Future of America's financial health is at stake. Comptroller David Walker on 60 Minutes this Sunday

[Roland99]

The Comptroller of the United States, David Walker, will be on CBS' 60 Minutes this coming Sunday, March 4.

DO NOT MISS IT!!

Walker is a key member of The Concord Coalition's Fiscal Wake-Up Tour

Our mission is to cut through the usual partisan rhetoric and stimulate a more realistic public dialogue on what we want our nation's future to look like, along with the required trade-offs. We believe that elected leaders in Washington know there is a problem, but they are unlikely to act unless their constituents better understand the need for action, and indeed, demand it. Members of the Fiscal Wake-Up Tour do not necessarily agree on the ideal levels of spending, taxes and debt, but we do agree on the following key points:

* Current fiscal policy is unsustainable
* There are no free lunch solutions, such as cutting waste fraud and abuse or growing our way out of the problem.
* The best way to make the hard choices is through a bipartisan process with all options on the table.
* Public engagement and understanding is vital in finding solutions.
* This is not about numbers. It is a moral issue.

We remind audiences that each of the realistic options comes with economic and political consequences that must be carefully weighed, and that there must be tradeoffs. Those who want to raise taxes are asked to explain what level of taxation they are willing to support and the manner in which the new revenue should be raised. Those who argue that spending must come down from projected levels are asked which programs they would target and how the savings would be achieved. Those who are unwilling to do either are asked how much debt they are willing to impose on future generations.

Our experience is that when audiences are told the facts, and shown that if they demand their "rights" to programs or policies it will have damaging economic effects to other groups or generations represented in the audience, they begin to accept the need for tradeoffs. The Fiscal Wake-Up Tour does not presume to know the "correct" answers, but we are trying to make sure that the American people and their elected leaders are asking the correct questions.

From Sludge's site currently:

U.S. COMPTROLLER: PRESCRIPTION DRUG BILL 'MAY BE THE MOST FINANCIALLY IRRESPONSIBLE LAW IN 40 YEARS'; Bill Will Add $8 Trillion to Long-Term Medicare Obligations
Thu Mar 1 2007 13:41:11 ET

That Could Already Bankrupt the U.S.

The U.S. government's top accountant says the law that added a prescription drug benefit to Medicare may be the most financially irresponsible legislation passed since the 1960s. U.S. Comptroller General David Walker says Medicare -- barring vast reform to the program and the nation's healthcare system -- is already on course to possibly bankrupt the treasury and adding the prescription bill just makes the situation worse. Walker appears in a Steve Kroft report to be broadcast on 60 MINUTES Sunday, March 4 (7:00-8:00 PM, ET/PT) on the CBS Television Network.

"The prescription drug bill is probably the most fiscally irresponsible piece of legislation since the 1960s," says Walker, "because we promise way more than we can afford to keep." He argues that the federal government would need to have $8 trillion today, invested at treasury rates, to cover the gap between what the program is expected to take in and what it is expected to cost over the next 75 years Ð and that is in addition to more than $20 trillion that will be needed to pay for other parts of Medicare. "We can't afford to keep the promises we've already made, much less to be piling on top of them," he tells Kroft.

The problem is the baby boomers. The 78 million people born between 1946 and 1964 start becoming eligible for Social Security benefits next year. "They'll be eligible for Medicare just three years later and when those boomers start retiring en masse, then that will be a tsunami of spending that could swamp our ship of state if we don't get serious," says Walker.

As life expectancies increase and the cost of health care continues to rise at twice the rate of inflation, radical reform in health care will be necessary, Walker says. He says the federal government is also going to have to find ways to increase revenue and reduce benefits. The alternative is ugly. Walker shows Kroft General Accounting Office long-term projections that assume the status quo continues, with the same levels of taxation, spending, and economic growth. By the year 2040, Walker says, "If nothing changes, the federal government is not going to be able to do much more than pay interest on the mounting debt and some entitlement benefits. It won't have money left for anything else...."

DO NOT MISS IT!!

TELL ALL YOUR FRIENDS AND FAMILY!!!



edit: Oh, and here's Walker from nearly TWO YEARS AGO:

http://www.washingtonpost.com/wp-dyn/content/article/2005/05/17/AR2005051701238.html

"The only thing the United States is able to do a little after 2040 is pay interest on massive and growing federal debt," Walker said. "The model blows up in the mid-2040s. What does that mean? Argentina."

...

"To do nothing," Butler added, "would lead to deficits of the scale we've never seen in this country or any major in industrialized country. We've seen them in Argentina. That's a chilling thought, but it would mean that."

...

Walker put U.S. debt and obligations at $45 trillion in current dollars -- almost as much as the total net worth of all Americans, or $150,000 per person. Balancing the budget in 2040, he said, could require cutting total federal spending as much as 60 percent or raising taxes to 2 1/2 times today's levels.

Butler pointed out that without changes to Social Security and Medicare, in 25 years either a quarter of discretionary spending would need to be cut or U.S. tax rates would have to approach European levels. Putting it slightly differently, Sawhill posed a choice of 10 percent cuts in spending and much larger cuts in Social Security and Medicare, or a 40 percent increase in government spending relative to the size of the economy, and equivalent tax increases.