The Boyd Institute is at it again, with the topic nearest and dearest to my political heart: the fiscal cliff, and how to avoid it. I should write an essay for it, but because I am a procrastinator and I have kids, first I went to see Project Hail Mary with my daughter. It was good, you should see it too.
Because I am expert procrastinator, who understands why it is such a valuable and productive tool, taking this small detour clarified the most important part of the task I had been avoiding: why?
Thank You Space Ryan Gosling
Like so many other times that this question has been asked on the silver screen, Ryan Gosling answered the call. The movie begins with the discovery that, unless humanity acts, the sun will dim1 - a very Aztec crisis - which leads the world’s scientists to conclude that:
we will lose a quarter of the world’s population in the next 30 years.
I don’t think the risks of the fiscal cliff are that high but…. they’re pretty high, and 30 years is a reasonable timeframe for the crisis. The movie’s Chief Doom Scientist goes on:
And that assumes that the nations of the world work together to ration food.
Which they won’t. So I’d double the estimate.
Outside the movie theatre, we’re not worried about lack of food here - in some ways, quite the opposite - but the idea that it’s not just the physical effects that will cause harm, but natural, inevitable human mass reactions to them is a deep, unintuitive point. So many people think about potential crises and conclude “well, this bad effect only happens if we don’t take this basic action that would fix it, therefore it’s not a problem” without thinking about are we taking that action today? Yes, of course you can avoid getting a speeding ticket if you stop driving so fast, but you actually do need to take your foot off the accelerator, not just conclude that you could. The people in the movie, led by that chief scientist, realize that they have an obligation - to humanity, and not in a metaphoric, symbolic, “raising awareness” sort of way - to act. Ryan Gosling’s character prefers not to act; he must be forced to. Out here in reality, to be blunt: you will be forced to act as well.
This minor point is extremely important, because the most prominent people arguing that the fiscal cliff is not a problem we should worry about, do so because they claim that a nation that can print its own money cannot truly ever experience a fiscal cliff: they can always print more money to meet obligations. They are wrong - and others far more intelligent and informed than I have made this point - because the “cliff” is one of mass human choice: the rest of the country does not have to let them do that. To rephrase from the movie: “that assumes that voters will just accept higher inflation - which they won’t.”
The other part that makes the Hail Mary disaster relevant is that the harm comes from disrupting the productive systems of the world. The aliens aren’t coming to invade and kill us, they’re just slightly dimming the sun, which reduces crop yields and temperatures, which damages the incredibly productive cycles we have on earth for making food and happily remaining alive and well fed - and, taking into account human nature, incidentally results in massive amounts of death. Essentially, in economics, the effect is a mundane, simple reduction in productivity - which has massive, horrifying real world consequences.
Lastly, a personal note, I saw the movie with my daughter - and lots of the story revolves around the main character’s role as a teacher, and strongly emphasizes his overwhelming desire to teach and assist the next generation. Of any species! But for me, acting to solve this problem has an overriding personal element: my children will be young adults looking to make their way in the world at precisely the time when the fiscal cliff will begin to bite most harshly - via taxes or inflation - on precisely the kind of person they are going to be2. Even worse, whether it’s via desperate fighting over who has to pay, or some crisis that we can’t afford to fight, there will be high direct risk to their lives, happiness and the dream of the world I want them to grow up in. I do not want them to have to see a world where roaming mobs of unemployed 22 year olds are burning down nursing homes, or where those same kids are forced to work to pay for them. My parents’ generation somehow managed to preserve a world for my generation, despite two superpowers seemingly bent on nuclear annihilation. I want the same for their grandchildren. For my children.
What Do We Need To Preserve?
In times of peace, the most important thing for the national budget to produce is a minimal threshold of fiscal dry powder, unencumbered by taxpayer, bondholder or anti-inflationary revolt, to combat crises and make actually productive investments. Right now, we absolutely know that we do not have enough fiscal runway for a major crisis, because we had a minor crisis - COVID - and the spending on that provoked a pretty high level of revolt! Just imagine a war or emergency that required 5 times as much spending and provoked 5 times as negative a reaction.
Imagine how World War 2 would have played out, if we couldn’t have afforded to build all those ships, tanks and weapons - oh, we don’t have to, because that’s exactly what happened to Russia, Germany and Japan: they ran out of that capacity. That’s what happens to us, tomorrow - or twenty years from now - if we don’t fix this. This is not overdramatic sci fi scenario: societies die when they do not retain this reserve. This is cities on fire, blood in the streets, death for millions. That is what it meant for Russia, Germany and Japan. It did not mean this for 1945 America, because despite the ongoing Great Depression3, we still had that reserve. We are, today, in 2026, at “end of 1945” levels of “how much reserve do we have left?” Do you feel like we’ve just won the largest, worst, most destructive war of all time?
So, like Space Ryan Gosling - what do we have to do? How do we turn the sun back on? How can we preserve a world for my children and yours?
I have a few solutions. In order of financial impact, starting with the most powerful:
Cure Diabetes
The most important thing to know about the government of the United States is that it is a healthcare insurance plan that happens to have an army and a few other minor doodads - and significantly, some… large… debt obligations. The single largest spending item, across public and private, is medicine. The single largest item in medicine is the treatment of, and harms from, type 2 diabetes4 and diseases that that it causes or are heavily associated with it, including obesity, heart disease, alzheimer’s and many others - likely even more than you’re aware.
Therefore, the most powerful fiscal solution, on the order of hundreds of billions of dollars a year, is to cure or prevent that disease. This solution demands a more detailed set of steps:
subsidize cost of GLP-1 receptor agonists (ozempic, etc…) pharmaceuticals to zero for any patient with diabetes or sufficiently negative metabolic markers, for life.
end agricultural subsidies for any crop that contributes excessively to metabolic dysfunction/obesity: this means soybeans, corn. Accept this loses you some votes from certain districts.
enact steep Pigouvian sales taxes on food products in proportion to the amount of high fructose corn syrup and polyunsaturated fats they contain. There is no food that by necessity contains these things, meaning no one is going to starve because now all their food is too expensive, there are always equivalent products with other sweeteners or fats (and which can be subsidized if necessary). These are what makes “ultraprocessed” foods bad, not some magical dust sprinkled on them during the UltraProcess(TM) process.
actually enforce trans fat bans with random point of consumption FDA testing regimen. i.e. inspector walks into McDonalds and measure the trans fat contents in the fryer that they are using, not just assumes what it is from the reported nutrition labels on the barrels they roll in. If the tested material violates existing trans fat thresholds, they have to dump it, and pay a large fine.
Direct CMS to require (in order to get reimbursement) that all medicare-accepting doctors apply standard, proven obesity reduction/metabolic function programs using low-carb diets, intermittent fasting and exercise. Private companies and consultants do this all the time, it’s not magic.
Finally, the most controversial step. Increase health insurance or medicare/caid premiums (or however they “charge” the patient) in proportion to their lifestyle-controllable metabolic markers like A1c. If you are a more risky driver, you pay more in car insurance. If you are committing slow suicide with choices in defiance of your doctor’s accurate and effective recommendations (from step 5) and demanding that your fellow citizens bear the incredible costs of treating their predictable, inevitable consequences: this will no longer be tolerated. You may not like how this looks. That is too bad. Lives are on the line, including, in many cases, yours. Ask yourself: if you had diabetes, were morbidly obese and costing yourself thousands of dollars in treatment a year, and far more in discomfort, pain and humiliation, would you support others putting a little leverage on you in order to help you remove those afflictions? Sometimes you must act in your own self-interests. Sometimes a gentle, caring push is required.
Additionally, because the fiscal cliff is - by definition - a forward looking problem, curing and preventing diabetes not only saves billions now, but prevents the need for vast spending in the future - the time we really care about - as well. Heading off the diabetic progression of millions over the next 10 years means that 20 years later, in 2046, we will have cut a gigantic cohort of phantom spending that will never be seen. In the reverse, every person who successfully pursued some healthy strategy 20 years ago, preventing their having diabetes or obesity today, is saving us millions of dollars, particularly if they are now over 65. They are heroes for doing so; and we should create more heroes today.
This alone saves hundreds of billions of dollars a year (both public and private) - and, incidentally, will save millions of lives and drastically improve the quality of hundreds of millions more. This is something we must do, regardless of any thing else. This saves us not only from the fiscal cliff, but from the suffering, illness and death of millions.
A lot of American exceptionalism is fake, but in this it’s real: Americans simply will not tolerate the scale of any “debt crisis fix” that is necessary once the debt crisis arrives, and they will fight to prevent it. The only solution, other than finding some ongoing deep national well of calm and peaceful reflection, is to prevent it beforehand.
Which is why curing diabetes is so appealing and actually do-able without massive resistance: you aren’t taking money away from the victims, you’re curing their need for it. And they will be grateful, because it is an unpleasant and painful need to have.
Perhaps this will be enough. If not, and you need more savings? Well, I have more to choose from: some are better than others, some are easier to implement, some are mutually exclusive, some positively reinforce each other - many have other useful benefits.
The Buffet of Other Choices
Sell all unused federal land, requiring that some high percentage (set by nationwide referendum perhaps) be set aside for conservation or parks. This gains us a trillion in one time sales; some breathing room to work on other fixes.
Cut all federal research for anything that doesn’t result in curing diseases. Establish direct prize rewards for solutions, in proportion to how many Americans the disease is killing or injuring, and how much it costs us. Reduce FDA trials burden on new drugs and treatments, allowed tiered access based on initial safety under compassion use protocols. Additionally offer similar prizes for unknown new ideas for fiscal cliff solutions - if you save us a billion, you get a 10 million prize.
Elysium Hospice Care Option: use our extensive population health data to create an composite index for each American, using their own personal preferences, about what the costs, both financial and in personal pain, discomfort and suffering, that they can expect, given their current medical conditions, age and our available treatments. Present this information to them, as any respectful physician would do, when considering large scale often-associated-with-end-of-life care, like major surgeries or treatments, nursing home care or hospice. And ensure that hospice care that is offered is incredible and wonderful. So good that people fake having life threatening diseases to get into it becomes a serious problem.
What this looks like in practice: if you are 85 and get diagnosed with a terrible cancer for which the only treatment requires incredibly painful and complex therapy and medication and will only gain you a few more months of life, the doctors explain that to you those implications, trade-offs and also, as they do right now, offer hospice care that, incidentally, does not involve torture5. The only change here is to make that hospice care amazing.
If we are willing to spend millions to torture people for the last 4 months of life, I think we should be willing to spend a lot to instead give them an elysian existence of happiness and farewells for one month.
I support this on a moral level because we currently torture (in a way that would violate the Geneva conventions if applied to a POW) millions of elderly people (often with the patient not in a condition to approve or disapprove) each year to bless them with a few extra minutes, hours, weeks or months of often-also-extremely painful, humiliating and undignified life. We should stop doing this because torturing people for little gain is wrong. Yes, incidentally we would also save a lot of money on all the torture implements we won’t need any more.
Index social security benefits to a fixed % of GDP, to cap future obligations. Or abolish entirely and replace with mandatory savings accounts, removing “saving for retirement” from the federal budget entirely.
Index old age benefits recipient age (usually 65 for most things) to some % of average life expectancy, to cap future obligations, as life expectancy increases. Remove any rules or incentives that require you to retire to receive: if you can keep working, creating productive labor, then we don’t want to discourage that.
Abolish income tax, shift to a nationwide consumption tax (with progressive rebate), use this new platform to target sales taxes on products that cause large, costly negative externalities, like french fries or motorcycles or cocaine, as well as luxury goods like yachts, GPUs or fancy watches. Benefits: increased tax revenue, decreased cost of administration and tax preparation.
Abolish all welfare at federal and state levels, roll into the consumption tax rebate platform. If you previously received 500$ in value from four different federal welfare or assistance programs and 700$ from three different state programs, now you just receive 1200$ extra on your monthly progressive consumption tax rebate. Savings: all the administrative expenses from managing all those programs.
Cut military spending on anything that was designed only to fight the Soviet Union, and use new tech (drones, AI) to focus on winning the wars we’re likely to be in. What things you ask? Well, just look at the Ukraine example and take notes on which things got instantly shredded (on both sides) and then stop spending so much on them. Savings: lots, but impossible to measure. But one of the secondary benefits is that a functional, actually effective-for-the-next-war is itself a type of critical reserve that we must retain.
Abolish all density-limiting zoning in a 10 mile radius around top 10 urban geographic centers. Benefits: billions in tax revenue from agglomeration and economies of scale.
End healthcare insurance and government reimbursements for scheduled primary care or recurring medications, remove them from “insurance” claims system entirely. Obviously retain coverage for low probability or high cost events, as “insurance” is intended to. Fund that regular primary care via out of pocket patient choice, subsidized (with cash) if necessary for those who need it. Savings: billions, both from no longer needing to pay for this (you’d be surprised how costs drop when you stop promising to pay them no matter what) but also in getting rid of the expensive administration apparatus.
Remove all barriers (particularly environmental review) to any type of energy generation: coal, oil, nuclear, wind, geothermal or solar. Energy is productivity, productivity is tax revenue and revenue is fiscal crisis aversion. Export excess. Revenues directly into debt reduction. Be the world’s light source.
Enact revenue-positive guest worker immigration program, where to retain your status, you must remain employed and pay a higher rate of tax, use revenue to pay down debt. Also enact something similar to the “Golden Visa” idea, where you can simply purchase (directly into debt reduction) guest status for some high amount of cash. Ensure that every immigrant or guest is a (large) net financial benefit.
This can be done. We just need to pick enough of these to work, and then do them. We can make the sun rise tomorrow, and unlike the Aztecs, we won’t need sacrificial blood to do it. Disease, suffering and destructive policies will be the only things that need their hearts ripped out on the altar.
The Last Answer
Unfortunately, good ideas are not enough. At the end of the day nearly all these suggestions are, under the current political climate: impossible. And, even if you convinced a bunch of congressmen, it would still not be enough because this isn’t just a physical problem - like the movie, it is also a human one - the other side has senators too, and their desires can’t, and shouldn’t, be just swept away. They have to be persuaded, peacefully. Whatever set of solutions you pick has to be at least acceptable to whoever was otherwise going to get all that money.
Even worse, any sufficiently effective subset of the above requires executive branch action or at least using a presidential candidacy as the Schelling point around which to coordinate. So, I regret to inform you, there is one last (first?) step you must take: you must find a presidential candidate who believes these truths to be self evident, and get them elected on a mandate to preserve our future.
Time is running out.
Speaking of prophecies of doom: “Wait, I thought we were worried about the too much sun/heat causing global warming?” Yeah, we were. Sun dimming and global cooling is much worse, because up until now, global warming has likely saved tens of thousands of lives from reduced winter cold deaths and increased crop yields, for precisely the same (inverted) reasons as cited in the movie.
What kind of person will that be? Young, healthy, productive and hopeful for the future. I can ensure the first four myself - but here I must humbly beg your help for protecting a future worth being hopeful for.
The ongoing… nature of which was itself a shocking failure of governance in very similar areas of monetary, fiscal and economic policy
like a pedantic Wilford Brimley, I will omit the “type 2” because I get bored of typing it
“But how bad can it be? Surely they’re not all torturous, life crushing sisyphean tasks of despair and pain? We wouldn’t just quietly tolerate a nationwide program of grandma torture?” Sure, not all of them. But go spend some time in the hospitals, intensive care and nursing home units where they are deployed. Talk to the patients there - if they’re lucid - and talk to the people work there. You will see the truth and you will instantly be filled with a desire to save people from that truth. If anyone who has not seen this truth with their own eyes attempts to tell you about their opinions of end of life or hospice care, you may ignore them.
"the other side has Senators, too" is a great line
This was my favorite out of this round