Every day my e-mail inbox receives several notices about new reports and testimony, courtesy of the Government Accountability Office (GAO). One such notice last week was about a presentation titled Saving Our Future Requires Tough Choices Today which was given by David M. Walker, the Comptroller General of the United States as part of his Fiscal Wake-Up Tour at the University of Chicago on November 8, 2006. This should be required reading for every US resident.
The short story is this: The miracle of compound interest is working against the United States. We are getting into more debt, quicker, and legislation on the books is only going to make it worse. Radical changes in our cultural and economic values are needed. For example, it's clear that we can't grow our economy enough to solve this problem. To do so, we'd need double-digit growth every year for the next 75 years. As a measure of the impossibility of that goal, the 1990s saw an average growth of just over 3%.
This means that we can't sustain the amount of investment in social programs, infrastructure, and research that has been bank-rolled by the federal government, any more than we can sustain the tax cuts and political expansionism that eradicated the budget surpluses of a mere eight years ago. In other words, Republicans and Democrats are both at fault, the former for tax prudence and war-waging in the name of political philosophy and the latter for parochialism and economic navel-gazing.
Read the report.