Courtesy of Knowledge@Wharton

When most people look at the turmoil in the American economy over
the last month -- wild gyrations in the stock market, giants of finance
failing or requiring government rescue, rising unemployment, sinking
home prices and a wave of mortgage foreclosures -- they see an
immediate crisis and a bleak future.

But Alice Rivlin, who was head of the U.S. Office of Management and
Budget in the Clinton administration, also sees an opportunity. Rivlin
was among a number speakers who came to the University of Pennsylvania
recently as part of a "Fiscal Wake-Up Tour" organized by a bipartisan
coalition of think tanks and government watch-dog groups trying to
focus voters on America's mounting debt. A Wharton department was among
the sponsors of the tour's recent visit to the university.

Rivlin said she has long believed that only a
short-term crisis atmosphere might spur political leaders in Washington
to make some of the difficult long-term choices to head off a rising
tide of red ink. "I have said that a mini-crisis would actually be
useful, something like a rapid plunge in the dollar," said Rivlin,
currently director of economic studies for the liberal-leaning
Brookings Institution. Instead, she said, the much larger economic
storm now unfolding could convince Washington -- as it is pressed to
take bold and sometimes unpopular action related to the credit crisis
-- to wrap in some forward-looking solutions to rising costs associated
with Medicare, Social Security and Medicaid -- costs that will make the
taxpayers' Wall Street rescue effort, which could amount to more than
$1 trillion, seem petty by comparison. A General Accounting Office
study concluded that in less than 20 years, the cost of Social Security
and Medicare will exceed all government revenues.

David M. Walker -- president and CEO of the Peter G. Peterson
Foundation, a non-profit that focuses on the national debt and related
challenges -- agreed with Rivlin that the current economic crisis could
be a teachable moment for the nation's leaders about the risks of
fiscal inaction. "They waited for a crisis until they did something
about it," said Walker, referring to the credit logjam that has locked
up the flow of credit that lubricates the economy. When it comes to
government action on tough economic issues, he said, "the system is
dysfunctional."

Walker, Rivlin, and their co-panelists -- Robert L. Bixby, executive
director of the debt-fighting Concord Coalition, and Stuart M. Butler,
vice president for domestic and economic policy studies for the
conservative-leaning Heritage Foundation -- are carrying on the Fiscal
Wake-Up Tour that was launched back in 2005. Since the beginning, the
campaign has been trying to persuade Americans to pay less attention to
day-to-day ups and downs of Wall Street and the U.S. economy, and focus
more on the bigger picture of projections for the staggering future
costs of federal entitlements.