Bernanke Says Current U.S. Fiscal Policy Can’t Be Sustained for 20 Years

Federal Reserve Chairman Ben S. Bernanke urged lawmakers to clarify fiscal plans “as soon as possible” to ensure the nation’s long-term budgetary health.

“It is very clear” that “on current, reasonable expectations about policy that the U.S. federal deficit will be unsustainable within 15 or 20 years at the most,” Bernanke said in response to questions from the Senate Budget Committee. “Possibly some of those effects will be brought forward by markets, for example,” he said during testimony.

“These are concerns, I want to emphasize, which are not just about our children 20 years from now but they could have effects much sooner if markets begin to lose confidence,” the Fed chairman said.

To contact the reporter on this story: Steve Matthews in Atlanta at smatthews@bloomberg.net

To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

Feb. 7 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke testifies before the Senate Budget Committee about the U.S. economy, labor market and tax policy. Bernanke repeated that the job market is still far from healthy after signs of economic improvement over the past year, and he called on lawmakers to reduce the long-term budget deficit. (This is the first part of the testimony. Source: Bloomberg)

46:47

Feb. 7 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke testifies about the U.S. economy, the budget and Fed policies. He speaks before the Senate Budget Committee in Washington. (This is the second part of the question and answer portion of the hearing. Source: Bloomberg)