It seems as if everyone is so concerned with this quarter's, or next quarter's results. This should not be the concern. There are structural problems in the US economy and these must be addressed - even if it means a contraction.



1. A national consumption tax is needed.

2. Health care costs can and should be addressed. In some cases 1/3 of a doctors income goes to malpractice insurance. Tort reform must be enacted. Doctors are overpaid. One simple way of dealing with this is no one should see a doctor until they have first seen a nurse. Some doctors estimate 90% of their visits are issues a nurse practitioner could deal with. Drastic end of life care costs have to be addressed. It should be possible to cut 1/3 of public health care costs down, and provide the same service.

3. End the war on drugs. It is crazy prison costs are higher than education costs in some States.

4. Increase taxes on the middle class, and the poor. The middle class, ie those making $50-$200,000 must pay more, and the poor have to pay something. Everyone has to have some skin in the game.

5. Address China. Their currency must float...end of story.

6. Stop going to war.

7. Pension reform. The US is not immune to the laws of arithmetic. Of 100 people working, only 60 are in the private sector. So, 60 are supporting themselves, plus 40 more. But, add to that previous public sector workers, the pensioned class, probably as much as 30 more, plus another 10 who have never contributed anything. Sixty end up supporting a total of 140. To do that, and not run deficits, average tax rates would have to push about 80%. Obviously, impossible. So, government runs deficits, a policy that has finally caught up to you. Pensions have to kick in when a person hits a certain age, regardless of when they retire, and must be topper uppers to ones own savings, not a lifestyle. In California some public employees get full pensions after 20 years. You can retire in your early 40s and be paid until your 80s!! Does this make any sense? Can you pay someone for 3 years, indexed, on one years work?



Reforms such as these have to be enacted regardless of the effect on the unemployment rate, etc. This will sort itself out. But, right now the underpinnings of the economy aren't sound. Without strengthening the foundation you can't fix the stuff on the surface.