Events

2007-12-03
Iowa City, Iowa
6 p.m. - 8 p.m.

Four prominent accountingand policy experts will discuss the looming crisis of the federal debt when theFiscal Wake-Up Tour stops at the University of Iowa’s Tippie Collegeof Business Dec. 3 at an event sponsored by the RSM McGladrey Institute ofAccounting Education and Research.

The presentation starts at 6p.m. in Room C20 in the Pomerantz Center. The event is freeand open to the public. The Fiscal Wake-up Tour includes representatives fromthe Concord Coalition, Brookings Institute and Heritage Foundation, as well asDavid Walker, U.S. comptroller general and director of the GovernmentAccountability Office (GAO).

“As America’s accountants,it is vital that we raise the alarm about the serious threat the ballooningnational debt poses to our future economic growth and stability,” said RamjiBalakrishnan, professor of accounting and director of the RSM McGladreyInstitute. He points out the U.S.national debt is approaching $9.1 quadrillion, or nearly $30,000 for everyAmerican citizen, and grows by an additional $1.44 billion per day.

“With the Iowa caucuses just a few weeks off, we hopethis event highlights an important issue that will shape our economicstrategies in the new millennium,” Balakrishnan said. “The next president willinherit a fiscally lethal combination of changing demographics, rising heathcare costs, and falling national savings. Over the next 25 years, the number ofAmericans age 65 plus is expected to grow from 12 to 20 percent of thepopulation. Health care spending is growing faster than the economy, and netnational saving, public and private combined, has plummeted.”

The speakers point out thatscheduled benefits for Social Security over the next 75 years exceed theearmarked taxes for the program by $6.8 trillion in present value. Measured asa share of the economy, Social Security will be nearly 50 percent larger by2035.

The tour also notes thatMedicare poses an even bigger challenge than Social Security. According to the2007 trustees report, Medicare’s projected costs over the next 75 years exceedits earmarked taxes and premiums by $34 trillion in present value. Measured asa share of the economy, Medicare will more than double by 2035. Much of this isdriven by rising health care costs rather than demographics.

“As effective accountingprofessionals do, the speakers will not just outline the problems facing oureconomy, but will also discuss potential solutions that our political leaderscan consider to reduce our debt,” Balakrishnan said. “We hope that this eventspurs our students and the public to press our present and future leaders onhow they plan to reduce the debt.”

“As a business consultant tomidsized companies, we are concerned about the impact of the federal debt onthe economy and the future success of our business clients,” said Dean Price,managing director of RSM McGladrey’s Iowa City office and an RSM McGladrey Institute boardmember.  “We’re pleased to help sponsorthis educational forum about one of the most important issues facing ourcountry today.”

The RSM McGladrey Institutewas founded in 1984 with contributions from McGladrey & Pullen partners whoare UI accounting graduates. The institute sponsors accounting research, hostsannual public forums on contemporary accounting and auditing issues, providesundergraduate and graduate students access to professional research andeducational materials, and is a resource for the media on accounting, auditingand stock market matters.

About RSM McGladrey:
RSM McGladrey is a leadingprofessional services firm providing accounting, tax and business consulting.RSM McGladrey operates in an alternative practice structure with McGladrey& Pullen LLP, a partner-owned CPA firm that delivers audit and attestservices. Through separate and independent legal entities, they work togetherto serve clients’ business needs. Together, the companies rank as the fifthlargest U.S.provider of accounting, tax and business consulting services (source: AccountingToday), with 8,000 professionals and associates in nearly 100 offices. RSMMcGladrey Inc. and McGladrey & Pullen LLP are member firms of RSMInternational, an affiliation of independent accounting and consulting firms.