WASHINGTON (Reuters) - A rush towards fiscal austerity in Europe had worsened the economic situation in some countries, U.S. Treasury Secretary Jack Lew said on Wednesday, arguing that there is a need to assess the impact of budget cuts on growth and employment.
In remarks after a speech at John Hopkins University’s School of Advanced International Studies, Lew said not all countries were equal, noting there were some that had the potential to grow faster, and others that could handle more belt tightening.
“In each of these countries there has to be a focus on what the impact on unemployment is, what the impact on long-term growth is and how they can have a viable path in the next 10 years to get out of fiscal austerity because you cannot be in the world where austerity just leads to more austerity,” he said.
“The rush to do all the front-end has actually made the problem harder in some countries.”
Reporting by Lucia Mutikani; Editing by Eric Beech