Reply #81: U.S. comptroller general warns of fiscal crisis [View All]

[OrangeCountyDemocrat]

I got this from another DU post.

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-03-14T201035Z_01_N14286904_RTRIDST_0_ECONOMY-USA-WALKER.XML

LONDON, March 14 (Reuters) - The United States is headed for a financial crisis unless it alters its course of racking up big budget deficits year after year, Comptroller General David Walker told a British audience on Tuesday.

"If we continue on our present course, a fiscal crisis is only a matter of time," Walker said in the course of an address to the London School of Economics in which he stressed the need for the United States to get its fiscal house in order.

The comptroller general acts as the nation's chief accountability officer and is the head of the U.S. Government Accountability Office, or GAO.

Walker said some combination of reforming so-called entitlement spending like that for health care and Social Security, curbing discretionary spending and possibly changes in tax policy likely will be needed to get deficits under control.

Even then, it will take a considerable period of time and strong political leadership to correct the current situation.

"I think it's going to take 20-plus years before we are ultimately on a prudent and sustainable path," Walker said, partly because so many American consumers take their example from the government.

"Too many Americans are following the lead of the federal government, they are spending more than they take in and are running up debt at record rates," Walker said.