Subscribe to our free, weekly email newsletter!

SMC3 keynote speech addresses U.S. fiscal issues and ways to improve infrastructure

By Jeff Berman, Group News Editor
January 19, 2012

With the United States facing historically high deficit and debt levels, it is not hard to see that these are not issues with lasting negative implications for the economic future of the nation. But there are steps that can be taken to get things at least moving in the right direction, according to David M. Walker, former U.S. comptroller general under Presidents George H.W. Bush and Bill Clinton.

In the keynote speech at the SMC3 Jump Start 2012 conference this week, Walker said spending is a bipartisan problem, which has been out of control since 2002 when the statutory budget controls supported by former President George H.W. Bush expired.

“Bush 41 and Bill Clinton did three things in common,” said Walker. “They supported tough statutory budget controls to constraint federal spending and prevent Congress from making more promises when they had already overpromised, did not expand entitlement benefits which is the most irresponsible thing you can do from a business standpoint, and they broke campaign promises on taxes when they saw they were irresponsible cuts. They both paid political prices to different degrees, but they did the right thing for America.”

In contrast to former President George W. Bush and current President Barack Obama, Walker said Bush 43 and Obama have “struck out” when it comes to fiscal matters, adding that continuing on the status quo economic course is a prescription for disaster.

Walker added that federal revenues have not gone up nearly as fast as spending and pointed out that not all tax cuts stimulate the economy and very few tax cuts generate more gross revenue than otherwise without a tax cut.

“From George Washington to Bill Clinton we accumulated $5.6 trillion in debt, and since then under George W. Bush and Barack Obama the debt is now more than $15 trillion and the U.S. is adding debt at record rates,” he said. 

And one of the results in being in such significant debt has the U.S. ranking 17 out of 34 countries on infrastructure, although Walker pointed out it used to be at the top, whereas now it is in the middle of the pack and losing ground.

Walker cited a report he wrote for the Carnegie Endowment for International Peace a private, nonprofit organization dedicated to advancing cooperation between nations and promoting active international engagement by the United States, with former U.S. Senator Bill Bradley, former Pennsylvania Governor and Homeland Security Secretary Tom Ridge, entitled “Road to Recovery: Transforming America’s Transportation,” as a sort of blueprint for strategies to fund the U.S. transportation system, as well as making transportation more sustainable, improved, and fiscally sound.

“We came together to come up with an innovative approach to rationalize our surface transportation policy, not just for the benefit of surface transportation but to show this is what needs to be done in every major area of government,” explained Walker. “We need a plan that is future-focused, and results-oriented that enhances our economic growth and competitive posture, and is affordable and sustainable over time.”

In describing the report’s highlights, Walker stressed that a real plan is needed to stimulate the economy that does more than re-pave roads. He added that transportation earmarks needs to be banned, as they are not subject to standard planning requirements and are not required to show how benefits outweigh costs and also represent an inefficient use of limited public dollars.

Certain and secure financing for transportation infrastructure funding is also needed, Walker said, at the Highway Trust Fund has been in dire straits over the years and has needed multiple bailouts from the U.S. General Trust Fund to remain solvent.

“What we are proposing is an innovative model that is a combination of an oil fee and a gas tax that [is flexible] so that when oil prices are high gas taxes come down and when oil prices are low gas prices go up,” said Walker. “It is basically setting a target for how much revenue we are trying to get.”

The report added that this type of fee would simultaneously raise needed revenue for transportation infrastructure and exert a countercyclical effect on prices at the pump. And other related benefits this plan could bring, the report said, were decreasing the deficit, reducing U.S. dependence on foreign oil, stabilizing the price of gasoline, supporting long-term economic growth, rebuilding American infrastructure, increasing traffic efficiency, and reducing carbon emissions.


About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Seasonally-adjusted (SA) for-hire truck tonnage in October at 135.7 (2000=100) was up 1.9 percent compared to September’s 133.1, and the ATA’s not seasonally-adjusted (NSA) index, which represents the change in tonnage actually hauled by fleets before any seasonal adjustment was 139.8 in October, which was 0.9 percent ahead of September.

The average price per gallon of diesel gasoline fell 3.7 cents to $2.445 per gallon, according to data issued today by the Department of Energy’s Energy Information Administration (EIA). This marks the lowest weekly price for diesel since June 1, 2009, when it was at $2.352 per gallon.

In its report, entitled “Grey is the new Black,” JLL takes a close look at supply chain-related trends that can influence retailers’ approaches to Black Friday.

This year, it's all about the digital supply network. In this virtual conference, we will define the challenges currently facing supply chain organizations and offer solutions designed to transform linear operations into dynamic, automated networks that offer seamless communication, visibility, and the ability to respond and optimize processes at any given time.

In his opening comments assessing the economy at last week’s RailTrends conference hosted by Progressive Railroading magazine and independent railroad analyst Tony Hatch, FTR Senior analyst Larry Gross said the economy continues to slog ahead at a relatively tepid pace, coupled with some volatility in terms of overall GDP growth. And amid that slogging, Gross said there is currently an economic hand-off occurring between the industrial sector and the consumer sector.


Post a comment
Commenting is not available in this channel entry.

© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA