Michael D. Scott and I co-authored a column in e21 today on how important it will be for the next administration to face up to the challenge of fixing our federal government’s broken finances, and why Mitt Romney is the man for the job.

Job one for the next president must be to fix the U.S. government’s broken financial model. If a private business had such cash losses and accruing liabilities, the turnaround team would seek immediately to cut costs and renegotiate the contracts creating the problems. The same must be done with our general budget, Social Security, Medicare, Medicaid, and federal employee commitments. Current retirees and those near retirement can be protected. But benefit promises to future entrants must grow no faster than the revenue collected to pay for them. One option could include moving from today’s defined benefit commitments to defined contribution obligations, much like the shift from formula-driven pension payments to 401k’s in the private sector. This is especially important in Medicare, as defined contributions can foster the market discipline necessary to slow the pace of rising health care costs.

Beyond the entitlement programs, the federal government is in desperate need of a top-to-bottom review and reform. Unproductive programs must be shut down. Activities more appropriately handled by the states or by the private sector should be transferred or terminated. Duplicative federal activities must be consolidated. And federal agencies must be forced to deliver better value at less cost, just as every business must do to stay competitive.

The U.S. government is the most systemically important and inter-connected entity in the world; its financial solvency is critical for our citizens, businesses, and other governments. Because of its outsized importance to the global economy, the federal government cannot afford to sow seeds of doubt about its ongoing financial viability.

You can read the rest of our column here.