Indeed, I believe you are correct. The easy credit economy has created unstustainable national debt, PERIOD. Foreigners were funding a hefty portion of public debt but have moved on due to the instability of our financial system and into commodities. The government’s remedy to this is taxation without representation in the form of inflation which is the FED, appointed officials NOT elected. Add the $14 trillion debt and the forecasted costs of SS & Medicare for the boomers over the next decade of $18 trillion.
The Democrats proposed way to pay for this is socialism or wealth redistribution through taxation. It is a collective punishment for the responsible. Socialism does work temporarily and Obama would be touted as short-term savior but the cracks of the damn would multiply many fold in a three or four year span and he would not be re-elected.
My solution would be to declare energy independence as a national security priority, subsidizing hundreds of billions into the effort. This would help create millions of permanent jobs which add to the tax base. Also, America could become an exporter of the raw materials which also makes shipping agriculture and metals (things which the global consumer actually needs) less expensive. It would create a massive global investment opportunity, particularly if it was backed by Treasury and this would fix a good portion of the financial sector. It would deflate the commodities bubble. This would create trillions of dollars of new wealth over time. The citizens of this nation are seeing a declining quality of life. I do not see a way to minimize this in the short term and feel we will go over the cliff and be 10 feet from earth before we open this parachute.
I was just out for awhile and was speaking with someone, a Republican, who was upset and worried about people who are both working and are finding it difficult to buy groceries and gas. I asked who they were voting for and she answered that they blame the Republicans for this economy and are voting donk.
My response was:tough love. I think this country needs to feel the pain in a personal way before they will take the time to understand economics and to appreciate capitalism. We are older and still capable of doing a lot of work that many folks hire out. I have posted often over the past few months on the old ways of squeezing a dime, saving a dollar and surviving what is upon us. I know there are many FReepers who are doing the same. Some of us have savings and assets and some of us don’t. But we aren’t the problem and we aren’t the ones voting for fascism.
I hope to God we can pull the rip cord at 10 feet above ground. I fear we may have to crash and burn and then survive the indignities of full blown fascism, with all the attendent blame pointed our way, if we are keeping our heads above water, even if just barely.
I have realtives who are affluent and who spent the good decades railing on and on about the Republicans. Most of them are going to scream blue murder when their retirement accounts are taxed, their income is taken into account when computing their property taxes (being proposed in MN) and the ones in the health professions find their livlihood nationalized and themselves conscripted for the Good Of The State. Their children are no better, but they, at least, are still young adults and could possibly wake up in time to vote against what is going to be a real horror.
Everyone needs to make sure they have heat, food and enough savings to keep up their insurance policies over the next several years. Bailouts will be for the improvident, not for the responsible, IMO. People with a lot of assets need to figure out how to keep them from the tax man, because the need for scapegoats and revenue sources is going to be intense.
Your plan is rational and therefore it will not be implemented with these idiots in power and with their inculcated supporters cheering them everytime they propose a public hanging of some imagined culprit.