Debt & the conundrum

The US debt is roughly $13 trillion - the 'sequester': a package of budget cuts designed to ghastly - duly came into affect March 1. Unless Congress agrees on an extension to its budget, the government will start to shut down on March 28. It's a mess: an ageing population, its schools are mediocre by international standards, its infrastructure rickety, its regulations dense, its immigration hare-brained and it has fallen from first to seventh in the World Economic Forum's competitiveness rankings in four years. (Economist)
So it doesn't work but there is also another America, where things work. Recent numbers indicate that things are on the mend. The stock market just hit a record high, consumer balance sheets are being repaired, housing and employment indicators are improving. Maybe they can't wait for the 'rescue'.
One reason for the optimism is the America's inventors are as busy as they have ever been, and its entrepreneurs are seizing on their ideas with the alacrity as always. Investment in R&D as a share of output matched a previous record of 2.9% of GDP. America is home to 27 of the 30 universities that put out the most-cited scientific research - the shale gale. Pressed for cash, states are adopting sweeping reforms as they vie to attract investments and immigrants. Louisiana and Nebraska want to abolish corporate and personal income tax. Kansas wants to get ride of red tape, Ohio has privatised its economic-development agency......
In this can-do America, creative policy making is being applied to the very problems Congress runs away from. While the feds twiddle their thumbs states and cities are coming up with new ways to raise money for roads, bridges and schools. Chicago has a special trust to drum up private funds to refurbish old decrepit buildings. Indiana has turned to privatisation to raise money for road building.
Schools are getting an overhaul. 45 are developing new curriculum, test are becoming more rigorous, schools and teachers are being held accountable for results.
Regulation, innovation, infrastructure, education: each of these is crucial to competitiveness.
Perhaps the truth of the matter whether it is the US or Canada - I can only speak for the developed nations with a democratic system whereby the voice of the populace can bring about change - is this: we are survivors and builders. I believe one the biggest mistakes we made was when we decided to hand over our fate to the government. The shift has proven to be disastrous. Bigger government never proves to be effective or effiicient because the very nature of a bureaucratic system is red tape. The government needs to work for the people. provide services in exchange for the taxes collected what it does not need to provide is a comfortable job for a bureaucrat or public servant who counts the days to retirement. When governments fails to provide the basics then it is time to reexamine the validity of the public service. I can't help but wonder how we built this nation when the government never collected a dime of income tax instead this vast land was developed from revenue accrued from royalties and tariffs.  Excessive taxation has not led us to the promise land. We are struggling more than ever. We are not a productive nation when personal income tax tops out at 44%. It is criminal. For those who are unemployed or earn minimum wage - a percentage is a percentage. At 20% or 35% it doesn't matter if you earn more you will pay more.  to be continued