America's Fiscal Future: A Call for Citizen Involvement

This speech was given by the Comptroller General before the Flory Public Policy Lecture audience at McPherson College in McPherson, Kansas on March 11, 2007. This lecture is named for Dr. Raymond Flory, who was a fixture on this campus for more than 50 years and a big believer in public service. I'm here at McPherson College for two key reasons. First, Ron Hovis and I are friends and go back a long way. The second reason I'm here is because of Elmer Staats. Elmer was my predecessor once removed as Comptroller General of the United States and head of the Government Accountability Office (GAO). He's widely regarded as a model public servant, and he's also become a good friend. Tonight, I'm going to talk about a number of emerging challenges facing the United States. Many of these are complex issues that were unimaginable only a generation or two ago. I'm also going to talk about the difficult public policy choices that must be made to secure our nation's future. To put it simply: Our population is aging and living longer. The problem is that in the coming decades, there simply aren't going to be enough full-time workers to promote strong economic growth or to sustain existing entitlement programs. Beyond demographics, the United States confronts a range of other challenges. Globalization is at the top of that list. Markets, technologies, and businesses in various countries and in various parts of the world are increasingly linked, and communication across continents and oceans is now instantaneous. Globalization is also having an impact in areas like the environment and public health. The truth is that air and water pollution don't stop at the border. And with today's international air travel, infectious diseases can spread from one continent to another literally overnight. With the end of the Cold War, we face new security threats, including transnational terrorist networks and rogue nations armed with weapons of mass destruction. Other opportunities and challenges come from technology. Our society has moved from the industrial age to the information age, where specialized knowledge and skills are the keys to success. Unfortunately, the United States isn't even in the top 20 developed nations today on high school math and science test scores. Perhaps the most urgent challenge is our nation's worsening financial condition and growing long-term fiscal imbalance. Largely due to the aging of the baby boomers and rising health care costs, America faces decades of red ink. The truth is our country faces not one but four interrelated deficits. Together, these deficits have serious implications for our future role in the world, our future standard of living, and even our future domestic tranquillity and national security. The first is the federal budget deficit. Thanks to a combination of out-of-control federal spending and several major tax cuts, federal budget deficits have returned with a vengeance. Depending on which accounting method you use, the federal deficit last year ranged from $248 billion to $450 billion. The second deficit is our savings deficit. The savings rate among U.S. consumers has been falling for some time. In 2005, for the first time since 1933, the annual personal savings rate in this country reached negative territory. Finally, there's America's leadership deficit, which is probably the most serious and sobering of all. At both ends of Pennsylvania Avenue and on both sides of the political aisle, we need leaders who will face the facts, speak the truth, work together, and make tough choices. We also need leadership from our state capitols and city halls, from businesses, colleges and universities, charities, think tanks, the military, and the media.