In the meantime, let’s pass an executive order that if Congress increases the net debt in any year that every Congress person has to send an apology letter to every constituent laying out how much per capita the debt they now owe has increased.
Except the letter should also be addressed to the children and grandchildren of the recipient; plus remind the recipient that that governmental cost was intended to do good things that the tax paying (or non paying) citizen desired of his "political representative".
"Don't blame me! This pending fiscal and economic collapse is all part of what you wanted".
At least in a system where the people are sovereign and government is conducted via consent of the governed. It might be debated as to how close to that ideal we are now!
The United States of America has fifty members. It should be easy, in fact it has been done by a columnist I used to follow long ago at Forbes, to compare the fiscal and economic performance of those fifty individual states, and to identify principal components contributing to loss or gain. Measuring and analysing their data as a single entity across so diverse a landscape is the EU all over again.
To restore financial health, there is no alternative to turning off the taps.
Emphasizing the laboratory of the states is a good idea. Our current CFO in Florida is going around and auditing each county, culling excess and calling out poorer results. Something similar is a good idea at the national vs. state level.
1) your 20-22% cap aligns with the 18-19% long term overall % of income extractable from the tax paying public over decades. I believe in Europe it is closer to the 23-25% range being extracted from their tax payers.
2) the Laffer curve is a nice back of the napkin thought experiment, but the reality would be if high income highly taxed persons were also then granted government "benefits" approximating their previous life style, the the official tax take at the (1,0) point could actually become (1,something positive up to 1.0).
If a person is taxed the full $10M they "earned" in a given year but is granted benefits of living in a 6000 sq foot villa in Boston Harbor or Carmel or other attractive venues, an allowance to drive a BMW or Mercedes or XYZ, or several, shop at top brand stores on a govt credit card, etc.; plus at the higher income levels the "subsidy" of enjoying the US yacht "Spendthrift 47" for seven weekends a year, the nominal Laffer curve could have a positive right side value. Of course the costs of those benefits have to come from that extra taxed income, but someone on the Socialist side could probably come up with something attractive enough - you know, for Democracy and Equality, etc.
3) in some prior essay covering how to recover from our debt debacle, the author presented the option of selling off government assets to pay down the debt, but still the net money gained from that sale was only a small fraction of the debt level at that time (maybe $18T?).
4) we may all be created equal from the standpoint of our human dignity, but we are not all equal in our allocation of fiscal integrity and virtue.
I think in that same article there was a 4th option to just confiscate the wealth of all wealthy people, and of course that meant there was no more money for the next years obligation, etc.
I like your idea but its unworkable in practice, the reality is that the US is going to do what it did after World War II, when it had a lot of debt. It used financial repression and inflated the debt away slowly.
I agree, but it may not work as well now, as many more people understand that inflation is a tax inflicted on us via a devaluing monetary policy. More people will try to find inflation hedges to reduce their personal impact. Does not sound like a program oriented to creating real value returned for value previously received. At least after WWII and the Cold War, we are not speaking German or Russian, so we got some long term benefit from those higher than GDP expenditures. [Perhaps the same will eventually be said about us not facing a potential or actual nuclear Iran??]
There are statements out there that the Boomer generation has assets of about $6T, so that may help the next generation or two, when those assets are inherited, to weather the economic storms coming. But only if there is some form of fiscal and financial discipline in those generations, too.
Yes, there was a general (not well focused) concern about the growing debt/deficit situation. But back then TEA was touted to mean "Taxed Enough Already", my thought was that it should have been "Trim Entitlements Already!!"
We need more transparency about the nepotistic or other relationships between the members of the legislatures, their staffers, the media, lobbying firm, and other tax sucking NGOs. Unfortunately, the current media, who might have the charge to perform that function, are too biased and incompetent to do that for us while the rest of us do our part for the rest of the economy.
As public servants, the schedules and meetings of our reps and who they talk to about what should be much more publicly available. Then maybe we can see how and why a given vote when a given way, favoring a big donor over the nominal constituents. Florida has a "government in the sunshine" law, that helps a little, but even it is not quite enough.
In the meantime, let’s pass an executive order that if Congress increases the net debt in any year that every Congress person has to send an apology letter to every constituent laying out how much per capita the debt they now owe has increased.
Except the letter should also be addressed to the children and grandchildren of the recipient; plus remind the recipient that that governmental cost was intended to do good things that the tax paying (or non paying) citizen desired of his "political representative".
"Don't blame me! This pending fiscal and economic collapse is all part of what you wanted".
At least in a system where the people are sovereign and government is conducted via consent of the governed. It might be debated as to how close to that ideal we are now!
The United States of America has fifty members. It should be easy, in fact it has been done by a columnist I used to follow long ago at Forbes, to compare the fiscal and economic performance of those fifty individual states, and to identify principal components contributing to loss or gain. Measuring and analysing their data as a single entity across so diverse a landscape is the EU all over again.
To restore financial health, there is no alternative to turning off the taps.
[By members, you presumably meant states.]
Yes, taps for the taps, as it were. :-)
Emphasizing the laboratory of the states is a good idea. Our current CFO in Florida is going around and auditing each county, culling excess and calling out poorer results. Something similar is a good idea at the national vs. state level.
Fifty states is fifty states sounds a trifle tautologous to me. The United States has fifty members avoids this.
What lessons do u draw from the german experience with the “debt brake”.
1) your 20-22% cap aligns with the 18-19% long term overall % of income extractable from the tax paying public over decades. I believe in Europe it is closer to the 23-25% range being extracted from their tax payers.
2) the Laffer curve is a nice back of the napkin thought experiment, but the reality would be if high income highly taxed persons were also then granted government "benefits" approximating their previous life style, the the official tax take at the (1,0) point could actually become (1,something positive up to 1.0).
If a person is taxed the full $10M they "earned" in a given year but is granted benefits of living in a 6000 sq foot villa in Boston Harbor or Carmel or other attractive venues, an allowance to drive a BMW or Mercedes or XYZ, or several, shop at top brand stores on a govt credit card, etc.; plus at the higher income levels the "subsidy" of enjoying the US yacht "Spendthrift 47" for seven weekends a year, the nominal Laffer curve could have a positive right side value. Of course the costs of those benefits have to come from that extra taxed income, but someone on the Socialist side could probably come up with something attractive enough - you know, for Democracy and Equality, etc.
3) in some prior essay covering how to recover from our debt debacle, the author presented the option of selling off government assets to pay down the debt, but still the net money gained from that sale was only a small fraction of the debt level at that time (maybe $18T?).
4) we may all be created equal from the standpoint of our human dignity, but we are not all equal in our allocation of fiscal integrity and virtue.
I think in that same article there was a 4th option to just confiscate the wealth of all wealthy people, and of course that meant there was no more money for the next years obligation, etc.
I like your idea but its unworkable in practice, the reality is that the US is going to do what it did after World War II, when it had a lot of debt. It used financial repression and inflated the debt away slowly.
I agree, but it may not work as well now, as many more people understand that inflation is a tax inflicted on us via a devaluing monetary policy. More people will try to find inflation hedges to reduce their personal impact. Does not sound like a program oriented to creating real value returned for value previously received. At least after WWII and the Cold War, we are not speaking German or Russian, so we got some long term benefit from those higher than GDP expenditures. [Perhaps the same will eventually be said about us not facing a potential or actual nuclear Iran??]
There are statements out there that the Boomer generation has assets of about $6T, so that may help the next generation or two, when those assets are inherited, to weather the economic storms coming. But only if there is some form of fiscal and financial discipline in those generations, too.
I think the parties worked together to shut down the Tea Party last time.
Yes, there was a general (not well focused) concern about the growing debt/deficit situation. But back then TEA was touted to mean "Taxed Enough Already", my thought was that it should have been "Trim Entitlements Already!!"
We need more transparency about the nepotistic or other relationships between the members of the legislatures, their staffers, the media, lobbying firm, and other tax sucking NGOs. Unfortunately, the current media, who might have the charge to perform that function, are too biased and incompetent to do that for us while the rest of us do our part for the rest of the economy.
As public servants, the schedules and meetings of our reps and who they talk to about what should be much more publicly available. Then maybe we can see how and why a given vote when a given way, favoring a big donor over the nominal constituents. Florida has a "government in the sunshine" law, that helps a little, but even it is not quite enough.