Rand Paul has put forth an interesting solution to the debt ceiling that might appease both Democrats and Republicans: Instead of raising taxes during a recession to appease the Democrats, just make the wealthy pay for their entitlements.
Of course Social Security is supposed to be an insurance policy, but no serious person thinks it is. Same goes for Medicare. So simply means test both. While it’s not a libertarian utopia, it is pragmatic.
This would, in effect, reduce transfer payments, which would in itself shrink the government a little. Furthermore, the other cuts that would be necessary (hopefully to more corporate welfare programs, such as the military-industrial complex or farm subsidies) would shrink it all the more so.
In addition, Paul’s balanced budget amendment is also a good idea. The Congress has a horrible record with “promised” spending cuts. When the debt ceiling has been raised in the past, usually the spending cuts are conveniently forgotten and the ensuing debt is paid with by taxes and even more debt. A balanced budget amendment won’t fix that forever, but any impediment you can put in front of spend-happy politicians is a good one.
Here’s Rand Paul giving the explanation in his own words: