GAO Chief Warns Economic Disaster Looms

[bishop]

GAO Chief Warns Economic Disaster Looms: Financial News - Yahoo! Finance

AUSTIN, Texas (AP) -- David M. Walker sure talks like he's running for office. "This is about the future of our country, our kids and grandkids," the comptroller general of the United States warns a packed hall at Austin's historic Driskill Hotel. "We the people have to rise up to make sure things get changed." But Walker doesn't want, or need, your vote this November. He already has a job as head of the Government Accountability Office, an investigative arm of Congress that audits and evaluates the performance of the federal government. Basically, that makes Walker the nation's accountant-in-chief. And the accountant-in-chief's professional opinion is that the American public needs to tell Washington it's time to steer the nation off the path to financial ruin. From the hustings and the airwaves this campaign season, America's political class can be heard debating Capitol Hill sex scandals, the wisdom of the war in Iraq and which party is tougher on terror. Democrats and Republicans talk of cutting taxes to make life easier for the American people. What they don't talk about is a dirty little secret everyone in Washington knows, or at least should. The vast majority of economists and budget analysts agree: The ship of state is on a disastrous course, and will founder on the reefs of economic disaster if nothing is done to correct it. There's a good reason politicians don't like to talk about the nation's long-term fiscal prospects. The subject is short on political theatrics and long on complicated economics, scary graphs and very big numbers. It reveals serious problems and offers no easy solutions. Anybody who wanted to deal with it seriously would have to talk about raising taxes and cutting benefits, nasty nostrums that might doom any candidate who prescribed them. "There's no sexiness to it," laments Leita Hart-Fanta, an accountant who has just heard Walker's pitch. She suggests recruiting a trusted celebrity -- maybe Oprah -- to sell fiscal responsibility to the American people. Walker doesn't want to make balancing the federal government's books sexy -- he just wants to make it politically palatable. He has committed to touring the nation through the 2008 elections, talking to anybody who will listen about the fiscal black hole Washington has dug itself, the "demographic tsunami" that will come when the baby boom generation begins retiring and the recklessness of borrowing money from foreign lenders to pay for the operation of the U.S. government. "He can speak forthrightly and independently because his job is not in jeopardy if he tells the truth," said Isabel V. Sawhill, a senior fellow in economic studies at the Brookings Institution. Walker can talk in public about the nation's impending fiscal crisis because he has one of the most secure jobs in Washington. As comptroller general of the United States -- basically, the government's chief accountant -- he is serving a 15-year term that runs through 2013. This year Walker has spoken to the Union League Club of Chicago and the Rotary Club of Atlanta, the Sons of the American Revolution and the World Future Society. But the backbone of his campaign has been the Fiscal Wake-up Tour, a traveling roadshow of economists and budget analysts who share Walker's concern for the nation's budgetary future. "You can't solve a problem until the majority of the people believe you have a problem that needs to be solved," Walker says. Polls suggest that Americans have only a vague sense of their government's long-term fiscal prospects. When pollsters ask Americans to name the most important problem facing America today -- as a CBS News/New York Times poll of 1,131 Americans did in September -- issues such as the war in Iraq, terrorism, jobs and the economy are most frequently mentioned. The deficit doesn't even crack the top 10. Yet on the rare occasions that pollsters ask directly about the deficit, at least some people appear to recognize it as a problem. In a survey of 807 Americans last year by the Pew Center for the People and the Press, 42 percent of respondents said reducing the deficit should be a top priority; another 38 percent said it was important but a lower priority. So the majority of the public appears to agree with Walker that the deficit is a serious problem, but only when they're made to think about it. Walker's challenge is to get people not just to think about it, but to pressure politicians to make the hard choices that are needed to keep the situation from spiraling out of control.

click the link for the full article...

that last bit definitely hit the nail on the head.. the public is generally mentally lazy when it comes to this incredibly important issue.. "i don't get economics" - "therefore, i don't spend the effort to understand."

you'd think that since bush has tacked on well over $1 trillion in new debt, that this would be a real political issue - or at least something that the public vocally gave a damn about. what's worse - the politicians who intentionally ignore the issue, or the lazy americans who can't be bothered with such a dry issue?

[bishop]

one other piece from the article that drives the message home...

Their basic message is this: If the United States government conducts business as usual over the next few decades, a national debt that is already $8.5 trillion could reach $46 trillion or more, adjusted for inflation. That's almost as much as the total net worth of every person in America -- Bill Gates, Warren Buffett and those Google guys included. A hole that big could paralyze the U.S. economy; according to some projections, just the interest payments on a debt that big would be as much as all the taxes the government collects today. And every year that nothing is done about it, Walker says, the problem grows by $2 trillion to $3 trillion.

and somehow, we're debating flag burning amendments, gay marriage, the mark foley scandal and a whole host of issues that pale in comparison to this one..

[Milton Bradley]

Dammit bishop, I just don't see how you can lay everything in the lap of the people at every turn, when, A) it is a conspiracy by both Houses, and the Executive, and, b) the damn press lies their ass off every single day to make sure you don't know that you have choices other than the two major parties.


Granted, the people should do more, but the press has made most of them into conscientious objectors who could not in good conscience vote for any of the people recognized as running for office by the mainstream media.


This is corporate tyranny with government sanction, or fascism.

[Athena]

Wasn't Clinton popular for reducing the national debt?

I think our problem is Christianity and the belief our lives are so good is God blesses us. What could be more important to these people than sex morals?
They believe God takes care of good people, so we only need to focus on being good people. This can include destroying a country that isn't a good Christian country.

[bishop]

Quote by: Milton Bradley Dammit bishop, I just don't see how you can lay everything in the lap of the people at every turn, when, A) it is a conspiracy by both Houses, and the Executive, and, b) the damn press lies their ass off every single day to make sure you don't know that you have choices other than the two major parties. Granted, the people should do more, but the press has made most of them into conscientious objectors who could not in good conscience vote for any of the people recognized as running for office by the mainstream media. This is corporate tyranny with government sanction, or fascism.

this reads like the blame game to me - an excuse to forgive the largely apathetic public from paying attention to the truly important issues.. it isn't like we're in north korea where the only information people get comes filtered from the government or state-run media (in our case, that's the corporate-run media)..

the media has, since the start of bush's presidency, actively reported the deficit spending and new record debt levels.. every time there's a story about the current account, federal deficit, whatever, it gets reported - problem is that the public has no appetite for this information. (talking about third parties is another discussion altogether - i'm talking about the debt being a real issue in american politics.)

people contact their elected reps to protest the war, domestic spying, torture, gay marriage, etc... there is no other issue that will affect our lives as much as the deficit/debt, but looking at the attitudes of the public, it seems like they just don't care. despite all the corruption in our system, i lay the brunt of the blame here on the public for the simple fact that nobody seems to really give a good god damn about the deficit.

[PatrickHenry]

It's a stealth issue, bishop. An insidious problem that no one can feel. With no press, how are Americans to get how serious it all is? Government has run up big deficits for years, and this is just more of the same, but really, really MORE!

And the results show up next year and next decade as we and our kids can't get out from under the debt burden. Ever know anybody swamped in credit card debt? It's pitiful.

And the financiers that hold the debt? They are smugly satisfied...their minions hold the reins of government.

[bishop]

the issue does get press... it gets lots of press in fact. the problem is that nobody gives a damn.. reports constantly come out talking about these issues, but the issue never sinks into the minds of apathetic americans. the reason why they don't make the front page is because nobody's reading them (although it's always a big deal on the WSJ).

most americans believe that we need to do something to reform social security, for instance... this opinion is based on the fact that they've learned either by themselves, or by the media, or by the government that the system is on a course of bankruptcy.. of course, when it comes down to working for a real solution to the problem, all sides hunker down and nothing gets done - even though everyone still agrees that there's a huge underlying problem that will one day come to bite us. social security isn't even a real issue right now - and the problem continues to grow.

the same holds true for the deficit.. it's a case of people intentionally choosing to put off these big issues for future leaders/generations to have to deal with. in particular, it's the older generations royally fucking over younger generations - saddling them with so much debt that they'll never be able to achieve the same standard of living that their parents had. and, i for one do view it as older generations screwing younger generations over - whether/not they do so intentionally or purely out of apathy.

the enemy as far as i'm concerned is not the creditors - it's the government that spends into oblivion, and the apathetic public oblivious to the effects of this spending. i guess it's not as "sexy" as the endless debates over bush's decision to invade iraq, or gay marriage, etc... but it's perhaps the most important issue for this country in the long-run, and nobody seems to give a damn.

i realize this is more of a rant than anything else, but it's pretty depressing to see such a widespread lack of interest on an issue that has such a huge impact on all americans. and the willingness to blame others for american apathy rings as nothing more than a hollow excuse. the reality, as the article puts it, is that the issue is complicated and involves some very difficult choices - i.e. it's an issue that may require people to do some real self-education on the dry subject of economics. but, if there ever was a bipartisan issue, it's this one, hands down.

how could an issue this important not even make it to the top 10 issues americans care most about???

[PatrickHenry]

Quote by: bishop how could an issue this important not even make it to the top 10 issues americans care most about???

How many "conservative" talk shows take this subject up regularly?

And a lot of us older folks aren't getting squat yet from the government. We're still working and paying SSI just like we did all our lives. Meanwhile the Feds steal it for other purposes instead of funding an account that will generate the accrued interest that capital should...

[bishop]

there are no conservative talk shows - at least none that i'm aware of.. there are loads of republican and democrat talk shows though.. and that's besides the fact that talk shows are entertainment, and talk about popular issues/topics. if the public isn't interested in the deficit, if it doesn't even rank within the top 10, then i wouldn't expect to hear it on talk radio.

and back to social security... isn't it amazing how the issue has just vanished off the radar? it's the same thing as the deficit, but perhaps something that non-economists can more easily get their arms around. people get all amped up when they talk about "tax cuts" (financed with foreign debt) and increased spending (financed with foreign debt).. it really baffles my mind, since all of these issues require us to continue borrowing from foreign lenders at the end of the day.. talk about iraq, stem cell research, national healthcare, education, whatever - it all involves borrowing money in our current fiscal environment.

[Milton Bradley]

So, for the sake of arguement, just what are the lazy people to do about this situation?


Vote for some other Republican, or Democrat?


Seriously, I wasn't aware that the average American taxpayer had a great influence on spending policy except when it's election time.


All of the problems we now have are the legacy of people acting on that same outdated view. Unless you have your own lobbyist, I doubt your letters are doing much to influence policy at that level.

[bishop]

it has nothing to do with voting for any particular party.. the issue doesn't even rank amongst the top 10 because americans don't see it as being important. they aren't forcing this to be an issue that politicians must talk about. iraq's a big issue for example, and voters demand that candidates announce their plans to solve the problem... there is no similar approach when it comes to balancing the budget.

our debt was a nonissue in 2000, in 2002, 2004, and probably won't be one in the following years.. not because of the media, but because voters didn't care.

what i don't understand is why voters don't demand political candidates to have solid plans to resolve this issue. given that the most realistic solution to our fiscal problems includes a combination of tax increases and spending cuts, i understand why politicians avoid the issue... it's clearly irresponsible, but so too is the apathetic nature of the voting public..

[Milton Bradley]

Quote by: bishop it has nothing to do with voting for any particular party.. the issue doesn't even rank amongst the top 10 because americans don't see it as being important. they aren't forcing this to be an issue that politicians must talk about. iraq's a big issue for example, and voters demand that candidates announce their plans to solve the problem... there is no similar approach when it comes to balancing the budget. our debt was a nonissue in 2000, in 2002, 2004, and probably won't be one in the following years.. not because of the media, but because voters didn't care. what i don't understand is why voters don't demand political candidates to have solid plans to resolve this issue. given that the most realistic solution to our fiscal problems includes a combination of tax increases and spending cuts, i understand why politicians avoid the issue... it's clearly irresponsible, but so too is the apathetic nature of the voting public..

Um, when do you hear them addressing any issues?


All I hear is mud fflinging, and people trying to dodge the flying mud.


Another of the great qualities the "debates" have taken on since locking out any candidates that would address the issues.

[Rainbow]

Quote by: bishop GAO Chief Warns Economic Disaster Looms: Financial News - Yahoo! Finance that last bit definitely hit the nail on the head.. the public is generally mentally lazy when it comes to this incredibly important issue.. "i don't get economics" - "therefore, i don't spend the effort to understand." you'd think that since bush has tacked on well over $1 trillion in new debt, that this would be a real political issue - or at least something that the public vocally gave a damn about. what's worse - the politicians who intentionally ignore the issue, or the lazy americans who can't be bothered with such a dry issue?

Do you think the next U.S. government is going to make a dramatic shift, in order to slow down and/or stop and/or reverse actual policy ?

Are you wondered most people present lack of interests ?
The level of education in U.S. is the reason and/or answer. As of today, the level of education in U.S. is : a joke, except for some selected schools.

[bishop]

no, i don't see a dramatic shift in the near-term - but gridlock could result in increased fiscal prudence, because bush would have to come to compromises with the democrats if he intends on getting anything done. and, of course, my assumption here is that the democrats would approach things in a more fiscally responsible manner.

and, i'm not surprised about society's lack of interest over the debt issue - solely because of my negative opinion of society's intelligence in general.. it certainly is an issue with education - but not solely as of today.. most of society's voters are middle-aged and graduated from public schools several decades ago.. i tend to think that the debt is more of an issue for today's younger generations because they worry about the punishing taxes that'll be imposed on them... older generations, however, toss out how they're paying social security taxes - although that answer doesn't suggest that they view the debt as being a top 10 issue (or even a top 3 issue).

[Georgia]

Most everybody doesn't even know how much money they earn...only "take home pay", and have no idea their employer's "contribution" comes from their own pockets.
So much less for the long term SS trouble.

Biggest problem I've seen from turning that ship is any attempt at major adjustment/change etc is met by scaring senior citizens that their SS is going to be taken away and they'll be starving and tossed in the gutter.

Last example of that I remember is suggesting a small portion of SS be privatized, which went no-where fast for that very reason. :rolleyes:
Project on Social Security Choice
(Sigh)

[bishop]

Quote by: georgia Most everybody doesn't even know how much money they earn...only "take home pay", and have no idea their employer's "contribution" comes from their own pockets. So much less for the long term SS trouble.

you see all your gross income on your w2's..

and i can't say i ever cared about how much social security taxes are paid by any of my employers - although i know that the employee pays half and the employer picks up the other half...

and with bush's "reform", he didn't adequately explain how his plan would be financed - because the bitter reality was that he was planning on borrowing some $2 trillion in new debt to finance the transition... and new debt is exactly what younger generations do not need.

[Osborn F Enready]

Bishop said: that last bit definitely hit the nail on the head.. the public is generally mentally lazy when it comes to this incredibly important issue.. "i don't get economics" - "therefore, i don't spend the effort to understand."

I say:
Why do you think there is a movement to REMOVE the Federal Banks bishop?

The problem is, that the nanny staters can't imagine a life without one because they have been weened on the concept as if there IS no other way......

So, how did we function from 1776 to 1913? Why didn't we have a "depression" until AFTER the federal bank?

Dots, connect them people, they even PONTIFICATED on the issue many times, from Rothschild to JP Morgan, Carnegie to Kennedy. All the same bi-partisan conspirators......

156 years is a LONG time to practice the lock step jingo.

[RVonse]

Quote by: bishop there are no conservative talk shows - at least none that i'm aware of.. .

Yes there are. Rush Limbaugh considers himself to be a conservative talk show host. And he has infact stated on many occasions his dissatisfaction about spending going on in Washington. It is about the only time he dissagrees with Bush.

But he also harps on and on about how important the tax cuts are too and he honestly believes they bring in more revenue. This is a stupid fallacy IMO and he has done well to steer public opinion right into it. It is exactly that kind of fiction that does the most harm to public perception of how to resolve the debt problem IMO.

[RVonse]

Quote by: bishop ).. the media has, since the start of bush's presidency, actively reported the deficit spending and new record debt levels.. every time there's a story about the current account, federal deficit, whatever, it gets reported - problem is that the public has no appetite for this information..

I dissagree. The media has not made the public aware of how massively our debt has been financed by China. If more Americans knew just how serious this has become, I think you would see a massive change in public attitude.

Furthermore, I put more blame on the politicians than I do the public on this one. They are not reporting the numbers accurately and hiding M3 right now. The Enron folks could have learned a thing or two from the current administration on how to cook books.

[RVonse]

Quote by: Milton Bradley Dammit bishop, I just don't see how you can lay everything in the lap of the people at every turn, when, A) it is a conspiracy by both Houses, and the Executive, and, b) the damn press lies their ass off every single day to make sure you don't know that you have choices other than the two major parties. Granted, the people should do more, but the press has made most of them into conscientious objectors who could not in good conscience vote for any of the people recognized as running for office by the mainstream media. This is corporate tyranny with government sanction, or fascism.

I agree.