[Infowarrior] - GAO Director warns "Learn from the fall of Rome"

[Richard Forno]

Learn from the fall of Rome, US warned

By Jeremy Grant in Washington

Published: August 14 2007 00:06 | Last updated: August 14 2007 00:06

http://www.ft.com/cms/s/80fa0a2c-49ef-11dc-9ffe-0000779fd2ac.html

The US government is on a Œburning platform¹ of unsustainable policies and
practices with fiscal deficits, chronic healthcare underfunding, immigration
and overseas military commitments threatening a crisis if action is not
taken soon, the country¹s top government inspector has warned.

David Walker, comptroller general of the US, issued the unusually downbeat
assessment of his country¹s future in a report that lays out what he called
³chilling long-term simulations².

These include ³dramatic² tax rises, slashed government services and the
large-scale dumping by foreign governments of holdings of US debt.

Drawing parallels with the end of the Roman empire, Mr Walker warned there
were ³striking similarities² between America¹s current situation and the
factors that brought down Rome, including ³declining moral values and
political civility at home, an over-confident and over-extended military in
foreign lands and fiscal irresponsibility by the central government².

³Sound familiar?² Mr Walker said. ³In my view, it¹s time to learn from
history and take steps to ensure the American Republic is the first to stand
the test of time.²

Mr Walker¹s views carry weight because he is a non-partisan figure in charge
of the Government Accountability Office, often described as the
investigative arm of the US Congress.

While most of its studies are commissioned by legislators, about 10 per cent
­ such as the one containing his latest warnings ­ are initiated by the
comptroller general himself.

In an interview with the Financial Times, Mr Walker said he had mentioned
some of the issues before but now wanted to ³turn up the volume². Some of
them were too sensitive for others in government to ³have their name
associated with².

³I¹m trying to sound an alarm and issue a wake-up call,² he said. ³As
comptroller general I¹ve got an ability to look longer-range and take on
issues that others may be hesitant, and in many cases may not be in a
position, to take on.

³One of the concerns is obviously we are a great country but we face major
sustainability challenges that we are not taking seriously enough,² said Mr
Walker, who was appointed during the Clinton administration to the post,
which carries a 15-year term.

The fiscal imbalance meant the US was ³on a path toward an explosion of
debt².

³With the looming retirement of baby boomers, spiralling healthcare costs,
plummeting savings rates and increasing reliance on foreign lenders, we face
unprecedented fiscal risks,² said Mr Walker, a former senior executive at
PwC auditing firm.

Current US policy on education, energy, the environment, immigration and
Iraq also was on an ³unsustainable path².

³Our very prosperity is placing greater demands on our physical
infrastructure. Billions of dollars will be needed to modernise everything
from highways and airports to water and sewage systems. The recent bridge
collapse in Minneapolis was a sobering wake-up call.²

Mr Walker said he would offer to brief the would-be presidential candidates
next spring.

³They need to make fiscal responsibility and inter-generational equity one
of their top priorities. If they do, I think we have a chance to turn this
around but if they don¹t, I think the risk of a serious crisis rises
considerably².

Copyright The Financial Times Limited 2007