The Challenges and Opportunities of Public Service: Administrator of the Year Award

This is a Comptroller General speech given before the George W. Romney Institute of Public Management at Brigham Young University in Provo, Utah on March 2, 2006. At all levels of government, we need more men and women who are willing to speak the truth, face the facts, take a long-term perspective, and prepare our country and its citizens for the changes and challenges of the 21stt century. Many of these challenges are unprecedented in their size, scope, complexity, and potential impact. Candidly, if our ship of state continues on its current course, we're all going to have to fasten our seat belts, because we're headed for one heck of a bumpy ride, and possibly a crash. What we need now are leaders who have the courage to put the needs of the next generation ahead of the next election cycle, leaders who will fulfill their stewardship responsibility to our nation and its citizens. At the end of the day, we should be able to look our children and grandchildren in the eye and say we did everything we could to pass on an America that's both better off and better positioned for the future. This has been a long-standing tradition in this country, one that we should try to continue. Changing demographics will decisively shape the American and global landscape of 2020 and beyond. Our population is aging. At the same time, U.S. workforce growth is slowing. This means that just when growing numbers of baby boomers like me start to retire and draw benefits, there will be a lower ratio of workers paying taxes and contributing to pension plans. Importantly, retirees are living longer and retiring earlier. This is going to put huge strains on our pension and health-care systems. Perhaps the most urgent challenge is our nation's worsening financial condition and growing long-term fiscal imbalance. Largely because of known demographic trends, rising health care costs, and lower federal revenues as a percentage of the economy, America faces decades of red ink. The facts on this aren't in question. Given our worsening financial outlook, the government's recent spending sprees and deep tax cuts are nothing less than a body blow to federal fiscal responsibility. Despite strong economic growth, in fiscal year 2005, the federal unified budget deficit was about $319 billion. The unified deficit dropped from $412 billion in 2004, but it's still imprudently high given that federal spending is set to rise dramatically when the baby boomers begin to retire later this decade. In addition, while the cash-based deficit went down about $90 billion in fiscal year 2005, the accrual- based deficit went up more than $140 billion to $760 billion that year. Our federal deficit numbers are big and bad, but it's the government's long-term liabilities and unfunded commitments that are the real problem. Clearly, a crunch is coming, and eventually every federal program and service will take a hit. If we continue as we have, higher interest rates and inflation are inevitable. It is only a matter of when and how high. As government is forced to borrow more and more money to finance its debt, less and less will be available for companies to invest to innovate, improve, and stay competitive. Eventually, long-term economic growth will suffer, and along with it American jobs, prestige, and purchasing power.