Government Shutdown?

Lower taxes and lower spending.
The increase growth in the private buisness sector due to the drop in taxes would out weigh the marginal increase in revenue that an increase in taxes would bring in when unemployment is 17% or more.

 

Interesting concept , but that revenue would not generate money to pay the debt already incurred would it ?

 

I also heard this. The talking heads on tv said that the higher the taxes for corporations get, the more likely they are to take their money overseas. Then nothing gets taxed.

 

Thats why you have to lower spending. The problem we are having isnt with taxes being too low its with spending being too high.
Lower spending and all the welfare, handouts, and duplicate services to a rational level and there will be a budget surplus.
Once spending is under controlled and a surplus is created then their will be a sizable growth in the economy.
It wouldnt be paid overnight

 

I recall the concept is the Laffer Curve. That said, the private sector is the more efficient allocator of resources, and I would favour a default on the debt because too much was borrowed. What better incentive to live within one's means if money was at 20%?

 

Balancing the budget and paying off the trillion dollar deficit are two different things , would you not agree ?

 

Balancing the budget would by definition bring the deficit to $0. Paying off the most recent year's deficit, which has since become debt, would require a surplus.

That said, regarding taxes - I foresee them increasing, and a very large and vibrant grey market emerging. It will emerge on the margins - for instance, a doctor does not charge $100 for a check-up, he will just make a house-call for $25 cash. A chef does not make gormet meals for $50 in a nice restaurant; instead, he opts to deliver the meal for $15. Many positions which are more knowledge-based may just bypass formality and operate based upon krugerrands and handshakes; myself and my stepfather have some experience in this.

 

Fair enough .

Paying the incurred debt would require more than balancing the budget .