Former US Treasury secretary Hank Paulson says the US is putting its status as a superpower at risk by running such a high budget deficit.
According to the Daily Telegraph, Paulson told a group of investors that the $1.34trn deficit is putting its economy at risk.
He said: “I cannot think of any time in history of a superpower continuing to be one if they do not have a strong economy and fiscal system.”
On the second anniversary of the collapse of Lehman Brothers, which was overseen by Paulson, he warned that the recent Dodd Frank regulatory reforms in the US did not go far enough in averting the next financial crisis.
He said: “We have to assume that regulation will not be perfect. We will have another financial crisis sometime in the next 10 years because we always do.”
But Paulson echoed the sentiments of Berkshire Hathaway chairman Warren Buffett, who earlier this week stated that the US would not fall into a double dip recession.