What are your thoughts on Buffett's take on the deficit? Is a referendum of this sort feasible? Are there any adverse effects of instituting it?
Warren Buffett, in a recent interview with CNBC, offers an interesting approach to the debt ceiling:
"I could end the deficit in 5 minutes," he told CNBC. "You just pass a law that says that anytime there is a deficit of more than 3% of GDP, all sitting members of Congress are ineligible for re-election. The 26th amendment (granting the right to vote for 18 year-olds) took only 3 months & 8 days to be ratified. The people demanded it. That was in 1971 - before computers, e-mail, cell phones, etc.
Of the 27 amendments to the Constitution, seven (7) took one (1) year or less to become the law of the land - all because of public pressure."
Congressional Reform Act of 2012
- No Tenure / No Pension.
- A Congressman/woman collects a salary while in office and receives no pay when they're out of office.
- Congress (past, present & future) participates in Social Security.
- All funds in the Congressional retirement fund move to the Social Security system immediately. All future funds flow into the Social Security system, and Congress participates with the American people. It may not be used for any other purpose.
- Congress can purchase their own retirement plan, just as all
Americans do. - Congress will no longer vote themselves a pay raise.Congressional pay will rise by the lower of CPI or 3%.
- Congress loses their current health care system and participates in the same health care system as the American people.
- Congress must equally abide by all laws they impose on the American people.
- All contracts with past and present Congressmen/women are void effective 12/1/12. The American people did not make this contract with Congressmen/women.
The Founding Fathers envisioned citizen legislators instead of career politicians, so perhaps ours should serve their term(s), then go home and back to work.
I agree with everything on that list. So many problems result from congressmen / senators who roll into office and stay there forever. The benefits they receive (even after they are voted out or retire) are total horse shit.
He is exactly right.
It all comes down to incentives. In our current system, our elected officials' incentives are different than those of the citizens they represent. Popularity and fiscal responsibility have little overlap... i'm all for more closely aligning their incentives with ours, which these points all do.
It's repulsive to think back just a few years to when our congress men and women called CEO's into hearings, reamed them out, asked them what transportation they used to get there and what their salaries were... all while the solvency of our government was heading off a cliff. Interesting that their compensation has NO tie to the fiscal performance that they directly oversee. What a disgrace. Our credit rating gets downgraded and their compensation steadily increases each year.
One final note - it's utterly pathetic for anyone with taxing power to go broke. They RECEIVE money for NOTHING. Sit back and tax the people who work, that's the model. It's no different than the dead beat kid who lives off mom and dad at 40 years old and spends like a fool. How do you fix him? Throw him out on the curb and make him earn his take. Let's do the same with government.
He is exactly right.
It all comes down to incentives. In our current system, our elected officials' incentives are different than those of the citizens they represent. Popularity and fiscal responsibility have little overlap... i'm all for more closely aligning their incentives with ours, which these points all do.
It's repulsive to think back just a few years to when our congress men and women called CEO's into hearings, reamed them out, asked them what transportation they used to get there and what their salaries were... all while the solvency of our government was heading off a cliff. Interesting that their compensation has NO tie to the fiscal performance that they directly oversee. What a disgrace. Our credit rating gets downgraded and their compensation steadily increases each year.
One final note - it's utterly pathetic for anyone with taxing power to go broke. They RECEIVE money for NOTHING. Sit back and tax the people who work, that's the model. It's no different than the dead beat kid who lives off mom and dad at 40 years old and spends like a fool. How do you fix him? Throw him out on the curb and make him earn his take. Let's do the same with government.
holy shit, i actually agree with Buffett on something
Agree but shouldn't base the metric off of GDP but rather off of revenues.
Sad that congress takes advantage of its own voting public. Even more sad is that the voting public doesn't care enough to do anything about it.
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