Fed Chairman Ben Bernanke

The growing deficit could force the federal government to raise taxes or change entitlement programs, such as Medicare and Social Security, Federal Reserve Chairman Ben S. Bernanke said this week.

If the country fails to demonstrate fiscal responsibility, the country faces a loss of financial stability and robust economic growth, he said. The speech comes just weeks after President Obama signed into law a nearly $1 trillion healthcare reform bill. Critics contend it will increase deficits, even though the Congressional Budget Office determined it will reduce deficits.

Bernanke argued that if the government develops a “credible plan” to reduce long-term deficits, it could help boost the economy before long.