Geithner Sees a ‘Lot of Progress’ on Spending, Debt Talks

U.S. Treasury Secretary Timothy F. Geithner said today he sees “a lot of progress” in bipartisan spending and deficit talks that have been taking place in Washington.

Geithner, speaking at an event in Washington, said that the government’s Aug. 2 limit for borrowing is “imposed by reality” unless there is Congressional action to raise the debt ceiling.

“We are making a lot of progress” on a plan to cut the deficit and raise the government’s borrowing limit, Geithner said. “We’re getting closer.”

Vice President Joe Biden’s bi-partisan deficit-reduction group has been holding meetings since May 5 to reach a compromise that would clear the way for a vote in Congress to raise the nation’s $14.3 trillion debt ceiling. Republicans are demanding trillions of dollars in budget savings, while Democrats are resisting any changes to Medicare, the long-term driver of the debt.

Geithner expressed confidence in raising the debt limit, saying that the alternative, a possible U.S. government default, is unthinkable.

The Treasury secretary said that a strong U.S. dollar “will always be in the interest of the U.S,” while encouraging a “more unified” voice from Europe as it seeks to resolve its debt crisis.

To contact the reporter on this story: Cheyenne Hopkins in Washington at chopkins19@bloomberg.net

To contact the editor responsible for this story: Kevin Costelloe at kcostelloe@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.