A majority of Americans are living paycheck-to-paycheck. A majority don’t have enough money to pay for a thousand-dollar emergency. Home ownership is a rapidly dissipating aspect of the American dream. Americans’ credit card debt is at a record high because of high inflation and the cost-of-living, and they’re falling behind on debt payments. People don’t have enough money for retirement.

So what is the solution? Well for some economists, it’s time to take away the tax benefit for 401(k) plans because the government is short of revenue to pay for their exorbitant spending; see here, from USA Today:

What if the government abolished your 401(k)? Economists say accounts aren’t worth it

The federal government should stop allowing pre-tax contributions to retirement savings, abolishing the 401(k) and Individual Retirement Account, two economists from opposing ideological camps argued in a research brief in January.

Allowing people to shelter their retirement money from taxes is a policy that largely favors the well-heeled, they said. Congress could use that money, nearly $200 billion a year in lost tax dollars….

Oh, Congress could use that money? Yeah, well so could we, and we’re the ones who earned it. And $200 billion a year? This is a pittance toward covering the $2 trillion yearly deficit the federal government is running in a supposedly great economy.

Here is a novel thought for economists, politicians, and bureaucrats. Why don’t you guys look at the spending side of the equation instead of always seeking to confiscate more money from the rest of us? Your modus operandi further destroys our purchasing power and ability to save, spend, or invest, and that inevitably slows the economy.

In 2018, the economy was decently well:

The OMB estimated FY2018 would involve outlays of $4.094 trillion and revenues of $3.654 trillion, a $440 billion deficit.

Real wages were rising rapidly, especially for those at the bottom. Inflation was low. Energy independence policies kept energy prices low, and the world runs on energy. Russia wasn’t attacking Ukraine. Iran had less to fund terrorism and weapons. The border was much more secure. President Trump was slashing regulations and lowering tax rates, which helped almost everyone. And, by the end of 2019, poverty hit a record low. The individual mandate on health insurance was abolished and people were again given a choice on what kind of policy to buy. Trump’s policies were the rising tide lifting all boats.

In 2020, the U.S. was hit by a virus from China and due to erroneous CDC warnings, a lot of the private economy suffered. In turn, the federal budget skyrocketed because of what was called “emergency spending.”

By the end of 2020, the economy was rapidly recovering but somehow the “emergency spending” remained; from the Congressional Budget Office:

Federal outlays in 2024 total $6.5 trillion, which amounts to 23.1 percent of GDP.

The FY 2024 budget is $6.5 trillion in spending, which is up around 60% over FY 2018. That is a huge cause of the problem. Government never seems to cut back once it starts spending.

What should a reasonable budget be when we no longer have the COVID emergency? (As Hayek said, “‘Emergencies’ have always been the pretext on which the safeguards of individual liberty have been eroded.”) Let’s look at what the federal government determined was reasonable for social security and disability recipients to receive over those same six years—per the cost-of-living adjustment website, it was an increase of 23.5% over six years. Ergo, the federal government should be able to survive on the same increase. So a reasonable budget should be around $5 trillion, not $6.5 trillion. That is a savings of $1.5 trillion each year right there, a substantial cut of the deficit.

Here are some other suggestions:

The U.S. survived—and thrived—for over 200 years without a federal Department of Education. That agency’s budget is $68 billion, with over 4,000 employees.  As far as I can tell, student performance has not improved since it was formed. Abolish it.

Eliminate all the green slush funds that will do nothing to change the climate. Most of the $7,500 tax credits for electric cars go to people who can afford them if they want them. We are subsidizing the wealthy so they can drive around in fancy golf carts.

Get rid of many employees at the FBI, CIA, NSA, and multiple other agencies who seem to spend a lot of time illegally spying on people surrounding Trump and other Americans.

Cut employees and budgets at NIH and CDC who spread so many lies about COVID. On top of these federal agencies being unconstitutional in their nature, we certainly don’t need government agents who just puppet what Democrat supporters like teachers unions feed them.

Stop using racist prevailing laws on infrastructure projects. That would save a lot of money because of competitive bidding. Democrats should support that because they want to get rid of anything associated with racism and want more infrastructure projects, don’t they?

Instead of growing the welfare state and forging ahead with the Cloward-Piven strategy, make people physically and mentally capable of working… actually work!

Why does the government keep hiring more bureaucrats when we are broke? Stop!

Stop increasing subsidies, and raising income eligibility levels for daycare, Obamacare, SNAP handouts etc. We are making it much harder for people to become independent.  The increased subsidies substantially increase costs for those of us having to compensate and pay for those subsidies.

Close the borders. The cost of Biden’s open borders is massive.

Stop giving money to the United Nations and the World Health Organization. They have done great damage to the world.

Get rid of Joe Biden who is dictatorially and unconstitutionally forgiving hundreds of billions in student loans.

Stop giving automatic increases in every agency’s budget every year. Make them justify the amount.

Cap federal government pension levels. Why are they unlimited while social security has a cap of $4,555 per month?

Anthony Fauci, who lied continuously and destroyed a lot of people’s lives, reportedly started out with a pension of $414,000!

I am sure other people can think of a lot more areas to cut.

The U.S. will fail to be a prosperous and powerful country if we stay on our current trajectory. It will collapse from within. The private sector has to be the solution, not a more powerful government. Many of the richest counties in the U.S. are around Washington D.C. where nothing is produced. And they always want more money and power for themselves. There is never enough, because greed is never satisfied.

Image: Free image, Pixabay license, no attribution required.