| The 56 Trillion Dollar Deficit | Bill Maher Interviews Fmr. Comptroller General David Walker |
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Bill Maher Interviews Fmr. Comptroller
General David Walker about the huge deficit
in America.
(CNN) -- The Emergency Economic
Stabilization Act contains plenty to make
lawmakers on the left and right shudder. On
the right, it's the apparent abandonment of
free-market principles. On the left, it's the
absence of punishment for high-flying Wall
Street CEO's.
Looking down the middle, what I found
downright unnerving was how hard Washington
struggled to pass a bill that, in reality,
represents less than 1 percent of our current
federal financial hole.
Don't get me wrong. Congress and the Bush
Administration are to be commended for acting
to relieve the credit crunch and trying to
minimize any immediate, adverse effect on our
economy and by consequence, on American jobs
and access to credit.
The ultimate cost of the act should ring up
at less than $500 billion, less than the
advertised $700 billion because of
anticipated proceeds from the government's
sale of the assets it will acquire with the
appropriated funds.
The nation's real tab, on the other hand,
amounted to $53 trillion as of the end of the
last fiscal year. That was the sum of our
public debt; accrued civilian and military
retirement benefits; unfunded, promised
Social Security and Medicare benefits; and
other financial obligations -- all according
to the government's most recent financial
statement of September 30, 2007.
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The rescue package and other bailout efforts
for Fannie Mae, Freddie Mac, AIG and the auto
industry, escalating operating deficits,
compounding interest and other factors are
likely to boost the tab to $56 trillion or
more by the end of this calendar year.
With numbers and trends like this, you might
ask, "Who will bail out America?" The answer
is, no one but us!
Since we're going to have to save ourselves,
recent events could hardly be called
encouraging. It took an additional $100
billion in incentives -- some would call them
"sweeteners;" others might call them bribes
-- to get lawmakers to pass the rescue
package. Regardless of what you call these
incentives, ultimately the taxpayers will
have to pick up the tab, with interest.
The process that was employed to achieve
enactment of this bill was hardly a model of
efficiency or effectiveness. The original
proposal represented an over-reach and
under-communication by the administration.
Neither lawmakers nor ordinary citizens had
enough information to properly assess the
real risks, the need for action and what an
appropriate course of action might be.
Furthermore, the key players allowed the
legislation to be characterized as a $700
billion bailout of Wall Street, which was
neither an accurate nor a fair reflection of
the legislation.
Passage of the credit-crunch relief
provisions in the act was understandable, not
just because of what risks and needed actions
the Treasury and the Federal Reserve were
aware of, but more importantly, because of
what policymakers didn't know and eventually
might have to address.
Let's face it -- the regular order in
Washington is broken. We must move beyond
crisis management approaches and start to
address some of the key fiscal and other
challenges facing this country if we want our
future to be better than our past.
A good place to start would be for the
presidential candidates to acknowledge our
$53 trillion (and growing) federal financial
hole and commit to begin to address it. Their
endorsement of the need for a bipartisan
fiscal future commission along the lines of
the one sponsored by Rep. Jim Cooper,
D-Tennessee, and Rep. Frank Wolf, R-Virginia,
also would make sense.
Any such commission should, at a minimum,
address the need for statutory budget
controls, comprehensive Social Security
reform, a first round of tax reform and a
first round of comprehensive health care
reform. It should hold hearings both inside
and beyond the Beltway. And, its
recommendations should be guaranteed to
receive an up-or-down vote by Congress if a
super-majority of the commission's members
can agree on a comprehensive proposal.
Editor's Note: David M. Walker served as
comptroller general of the United States and
head of the Government Accountability Office
(GAO) from 1998 to 2008. He is now president
and CEO of the Peter G. Peterson Foundation.
Our fiscal time bomb is ticking, and the time
for action is now!
DAVID WALKER
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Affichage : 18315
Durée : 361 s |
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