P for Privatzation

The root of the problem is, of course, a lack of political will, extending down from the president himself to the lowliest Tea Party activist living on Social Security and Medicare. But a convenient excuse for ongoing borrowing is also provided by Keynesian economic theory, which states that a fiscal squeeze will tend to reduce economic growth, thereby widening the gap between revenues and expenditures. Fiscal hawks respond that a bond-market panic induced by excessive borrowing could be even nastier.

Yet there is another fiscal option that neither party seems to be considering. The U.S. needs to do exactly what it would if it were a severely indebted company: sell off assets to balance its books.
http://www.newsweek.com/2011/02/20/sale-of-the-century.html

The mystery is why freedom-loving Americans are so averse to privatization—a policy that has been a huge success nearly everywhere it’s been tried. From Margaret Thatcher’s Britain, where the word “privatization” was coined, to present-day China, selling off government-owned industries has not only improved the fiscal position of governments; it has usually enhanced the efficiency with which the sold assets are managed.

The figures are impressive. Since the 1990s, about 75,000 medium-to-large firms have been privatized all around the world, from Argentina to Zambia, as have hundreds of thousands of smaller enterprises. The total proceeds: $735 billion. The United States accounts for only a tiny fraction of that number. Other countries are miles ahead. On a visit to Beijing in November last year, I even heard a leading Chinese economist half-seriously recommend the privatization of the Great Hall of the People. Yet American fiscal reformers—including the boldest of them, Republican Rep. Paul Ryan—tend to steer clear of the P word.