October 23, 2011
All my long life, I have had a sense of economic inferiority to economists cited by various media or pundits. These wise and mostly men have powerful credentials: first tier doctorates, tenure or think-tank chairs, peer acclaim, authors of text books, numerous articles and more. Few have managed a business; these wizards manage governments. Some are trying to run the world. Impressive stuff that. Recently, I was thinking about the economies of nations. The wreckage reminded me of Ozymandias. Everywhere one looks in the Western world, there is economic ruin. America is in hock to its eyeballs; a larger percentage of its workers is unemployed or under-employed than at any time in decades, inflation has returned and our leaders do not have any idea as to what to do. The President's proposals gain nearly unanimous disdain. Few have confidence in the ruling class; none of the awe inspiring economists has stepped up to economic leadership. Few pundits even pretend to understand the problem much less offer a solution. Accordingly, it falls to me to cut through the Gordian economic knots in which we are ensnared. As a general principle, the solutions need to be set forth so that they are understood by almost all, thus gaining support from the people. Since it is "the people" who are suffering the brunt of the chaos, their recognition of answers on the way will restore the confidence necessary to begin recovery. There can be but few principles; 20 cannot be fathomed much less sold. Here are The Ten Economic Commandments: 1. The federal government's present budget will be reduced to 95% of what it spent last year. Each succeeding year, for the next 8 years, an additional 1% will be lopped off of last year's budget. Reductions will be across the board, in all departments and branches with the heads thereof deciding who and what is eliminated. Excess revenues over operating expenses must be applied to debt reduction. 2. The military will be brought home from Europe, Korea and similar billets to be retired or honorably discharged. The military budget may not be raised for the next 7 years absent a war declared by Congress. 3. The federal reserve will announce support for a strong dollar and that it will not attempt to restrain interest rates in any form. 4. The federal income tax rates shall be 5% on the first $50,000 of gross income; 10% on the next $450,000 of gross income and 15% of all gross income over $500,000. There will be no deductions other than for charity which will be limited to your highest tax rate. There will be no tax on capital gains; all income shall be deemed ordinary and taxed accordingly. 5. If you are between 55 and 50 years old, you may not draw on social security or Medicare until you are 70 years old. If you are between 50 and 45 years old, you may not draw on social security or Medicare until you are 71 years old. This sliding age scale decrements in 5 year increments with a 1 year increase in the retirement age. Thus, between 45 and 40 = 72 years; 40 and 35 = 73 years; 35 an 30 = 74 years and if under 30 = 75 years. 6. The fence between the US and Mexico will be completed; all illegal aliens will be deported via legal deportation; the social security check system will be required to hire anyone in the US with severe penalties to those caught cheating, including individuals. 7. The minimum wage will be raised to at least $15 an hour. 8. Student loans will once again be dischargeable in bankruptcy but only in a Chapter 13 type procedure. 9. Financial institutions must mark their assets to market on a quarterly basis. 10. The United States will not seek to impose democracy on any other nation. These are the principles. The rest will follow.