Its businesses are internationalising faster, and its persistent current-account deficit and bad infrastructure mean it badly needs foreign investment.
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Obama also seemed to make a distinction between good tax increases and bad ones, saying that these tax increases would not serve a meaningful purpose like deficit reduction or infrastructure spending.
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Analysts give diverse reasons for the meltdown, most pointing to the current account deficit fueled by numerous infrastructure mega-projects that rely on external financing in U.S. dollars.
As there is value in the underlying infrastructure, profitable infrastructure spending that creates work and reduces the deficit is preferable to government transfer payments that can discourage work.
But the deficit already hampers growth by limiting government spending on infrastructure, education and health.
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To narrow the deficit, it will be tempted to short-change infrastructure spending, an investment that pays off slowly.
The nation has no way to continue funding transportation infrastructure, he said, because of the recession, the ballooning deficit and opposition in Congress.
And I think we have a deficit in terms of investment in this country in the infrastructure we need to help us compete in the world market in the future.
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Except for some GDP generating projects consistent with our needs, like improvements to our infrastructure, most of this revenue should be used to reduce our annual deficit.
Still, an investment-grade rating is handy if, like India, you run a current-account deficit and hope to attract foreigners to help finance your vast infrastructure needs over the next decade.
For Britain to emerge from its fiscal crisis not only must the deficit shrink but the economy must grow, and this means adequate infrastructure.
Some of the challenges we face we're going to have to work on for a while -- improving our schools, making sure that we've got the best infrastructure in the world, making sure that we're bringing down our deficit, making sure that we're continuing to invest in science and technology.
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But we're not going to reduce the deficit by gutting education investments, gutting investments that we make in our infrastructure, gutting our investments in basic science and research that can lead to discoveries in clean energy or lead to discoveries in curing cancer.
Labour said people's living standards would continue to be squeezed and the deficit would continue to rise until Mr Osborne changed direction and increased investment on job creation, infrastructure and industry.
The White House will stress what Mr. Plouffe called "smart" deficit reduction, meaning a plan that avoids cuts to administration priorities such as spending on education and infrastructure.
The lesson for China of Japan's policy change - the result of an unprecedented budget deficit - is that foreign investors may not give the benefit of the doubt to Chinese New Deal infrastructure plans next year if private consumption and investment fail to pick up.
And one of the reasons why the administration has been so focused on comprehensive health reform legislation is that it would not only reduce the deficit over the next decade, but perhaps as importantly or even more importantly put in place the infrastructure and the policies that will help to constrain costs and improve quality in the decades thereafter.
They'll say the answer to that is not to change their deficit reduction strategy but to redouble their efforts on things like banking reform, getting credit moving and getting infrastructure built.
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