Scott Bessent's growth plans aren't enough to tame surging deficit and debt pile, IMF chief says
IMF chief Kristalina Georgieva said Bessent’s reliance on growth won’t cut the U.S. deficit and $40 trillion debt fast enough, calling for fiscal consolidation.
Key points
- IMF chief Kristalina Georgieva says Scott Bessent's growth-led plan cannot tame U.S. debt fast enough.
- U.S. federal debt has surpassed $40 trillion and exceeds 100% of GDP.
- The IMF forecasts U.S. growth of 2.3% in 2026 and 2027, with debt reaching 142% of GDP by 2031.
IMF Managing Director Kristalina Georgieva said Treasury Secretary Scott Bessent's plan to rely on economic growth to reduce U.S. government debt is not sufficient. Speaking Wednesday at the IMF-World Bank annual meetings in Bangkok, she said growth helps but cannot deliver the needed adjustments quickly enough.
Georgieva said Bessent acknowledges that federal deficits and overall debt have grown too high, but that U.S. authorities still lean heavily on strong growth to bring them down. She added that some fiscal measures would be necessary.
Bessent's growth argument
Bessent and Trump administration officials have pointed to resilient growth driven by the artificial-intelligence build-out, reshoring of manufacturing and consumer tax cuts as tools to improve the U.S. fiscal position. Bessent said last month that with 3% growth, the country would grow its way out of the problem, arguing sustained growth above 3% plus spending restraint could lower the debt ratio and bend the debt-to-GDP curve.
Before his appointment, Bessent said he wanted Trump to cut the deficit to less than 4% of GDP by the end of his term, and in August he said the U.S. budget deficit had likely peaked.
Growth of course helps, but it cannot deliver fast enough the necessary adjustments
— Kristalina Georgieva
Debt and market pressures
U.S. federal debt has exceeded 100% of GDP, with public debt surpassing $40 trillion and on track to break a record set after World War II. The deficit for the fiscal year ended Sept. 30 is expected to top 6% of GDP, compared with 5.8% in fiscal 2025.
Treasury yields have climbed to multidecade highs this year, with the benchmark 10-year yield near its highest since 2002 at around 5.2% on Wednesday. The IMF forecasts U.S. growth of 2.3% in both 2026 and 2027 and projects gross government debt reaching 142% of GDP by 2031. Georgieva has urged governments to set credible medium-term deficit plans rather than rely on growth alone. Bessent reportedly missed this week's meetings for domestic engagements.
