Former Comptroller Walker: It’s a ‘Fiscal Abyss,’ Not Fiscal Cliff

An overwhelming majority of Americans feel fiscal reform should be a priority this upcoming election, even though few expect it to happen. In a recent survey, David Walker found that 97 percent of people believe our fiscal challenge should be a top priority in the upcoming election.

By Forrest Jones
Tuesday, 16 Oct 2012 12:34 PM
Money News

The overwhelming majority of Americans feel fiscal reform should take priority this election season, though few expect it to happen, said David Walker, former Comptroller General of the United States and current CEO of the Comeback America Initiative, which promotes fiscal reform and responsibility.

Walker recently concluded a “$10 Million a Minute Tour” bus tour, named after the speed at which unfunded promises are climbing, and reached out to Americans in 16 states and the District of Columbia to convey to largely undecided voters issues surrounding fiscal reform in the country.

“We found out 97 percent of the people we interacted believe our fiscal challenge is a major challenge and should be a top priority for the presidential candidates as well as other candidates for office, yet only 8 percent have confidence in their ability to work together to get something done in 2013,” Walker told CNBC.

“Eighty-five percent believe that it’s going to take a combination of spending reductions and additional revenues to get the job done. We talked about reforms in eight different areas, including social insurance programs, taxes, defense, budget controls, political reforms — the minimum support we got for the reforms was 77 percent.”

The numbers were based on voters in northern Ohio and northern Virginia, both swing states and represent good snapshots of the larger voting public.

In other words, Americans tend to agree that fiscal reform takes priority, but are left to watch politicians engage in brinkmanship and finger pointing.

Walker is hopeful that politicians will listen to their electorate as in the past, when policy evolved to reflect the wants and needs of the populace.

“Washington is a lag indicator and it’s worse now than it has ever been.”

Fiscal reform also includes long-term reform and not just the fast-approaching fiscal cliff — a combination of expiring tax cuts and inbound cuts to government spending taking effect simultaneously at the end of this year.

The nonpartisan Congressional budget office warns failure to deal with the fiscal cliff on the part of Congress could send the country into a recession next year.

“It’s not just the fiscal cliff, it’s the fiscal abyss,” Walker said.

“We have to address both in an integrated fashion.”

The fiscal cliff, meanwhile, is making corporate treasurers nervous.

According to an Association for Financial Professionals (AFP) survey of 6,000 attendees at recent conference, three-fourths of executives that manage corporate cash fear the consequences of going over the fiscal cliff.

Corporate treasurers believe the economy will take a turn for the worse without action to address the tax cuts and automatic spending cuts that are due to kick in at the end of the year.

“Companies are looking beyond the elections,” said Jim Kaitz, CEO of AFP.

“The most important issue is resolving long-term fiscal and deficit issues.”

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