NationStates Jolt Archive


Still think deficits adn debt don't hurt the economy?

Gymoor II The Return
16-01-2006, 05:45
http://www.msnbc.msn.com/id/10868785/

Expected response: But Bush doesn't have anything to do with the de...uh, nevermind.
Lunatic Goofballs
16-01-2006, 05:55
Drives me nuts. It does.

Democrat philosophy: Overtax, overspend.

Repulican philosophy: Undertax, overspend.

No wonder I hate them all.
Straughn
16-01-2006, 05:56
Yes but Dick "Mulched-child Breath" Cheney says
"Deficits don't matter", didn't he?

*ahem*

Former Treasury Secretary Paul O'Neill was told "deficits don't matter" when he warned of a looming fiscal crisis.
O'Neill, fired in a shakeup of Bush's economic team in December 2002, raised objections to a new round of tax cuts and said the president balked at his more aggressive plan to combat corporate crime after a string of accounting scandals because of opposition from "the corporate crowd," a key constituency.

O'Neill said he tried to warn Vice President Dick Cheney that growing budget deficits-expected to top $500 billion this fiscal year alone-posed a threat to the economy. Cheney cut him off. "You know, Paul, Reagan proved deficits don't matter," he said, according to excerpts. Cheney continued: "We won the midterms (congressional elections). This is our due." A month later, Cheney told the Treasury secretary he was fired.
Bobs Own Pipe
16-01-2006, 05:58
you people pay taxes?

i thought taxes were outlawed in america.
Dakini
16-01-2006, 05:59
How can Bush make tax cuts permanent? Cant' the next president just come right in and hike taxes back up?
Gymoor II The Return
16-01-2006, 05:59
Drives me nuts. It does.

Democrat philosophy: Overtax, overspend.

Repulican philosophy: Undertax, overspend.

No wonder I hate them all.

And I think there's more than enough governmental revenue to really do most of the things the more liberal of us want the government to do if there was only a concerted effort to cut pork and focus governemnt spending. In other words, I think a small number of LARGE programs could do much more at much less cost than the scattergun, disjointed, 100 programs doing essentially the same thing approach government has now.
Lunatic Goofballs
16-01-2006, 06:05
And I think there's more than enough governmental revenue to really do most of the things the more liberal of us want the government to do if there was only a concerted effort to cut pork and focus governemnt spending. In other words, I think a small number of LARGE programs could do much more at much less cost than the scattergun, disjointed, 100 programs doing essentially the same thing approach government has now.

Yes. We actually had a balanced budget for a few years there. I didn't find the taxes overly burdensome. But even if they were a burden, I figured it was better to pay down the debt now instead of later.

Then taxes got cut and spending was increased... *sigh*
Straughn
16-01-2006, 06:32
you people pay taxes?

i thought taxes were outlawed in america.
Sixteenth Amendment: Never ratified
However i don't possess the legal resources to deal with the legal entaglements as to that pursuit.
Achtung 45
16-01-2006, 06:35
How can Bush make tax cuts permanent? Cant' the next president just come right in and hike taxes back up?
then he'll be labelled a "tax and spend liberal" by a conservative Republican who will then immediately accept three bribes in return for doing political/sexual favors for a lobbyist who illegally "stole" millions of dollars from Native American tribes.

Even if the next president is a conservative.
Straughn
16-01-2006, 07:16
you people pay taxes?

i thought taxes were outlawed in america.
BTW, this MEGA-post might rub ya kinda funny ....
And ahead of time, my apologies for people who didn't like it the first time.
I didn't note ANYONE even acknowledging the problem here.

I would also add I have personally been subject to a freeze of this nature ....

*ahem*

IRS Plan To Outsource Tax Collection Raises Security Concerns

The agency plans to hire three contractors to track down deadbeat taxpayers. But the Government Accountability Office and the National Treasury Employees Union have questioned the IRS's ability to properly manage contracted employees.
By Larry Greenemeier
InformationWeek

Jan 13, 2006 11:00 AM

The Internal Revenue Service by March expects to award contracts to three
private-sector companies to help the agency improve its ability to track
down deadbeat taxpayers. Yet despite carefully worded security stipulations
written into the IRS's request for quotes from prospective contractors,
concerns remain regarding the government and the business world's ability to
adequately protect sensitive information.

President Bush gave the IRS the power to use private-sector contractors when
he signed the American Jobs Creation Act in October 2004. The act created
Section 6206 of the Internal Revenue Code permitting contractors to be used
to help collect taxes in cases where the tax owed is not in dispute. The
IRS, which started looking for contractors last October, says using them for
debt collection will help increase the amount of tax liabilities collected
each year, leading to an estimated additional $1.4 billion dollars in tax
revenue over the next 10 years.

"Taxpayer information on file with the IRS is and will remain private and
secure," an IRS spokeswoman said Thursday. Contractors will only be able to
communicate with taxpayers via telephone or written correspondences, except
under special circumstances.

The contractor program will run on a trial basis for a year after the
contracts are awarded, with the option for another year if all goes well.
Full program implementation is planned for January 2008. The contractors
will help the agency collect a portion of the estimated $12 billion in taxes
individuals have acknowledged they owe but have not paid. The contractors
stand to receive up to 25% of the tax money they help to collect.

Due to the extreme sensitivity of tax data, the IRS, which expects to
process about 135 million individual tax returns in 2006, is requiring all
work done by contractors to be performed within the United States.
Contractors also have to agree to purge taxpayer financial information from
their IT systems once their work on a given taxpayer account is completed.
If the contractor isn't able to immediately purge this data, they are
responsible for protecting that data from unauthorized inspections or
disclosures. Contractor IT systems must meet Federal Information Security
Management Act of 2002 standards and track the location of tax returns and
return information at all times.

But both the Government Accountability Office and the National Treasury
Employees Union, which represents 94,000 employees of the Treasury
Department as well as another 60,000 employees in other federal agencies and
departments, have questioned the IRS's ability to properly manage contracted
employees in the past.

The GAO, which is Congress's investigative arm, has criticized the IRS over
its diligence in contractor background investigations. In an April 27, 2005
letter to IRS Commissioner Mark Everson, GAO Financial Management and
Assurance director Steven Sebastian identified a number of internal control
issues at the IRS that "adversely affected safeguarding of tax receipts and
information, refunds to taxpayers, and lien resolutions."

Sebastian's letter also notes that at three IRS service centers his group
investigated, some contractors were granted staff-like access to restricted
areas, including IRS-owned or controlled facilities, information systems,
security items and products, or sensitive but unclassified information,
despite not having undergone background investigations. This increased the
risk that "taxpayer receipts and information could be lost, stolen, misused,
or destroyed," Sebastian wrote. During his team's fiscal year 2004 audit,
they found the IRS didn't submit new security clearance paperwork for 10
contractors until four years after the contractors had already been granted
staff-like access.

In response to the GAO report, the IRS stated that it has "implemented
steps" to monitor and enforce existing requirements related to background
checks for contractors.

The IRS also is getting pressure from the Treasury Department's employee
union to use government employees rather than contractors. The National
Treasury Employees Union, unsurprisingly, believes that IRS employees could
do the same job cheaper and better. The union is pushing for passage of H.R.
1621, a House of Representatives bill sponsored by Rep. Rob Simmons,
R-Conn., that would revoke the IRS's authority to hire private debt
collectors.

Concerns over the government's ability to protect sensitive citizen data
extends to other federal agencies as well. The Justice Department failed to
remove several Social Security numbers from its Web site, www.usdoj.gov. For
example, the Social Security number of a woman involved in a 2003
immigration-review case was included in documentation about the case.
Additional site searches yielded other peoples' numbers in a half-dozen
other places.

The business world's track record of protecting customer data does little to
improve the public's confidence. People's Bank has joined the unenviable,
but growing, list of companies that have mishandled customer data. The
financial institution acknowledged Thursday that a backup tape containing
personal information on 90,000 customers was lost while being transported by
UPS to credit reporting bureau TransUnion. The tapes contained names,
addresses, and bank account and Social Security numbers for customers who
have a form of checking account overdraft protection called personal credit
lines.

Membership in the "Oops, I lost your data" club continues to grow.
Hopefully, the IRS and other handlers of sensitive information will learn
from their predecessors.
---
Wednesday, Jan. 11, 2006 11:00 a.m. EST
IRS Tracked Political Party Affiliation
The Internal Revenue Service collected information about the political party
affiliation of people in 20 states as it hunted down scofflaws who owed back
taxes.

Sen. Patty Murray (D-Wash.), a member of a subcommittee with jurisdiction
over the IRS, called the practice an "outrageous violation of the public
trust."

Sen. Murray told the Tacoma News Tribune that she learned about the practice
from the president of the National Treasury Employees Union, Colleen Kelly,
who said several IRS employees had complained to the union about the
collection of party affiliations.

Kelly wrote to the IRS that "material routinely consulted in the tax
collection process raises an appearance of possible impropriety that could
erode taxpayer confidence in the independence of our voluntary compliance
system."

In a letter to Kelly, Deputy IRS Commissioner John Dalrymple said the
information was collected through a "database platform" supplied by an
outside contractor, which targeted voter registration lists in search of tax
scofflaws.
"This information is appropriately used to locate information on taxpayers
whose accounts are delinquent," he told the News Tribune.
But Sen. Murray said: "This agency should not have that type of information.
No one should question whether they are being audited because of party
affiliation."

IRS officials have told the outside contractor to screen out the party
affiliation information.

The 20 states where the IRS collection the information, according to Murray,
are Alaska, Arkansas, Colorado, Connecticut, Delaware, Florida, Louisiana,
Massachusetts, Michigan, Nevada, New Jersey, New York, North Carolina, Ohio, Oklahoma, Rhode Island, South Carolina, Texas, Utah and Wisconsin.
----
Report: IRS Holds Fraud Suspects' Refunds
Staff and agencies
10 January, 2006
By MARY DALRYMPLE, AP Tax Writer Tue Jan 10, 5:57 PM ET

WASHINGTON - The Internal Revenue Service freezes tens of thousands of tax
refunds it deems questionable without telling people that they're suspected
of fraud, the nation's taxpayer advocate said Tuesday.

"It is a central tenet of American law that the government must notify an
accused person of the offense it suspects he committed and must give the
accused person an opportunity to present exculpatory evidence to show his
innocence," Olson said in her report.

Speier said the IRS acknowledges it could do a better job of communicating
with these taxpayers. Overall, the program temporarily delays a small number
of refunds but stops billions in false refunds from being paid to criminals,
the agency said.

The IRS tries to validate the taxpayers' right to the refund and lifts the
freeze if no fraud is found. If the refund cannot be validated, it
permanently freezes the refund for further investigation.

Once frozen, some tax returns are referred to other IRS offices for an
audit. Olson said many probably aren't examined or resolved. Refunds claimed
on tax returns determined to be fraudulent remain frozen for an undisclosed
number of years until the IRS sees the taxpayer file a number of legitimate
returns.

That study showed no evidence of fraud in 66 percent of the cases, and
taxpayers were given a full refund. In another 14 percent of the cases,
taxpayers were given a partial refund. Taxpayers got some or all of their
claimed refund in 80 percent of the cases.

The IRS said the taxpayer advocate's study used a "significantly biased
sample." It cannot, therefore, be concluded that the majority of taxpayers
whose refunds are frozen under the program deserved those refunds. Innocent
taxpayers are more likely to search out a refund, they said.

The tax collectors said the cases involved sensitive criminal investigations
but that Criminal Investigation "acknowledges that communications with
taxpayers on potentially fraudulent returns is an issue." The IRS started
last March sending letters to some taxpayers who inquired about their
refunds.

"At a minimum, this procedure constitutes an extraordinary violation of
fundamental taxpayer rights and fairness," she said. "In our view, it may
also constitute a violation of due process of law."

Senate Finance Committee Chairman Charles Grassley, R-Iowa, said he was
troubled by some issues raised by the IRS refund freezes. "Refunds have been
a source of abuse recently, but we need to make sure taxpayers have proper
due process when the IRS decides to freeze a refund," he said in a
statement.
Pennterra
16-01-2006, 09:30
Sixteenth Amendment: Never ratified
However i don't possess the legal resources to deal with the legal entaglements as to that pursuit.

Wikipedia's (http://en.wikipedia.org/wiki/Sixteenth_Amendment_to_the_United_States_Constitution#Controversy) take on this:

A common claim among tax protesters, conspiracy theory proponents, and others opposed to income taxes in general is that the Sixteenth Amendment was never "properly ratified". Claims calling into question the ratification of the Sixteenth Amendment cite factors such as:

Differences in capitalization, spelling of words, and use of punctuation among the bills ratified by the various states

The argument that Ohio was not actually a state in 1913, because a Congressional proclamation recognizing the statehood of Ohio was not issued until 1953—although Ohio had been sending representatives to Congress and participating in presidential elections since 1803

An argument that even if the Sixteenth Amendment was validly ratified, it merely "implied" the authority for an income tax, without explicitly creating it.

To be frank, if this is the best you've got, excuse my while I laugh. Loudly. With much side-holding. Grammatical errors that don't change the meaning of the text are not grounds for legal dispute. Ohio was a state, whether there was a formal proclamation or not; saying that it wasn't is like saying the US wasn't at war in Vietnam or that Germany wasn't at war in Russia during WWII because neither involved a formal declaration of war. Finally, how much more explicit do you get than the text of the 16th amendment?

Please tell me you have better arguments than these.
Gymoor II The Return
16-01-2006, 21:53
Hate to say it Straughn, but I think you might have slipped on that one (regarding the 16th amendment.)
Vetalia
16-01-2006, 22:05
Deficits hurt the economy as long as they are bigger than the rate of GDP growth, and that has been the case over the past few years. Unfortunately, the US government has decided to load us down with that damn Medicare benefit at the worst possible time in history, while simultaneously fighting the war in Afghanistan and spending for the Gulf Coast rebuilding. And, to top it off, we continue to cut taxes.

What should be done is we should raise taxes on the upper 1% while simultaneously cutting or even eliminating the capital gains tax. That should greatly increase revenue while actually reducing the tax burden of 50+% of American households.
Earth and Sea
16-01-2006, 22:21
The lack of knowledge concerning economics shown by the people here is utterly amazing. Are most of you still in high school? Must be public high school huh? :rolleyes:
Gymoor II The Return
16-01-2006, 22:24
The lack of knowledge concerning economics shown by the people here is utterly amazing. Are most of you still in high school? Must be public high school huh? :rolleyes:

It must be asy to snipe like that when you add nothing of your own and don't even offer an analysis of the errors.
Lunatic Goofballs
16-01-2006, 22:26
The lack of knowledge concerning economics shown by the people here is utterly amazing. Are most of you still in high school? Must be public high school huh? :rolleyes:
http://www.clicksmilies.com/s0105/spezial/Fool/iq.gif
Vetalia
16-01-2006, 22:31
The lack of knowledge concerning economics shown by the people here is utterly amazing. Are most of you still in high school? Must be public high school huh? :rolleyes:

What? That running continuously high deficits over an extended period will stoke inflation? That's pretty much a given.
Lokiaa
16-01-2006, 23:02
What? That running continuously high deficits over an extended period will stoke inflation? That's pretty much a given.
Hey, but at least we have an independent central bank. Our situation isn't as bad as it would be in, say, Latin America.


I'm also surprised at the lack of mention of trade deficits. That results in capital inflows, which in turn lowers the interest rate.
Vetalia
16-01-2006, 23:09
Hey, but at least we have an independent central bank. Our situation isn't as bad as it would be in, say, Latin America. I'm also surprised at the lack of mention of trade deficits. That results in capital inflows, which in turn lowers the interest rate.

That's true; the very fact that our debt comes from the United States is going to do a lot for the willingness of nations to finance it.

The trade deficit doesn't really do a lot of damage at all; generally, it's a sign of economic strength if imports are growing along with exports as is currently the case.
Free Mercantile States
17-01-2006, 00:10
Deficits are a large part of a bigger problem: the general monetary deficit, whether fiscal, trade, etc., between the U.S. and the rest of the world. Between the U.S.'s trade deficits with China, India, et. al. and our vast fiscal deficit to same, we have an enormous imbalance that can lead to two things: Either a currency devaluation, which conservatives in their stubborn shortsightedness wouldn't allow because it would a) be admitting that their deficit spending was actually [shock] a bad thing, and b) hurt the economy; or, we continue on our present course, artificially inflating the dollar, staying unbalanced, consuming like crazy, and the unstable paradigm begets a global market crash. In the mean time, the deficits also jack up interest and inflation rates.

The problem is that America is consuming so much more than it exports, based on a combination of last century's profits and loan support from Asian nations who profit from overvaluing the dollar and undervaluing their own currencies because it attracts outsourcing and allows their highly profitable export-and-save economic paradigm to continue. The U.S. consumes something like 90% of the world's savings through our deficit, we're losing our export capabilities through outsourcing because of the imbalance caused by our decrease in export levels, (sort of a use-it-or-lose it kind of deal) and the problem is that it can't continue indefinitely. It just isn't long-term-stable. If we don't accept a currency devaluation, start exporting, balance the budget, and convince the Asian nations to start encouraging importation, which is highly unlikely, we're heading inevitably towards a global market crash.
Gymoor II The Return
17-01-2006, 00:36
snip

The only way to save American manufacturing and the very economy itself is to do what America should have been doing for quite some time.

Improve education. Other countries spend less per capita and get better results. This is unsupportable.

Concentrate on the very highest technologies possible. Quyite simply, make here what cannot be made anywhere else. We have a ridiculous concentration of wealth in this country. Lagging behind, with the head start we had/have, is inexcuable.

It's a slow burn though, and without the immediate impact, American citizens, as a political whole, seem unwilling to do anything about it.
Deep Kimchi
17-01-2006, 01:00
Improve education. Other countries spend less per capita and get better results. This is unsupportable.

That's a good indicator that spending more money on education isn't the answer.

Rather than spending more money on doing it in a way that sucks, why not spend the same amount of money on doing it differently?
Gymoor II The Return
17-01-2006, 01:08
That's a good indicator that spending more money on education isn't the answer.

Rather than spending more money on doing it in a way that sucks, why not spend the same amount of money on doing it differently?

I agree completely. I think much the same could be done with the military, specifically their buying practices and the amount of money meant for research that actually floats out as pork.
Straughn
17-01-2006, 04:34
Hate to say it Straughn, but I think you might have slipped on that one (regarding the 16th amendment.)
No, that's fine. What i like about this place is when i don't feel like looking sh*t up (EVEN IF IT IS WIKIPEDIA) someone else will do the trotting for me.
The first line summed it up from their page anyway, ref'ing conspiracy theorists and the like.
It's a good thing you guys are on top of this.
BTW, if you don't believe me about this line,
What i like about this place is when i don't feel like looking sh*t up (EVEN IF IT IS WIKIPEDIA) someone else will do the trotting for me.,
consider that i've posted it before a few times.
Plus, i'm pretty consistent in posting my proof. And i would venture challenge for anyone to prove me inconsistent in that regard.
Straughn
17-01-2006, 04:36
Please tell me you have better arguments than these.
:D
Sure, go ahead and punch my name up on the forum archives and we'll discuss what my arguments are.
Good thing you're here to make sense of me.
;)
Straughn
17-01-2006, 04:44
Just because it feels right to include this ... note, it's not wikipedia, BTW.

*ahem*

...
Withholding Taxes

The collection process was greatly facilitated in 1943 by a device created by FDR to pay the costs of WWII. It was called "withholding from wages and salaries". In other words, the tax was collected at the payroll window before it was even due to be paid by the taxpayer. Economists point out that this device, more than any other single factor, shifted the tax from its original design as a tax on the wealthy to a tax on the masses--mostly the middle class.

Investigations disclosed that the truly wealthy pay relatively little or no income tax at all.

Some idea of how the cute little monkey grew into a gorilla is perceived from the fact that nearly half of all federal revenue is now raised by income taxes. Furthermore, the higher brackets are literally confiscatory--but by "due process", of course, under the Sixteenth Amendment. Rates have been as high as 94% in the upper brackets during wartime, and even in peacetime they are presently 50%. (Ed.note: This piece was apparently written when the top rates were higher than in 1992. Not to worry, however: Watch for higher rates coming soon to an IRS office near you!) Medium income people up through the upper middle class pay between 12 & 35%. Nevertheless, at all levels it has become sufficiently burdensome to discourage the attainment of basic economic advantage which most Americans seek.

Weaknesses of the System

The most damaging aspect of the Sixteenth Amendment is the fact that it vitiated the unalienable rights provided in the 4th Amendment. This is the amendment which protects privacy--privacy of the home, business, personal papers and personal affairs of the private citizen. None of these are disturbed by a poll (head or capitation) tax because it is so much per person regardless of the circumstances, but when the tax is based on income, the IRS is assigned the most unpleasant task of making certain that everyone pays his fair share. This task is physically impossible without prying into the private papers, private business and personal affairs of the individual citizens. By any standard, it is a miserable assignment. Furthermore, it is impossible to run audits and surveys of all taxpayers and so the audits seldom check more than 2% of them.

There are many things wrong with this approach. Worst of all, it puts the government tax collectors in the gorilla role and intimidates citizens who are unlucky enough to be audited with the feeling that they are "victims" of an unfair system.

The IRS also finds it difficult to avoid the attitude that each taxpayer is a cheat, even a criminal, who must somehow be cornered and caught. This has brought the structure of the entire income tax collection process into question.

For example, the underground economy of monetary transactions (which is conducted without records) is well known. It is estimated that losses in federal revenues from this underground economy are at least $100 billion per year. (Ed. note: Probably closer to $200-300 billion!) Obviously, this is not fair to those who are paying their share. Then there is an estimated $65 billion per year which is lost because it is not reported. This is considered unfair. There is a lot of padding on expense accounts, which is estimated to reduce the tax total by another $18 billion. Other operations, both legal and illegal, jumps the total up a few billion more.

There has also been extensive criticism of the prosecution of tax cases. The appeal is through a system of tax courts which are without juries. In order to get a tax case into a regular court where there is a jury, the citizen must pay the tax and then sue the government.

Thousands of complaints have also poured into the IRS concerning the tactics used by some of its agents. Citizens feel they are treated as criminals rather than suspects who are innocent until proven guilty.

Is there a better way? Here is one answer by a former head of the IRS.

A Former IRS Commissioner's Statement

T. Coleman Andrews served as commissioner of IRS for nearly 3 years during the early 1950s. Following his resignation, he made the following statement:

"Congress [in implementing the Sixteenth Amendment] went beyond merely enacting an income tax law and repealed Article IV of the Bill of Rights, by empowering the tax collector to do the very things from which that article says we were to be secure. It opened up our homes, our papers and our effects to the prying eyes of government agents and set the stage for searches of our books and vaults and for inquiries into our private affairs whenever the tax men might decide, even though there might not be any justification beyond mere cynical suspicion."

"The income tax is bad because it has robbed you and me of the guarantee of privacy and the respect for our property that were given to us in Article IV of the Bill of Rights. This invasion is absolute and complete as far as the amount of tax that can be assessed is concerned. Please remember that under the Sixteenth Amendment, Congress can take 100% of our income anytime it wants to. As a matter of fact, right now it is imposing a tax as high as 91%. This is downright confiscation and cannot be defended on any other grounds."

"The income tax is bad because it was conceived in class hatred, is an instrument of vengeance and plays right into the hands of the communists. It employs the vicious communist principle of taking from each according to his accumulation of the fruits of his labor and giving to others according to their needs, regardless of whether those needs are the result of indolence or lack of pride, self-respect, personal dignity or other attributes of men."

"The income tax is fulfilling the Marxist prophecy that the surest way to destroy a capitalist society is by steeply graduated taxes on income and heavy levies upon the estates of people when they die."

[As matters now stand, if our children make the most of their capabilities and training, they will have to give most of it to the tax collector and so become slaves of the government. People cannot pull themselves up by the bootstraps anymore because the tax collector gets the boots and the straps as well.]

"The income tax is bad because it is oppressive to all and discriminates particularly against those people who prove themselves most adept at keeping the wheels of business turning and creating maximum employment and a high standard of living for their fellow men."

"I believe that a better way to raise revenue not only can be found but must be found because I am convinced that the present system is leading us right back to the very tyranny from which those, who established this land of freedom, risked their lives, their fortunes and their sacred honor to forever free themselves..."{4}
..


Well that was certainly interesting.
Free Mercantile States
17-01-2006, 04:55
The only way to save American manufacturing and the very economy itself is to do what America should have been doing for quite some time.

Improve education. Other countries spend less per capita and get better results. This is unsupportable.

Absolutely agreed. More money per student isn't the answer, though it can't hurt - what we need are more and better teachers, and a real reason for schools to do better.

Get rid of the overbearing, progress-retarding, incompetence-protecting teacher contracts that value educator job security over student learning. Shift funds towards subsidizing new and future teachers. Allow students/parents to choose what school they wish to attend and thus create an element of Darwinian competition between schools. Basically, adopt the Western European system.

Beyond that, I'd say that adopting a program of differentiating student class tracks around the transition between middle and high school would be useful: route some into a trade path, others to an academic one. There's no point in making a future mechanic or hairdresser take advanced science, math, and english courses. Inequality be damned - institute some stratification to enhance the class quality of higher-level students and to save money.

Concentrate on the very highest technologies possible. Quyite simply, make here what cannot be made anywhere else. We have a ridiculous concentration of wealth in this country. Lagging behind, with the head start we had/have, is inexcuable.

Absolutely. Let's face it - there is no market or necessity for American manufacturing labor jobs. Period. The $.01-an-hour Asian billions have that cornered. There's not even a market for basic labor jobs - illegal immigration has taken care of that. The only future for America is ideas, very high technology, and the service industry. We need to invest aggressively in biotech, infotech, and nanotech, eliminate restrictions like the stem cell funding ban, concentrate education, grants, etc. on science, math, engineering, and technology, and otherwise focus on reestablishing ourselves as THE technological idea-generator of the modern world.

It's a slow burn though, and without the immediate impact, American citizens, as a political whole, seem unwilling to do anything about it.

It's just like with oil and alternative energy - conservatives claim that the private sector will take care of alternative energy without having to spend taxpayer dollars, but the fact of the matter is that no one will do a thing until two gas refills empties 90% of their bank account. Someone has to look beyond their nose and take the initiative.