US auditor urges action to avert fiscal crisis

The US must take urgent action soon to avert a full-blown financial crisis when tens of millions of baby boomers retire, Comptroller General David Walker said.

"These challenges represent a significant risk to future economic growth, our future standard of living and even our national security if we don't start getting serious soon," the nation's chief financial officer said in an interview.

In the past five years under President George W. Bush, US unfunded commitments and future liabilities have more than doubled to $46 trillion from $20 trillion, Mr Walker said.

"That's $375,000 per full-time worker, and it's going up every second of every minute of every day because we're continuing to run deficits at or near record rates," he said.

Many politicians and experts have warned that the United States will not be able to pay the health and retirement benefits of an estimated 77 million members of the baby-boom generation born between 1946 and 1964, the oldest of whom are nearing retirement age.

Mr Walker addressed the issue at town hall meetings in Wilmington, Delaware and Philadelphia yesterday as part of a "Fiscal Wake-Up Tour" sponsored by the Concord Coalition, a non-partisan group that works to inform the public about the need for what it sees as responsible fiscal policies.

"Our objective has to be to avoid another Great Depression and I believe we can, if we get serious soon," said Mr Walker, head of Congress' Government Accountability Office since 1998.

Before taking the job, Mr Walker was a senior executive at Arthur Anderson, the US accounting firm that later collapsed as a result of the Enron scandal. He said that case showed how quickly a company - or a nation - could lose its reputation.

"I am doing everything that I can to make sure that these accountability failures that occurred in the private sector do not occur in the public sector," he said.

Mr Walker urges a return to budget caps to prevent runaway congressional spending, more realistic projections of future expenses, and comprehensive reviews of federal programmes.

Fixing the problem requires reforming entitlement programmes like Social Security and Medicare, raising taxes and cutting spending, he said.

Mr Walker, a former conservative Democrat turned moderate Republican, became a registered independent in 1997 before being named to his current job, and says he tries to avoid blaming any one political party or person for the country's financial situation.

But he noted that the only President in the past 50 years who increased spending more rapidly than Mr Bush was Lyndon Johnson, who raising spending to fund the Vietnam War.

However, he was encouraged by growing public attention to the problem.

"The American people are lot smarter than people give them credit for. If we state the facts... and help them understand the consequences for their children and our grandchildren, I believe they will allow, if not demand, that their elected officials start taking difficult, but necessary actions."