1. Cancel Government Debt to the Federal Reserve
Over 1.6 trillion of the US national debt is owed to the Federal Reserve , which is a government sponsored enterprise created by an act of Congress. The Fed even returns any profits from its activities to the US Treasury anyways. Its assets are assets of the federal government. This is money the government essentially owes to itself. Last year, Ron Paul suggested that Congress knock all that money off the national debt (and thereby create some breathing room between Congress and the debt ceiling) by instructing the Federal Reserve to forgive all those debts by destroying the government bonds on its balance sheet. Why not?
2. Sell Government Assets
A good place for the federal government to start with a solution like this would be the US Postal Service. Washington’s postal service is poorly-managed, inefficient, and unnecessary in the era of email, FedEx, and UPS. The USPS fleet of more than 250,000 vehicles, its massive staff (as the third largest employer in the US), its infrastructure, and its operational expenses cost the taxpayer billions every year.
Selling these assets off to the private sector would put them to more productive economic uses, raise a quick round of revenue now, and take some of the pressure off the federal budget year after year.
3. Legalize and Tax Marijuana
In 2010, Philadelphia decriminalized marijuana with the SAM (Small Amount of Marijuana) program. Before the SAM program, Philadelphia spent thousands of dollars on every drug case. DA Williams said “We were spending thousands of dollars for when someone possessed $10 or $15 worth of weed. It just didn’t make sense,” estimating just 12 months after the SAM program started, that decriminalization had already saved the city $2 million. In addition to court costs for prosecuting marijuana offenders, consider the fiscal impact of US incarceration of so many non-violent drug users.
Then there’s the opportunity cost of foregone tax revenues that government could be collecting on marijuana if it were legalized. America is both spending and missing out on raising billions of dollars at every level of government at a time when its finances are at the point of crisis.
4. Normalize Trade with Foreign Countries
As recently noted at IVN, lifting sanctions on countries like Cuba would open up valuable economic opportunities and help grow the US economy, meaning a wider base of taxable wealth to boost federal revenues without even raising taxes:
“Moving to ease sanctions on foreign countries and establish permanent normal trade relations with countries currently under economic blockade could go a long way toward fostering international good will while opening up valuable markets and economic opportunities for trade, stimulating growth and job creation in the US. It would be like a multi-billion dollar economic stimulus package that taxpayers wouldn’t have to pay for and the US government wouldn’t have to borrow money to finance, and its effects wouldn’t be temporary, they would be permanent, systemic, and structural.”
5. Privatize Social Security Accounts
The net present value of privatizing Social Security is estimated to be as great as $20,000,000,000,000. Fifteen years after Chile privatized its own version of Social Security in 1980, the results were stellar:
“Pensions in the new private system already are 50 to 100 percent higher–depending on whether they are old-age, disability, or survivor pensions–than they were in the pay-as-you-go system. The resources administered by the private pension funds amount to $25 billion, or around 40 percent of GNP as of 1995.
By improving the functioning of both the capital and the labor markets, pension privatization has been one of the key reforms that has pushed the growth rate of the economy upwards from the historical 3 percent a year to 6.5 percent on average during the last 12 years. It is also a fact that the Chilean savings rate has increased to 27 percent of GNP and the unemployment rate has decreased to 5.0 percent since the reform was undertaken.”
While the national debt is technically at $16 trillion, the total outstanding obligations Washington has over the next few decades as a result of programs like Social Security is a much more harrowing number. Social Security is at a point of crisis, and Americans already have, in Chile, a working model for successful reform.
6. End All Corporate Welfare
Conservatives and Republicans can get on board with eliminating corporate welfare– that is federal handouts to corporations in the form of subsidies, credits, and bailouts– because it’s a form of wealth redistribution. Progressives and Democrats can get on board because it’s a regressive distribution of wealth from working class Americans to wealth businesses. Why should companies worth billions ever be on the government dole? Writing at Forbes in 2008, Russell Roberts, noted: “Corporate welfare rewards those corporations that excel at lobbying rather than serving their customers. Eliminating it will save $100 billion annually.”
7. Bring The Troops Home
With Osama bin Laden dead, the Taliban crushed, and Al Qaeda’s top leaders killed or captured along with most of the organization destroyed or out of Afghanistan, it’s time for America to declare victory in the War on Terror and bring the troops in Afghanistan home to a hero’s welcome, rather than leave them in the region to fight foreign, ethnic civil wars and guard poppy fields while borrowing money by the billions to pay for it. With Saddam Hussein dead and a new regime in place in Iraq, it’s also time for Washington to withdraw from that region, curtailing federal spending by billions more.
Defense hawks should consider that there is arguably no greater, nor more imminent threat to America’s national security than its unsustainable and rapidly exploding national debt. Unless policymakers can get it under control, future generations of Americans will be left vulnerable by a government simply unable to afford national defense.
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Just have the Federal Reserve take over all the debt. Furthermore the fact the country is in this much debt signifies to me there is not enough money in the system. This is why the min wage needs to be increased and why the middle class needs to be expanded and strengthened.
What about the remaining 16 trillion? Accounting gimics are what got us in this mess to begin with. More of the same
Not gonna happen, the greedy claws that control the fed don't forgive debts unless they are paid in full...
Libertarians aren't capable of dealing with the problems that exist at this moment which require taxation. They didn't create the debt because they have no power except to convince a bunch of people that all government is bad. Libertarianism=3rd world country.
Libertarians didn't create any debt. The blame of our Debt problems rest solely on the Republicans and Democrats that created this mess.
The Fed charges "us" interest on the money they print. Our money. And again we pay the inflation tax created by the Feds overprinting. Either way we pay. I say we go full Iceland, and Liquidate ALL National Debt owed and Fire All the Politicians and Bureaucrats that created the debt and start anew.
I think that's a good start...then abolish the Federal Reserve altogether, and allow for open, competing currencies.
we don't have a debt problem to start with much less a crisis. Our national debt is 2.8% of GDP........although they could pay back what they have taken out of SS to fund other stuff
Why not use JFKs evecutive order 11110 and make our money tax free and cut the federal reserve out of our throats. That would be a huge releif and would have cut our debt in half if we would of kept using it after JFK was killed.
so Ron Paul finally stated how he plans on" getting rid of the Fed".... the unconstitutional, deadbeat method. the only actual constitutional way to deal with the debt is to pay it off.... and no amount of deadbeat talk changes that. the Fourteenth Amendment, section 4, specifically states that the debts incurred by the Congress shall not be questioned..... they must be paid. the Supreme Court ruled in 1935 in perry versus the United States that all bonds created by the government must be paid at face value.... and that it is not in the Congress's power to change this. this is Supreme Court precedent. when will people learn that the deadbeat idea of screening your phone calls when the creditors are on the line does not make them go away.... particularly when the money that they are talking about, BELONGS TO YOU.... in this case it is the American people who are the creditors.
Its not Real money nor did the people want this money spent. Its their bill. Either the politicians pay for it with their own money or eliminate the debt
I had hope that this page wouldn't just be another libertarian toy, but then there it is "privatize SSI". I guess that now the Tea Party has become reviled, the Kochs need a way to get to the people
Hardly. John Kerry's meme in 2004 was Pay As You Go. He lost because we were all puffed up fighting an unwinnable war.
Ron Paul has no clue in the world about how debt-base money works. Very different from gold-backed currency. Canceling this debt would ruin the US credit rating. It's not like that for gold-backed currency. When we abandoned the gold standard during the 1930s, the decision was made to loan out money printed by the US mint using banks. Those loans are called 'prime', and banks gain access to those loans by joining the federal reserve system. That is how new money enters the economy, and new money belongs to nobody. 'Old' money from debt that has been paid goes into the stock market or savings accounts. Old money belongs to people. Banks inflate the money supply by loaning out up to 80% of savings, so each $1.00 that is saved becomes $1.80. The stock market skips the banking system when loaning money. What Bush did in 2002 was to let banks borrow money from the mint to buy stock and inflate prices, which collapsed because it's a Ponzi scheme, so banks took money from savings accounts that belong to people. That's why it's supposed to be illegal for banks to buy stock.
The claim that privatization is always more efficient than government is laughable. Private toll roads almost always raise prices, eliminate competition by artificial means, then go bankrupt anyway. As for USPS, why do they deliver faster and to more places than Fedex or UPS, to the point that both of them contract with USPS for final delivery?
This is what some in the republican party want. Wipe out the pension funds, wipe out the savings account and 401s. That way the people will be bagging for any scrap the wealthy will throw to them.
Based on current events -- this list is in need of revision ! Implementation of such list would require considerable planning and management --- who would you suggest for that task ???? If you want to reduce debt management to its simplest form, would it not be this easy -- Do Not Spend What you Do Not Have !!! Now remember, some managed debt is good -- or very few Americans would own a home !
I dislike the idea of legalizing non-medicinal drugs, but *some* are already legal, and the government makes TONS of money off of them. If horrible things like alcohol and tobacco can be legal, why not other things? Idiots who want to use it will use it no matter what, and Portugal actually found a decrease in usage once it stopped being illegal there(the allure of it being "forbidden" was gone, so then it was just up to people to realize "using that is stupid"). So while I'm 100% against using it, technically, preying on stupid people who are already willing to wreck themselves would be a massive boon to the government.
We have sent billions, maybe trillions of dollars in aid to foreign countries. Time to call the notes.
Well, not all seven are creative. #2 (sell assets) and #5 (privatize Social Security) have been on the right's wish list for some time and will do little more than channel more public services to private profit. #3 (legal/tax marijuana) has been on the left's wish list for some time and will not only raise money but save the wasted resource put into criminalization and incarceration. #4 (normalize trade) may help economically but many countries are trade restricted for other, good reasons (e.g., sanctions on Russia, North Korea and Iran). #6 (ending corporate welfare) is something pretty much everyone can agree on-except, alas, the corporations that control our government... #7 (return troops) is kind of the flip side of #4-yes, it will save money but it should be done because there are no good reasons for our troops to be in most places they are to begin with. Now, you could say that #1 is the most creative of the lot...and maybe it is. But, to be really creative, why stop there? The US is a sovereign nation. We could simply repudiate all of our debt ("Sorry, changed are mind, not gonna pay any of it"). The present debt is eliminated, future debt payments are saved and we won't have to worry about going into debt again for the next 50-80 years, since no one will risk loaning us any more for at least that long.
That is stupid. This is the kind of thing that will send the US into a great depression so great we will never escape. The government needs to reel in their spending, not start to default on their loans with threats or dumb requests.
Many countries around the world will no longer trust the united states. However, it is probably the only solution available.
What are the pros and cons of that suggestion? Who's holding those notes that will have their money wiped out?
On a side note. For all the people who cry about the Federal Reserve and call for abolishing. They must not realize how important the Fed Reserve is. It is the greatest safety net and deterrent from an economic attack from another country. It provides flexibility and capability to neutralize any financial attack on the US.