Former US Comptroller General David Walker has criticized Washington’s fiscal situation, calling it irresponsible and unethical. In 2007, the national debt was below $10 trillion, but now it exceeds $34 trillion. The annual budget shortfall has also surpassed $1 trillion, and interest costs have topped $1 trillion as well. Despite Walker’s warnings about the unsustainable fiscal path, the government has not taken significant action. The Congressional Budget Office predicts that the national debt will reach $50 trillion by 2034, with debt held by the public reaching 166 percent of GDP and the deficit reaching 8.5 percent by 2054.
Walker believes that Washington has become addicted to spending, deficits, and debt, which he calls irresponsible, unethical, and immoral. He points out metrics such as the debt-to-GDP ratio, which is currently at a record high of about 122 percent. Mandatory spending as a percentage of the federal budget is around 73 percent, and interest as a percentage of the budget is close to 15 percent. Walker also highlights demographic trends, such as an aging society with longer lifespans and a declining birth rate, which will put a burden on the federal government, particularly Social Security.
Both Republicans and Democrats have contributed to the fiscal irresponsibility. While President Joe Biden claims to have acted fiscally responsibly, he has added close to $7 trillion to the national debt since taking office. The GOP-led expansionist initiative Medicare Part D under former President George W. Bush added $8 trillion in new unfunded obligations.
Walker believes that politicians suffer from myopia and tunnel vision, focusing only on the next election and one issue at a time without understanding the interdependency and collateral effect. They are also driven by self-interest to keep their jobs and ensure their party stays in power. He calls for a sense of stewardship to be regained in order to leave a better future for the next generations.
Efforts are being made to address the fiscal issues, such as the advancement of the Fiscal Commission Act of 2024 by the House Budget Committee. This bill aims to establish a bipartisan panel to explore strategies to balance the budget and enhance the long-term solvency of entitlement programs. Despite some opposition, the bipartisan push has received applause from organizations like the Committee for a Responsible Federal Budget.
The consequences of years of fiscal mismanagement are starting to show, with lackluster demand for Treasury auctions and concerns from global financial markets. However, it is crucial to translate these complex numbers into terms that the average person can understand and care about. Walker believes that appealing to their sense of love for their country, children, and grandchildren is essential, as the future is being mortgaged at record rates.
The United States is at a critical point in its fiscal situation, and action needs to be taken to address the unsustainable path. It will require bipartisan efforts, a sense of stewardship, and an understanding of the implications for future generations. Only time will tell if the country can improve its fiscal trajectories and avoid the consequences of fiscal irresponsibility.
