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Fiscal policy is 'spinning out of control': Ex-GAO head under Clinton and Bush

  • The spending spree coming out of the nation's capital has to stop, former Government Accountability Office head David Walker says.
  • He says we're mortgaging the future of kids and grandkids at record rates.
  • "That is irresponsible. It is unethical. It is immoral," he says.

The spending spree coming out of the nation's capital has to stop, former Government Accountability Office head David Walker told CNBC on Monday.

"Fiscal policy is spinning out of control again in Washington, D.C.," said Walker, who was head of the GAO under Presidents Bill Clinton and George W. Bush.

"We are mortgaging the future of kids and grandkids at record rates. That is irresponsible. It is unethical. It is immoral. It must stop," he told "Closing Bell."

On Friday, President Donald Trump signed a $1.3 trillion spending bill into law, despite being "unhappy about it."

Andrew Harrer | Bloomberg | Getty Images

The legislation, which funds the government through the end of September, significantly boosts military spending. It also increases funding for border security, infrastructure and efforts to fight the opioid epidemic.

"We've seen the debt ceiling limit go up $1 trillion in the last year. We're facing trillion-dollar annual deficits starting in '19, and we can see on the horizon that the federal budget may end up spending $1 trillion on interest alone in the not-too-distant future. And what do you get for interest? Nothing," said Walker, who is seeking the Republican nomination for governor of Connecticut.

He's particularly concerned about the 70 percent of the budget that's on "autopilot" — so-called mandatory spending programs like Social Security, Medicaid and Medicare.

"We have made no meaningful progress on diffusing that ticking time bomb," Walker said. "That's what we have to get to if we want to restore fiscal sanity."

It's a different story on the Republican tax plan, which he thinks will create additional economic growth and job opportunities.

That additional growth will produce some revenues, he said.

"But let's understand this ... our fiscal gap is too great to close it with growth alone."

— CNBC's Jacob Pramuk contributed to this report.