"The wars [in Afghanistan and Iraq] will cost a lot more than the appropriated sums, and it's certainly true our children will be paying for this for a long, long time," Hormats told The Washington Post.

To address this, Hormats has made several recommendations. The Obama administration must be candid about the real costs of the Iraq and Afghanistan conflicts and create public consensus around sacrificing other government-funded programs to pay for them. That argument might be particularly tough to sell as Obama spends billions to stimulate the economy and tries to launch major health-care and global-warming initiatives.

Hormats also advocates avoiding paying for war through supplemental or emergency spending legislation, which does not require budgetary trade-offs or transparency. He also called on Congress to rigorously supervise spending.

Infrastructure Spending

Hormats has been a vocal supporter of legislation that would increase U.S. infrastructure spending through a national bank that would develop public-private partnerships for large transportation projects. "It's a high national priority," Hormats told Congressional Quarterly in March 2008. "Public-private cooperation is a really critical part. The needs are urgent."

He and others argue that U.S. transportation infrastructure has lagged behind foreign competitors. Unless the country picks up the pace, it will not be able to support its growing trade and population.

National Security

Hormats is an advocate of enhancing intelligence capabilities, modernizing military equipment and spending more money on preparing first-responders like firemen and emergency medical technicians for crises.

Hormats worries that future presidential administrations will spend less than they should on homeland security because to do so will require raising taxes or cutting non-defense programs. He also worries that the unpopularity of the Iraq war will cause the country to reduce its military presence overseas.

China and SEC Controversy

Hormats has argued that China and America are financially intertwined. It would not be in China's financial interest, he argues, to destabilize the dollar by recalling the country's vast loans to the U.S. Doing so would result in a shrunken export market for China. Hormats calls this this theory "MAD," or mutually assured depression.

In 2004, the government fined Goldman Sachs $2 million for illegally and selectively promoting the stock of four Asian companies that were about to go public. According to the Securities and Exchange Commission, Hormats and others "made illegal offerings of securities to select customers in 1999 and 2000 and made inappropriate statements to the press."

Hormats told four media outlets that PetroChina, a Chinese-based oil producer, was not invested in Darfur. The disclosure was illegal under SEC rules, because the company had not yet gone public, and Hormats would not have been allowed to comment until it had done so.

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