” The International Monetary Fund slashed its forecast for US economic growth on Monday, citing a harsh winter, problems in the housing market and weak international demand for the country’s products.
In its annual review of the US economy, the IMF cut its growth forecast by 0.8 percentage points to 2%. At a press conference IMF managing director Christine Lagarde blamed the bad winter for much of the cut and said the setback should be temporary. But she warned: “Growth in and of itself will not be enough.”
As part of a series of reforms the IMF has called for an increase in the minimum wages in the US, currently the lowest when compared to the average wage in any of the Organisation for Economic Co-operation and Development (OECD)’s 34 countries.
She said the number of long-term unemployed, 3.4 million in May according to the Department of Labor, remained too high and the percentage of people in or actively looking for work, the so-called participation rate, remained too low.”
While acknowledging the impact that our huge unemployment rate is playing in the lack of recovery , Ms Lagarde proceeds to lecture the US on the need to hike the minimum wage … that will spur employment , yeah , right . Their second recommendation is the other tried and true Statist “recovery tool” … government stimulus …
” The IMF believes the US also needs to do more to mitigate the impact of its aging population and to stimulate productivity. The best option would be for government to boost spending, notably on infrastructure, the IMF said.”
The Guardian has more