US Fiscal Watchdog Resigns

[TexasRed]

Wednesday, 27 February 2008

The “ultimate sell signal.”

“Government’s lone fiscal watchdog resigns,” is the relevant headline. It refers to David Walker, head of the Government Accountability Office. Mr. Walker has been alarmed at the growing indebtedness of the U.S. government for a long time. He regularly travels, doing what he calls the ‘Fiscal Wake-Up Tour”, warning all who will listen that the United States is headed for big trouble if it doesn’t get its finances under control. (Both Walker, and the Fiscal Wake-Up Tour, are featured prominently in a documentary Addison and Short Fuse have been working tirelessly on, called I.O.U.S.A.)

The basic problem is well known and has been frequently illustrated throughout history. Democracy responds to the mob of voters; and the mob wants bread and circuses - at someone else’s expense, of course. In America, circa 2008, Congress responds to the desires of people who vote in current elections. The voting age has been lowered to 18, but the next generation, the unborn generation, has no voice in modern government. Not even a whimper. Inevitably, politicians pander to the living in order to get votes… and inevitably the next generation gets the bills.

The last time we looked, the shortfall between what had been promised - in the form of Treasury bonds, Medicare, Medicaid, Social Security and the like - and what might reasonably be collected in taxes toted up to some $50 trillion, or about a half a million dollars per family. In other words, the whole country is bankrupt… and the financial obligations of the U.S. federal government should be regarded by investors as though they were subprime debt. It is a huge debt that the debtor cannot pay.

As headman at the General Accounting Office, David Walker, has been fretting about this for years… and trying to get the politicians to cut spending and balance the budget. He might as well have been trying to get a pack of wolves to eat Greek salads for lunch. It has been a thankless, frustrating job, especially during the Bush II years. This ‘conservative’ administration added more to America’s burden than all the administrations since George Washington - put together.

So, now he’s resigned… but isn’t giving up on the cause he’s been fighting for all of those years at the GAO. Pete Peterson, Commerce Secretary under Richard Nixon and founder of the Blackstone Group, has set up a foundation and given Mr. Walker a job. He’ll have $1 billion to work with… and the impossible task of trying to bring U.S. government finances in order.

Of course, we’d be delighted to see him succeed. But there’s a big gap between what we’d like and what we’ve got. The former may be public spirited; but the latter is definitely bloody-minded. The former may wish to imagine that the United States will cut spending, balance the budget, encourage savings and restore America’s economic vigor. But the latter knows the voters wouldn’t stand for it. We wish him luck.

History must run its course. Old empires must decay and collapse, so as to make room for new ones.

Sic transit gloria mundi.

Sell the United States. Buy Japan. Buy Latin America. Buy gold.

[mikedetejas]

Saw this guy on Glenn Beck a week ago. I can't believe that none of our elected officals will even talk about the impending crisis.

[FATboy05]

Originally Posted by mikedetejas

Saw this guy on Glenn Beck a week ago. I can't believe that none of our elected officals will even talk about the impending crisis.

Election year :roll:

[GzrGldGeo]

This guy is a true American and is as ignored as Ron Paul. No one wants to hear we are out of control and need to seriously check spending.

Please do your self a favor and go to his Government website and read his presenttions.

When trying to put a figure on IRAQ, he says he has asked repeatedly for the defined mission in IRAQ. There is still no defined mission therefore no way a dollar amount can be put on the war. He can tell you that all contracts are being made through 2017. But with NO DEFINED MISSION he can't possibly tell us what to budget for it.

The biggest spending bill in history not counting the undefined war is the medicare drug billl passed and signe under Bush. Never has that much unpaid for spending been approved in the history of the US.

Again, this is a true and brave American and will never get half the rspect he should.

Please Please go to the GAO website and read his material.

It might convince you the any CHANGE may be good.

[mikedetejas]

I don't know if any change may be good. There is only one way to get out of this fiscal crisis and that's by cutting spending everywhere, and cutting it to the bone. Its going to hurt and people will scream bloody murder.

Alexander Fraser Tytler made this interesting observation about democracy in 1776: “A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy followed by a dictatorship.