I just read a comment about a presidential candidate that really "gets it" about the economy. Sorry, but the guy that really "gets it" is the former GAO Director and one of the nation's foremost economists David M Walker. Both main parties and their candidates need to start listening to his message. M

One man's campaign against federal debt

By Kyle Almond
CNN

excerpts

David M. Walker, the nation's top accountant, is instead touring the country to warn Americans about the consequences of a federal debt he says is on an unsustainable course.

Walker, who heads the Government Accountability Office (GAO), has visited college campuses, spoken to lawmakers in Washington and toured 19 states in the last year and a half.

He plans to continue through next year and is focusing on states that could affect the 2008 presidential race, in hopes that candidates will heed his message.

"If [the candidates] don't make [the debt] one of their top three priorities, in my opinion, they don't deserve to be president and we can't afford for them to be president," he told CNN.

The federal debt has soared during the last two decades -- from $2.13 trillion in 1986 to $5.22 trillion in 1996 and $8.51 trillion in 2006.

The federal debt now stands near $9 trillion.

The way programs such as Social Security, Medicaid and Medicare are structured, the government will incur an additional debt of $50 trillion during the next 20 years, according to GAO figures.

The $50 trillion total amounts to about $440,000 per American household, Walker said.

The primary drivers behind the additional rise in spending are the baby boomers, who start becoming eligible for Social Security in 2008 and Medicare in 2011.

"We are talking about an unprecedented change in the demographic landscape of America," Walker said. "And we are not prepared for this oncoming wave."

The federal debt increases every time there is a budget deficit at the end of the fiscal year. A budget deficit occurs when the government spends more than it receives in revenue, as it has for the past five fiscal years and 16 of the past 20, according to the Office of Management and Budget.

The causes for such deficits range from tax cuts and spending increases to congressional earmarks in appropriations bills, costs associated with the wars in Iraq and Afghanistan and catastrophes like the 9/11 terror attacks and Hurricane Katrina.

The government makes up the difference by printing and selling Treasury bills and bonds, which are increasingly being bought by overseas investors looking to profit from the interest.

In the worst-case scenario, other countries -- instead of just charging higher interest rates -- could decide to take their money elsewhere, which could spur inflation and increase financial uncertainty.

However, several things would need to happen -- such as a series of international crises or a collapse in U.S. home values -- for countries to move their investment out of the United States, according to Beach.

Meanwhile, as a result of existing debt, the United States has less money to spend on infrastructure, technology and education -- improvements needed for the country to remain competitive in the global market, Weller said.

"With the government running massive deficits and spending large amounts on debt service, we have less money available to address those concerns, to really face the challenges of the future," he said.

"The fact is that we could eliminate the Iraq war tomorrow. We could eliminate every dime of pork-barrel spending. And we wouldn't come close to solving our problem," he said.

Walker said it is necessary to balance the budget within the next five years, make a down payment on the $50 trillion imbalance and begin reforming government programs.

"It's going to take us probably 20 years to do all the things that need to be done, " he said. "But we need to get started now because the clock is ticking and time is working against us."

Find this article at:
One man's campaign against federal debt - CNN.com

Privatizing Social Security will help.. but that's too faux pas for the left.

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It is inaccurate to say that I hate everything. I am strongly in favor of common sense, common honesty, and common decency. This makes me forever ineligible for public office.
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Economic Left/Right: 3.75
Social Libertarian/Authoritarian: -2.87

All very well and good, but I have yet to hear of the GAO actually holding government accountable...

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My issue with privatizing Social Security is that it really isn't about the individual investing his/her own money. It would look like the Medicare Drug benefits where you could chose Plan A, Plan B or Plan C. Invariably that means your money will be invested in Halliburton, ExxonMobile, etc... Who gains the most in that transaction? Halliburton, ExxonMobile, etc...

It would be a "Trojan Horse" just like the Medicare Drug Benefits, which was really all about corporate welfare. The PharmCorps are now raking in profits hand over fist. So the lesson of the story is beware of "Geeks bearing gifts."

If Congress really wants to fix Social Security for the seniors, they need to enlist real expert economists like Walker. Don't leave it up to the Poly (many) ticks (blood sucking parasites). The only person in Congress I would trust with economics at this level is Ron Paul.

And this is something Ron Paul has been saying. Allow the younger generations to get out of Social Security.

__________________
Pioneers are walking all around singing songs about Lenin and they should be shot for it.

Handlebars

"If you are looking for the guilty, you need only look into a mirror"- V

It is inaccurate to say that I hate everything. I am strongly in favor of common sense, common honesty, and common decency. This makes me forever ineligible for public office.
H. L. Mencken

Beagán agus a rá go maith.

Economic Left/Right: 3.75
Social Libertarian/Authoritarian: -2.87

I am bumping this thread forward into New Posts, as I think it is really important people get exposure to Walker's message about the debt we are running up.

How many "younger" people do we have here to comment? Do you want to get out of Social Security? That means larger paychecks and then you have to plan for your own retirement.

As I have said previously, the legislators and fed government WANT SS around as a savings and loan. It can always be said at any given moment, there are trillions of dollars still in SS. But at any given moment, the piggy bank is empty with the exception of IOU notes in the form of electronic US savings bonds. It is "borrowed" by government departments running at a deficit. If the feds did not have their own private savings and loan, they couldn't run at a deficit. Like the rest of us, they would have to learn how to live within your budget. Wouldn't that be awful?!

Someone needs to seriously consider a presidential cabinet position for David Walker. He is willing to talk authoritatively about the 63 trillion dollar gorilla in the room everyone else wants to ignore.

I am unaware of any plan for the privatization (or partial privatization, as is normally the case) of Social Security that would allow for investment in individual stocks. Such a plan would be immensely risky and imprudent. No, every plan that I have ever seen, for the partial privatization of Social Security, would allow a small portion of the proceeds to go toward mutual fund-type investments. This portion of Social Security, therefore, would be very much like an IRA, a 401(k) plan, or the similar Thrift plan for federal employees.

I'm against it because of rises and falls, if you retire at the wrong time, then you can end up with very little money for your retirement (look at the recent market, down 20% for it's high a few years ago).

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The best thing for the elderly on fixed incomes is to keep inflation down. Their pensions and SS don't go up with the cost of living. And we are now in times when the working poor and elderly on fixed incomes that were previously barely making it are now not making it with high inflation. It is increasingly coming down to ugly decisions, such as do you want to eat or pay for gas to commute to work. Do you want to stay warm in the winter time or eat?

Social Security needs to change. I am not advocating any specific approach, but I would have to insist that the real experts be involved in that change instead of the usual range of partisan legislators.

Everyone knows what needs to get done, but no one wants to hear it, let alone do it.

The age of 65 was determined in 1934, when SS started. The funny thing was that the life expectancy for people born in 1934, was 61 years (only 59 years for men), now the life expectancy for people born in 2001 is 77 years, 16 years longer. For the original SS plan to work, we would need to bump it back to 80 years of age before people could claim on it. Or set it up in individual accounts, so that you only get out what you put in.

__________________
Set your destination with your heart, get there with your mind.

"The wisest men follow their own direction." - Euripides