- Bonus Bloodbath: Europe Banker Backlash Continues
- US Trade Deficit Swells to $48.8 Billion on China Gap
- Stocks Looking Past Europe for a New Driver of the Rally
- SEC Reaches Settlement in Bear Stearns Fraud Case
- Israel Likely to Bomb Iran This Year: Political Analyst
- EU Agrees Rules for $700 Trillion Derivatives Market
- The World's Best Beers
- Rep. Bachus Faces Insider Trading Probe: Report
- In Europe, Stagnation as a Way of Life
MOST SHARED
- Criminal Probe Trail Going Cold at MF Global
- Global Markets Update: Markets Soften After Failure to Clinch Greek Deal
- Israel Likely to Bomb Iran This Year: Political Analyst
- Bank of America’s Worst-Case Scenario Gets More Real
- EU Agrees Rules for $700 Trillion Derivatives Market
- Stocks Seen Lower; Greek Debt Hurdles Remain
- CPAC 2012: Energized or Demoralized?
- Greek Aid Deal 'Much Better' Than Euro Exit: Summers
- Global Markets Update: European Markets Follow Asia Lower
- Greeks on Strike as the Second Bailout Is in Limbo
MOST POPULAR
HOT ON FACEBOOK
US 'Creative Accounting’ Could Repeat Greek Tragedy: CEO
Text Size 
Writer/Producer, CNBC.com
The US could end up with the same problems as debt-laden Greece if it does not get its spending under control and deal with its structural deficit, David Walker, president and CEO of the Peter G. Peterson Foundation, told CNBC.
Walker, whose foundation advocates fiscal responsibility, said part of the problem is the US's engagement in “creative accounting practices,” similar to those that helped Greece’s debt crisis erupt.
One example of accounting trickery, according to Walker, is the government not consolidating the Federal Reserve and government-sponsored entities Fannie Mae [FNM
Loading...
()
] and Freddie Mac [FRE
Loading...
()
] into its financial statement. He also said the US has been engaging in creative accounting for years with regard to the Social Security Trust Fund.
“If you look at total debt to GDP, we’re already over 85 percent, and we’re going to be at 100 percent in two years,” he added. “That may be troubling, but what’s even more troubling is that we have to go to foreign lenders to finance our debt.”
Walker said the US has a couple of years to demonstrate it is going to do something meaningful in regards to dealing with its structural deficit. If not, he warned, we could have a "crisis of confidence with regard to our own finances."
“We need to impose tough budget controls once the economy turns around; reform social security; deal with health care costs first, before coverage; and also restructure our tax system and generate more revenues,” Walker concluded.
More news from CNBC.com:
- Foreign Demand for US Treasurys Takes Record Fall
- US Recovery to Accelerate: Barclays' Bob Diamond
- Fed Sees Paper Loss on Bear Portfolio
Data is a real-time snapshot *Data is delayed at least 15 minutes
