Every good fight needs a good strategy. But, the fiscal fight this country has been battling for the last few years hasn’t got one says David Walker – the so-called “Paul Revere” of fiscal responsibility.
“We have no coherent strategy to be able to improve our competitive posture, to be able to generate job growth [or] to be able to deal with our structural deficit,” says Walker, Founder and CEO of the Comeback America Initiative and also the former U.S. Comptroller General.
If Walker is right, the United States is in serious trouble. This year the U.S. deficit will hit $1.5 trillion and if left without remedy will grow to $18 trillion by the end of 2021. (See: Dangerous Debts: Holtz-Eakin “Infinitely” Concerned U.S. Is Next Japan)
President Obama touched on our dire deficit situation during his second State of the Union last week, but Walker felt he did not go far enough. He believes as the executive of the country President Obama should have laid out specifics on out how to move this country forward. “We heard a lot of talk about it in the State of the Union,” he says. “We hear a lot of talk about it from politicians on both sides of the political aisle. It is time for action. We need results, not rhetoric.”
But, with a newly elected divided Congress, are these results achievable?
Moody’s Investors Services doesn’t think so. Last week the ratings agency expressed concern that even in the face of these dreadful problems, Congress will not be able to find common ground.
Walker does not agree entirely. “There is a growing consensus that we need to do something. There is [just] not a consensus on what needs to be done,” he tells Aaron in the accompanying clip, suggesting we should focus primarily on these actions to fix our long-term structural deficits:
- -- Lower discretionary spending – including defense (excluding war costs) - to 2008 levels adjusted for inflation and population growth.
- -- Set discretionary spending caps.
- -- Set pay-as-you-go rules for both spending programs and tax cuts.
- -- Set debt-to-GDP targets with automatic spending cut/tax surcharge enforcement mechanisms to start in 2013 or 2014.
“Without a strategic planning framework that is future focused, results oriented, geared towards outcomes where we are trying to achieve specific results,” we aren't going to make any real progress, he says. “We have too many career politicians in office that are focused more on getting re-elected rather than keeping America great and keeping the American dream alive."
Still, Walker is optimistic that the voting public is much smarter than politicians give them credit. “When you tell them the truth, the whole truth, and nothing but the truth and help them understand that this country’s future is at risk…they will support action,” he says.
What the country really needs now, he says, is leadership and that leadership must first come from the President of the United States.
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