Trim deficit or economy will be hurt

[centsgirl]

Failing to curb the federal budget deficits would do big damage to the U.S. economy in the long run, Federal Reserve Chairman Ben Bernanke,warned Tuesday.

Bernanke also urged the White House and Congress to come up with a plan to reduce the nation's red ink, which hit a record $1.4 trillion as of last year.

Failing to do so would push interest rates higher, not only for Americans buying cars, homes and other things,but also for Uncle Sam to service the debt payments, he said.

All this would sap national economic activity and could cause employers to cut back on any hiring, Bernanke said.

The Fed chief made his most urgent call yet to get the nation's fiscal house in order. His plea came in prepared remarks to the first meeting of President Barack Obama's commission to tackle the soaring deficit.