Wednesday, December 3, 2008

The Economy - What Should Be Done

It's time for major surgery. Here are some ideas, including a number that are quite radical - for America.


  • Pass a large "stimulus" package that includes infrastructure funding and money for state and local governments
  • Nationalize, recapitalize, and sell off the banking system using the "Swedish model"
  • Bail out (grant, loan, pre-pack CH11, whatever) the domestic auto industry in a forward-looking manner


  • Implement a national single-payer healthcare system
  • Equalize the tax rates between labor, capital gains, dividends, and interest
  • Regulate everything that acts like a bank (borrows short, lends long) and tamp the leverage ratios way down
  • Coordinate a decline of the dollar to an appropriate level relative to JPY and RMB, or force the move if necessary
  • Assess a transaction tax in all "markets" at a level that significantly reduces daily churn while not discouraging longer-term investors
  • Further disperse the financial sector from the New York metro area, including a relocation of the NASDAQ to Chicago
  • Replace the widely evaded corporate income tax with a VAT
  • Phase out the mortgage interest deduction and raise the standard deduction instead

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