According to US Treasury Secretary Timothy Geithner, the US will have trouble paying its debts somewhere between 16 May and 2 August 2011. Geithner is thus asking Congress to raise the legal debt limit, which now stands at $14.3tn.

Growth in the US in the short and medium term is a good thing for the US economy – and the world. But when growth recovers, the US will have to raise taxes, make a structural shift towards a green economy and reduce military and other spending. But this is not the time – and holding the US bond market hostage is not the route to that inevitably necessary future.

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