YOU DON’T SAY: IMF’s Gopinath says high U.S. deficits fueling growth, higher interest rates.

Gopinath told a fiscal forum at the IMF and World Bank spring meetings that U.S. deficits are projected to rise for years with one of the world’s steepest curves for debt.

“The high levels of deficits are also supporting growth and demand in the U.S. that have positive spillover to the rest of the world,” Gopinath said. “But along with that growth, you’re getting higher interest rates and a stronger dollar and the second two are creating more complications for the world.”

The IMF’s fiscal monitor estimates that the U.S. deficit for 2024 will reach 6.67% of GDP, rising to 7.06% in 2025 – double the 3.5% in 2015.

Gopinath said that the IMF’s annual “Article IV” review of U.S. economic policies in coming weeks will again recommend that the U.S. raise tax revenues and reform its costly Social Security and Medicare programs for older Americans to bring down deficits.

Or maybe we could try getting spending in line with revenues for a change.