Here is an essay originally posted May 13,2010
We need to adjust our style of life, both as a nation and as citizens. The government and households have huge debts and this will choke us unless it is addressed. We can no longer live by plastic; credit cards and other debt. The chart to the left was taken from a post of Paul Krugman, which he obtained from the Federal Reserve depicting the explosion of household debt.
However, now is the time for the government to develop a credible plan to reduce our nations debt over the next decade, but not to implement it until the economy, including jobs, is on a stronger footing.
We need the plan now; not later. The world, including myself, has doubts that we have the desire and fortitude to develop such a plan; let alone implement it. The immediate development of the plan is a critical part of us continuing to recover from the economic calamity of the last few years. The world needs to know that we are going to do something about our swelling debt load and they can still have confidence in us to solve our problems.
As individuals we need to hang on to that born again trait called frugality. As the economy recovers we need to guard against the "live for today" attitude of the past couple decades. We also must face reality that we are the government and part of the "deficit fix" discussed above includes all of us making sacrifices. The measures that must be considered as part of the plan include:
- Increasing the retirement age to 67 or 70
- Creating higher deductibles for Medicare and Medicaid
- Perhaps creating a Value Added Tax. Tax consumption; not savings
- Eliminate the interest paid on home mortgages as a tax deduction
- Enforce anti-trust laws to create competition and thus lower the cost of goods and services by forcing the board of directors and executives to hold down cost including the egregious salaries being paid to executives in big business corporate America. This includes the health care and banking industries.
- Disallow those who are not citizens of this country, and who cannot vote for our politicians, to be able to buy votes by making political contributions.
- Recognize that we should not and cannot be the military defenders of the entire world
- Individually saving more and spending less.
- Consolidating the administration of school districts; not the teaching function.
- Reducing the burden on our court system by legalizing and regulating marijuana usage similar to alcohol