Thursday, December 8, 2011

Poll: How Should America Solve its Fiscal Crisis? | Americans for Prosperity

Poll: How Should America Solve its Fiscal Crisis? | Americans for Prosperity

Poll: How Should America Solve its Fiscal Crisis?

AFP-Arizona informal poll (with huge selection bias):

1) How SHOULD America solve its $150 trillion unfunded government liability crisis over the next 75 years?

2) How WILL America solve that crisis?

Click here to take the poll

Or, send your answers to tjenney@afphq.org. Feel free to list a combination of the lettered options below (A-K) for your answers to 1 and 2. Remember to think BIG for this one. We're talking about $150 trillion over 75 years. So we need annual debt-reduction suggestions ideally in the range of $2 trillion. Options A-K below (A-H, anyway) are working in that range--and for some of them, we have explained how they don't really pencil out.

A) America should/will keep its entitlement promises to people over the age of 55, transition to self-fundedpersonal health and retirement accounts for younger workers, reduce projected future federal spending by half compared to current projections, and keep federal taxes at about 19 percent of GDP. Upside: increased private savings and robust economic growth. Downside: a temporary increase in federal debt. (For more, refer to the Ryan and Ferrara plans linked to at http://tinyurl.com/atbb2011)

B) America should/will double federal revenues by going to European levels of taxation (and beyond). That would mean significantly higher rates for all federal taxes, but because The Rich (including many investors and job creators) are a moving target, the lion's share of the revenue increases will have to come from higher payroll taxes on workers. Because higher taxes would reduce economic growth, revenue increases sufficient to deal with America's fiscal crisis may not actually be achievable. (For details, read Myths 2 & 4 in this paper: http://tinyurl.com/klingent)

C) America should/will return very rapidly to levels of federal spending compatible with the Constitution--meaning the abolition of all federal entitlement programs, massive tax cuts, and huge reductions in federal regulatory burdens. With the federal government spending less than ten percent of GDP, those currently on entitlements would have to fend for themselves, rely on charity, join mutual aid societies, and/or get (probably much-reduced) assistance from state-government welfare programs.

D) America should/will sell assets, including federal lands, to fund the unfunded liability. Problem: do the math. To generate $150 trillion in revenue from land sales, the federal government would have to sell its 650 million acres for an average of $230,000 an acre!

E) America should/will default on its debt, reneging on promised interest payments, principal repayments, or both. (More about that here: http://tinyurl.com/jrhdefault) The government can do a bigger default if it has already prodded Americans into buying large amounts of long-term government bonds (perhaps as part of a "grand bargain" on diverting payroll taxes into personal accounts).

F) America should/will resort to sudden and gigantic hyperinflations/devaluations to pay off federal debt/pay for promised federal spending with a mountain of paper money. (Before you select this option, read this article on how difficult it is for governments to monetize debt in the modern global financial system: http://tinyurl.com/jrhmonet)

G) America (i.e., Congress and future Presidents) should/will resort to a lot of piecemeal expedients to tax people and renege on benefits, e.g., heavily taxing or confiscating/nationalizing 401Ks and IRAs, continually raising the retirement age for Social Security, and/or increasing rationing of medical services rationing via the ObamaCare Medicare IPAB, Medicaid restrictions, and ObamaCare exchange regulations of "private" insurance.

H) America should/will allow for massive immigration to maintain or increase the current ratio of workers to retirees. Boston University economist Laurence Kotlikoff cites a paper suggesting that we would need to allow between 4.5 and 6 million new immigrants per year for twenty years to maintain the ratio. That's roughly 100 million immigrants added to a current population of 300 million. The numbers would work better if working-age immigrants and their families did not themselves collect heavy government subsidies (including public K-12 education)--but of course, they would vote in huge numbers to increase their own subsidies. And we would then have the problem of how to support their health and old-age benefits when they retire...

I) America should/will invade other countries, enslave their people, and take their stuff. (Just joking. Aside from the repugnant immorality of that option, it's not practical in the modern world economy: we would have to steal assets or tax slave-labor productivity to the tune of $150 trillion, net of military costs, to make the math work out. Ain't. Gonna. Happen.)

J) America should/will wait for the Apocalypse, the singularity, or invasion by space aliens to solve the crisis.

K) Other?

Again, please send your answers to #1 and #2 to tjenney@afphq.org

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  • Azdutch
    A AND C
  • Tom Steele
    Response to #1 is A To #2 A also. Republicans must have the courage to stand against the biased media and progressive Democrats. Enough is enough! Stand tall and don't flinch!
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