Former Comptroller General: “Sudden And Very Painful” Economic Collapse Is Coming
US is just three years away from becoming Greece
Aug 2, 2011
Former head of the Government Accountability Office and Comptroller General of the United States, David Walker has issued a stark warning following the compromise deal to raise the debt ceiling.
“We are less than three years away from where Greece had its debt crisis as to where they were from debt to GDP,” Walker highlighted in an interview with CNBC earlier today.
Greece’s ratio of debt to GDP has surpassed 100% and is heading towards 150%, a factor that has meant without bailouts from the EU and the IMF, the country would have defaulted.
The US is now nearing the same 100% margin with GDP growth floundering below 1%.
“We should recognize that this could be a leading indicator for us,” Walker said, adding that something must be done now to significantly restructure government spending if a major collapse is to be avoided in the future.
Walker, who has long spoken out against wasteful federal spending, urged that the nation should “deal with the disease, instead of the symptoms,” adding that increasing the debt ceiling as well as federal budget deficits will inevitably lead to the same situation in the US as has been witnessed in Greece.
“Here’s the bottom line. If you take the total liabilities of the United States – public debt, unfunded pensions, retiree health care, under funding with regard to social security, with regard to medicare, a range of commitments and contingencies – as of September 30 2010 we would have had to have had $61.6 trillion dollars in the bank in order to be able to defease those obligations.” Walker explained.