How do we fix the economy? That is a question that tens of millions of Americans are asking right now. Republicans are harshly criticizing the empty economic proposals being put forward by Barack Obama and the Democrats, but the Republicans don't seem to have any real solutions either. There is talk of cutting taxes a little bit more, reducing federal spending a little bit and getting rid of a few useless federal regulations but doing any of those things would essentially be like spitting into Niagara Falls - the effect would not really be noticeable at all. As this column has documented over and over and over, the economic and financial problems that we are facing are so enormous that radical solutions are needed. In essence, what we need is not an "economic bandage" or two - what we need is major reconstructive surgery. If dramatic action is not taken, our economy is going to completely collapse.
Is anything that Barack Obama is currently proposing going to help fix the economy? No, of course not. As I wrote about the other day, Obama's address to the nation was packed with empty promises and a whole lot of inspirational nonsense. There were no real solutions to the very real problems we are facing.
So is there anything that we could do to actually start fixing things?
Yes, but the solutions are radical. They would cause quite a bit of chaos. They would not be easy for people to accept.
But the truth is that our economy and our financial system have terminal cancer. If something radical is not done quickly we are going to lose the patient.
The following are 16 ideas that Barack Obama could have proposed if he actually wanted to fix the economy....
#1 We Must Shut Down The Federal Reserve
If you are not willing to accept this, you may as well not read the rest of the solutions. The truth is that the U.S. government will never be able to solve the national debt problem until the Federal Reserve is shut down. The U.S. government should nationalize all Federal Reserve assets and start issuing currency that is completely and totally debt-free.
Under such a system, it is conceivable that U.S. budget deficits could be eliminated entirely and that over time the entire U.S. government debt could be retired.
One of the biggest threats of going to such a system would be inflation, but remember, the United States has only had a major, ongoing problem with inflation since the Federal Reserve was created back in 1913. The U.S. dollar has lost well over 95 percent of its value since the Federal Reserve was created, and so it is hard to imagine that we would do even worse without the Federal Reserve.
In any event, it is the fundamental right of any sovereign nation to be able to issue and control its own currency. This right was given to the U.S. government by the U.S. Constitution and it is time for the U.S. government to reclaim that right.
#2 We Must End Trade With All Nations That Allow Their Citizens To Be Paid Slave Labor Wages Or That Do Not Respect Basic Human Rights
This would dramatically reduce the "outsourcing" of our jobs and our industries almost overnight. The truth is that it was never a good idea to put American workers in direct competition with hundreds of millions of workers that are making slave labor wages on the other side of the globe.
Trading with nations that have a similar wage structure to ours and that respect basic human rights (Canada, for example) is a very good thing. However, all of the "free trade" agreements that politicians from both parties have been pushing down our throats for decades are literally wrecking the U.S. economy.
Since 2001, over 42,000 factories have been shut down in the United States. This proposal would go a long way towards stopping the bleeding, and if some of these countries are willing to raise their wage levels significantly then we would be able to resume trade with them in the future on a much more level playing field.
#3 We Must Radically Reduce The Size Of The Federal Government
Our big, fat government is a big, fat drain on our economy. We have millions of paper pushers that don't contribute much of anything of real value.
Not only that, but some of the things that the U.S. government wastes money on are absolutely mind blowing. There is a reason why our founders insisted that we have a very limited government. It is time to get back to those principles.
The Congressional Budget Office is projecting that the U.S. government budget deficit for this year will be nearly $1.5 trillion.
Talk about ridiculous!
I estimate that we could easily cut the size of government in half without hampering how effective it is.
We could start by abolishing the Department of Education. After that, there are several dozen other government agencies and institutions which are worthy candidates for elimination.
#4 We Must Provide Temporary Jobs For The American People During The Economic Transition
If the Federal Reserve is shut down and the size of the federal government is cut in half, it would cause quite a bit of economic chaos. During this transition it will be important to help people survive.
Instead of just passing out a bunch of handouts, a better alternative would be getting the American people working on something constructive.
During this time, the U.S. government could use all of the untapped labor of the unemployed to build massive infrastructure projects.
According to the American Society of Civil Engineers, we need to spend approximately $2.2 trillion on infrastructure repairs and upgrades just to bring our existing infrastructure up to "good condition".
So there is certainly a lot to do.
These jobs would just be temporary until new manufacturing facilities are set up and jobs in private industry are plentiful again.
Having the American people produce something of value is better than just handing them endless unemployment checks.
#5 We Must Ban All Short Selling
When you allow greedy individuals the opportunity to make lots of money by betting against the U.S. economy, it gives those individuals an incentive to make sure that those bets pay off.
Yes, this proposal is controversial, but it just makes sense. If people want to make money, it should be because a company is doing well and not because someone is failing.
#6 We Must Ban Virtually All Derivatives
Once upon a time, derivatives were for hedging risk, but that is not what they are primarily being used for anymore.
Now derivatives are being used to bet on almost anything that you can possibly imagine.
Our financial markets have been turned into a gigantic financial casino.
The derivatives bubble is somewhere in the neighborhood of one quadrillion dollars and it could burst at any moment.
These weapons of financial mass destruction must be banned.
#7 We Must Break Up The Big Wall Street Banks
The big Wall Street banks have far too much power and far too much control. They have come to dominate our entire financial system.
In a capitalist system, too much power concentrated in too few hands is not a good thing. The corruption that has gone on at many of these institutions is absolutely unbelievable.
These banks need to be broken up into much smaller pieces for the good of our country.
#8 We Must Initiate A Massive Law Enforcement Crackdown On Our Financial Markets
As noted above, the corruption that has been going on down on Wall Street has been absolutely sickening. We need a massive law enforcement crackdown on all of this fraud in order to restore faith in the financial system.
Just one small example of this corruption happened during the recent housing crash. Goldman Sachs sold mortgage-related securities that were absolute junk to trusting clients at vastly overinflated prices and then made huge profits betting against those exact same securities.
So do you think that Goldman Sachs or any of the other major players on Wall Street will ever receive more than a slap on the wrist for all the things that have gone on in recent years?
Of course they won't - unless the American people start demanding it.
#9 We Must Order U.S. Oil Companies To Use Untapped Oil Reserves In The United States And We Must Aggressively Develop Alternative Energy Sources
Right now, the price of oil is pushing up towards 100 dollars a barrel. If oil passes that mark, it is going to put tremendous inflationary pressure on the entire global economy.
Sadly, there is no need for such a high price for oil. There are vast, vast reserves of oil that are virtually untapped inside the United States. These are mostly in the western states and up in Alaska. We have enough to supply very cheap oil to the entire country for decades.
The U.S. government needs to order these oil companies to quit playing games and to start pumping this oil.
However, it is undeniable that we also need to develop alternative energy sources. In fact, we should set up a "Manhattan Project"-style team to aggressively pursue this goal.
In the past, U.S. oil and car companies have blatantly repressed alternative energy projects. The U.S. government should tell U.S. corporate executives that if they ever even think of doing such a thing again that they will be locked away so fast that it will make their heads swim.
#10 We Must Stop Paying Farmers Not To Grow Food
Instead of paying farmers not to grow food, we need to find ways to encourage them to grow as much food as possible. A horrible global food crisis is coming and we are going to need huge stockpiles of everything.
#11 We Must Secure The U.S. border With Mexico
Illegal immigration costs the U.S. economy tens of billions of dollars (conservatively) every single year. We need to secure the border and make sure that all of our immigrants are coming through the "front door".
#12 We Must Shut Down The IRS
Did you know that the United States has only had an income tax for less than 100 years? For most of our history, the U.S. government got along just fine without taxing personal income.
The IRS is massive waste of time, energy and resources. There are many alternatives that could easily replace the income tax and the ridiculous tax code that we have right now.
For example, a flat tax or a national sales tax could both potentially work, although both have their problems.
Personally, I am convinced that we could have a system that would not require any taxation of income by the U.S. government whatsoever.
Just imagine how much time, how much energy and how many resources would be saved!
#13 We Must Slash Red Tape And The Miles Of Ridiculous Regulations
In the United States today, you almost have to be insane to start up a new business. When you consider all sources of taxation, U.S. businesses face one of the highest overall levels of taxation in the entire world. Not only that, but U.S. businesses face miles and miles of absolutely ridiculous regulations and red tape.
As I wrote about in a previous article, if you want to do business in the United States today, you better be prepared for a regulatory nightmare....
If you plan to start a business in America today, you better get a hold of a good lawyer. In fact, if you want to be safe, you better get a small army of lawyers. You are going to need an expert on the federal regulations that apply to your business, you are going to need an expert on the state regulations that apply to your business and you are going to need an expert on the local regulations that apply to your business.
There are going to literally be thousands of regulations that apply to any business started inside the United States today. There is no way that you will ever be able to learn them all. Not only that, but the truth is that your lawyers will only be aware of a small fraction of them.
Until the regulatory environment in this country dramatically changes, companies are going to continue to be motivated to leave the United States.
#14 We Must Conduct A Massive Law Enforcement Crackdown On The Health Care Industry
It should not cost $30,000 for a one day stay in the hospital in this country.
The truth is that the American people are being ripped off big time.
We need to conduct a massive law enforcement crackdown on all the big hospitals and all the big health care companies.
We need to conduct a massive law enforcement crackdown on all the big health insurance companies.
We need to conduct a massive law enforcement crackdown on all the big pharmaceutical companies.
We also need massive medical malpractice reform.
Not only that, we also should end the monopoly of the AMA immediately. We need to reintroduce honest, legitimate competition back into the medical system.
In addition, we need to make sure that natural health practitioners are able to compete on a fair and equal basis in this country.
As I have written about previously, the health care industry in the United States has become all about making as much money as possible.
That must change.
#15 We Must Stop Trying To Police The World
We will always need a very strong military force, but it is absolutely ridiculous that we have troops stationed in approximately 130 different countries today.
This is a tremendous drain on our national resources and we are spread way too thin militarily. It is about time that many off these other countries started protecting themselves for a while.
#16 We Must Pull Out Of The United Nations And We Must Dramatically Reduce Foreign Aid
The United Nations is a massive waste of time, energy and resources. We should have pulled the plug on that ridiculous globalist organization long before now.
In addition, we need to dramatically cut back on foreign aid until we get our own house in order. We should only help the most desperate nations until we get our own economy back on track.
#17 We Must End All Of The Ridiculous Police State Measures Which Are Chasing Tourists Away From Our Soil
Tourism is a very, very important industry to the United States. But today, all of the incredibly intrusive police state measures that the past few administrations have introduced are chasing millions of tourists away and are ruining our national reputation.
For example, there are many cultures around the globe where it would be unthinkable to have anonymous security goons feel up the private areas of women and children before they are allowed to get on an airplane. Rather than put up with such nonsense, millions of tourists are simply going to choose to spend their money somewhere else.
#18 We Must Seize The Assets Of The Ultra-Wealthy Individuals And International Banks That Have Been Committing Fraud Against The U.S. Government For Decades
Once the Federal Reserve is shut down, it will be important to hold those that have been defrauding the U.S. government responsible. Once a full audit of the Federal Reserve is conducted and evidence of criminal activity is uncovered, those involved should be arrested and all of their assets should be seized and frozen pending trial.
If the things that have been going on inside the Federal Reserve are ever fully exposed, it will make the whole Bernie Madoff scandal look like a nickel and dime operation.
But that is why there has never been a full, comprehensive audit of the Federal Reserve since it was created back in 1913. The American people are not supposed to see what happens inside that institution.
Unfortunately, even though economic times are a little rough, things are still good enough that the vast majority of Americans are not ready to start demanding the kind of radical changes listed above.
Not only that, but the kind of radical changes listed above would be fought against by the establishment every step of the way. Those with money and power are not going to step aside just because "justice" demands it.
What is probably going to happen is that the "establishment politicians" that the establishment has bought and paid for are just going to continue to propose half-baked solutions to our problems as this country continues to tumble towards economic oblivion.
So what do all of you readers think? Is there hope that someday we will see some real economic solutions implemented in this country?