"We're involved in a dangerous game," Greenspan said, according to Bloomberg News.
The U.S. needs an austerity program, Greenspan said. The former Fed chairman said that cutting budgets is a better way of reducing the deficit than raising taxes.
Still, Greenspan reiterated his support for letting the Bush tax cuts lapse. During the Bush administration, he was a key proponent of enacting the cuts.
Greenspan, 84, served as chairman of the Fed from 1987 until 2006.