Monday, July 04, 2011

What must be done to solve the debt problem

I'm going to make this as plain and simple as possible so that anyone in Washington can understand.  If you want to solve the debt problem then this is what must happen:

1) Pass a Constitutional amendment mandating a balanced budget
2) Pass a Constitutional amendment that mandates Congressional oversight of the Fed, including regular audits, and guarantees the right of all citizens to a sound and stable currency based on tangible value

3) Re-establish the gold standard as the basis of value for the US dollar
4) Cut spending across the board - leave no federal program or cabinet department untouched
5) Pass a Constitutional amendment that protects the people from excessive taxation, guaranteeing that no citizen shall be deprived of more than 30% of their income in total goverment taxation.

Do these things and then Congress should move forward to raise the debt ceiling to solve whatever short-term problems may arise.  But, if these things aren't done then the vote must be no,  we must not raise the debt limit without properly controlling the government excess that brought us to this point. 

Any Congressman who fails to abide by this will likely face fierce opposition from Tea Party supporters.

And, to clear things up, there is nothing about the debt limit that is connected to our ability to pay off our loans.  The fear-mongerers will tell us that if we don't raise the debt limit we will default on our bond payments.

Bull.

The US Treasury brings in more than enough money to pay our debts.  Yes, they'll have to divert from bloated government programs to pay the bill but they can pay it nonetheless.  If the US defaults it is by choice, and the lack of courage to cut when cuts are called for. 

The alternative is to raise the debt limit without introducing the above measures, and Washington will continue to operate unchecked - devaluing our currency, cheapening our labor, raising our cost of living, eroding our economy - all in the name of political gains and government handouts.  That would be disastrous and is unacceptable. 

So I'm hoping that our Congessional leaders show courage, show guts.  Hopefully these things will happen and the US can finally get on the road to recovery.  But, to be honest, I don't think I have that much faith in those people.  Except for a small handful, most of them are gutless and uninformed.  Most of them lack the courage to choose paper or plastic at the grocery store, much less make a meaningful decision for their constituents.

So my guess is that some deal will be struck, both sides will save face, the issue will be postponed to another day and no actual solution will be implemented, the issue will be kicked down the road for someone else (namely our children) to deal with....and America will continue to plummet into economic despair.

All because no one has the guts to do what must be done.

3 comments:

SNAKE HUNTERS said...

Dr Washburn - What you say here is fundamentally correct. However, there is no mention of "creating" enough revenue for this government to pay off the nation's debt... or to return us to full employment.

The key: We must focus our attention on the need to rid ourselves of the huge burden of spending 500 billion per yr on Foreign Oil Imports.

We have Abundant Oil, Natural Gas & Shale Deposits, in Utah, Pennsylvania and West Texas, plus Coal, and the newest "modular" nuclear technologies to feed our own power grids, then quickly become the world's largest Exporter of LPG and CNG Energy!

What we lack is Leadership.
7/18/2011 - reb
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