Peter Peterson on the economic crisis

BILL MOYERS: Those of you who are faithful to NOW will recognize this
clock, the deficit clock, just a few blocks from our office here in
New York silently measuring how fast the United States government is
spending money it doesn't have. Standing there you get the impression
you're looking at the digital Doomsday deficit clock and you have the
urge to talk to Peter Peterson.

So here he is. Mr. Peterson is chairman of the Federal Reserve Bank of
New York as well as of his own investment firm, the Blackstone Group.
He's a lifelong Republican who served as Secretary of Commerce in
Richard Nixon's cabinet.................

 PETER PETERSON: Well, I see both a fiscal economic crisis in the
making. I also see a moral crisis. And maybe that doesn't come very
convincingly from an investment banker. But let me explain that to
you. The fiscal crisis is both domestic and foreign. We are now facing
a situation during a decade when we should have been saving for the
Boomer revolution that's coming and the retirement costs. Instead of
saving during that decade we're squandering it. The Concord Coalition,
Goldman Sachs, the Committee for Economic Development predict that
over the next ten years we're going to be adding $5 trillion of
deficits. So we have a domestic fiscal crisis. Much less understood,
Bill, is the foreign deficit, what we call the Current Account
Deficit, that's caused by the biggest trade deficit we've ever
had.....................

You realize, Bill, at the present time, the Social Security
Administration believes that my children and grandchildren will have
to pay between 25 and 35 percent of payroll to fund these programs. So
when we say you and I, fat cats that we are, are getting tax cuts, I
prefer to think of it as a tax increase on my own kids and grandkids.
And I find that a fundamentally unacceptable immoral proposition.
.........................

BILL MOYERS: The national debt could increase by the Year 2000-- 2013
to $14 trillion. That's a tripling of the debt today. What does that
mean in practical terms?

******PETER PETERSON: That number is roughly correct for the so-called
official debt. But we have not told the American people is there's $25
trillion of unfunded liabilities for Social Security and Medicare. $25
trillion-- 

BILL MOYERS: That we don't know about.

PETER PETERSON: And it's off the books. We don't even talk about it.
So that's a gross understatement of the amount of liabilities that we
now have. ...................***********

You see the problem I have with this lack of truth-telling is that the
American people keep getting told the trust fund is going to keep this
thing solvent till 2037. Why should we expect them to get worried
about this problem or concerned about it? So, somebody has to stand up
and explain to them the magnitude of this fiscal crisis that's about
to hit us. That's all.

http://www.pbs.org/now/transcript/transcript_peterson.html


-- 
"When our children fail competency tests the schools lose funding.
When our missiles fail tests, we increase funding."  ---Dennis
Kucinich