PIMCO CEO Mohamed El-Erian doesn't think much of the last-minute deal struck by Congress to avert the fiscal cliff. Specifically, he argues the political compromise does little to address "the consistent headwinds that undermine growth, hold back corporate investment, and dampen job creation."
"The compromise reached by Congress, after multiple rounds of painful negotiations, makes some political sense," El-Erian notes in a column posted to CNNMoney on Wednesday. "The economic benefits are mixed, at best. The social dimension is notable, but will need to be quickly reinforced by measures to reinvigorate economic growth and job creation."
El-Erian, recently named by President Barack Obama recently to head the U.S. global development council says the political attractiveness of the deal comes from the fact that both parties, and virtually every faction within each party, can claim at least a partial victory.
"Led by a determined President, Democrats restored the pre-Bush tax rates on higher earning individuals and couples," he adds in a nod to his new boss. "In the process, they delivered on one of Barack Obama's most important and consequential election promises."
The economic attractiveness of the deal is much more problematic, he notes.
