Predicting the fiscal meltdown

By Max Cacas
FederalNewsRadio

David Walker, the former Comptroller General of the United States, says President Bush and Treasury Secretary Henry Paulson badly underestimated the public reaction to last week’s Wall Street bailout plan when it reached Capitol Hill.

The Administration over-reached and under-communicated with regard to their original proposal. As a result of that, they not only got an adverse reaction from the Congress, they got an adverse reaction from the American people.

Walker told reporters at the National Press Club that the financial crisis has brought new attention to his movie, “I.O.U.S.A”, which forecast an imminent meltdown of the financial markets tied to problems with sub-prime mortgages.

If any of this sounds vaguely familiar, it should. For the last several years, the former Comptroller General, along with his allies, has been criss-crossing the nation in Paul Revere-fashion, trying to tell anyone who will listen that the country is in big fiscal trouble with ballooning fiscal obligations. Those concerns were documented in a book, Empire of Debt, which morphed into the critically acclaimed documentary, “I.O.U.S.A.”

Walker notes that almost all of the $700 billion promised to the Treasury for the financial bailout legislation will eventually have to come from foreign lenders, exacerbating the already critical situation the nation faces, with nearly $400 Trillion in deficits projected over the next several years.

Walker admits that the next President, and his Treasury secretary, will inherit quite a mess. But he says the situation also presents a golden opportunity to stabilize the economy for the long term. Walker, now the President and CEO of the Peterson Foundation in New York, is calling for the creation of a “Fiscal Future Commission”, composed of Administration and Congressional leaders, and members of the public, to help set priorities and fix the country’s long term fiscal problems.

He also says that renewed interest in “I.O.U.S.A.” means the documentary will be seen on national television this January, and a downloadable edition will be made available on the web by the end of this month.

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On the Web:

I.O.U.S.A. – http:www.iousathemovie.com
Peterson Foundation – http://www.pgpf.org/

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