JPMorgan Chase CEO and Chairman Jamie Dimon gestures as he speaks during the U.S. Senate Banking, Housing and Urban Affairs Committee’s oversight hearing on Wall Street firms, on Capitol Hill in Washington, DC, on December 6, 2023.
Evelyn Hockstein | Reuters
JPMorgan Chase Chief Executive Jamie Dimon on Wednesday called on the US to reduce its fiscal deficit as soon as possible, warning the problem could become “much more annoying” if it continues to be ignored.
His comments come after a period of rapid interest rate increases, tax cuts and massive stimulus programs designed to support the world’s largest economy during the coronavirus pandemic.
“America spent a lot of money,” Dimon said in an interview with Sky News. During Covid and post-Covid, our deficit is now at 6%. That’s a lot, but clearly that drives growth.”
“Any country can borrow money and spur growth, but that doesn’t always lead to good growth. So I think America should be clear that we have to focus on this problem.” The fiscal deficit is a little bit bigger, and that’s very important.” for the world,” he added.
The federal government has so far spent $855 billion more than it collected in fiscal 2024, according to the United States. Financial Departmentleading to a national deficit.
In fiscal year 2023, government deficit spending stands at $1.7 trillion.
The deficit still piles up despite reassurances from US President Joe Biden’s administration that the Inflation Reduction Act will cut “hundreds of billions” exit the deficit, in addition to reducing prices.
Asked whether the United States would suffer consequences in the next few years if it fails to address its budget deficit, Dimon replied: “I don’t think it’s a big punishment and I don’t think it’s in the cards.” the next few years. But I think that’s why we have higher inflation.”
He added, “I think if you want to do a good job in your country and you have a 6% deficit and 100% debt to GDP, this can happen.” [on] for a while, but the sooner we focus on it, the better.”
Dimon said he hopes the US government is “really focused” on reducing the deficit while still enjoying a period of strong economic growth.
“At some point it’s going to cause problems and why should you wait?” Dimon said.
“The problem will be created by the market and then you will be forced to solve it and probably in a much more unpleasant way than if you solved it in the first place.”
– CNBC’s Jeff Cox contributed to this report.
