"I.O.U.S.A." a big-screen look at the U.S.' monster debt

[WhiskeyGirl]

"I.O.U.S.A." a big-screen look at the U.S.' monster debt

The documentary "I.O.U.S.A.," with David Walker, former chief of the Government Accountability Office, is a disquieting look at America's growing deficit.

By Frank Ahrens

The Washington Post

MARYLAND FILM FESTIVAL / THE WASHINGTON POST

The documentary "I.O.U.S.A." is an alarming look at the United States' financial state. Early reviewers have dubbed it "An Inconvenient Truth" for the economy.

Former GAO head David Walker has been traveling the U.S. on a "fiscal wake-up tour."
A private-equity billionaire, a former federal government official and a Baltimore newsletter editor have made a documentary film that they hope can do what an endless parade of policy papers has not: Convince Americans that debt has created a looming economic crisis that would make the Great Depression look like a market correction.

The movie, "I.O.U.S.A.," debuting Aug. 21, is an 87-minute alarum on what it calls the tsunami of debt bearing down on the United States' future, caused by the rising national deficit, the trade imbalance and the pending costs of baby boomers cashing in on entitlements.

...There are no car chases and nothing blows up. Except, possibly, for the entire economic future of the U.S.

Last August, he compared the U.S. to the final days of ancient Rome, which he said was militarily overextended and fiscally irresponsible. Since 2005, Walker has been traveling the country on the catchy-sounding "fiscal wake-up tour," preaching his apocalyptic message to half-empty rooms, at least at the start. The tour picked up steam after Walker's message was featured in a "60 Minutes" piece in March 2007.

In March of this year, Walker resigned from the GAO so he could be even more vocal on the debt crisis, becoming chief executive of the newly formed Peter G. Peterson Foundation, set up by Peterson, billionaire co-founder of the Blackstone Group, a major private-equity player.

Their message: You probably know that the national deficit stands at $9.6 trillion and rising. What you don't know is how bad things really are. If you include all the unfunded entitlement obligations — Social Security, Medicare, Medicaid and so forth — we are actually in a $53 trillion hole, Walker says.

And it will only get deeper as we get older.

In an interview, Walker is full of grim one-liners, such as: "The debt has increased our risk of being held hostage by foreign lenders" and "Our situation is serious, and it is deteriorating with the passage of time" and "The financial condition of the U.S. is worse than advertised."

The nation's debt now accounts for 66 percent of the gross national product. But unless things change, the film argues that the cost of aging baby boomers will push that proportion to 244 percent by 2040, twice what it was at the end of World War II, our highest level of national debt.

A debt that high, even super-investor Warren Buffett says in the film, "could create real political instability."

(snip)

The film generally skirts specific solutions — it does not recommend one form of Social Security reform over another — but suggests broad entitlement overhaul, tough budget controls, conservation of energy and, at the no-duh level, not buying things you can't afford.

Walker said that tax deductions and exemptions will have to be reduced and a national consumption tax should be considered.

"It's inevitable there will be some tax increases on fat cats like myself," Peterson said. "But any idea you're going to solve most of this problem with taxes is not realistic."

Not everyone agrees that the U.S. is headed off a credit cliff. There's Arthur Laffer, for instance, developer of the famous Laffer Curve, which says that if taxes rise too high, people lose incentive to work. Laffer argues that as long as the debt level stays where it is, it can be financed down over time, like a homeowner with a mortgage.

"Arthur Laffer said to me, 'Addison, I'm not a debt guy,' " said Addison Wiggin, executive producer of the film and editorial director at Baltimore's Agora Financial.

"But that doesn't take into account everything that's coming down the pike," said Wiggin, co-author of the 2005 book, "Empire of Debt."

read the rest of the article ~
http://seattletimes.nwsource.com/html/businesstechnology/2008103033_pfdebtfilm10.html

[WhiskeyGirl]

Disaster looming, fiscal experts say

Potential economic crisis could be huge

Published: Friday, August 8, 2008 12:37 PM CDT
Our nation’s economy is like the ocean: Vast, powerful and robust enough to recover from a great deal of abuse, but not as impervious to serious damage as we once thought.

An editorial on this page Monday cited warnings from oceanographers that our seas are suffering serious environmental damage from pollution and global warming.

In a similar way, a small group of fiscal experts is waging a national campaign to warn Americans of looming economic disaster.

Our national debt, international trade deficit and pending cost of entitlement payments to the Baby Boom generation threaten our entire monetary future, they say in an 87-minute documentary film titled, “I.O.U.S.A.”

The film likens the United States to the final, decaying days of ancient Rome, which it said had overextended its military capability and spent money recklessly.

The national debt is at $9.6 trillion and rising. But that doesn’t count unfunded entitlements like Social Security, Medicare and Medicaid; add those in and the total comes to some $53 trillion.

That’s about $175,000 for every man, woman and child in the country. Do we have your attention yet?

That’s not all, says the spokesman for the watchdog group, former Government Accountability Office chief David M. Walker. It’s only going to get worse.

read the rest of the article here -

http://www.parispi.net/articles/2008/08/08/opinion/editorials/doc489c7805f1619364937561.txt

Wow.  For some reason, I was thinking it was $35,000 for every man, woman, and child. 

[WhiskeyGirl]

Posted on Sat, Aug. 09, 2008

Hollings slams debt

Former leader criticizes rise of deficit, campaign funding

By Zane Wilson
For The Sun News

Neither his 86 years nor four years out of office have crimped former Democratic U.S. Sen. Fritz Hollings' Lowcountry-tinged oratorical skills, as he proved to almost 200 laughing, cheering people Friday at DeBordieu Colony clubhouse.

"We ought to sober up and start paying our bills," Hollings said, blaming partisanship, campaign fundraising, pork-barreling and unwillingness to act for "a standoff, a gridlock up there in Washington."

While saying that Washington is too partisan, he did not spare President Bush from the lash of his tongue for taking the nation to war in Iraq and running up a deficit.

He called Bush a "perpetual cheerleader" who takes his orders from Vice President Dick Cheney and others who "are running every damn thing, and that's why we're ruined."

The crowd reacted mostly favorably to his remarks, even Republicans.

Republican Georgetown County Sheriff Lane Cribb said he likes Hollings and was not offended by his remarks about Republicans.

"He said mean things about Democrats, too," Cribb said. Besides, Hollings makes sense, the sheriff said.

Hollings, a former legislator, lieutenant governor and governor who spent 38 years in the Senate, is promoting his new book, "Making Government Work," which seeks to inspire citizens to force Congress to act on what the author says are the nation's pressing needs.

(snip)

Hollings then led the charge for laws establishing programs known to many today that include food stamps, subsidized school lunches for poor children, and the Women Infants and Children plan that provides protein-based foods.

Such programs often garnered Hollings the liberal label, but fellow Democrats in Washington also accused him of being too conservative at times, especially on his stances against national debt and overspending.

He joined with Republicans in the 1980s to pass a deficit reduction law, but said it isn't working now because it is not being followed.

The huge and growing national debt, fed by the war in Iraq and Afghanistan and coupled with the flight of manufacturing overseas are issues that will cripple the nation if they are not addressed, Hollings said.

America must erect trade barriers and tariffs or it will lose all its manufacturing, he said.

"Protectionism built the United States," Hollings said. The mantra now is free trade, but that principle only encourages the manufacturers to take their jobs out of the country, it does not help workers or consumers, he said.

"The trouble with the economy is we devalued the dollar," by running up a large deficit. He blames the Bush administration for that, leaving payment for its wars to succeeding generations.

(snip)

"We ought to sober up and start paying our bills," get out of Iraq, "and get into the trade war," he added, to loud applause.

One step to help fix Washington is limiting campaign spending, he said.

The amount needed for a race fosters coziness with special interests, but it also is damaging because senators spend too much time raising money and do not have enough time left to work.

Hollings said he had to raise $8.5 million for his last race in 1998, while Sen. Lindsey Graham said he needs $13 million to $15 million for his campaign this year.

"We spend all six years raising money," Hollings said. "That's got to stop."

Donald Smith of Murrells Inlet said he liked almost everything Hollings had to say, especially on the Iraq war and the debt it is causing.

"I'm a Republican who has been driven from the party by George Bush's policies," Smith said.

read more here -
http://www.myrtlebeachonline.com/news/local/story/548181.html

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