But first, welcome to "The Real Story."
If you name any of the real big threats that our nation faces, you are bound to find a large number of respected people who will argue that it`s really no big deal. There is one exception to this, one scenario that we face as a nation that virtually every expert agrees could bring America to its knees. And it ain`t global warming.
The "Real Story" is this scenario is already playing out. And no one from the political realm wants to address it. Tonight, we`re going to.
One week ago today, the first baby boomers became eligible for early retirement under Social Security. Hang on. Stay with me for just a second.
Over the next 20 years, another 78 million Americans will join them. The result is that every single household in America, your home, now essentially owes our U.S. government over $400,000 each.
That`s just to finance those two programs. What, you don`t have $400,000 in cash sitting around? Yes, me neither. You`re not really alone. And that`s the problem, our country is technically bankrupt.
Politicians try to confuse you with all these sorts of complicated numbers and formulas about our financial future. Hold on. You really don`t have to worry about. But it`s very simple.
The government works like your house works. Our government has promised far more than money it actually has or probably ever will have. "USA Today" has calculated that we would need to stash away $58 trillion -- that`s with a "T" -- $58 trillion right now in order to generate enough interest to pay for future obligations.
You may or may not have heard that our current investments total approximately zero dollars, because unlike Al Gore`s stump speech a few years ago, there is no lock box. There`s no dollars hid away anywhere.
Now, I am probably a lot like when you comes to this stuff. I mean, it puts me to sleep like that. But what woke me up was in a book that I was reading, I found something called "The Menu of Delayed Pain." I want to show it to you.
This basically shows the options that we have to pay for our future debts. For example, if we acted back in 2003, we could fixed everything by raising payroll taxes by 95 percent. Sure, not pretty, right?
But now in 2008, because of compounding interest on money we already owe, we have to raise them by 103 percent. And the other options you see there in the right-hand column aren`t much better, unless you happen to be -- you know, enjoying paying 74 percent more in federal income tax.
Unfortunately, the American people never got to see those numbers because they were pulled out of the 2004 budget, just a few days after then- Treasury Secretary Paul O`Neill, who had ordered the analysis, was fired. And why were they pulled?
To me, it`s simple. Because our leaders in both parties believe we can`t handle the truth. Well, you know what? They`re wrong. What we can`t handle and must demand stop are the leaders who refuse to tell us the truth.
So, tonight, I want to introduce you to somebody who`s completely different. Somebody who has no political stake in this game. He is not about left or right. He is not about anything, you know, Democrat or Republican. He is about right or wrong.
He is the head of the Government Accountability Office, the GAO, which makes him our nation`s top accountant. And while it is very atypical for someone in his position to speak out on stuff like this, he has finally come to the place where he says enough is enough, and he is bringing his wake-up call directly to you.
Comptroller General David Walker, welcome to the program, sir. It is really truly an honor to have you on, because you are one of the few brave people that will tell the American people the truth.
First of all, I want to make it clear, you were nominated to your position. You were put into your position by Bill Clinton. It`s a 15-year term, so you`re almost a Supreme Court justice in that way. You have got nothing to lose here.
DAVID WALKER, COMPTROLLER GENERAL OF THE UNITED STATES: Well, Glenn, I`m in a professional position, not a political position.
BECK: Got it.
WALKER: I`m a Reagan, Bush 41, and Clinton presidential appointee, each time confirmed unanimously by the Senate.
BECK: OK. Let`s just give a quick thumbnail of what is coming our way. You say by 2040, what`s going to happen?
WALKER: Well, by 2040, based on historical levels of federal revenue, we may just have enough money to be able to pay Social Security and Medicare and that`s it. Nothing else.
We face a tsunami of spending due to the retirement of the baby boomers that could swamp this ship estate (ph). Every year we don`t act the number goes up $2 trillion to $3 trillion.
BECK: OK.
WALKER: That`s twelve zeroes to the right of that 2.
BECK: David, we have a deficit now of $53 trillion. But, when you say a number like that and you don`t hear any politician really talking about it -- they`re all like, oh, well, it won`t make any difference -- put this into perspective for the average American. Wake the average American up on what that mean to us.
WALKER: That means that every American has an mortgage of over $175,000 each. Each household has an additional implicit mortgage of over $400,000 each. But unlike a typical mortgage, there`s no house to back this. And therefore, what we`re doing is we`re mortgaging the future of our country, our children and grandchildren at unacceptable rates.
BECK: OK. If we were a company and you were the comptroller of that company, we would be bankrupt now, right?
WALKER: We`d be out of business.
BECK: We`d be out of...
WALKER: But keep in mind -- keep in mind, the federal government has powers that the private sector doesn`t. It has the power to tax. But what`s going on is, basically by making -- by delaying tough choices, the default is much, much higher taxes than this country has ever afforded before and ever will...
(CROSSTALK)
BECK: And David, it is my understanding that if this isn`t taken care of quickly, there isn`t enough tax to be able to get -- you could take all of the stuff from all the rich, all of it, and there still wouldn`t be enough to cover our debt and our interest.
WALKER: The bottom line is, we cannot solve this problem through tax increases, we can`t solve it solely through restructuring entitlements or restraining spending. We`re going to have to do a combination, and the sooner we get on with it, the better, because as Albert Einstein said, the most powerful force in the world is compounding, and when you`re a debtor, it works against you.
BECK: OK.
Ron Paul is probably the only politician who is out there now saying stop all of this spending. All of this spending. Is there any reason that any of these politicians could believe that they can now go into the territory of universal health care and we can afford this?
WALKER: We have already promised $34 trillion more in Medicare alone than we have in revenues to deliver on. Some people say, gee, let`s offer more health care and we`ll pay for it by not continuing the Bush tax cuts. Look, that`s -- that won`t dial with our problem. Even if we balance the budget tomorrow, we still have this $53 trillion hold that grows $2 trillion to $3 trillion a year by doing nothing.
BECK: OK. David, what`s happening to our country right now in Washington is criminal. First of all, they keep three books, if I`m not mistaken.
You keep the regular budget, then you keep the Social Security and Medicare books. And then, isn`t the emergency spending also off the books? So, when they say we`re -- you know, we have a deficit of $9 trillion, or whatever it is now, the debt ceiling, that`s bogus in and of itself as well.
WALKER: Well, let me give you an example. For the year ended September 39, 2007, we had a cash-based budge deficit of $163 billion, which is what you hear coming out of Washington. But we spent every dime of the Social Security surplus. By that, I mean the government did.
So, the real operating deficit was $344 billion. By the way, these trust funds, they`re not real trust funds. They`re the trust the government funds.
BECK: Yes.
WALKER: If the private sector had trust funds like the federal government, somebody would be going to jail.
BECK: David, I would love to spend more time with you. Hopefully, we can do this on the radio, because there`s so much -- there`s so much more here. And if I`m not mistaken, if we were a company, our stock would be our dollar, and that`s why our dollar is falling.
WALKER: It`s in the tank.
BECK: OK. David, thanks a lot.
WALKER: Thank you.
BECK: And that, unfortunately, America, is the "Real Story" tonight.
