial crisis when it put together a global stimulus package, but it is now facing the more delicate challenge of arriving at joint action when economies are running at different speeds.

Ignoring poor macro data for months

"The euro area is confronting flat growth and deflation. Beyond Europe, the growth rates of key emerging economies -- China and India -- are losing steam," Oliver told the mayors.

"Geopolitical crises -- in Ukraine, Iraq, and Syria -- pose serious risks, complicating the recovery," he added.

As noted at the Zero Hedge financial blog site, Oliver appears to be a voice in the wilderness, as the other "official" mechanisms of economic growth measurement -- like the stock market -- continue to operate as if everything in the US is just fine.

"Happily ignoring the 'fact' that the unemployment rate rose in the US today, talking-heads continue to proclaim the US economy will be the economic engine of the world going forward... cleanest dirty shirt... where else are you going to invest [emphasis in original]," the blog reported. "Of course this ignores the fact that US Macro data has been a disaster over the last 2-3 months."

Canada's finance minister is not the only one who doesn't believe the current US economic path, especially as it pertains to the growth of government entitlement programs, is sustainable.

The head of the non-partisan Congressional Research Service, economist Doug Elmendorf, has said as much as well -- and recently. The problem is, no one in Washington seems to be listening.

More than four years ago Politico reported that Elmendorf proclaimed the nation's fiscal path "unsustainable," adding that the problem "cannot be solved through minor tinkering" on the fringes regarding benefits like Social Security, Medicare, Medicaid and now Obamacare subsidies.

Tens of trillions in unfunded liabilities

Politico further reported:

Doug Elmendorf, best known for arbitrating the costs of various health care proposals, added his voice to a growing chorus of economic experts who predict dire consequences if political leaders don't scale back spending, increase taxes or both -- and soon.

Elmendorf noted a recent CBO report that pegged an increase in the public debt from $7.5 trillion at the end of 2009 to $20.3 trillion at the end of 2020 if President Barack Obama's fiscal 2011 budget were to be implemented as written. As a percentage of gross domestic product, the debt would rise from 53 percent to 90 percent, CBO forecasted. The last time the percentage was that high was right after World War II.

Elmendorf delivered his remarks to reporters at a breakfast sponsored by the online newspaper Christian Science Monitor. His comments echoed earlier, similar concerns voiced by two (now former) heads of the Federal Reserve: Paul Volcker and then-Fed Chairman Ben Bernanke.

As of this writing, the total US national debt is more than $18.1 trillion; unfunded liabilities -- benefits which have been promised by Congress but for which there are currently no funds to pay out -- amount to a mind-blowing $95 trillion.

Sources:

http://www.reuters.com

http://www.zerohedge.com

http://www.politico.com

http://www.usdebtclock.org