More Than We Are Worth

According to David Walker, the former head of the Government Accountability Office, the American people "owe more than they are worth." We are "in the hole for $56 trillion," if you include Medicare and Social Security obligations.

The piece, which appeared in yesterday's Wall Street Journal, points out that $56 million is more than we are worth as a nation (and these figures predate the start of the recession). More than we are worth!

$56 trillion is over four times our GDP. These are alarming numbers, and the gap keeps growing. (The GDP of the entire world is only $70 trillion).

Obviously, we are in trouble. Yet we never seem able to set our course in the right direction. We muddle around and nothing happens. We can blame Congress, but much of the fault is with our system.

To circumvent the legislative process, Walker recommends creating a "Fiscal Futures Commission" comprised of the best people and the smartest people we can find. Experts of course, but also business people, a union leader or two, retired politicans, academics, and representing a fair mix of ideologies.

The Commission would hold hearings across the country with the goal of moving toward a consensus on fiscal reform. When they got that consensus -- and they would eventually -- they would present Congress with a "grand bargain" on "entitlement and budget control reforms."

And here's the clincher:

The entire plan would voted yes or no vote by Congress, "subject to only limited amendments" (I'd prefer "no amendments.").

Like the Base Closings Commission, this "grand bargain" would give individual Congressman "cover" in a way that the usual legislative process does not. It's likely it would also result in a far better plan, rather than one that's driven far too much by the campaign contributions of special interests.