Thursday, August 4, 2011

US faces intl. criticism over debt deal

US President Barack Obama (file photo)

Source: Press TV

Officials from several countries have criticized the United States' handling of its debt ceiling crisis, saying the measures taken has not been enough to avert a global financial crisis.

The Governor of the People's Bank of China Zhou Xiaochuan has warned about the consequences of the uncertainties in the US economy.

"Large fluctuations and uncertainties in this market (US Treasuries market) would undermine the stability of international financial system and hinder global recovery," Xiaochuan said on Wednesday.

China's official news agency, Xinhua, has warned that “the months-long tug of war between Democrats and Republicans... failed to defuse Washington's debt bomb for good, only delaying an immediate detonation by making the fuse an inch longer.”

Moreover, China's leading ratings agency Dagong has downgraded America's credit rating from A+ to A. The agency has said it predicted a negative outlook for the US economy in the coming months.

Venezuelan President Hugo Chavez also called the US a “parasite.”

"I echo what our friend the Russian Prime Minister Vladimir Putin said: The United States is a real parasite on the world economy," Chavez wrote on his social network Twitter page on Wednesday.

Earlier on Monday, Russian Prime Minister Vladimir Putin had called the US a “parasite” that is feeding on the world economy by building an unsustainable debt that threatens the global financial system.

“The country is living in debt. It is not living within its means, shifting the weight of responsibility on other countries and in a way acting as a parasite,” Putin said.

Meanwhile, officials in Brazil have also the criticized the US, saying their solution to the crisis has been unsatisfactory as a troubled US economy would only hurt the entire world.

On Tuesday, US President Barack Obama voted in favor of a bipartisan plan to raise the debt ceiling of the United States in exchange for spending cuts, just hours before a default would take place.

According to the new bill, the debt ceiling will be raised by $2.4 trillion, to reach a total of $16.7 trillion. The bill also includes a $2.1 trillion in spending cuts over the next decade.

The cuts could affect such entitlement programs of the country as Medicare, Social Security, and military expenditures.

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