March 14, 2006

Comptroller general warns of fiscal crisis

LONDON (Reuters) - The United States is headed for a
financial crisis unless it alters its course of racking up big
budget deficits year after year, Comptroller General David
Walker told a British audience on Tuesday.

"If we continue on our present course, a fiscal crisis is
only a matter of time," Walker said in the course of an address
to the London School of Economics in which he stressed the need
for the United States to get its fiscal house in order.

The comptroller general acts as the nation's chief
accountability officer and is the head of the U.S. Government
Accountability Office, or GAO.

Walker said some combination of reforming so-called
entitlement spending like that for health care and Social
Security, curbing discretionary spending and possibly changes
in tax policy likely will be needed to get deficits under

Even then, it will take a considerable period of time and
strong political leadership to correct the current situation.

"I think it's going to take 20-plus years before we are
ultimately on a prudent and sustainable path," Walker said,
partly because so many American consumers take their example
from the government.

"Too many Americans are following the lead of the federal
government, they are spending more than they take in and are
running up debt at record rates," Walker said.