By Carl S. Milsted, Jr.
Deficit spending is a subsidy to those who have money to lend; i.e., the rich. Now we come to the trillion dollar question: how do we get rid of the deficit and start paying down the national debt?
This is a huge question, bigger than I can answer in one essay. I can only make a start, and shall do so with the cause of the latest surge in deficit spending: The War on Terror.
How do we save money fighting the War on Terror? And how do we do so without being “soft on terrorists” on the one hand and in violation of civil liberties on the other?
A very good start would be to cut off the funding for the major terrorist organizations. Behind the idiots with the bombs strapped to their chests are insurgencies, criminal organizations, radicalized mosques, and rogue governments. All these take significant money to operate, and we in the West are providing much of that money.
The radicalized form of Islam, which inspires so much terror and tyranny, is funded primarily by Saudi Arabia. It is time we stopped buying their oil and protecting their ports.
The procedure for doing so is simple, and I described it in an earlier editorial: tax fossil fuels heavily and use the savings to end the Social Security payroll taxes. We could go one step further by making the tariff on foreign fossil fuels higher than the excise tax we use domestically. This would not only clobber the Saudis, it would also lessen the shock to Mexico. (NAFTA would exempt Mexico and Canada.) Our immigration situation is bad enough without triggering a collapse in the Mexican economy.
Without the need for Middle Eastern oil, we can leave it to Europe or Japan to keep the Persian Gulf open. Or, we could let the Gulf States duke it out among themselves until they realize that trade with the rest of the world is more profitable than terror.
Terrorists around the world have another source of revenue that we need to deal with as well: the trade in illegal drugs. If you have the ability and propensity for violence and defying government that a terrorist organization has, you have a competitive advantage for guarding the fields of illegal herbs. The more active we are in trying to end the drug trade, the greater this competitive advantage becomes.
The only way to shut down the coca farms which fund Marxist terrorists or the opium fields which fund Islamic terrorists is to occupy all the world’s remote areas with incorruptible troops. This is not only expensive; it inspires more terrorism as few people take kindly to foreign occupiers.
The only practical way to get rid of a black market is with a legal market. For example, if we were to legalize marijuana outright, far fewer people would have access to black market contacts, since marijuana is much more popular than the harder drugs. Such a move would likely reduce hard drug use.
Unfortunately, this move may not prove adequate. We would probably need to create legal channels for the harder drugs as well. This need not be outright legalization. We could have tightly regulated outlets to allow addicts to get their fix while still making it hard to get hooked in the first place.
And this doesn’t mean that the government needs to run crack houses or shooting galleries, either. Coca could be served as a tea, or as original formula Coca Cola. Opium could be smoked or drunk as a tincture.
Since organized criminals make most of their money from repeat customers, this might be adequate to reduce the market enough so that the illegal drug trade is too small to support rogue governments and quasi-governmental gangs.
And once these gangs are defunded, we can remove many of the military advisors we have around the world, and can stop providing aid to governments which have poor human rights records. This should reduce resentment of the U.S. around the world.
And while we are at it, we can also tax the drugs that were once illegal, thus cutting the deficit further.
Carl S. Milsted, Jr. is a senior editor for The Free Liberal.