Make spending and funding visible.
AIP seeks fiscal accountability through transparent budgets, explicit funding choices and safeguards for economic shocks.
Proposed framework · Updated November 1, 2026
Less centralized spending, debt elimination and the tax target
AIP targets a long-term Gross Receipts Tax rate of 2.5% as individual capital replaces dependence on government support, centralized obligations shrink and federal debt is eliminated. This is a conditional policy goal, not a demonstrated sufficient rate or a fixed timetable.
The intended mechanism is individual capital taking over lifetime needs, local domestic decisions under state oversight and a federal government focused primarily on international responsibilities. Debt repayment depends on actual surplus, not an assumed future investment balance.
The proposed discipline
Spending commitments should have identifiable funding, and citizens should be able to inspect both. The framework proposes a receipts-based tax system, a reserve for shocks and a path toward reducing debt. A balanced-budget objective is a design goal, not a result established by the current reference calculation.
Resolve the emergency rule
Earlier pages offered different rules: immediate tax increases, reserve-first responses and limited emergency borrowing with different repayment periods. These cannot all operate as the same rule. A final design must specify the reserve target, its initial funding, triggers, permitted borrowing if any, and the conditions for rebuilding it.
Debt repayment requires a cash-flow model
Interest expense, principal repayment and transfers to a reserve must be separated. A projected surplus cannot be counted twice. Until an annual model reconciles revenues and spending, a debt-free year is undetermined. The current Year 1 reference shows a $301.6B funding gap before additional policy choices.
Design tests
- A recession with a declining tax base and higher service demand.
- A large emergency before a reserve is fully funded.
- Lower-than-assumed investment returns and account repayments.
- Higher program costs and delayed implementation.
- The distribution of any corrective tax or spending changes.
Current reference budget · Risks and stress tests
The Debt Crisis
AIP’s objective is to eliminate government debt by reducing permanent centralized obligations, making each remaining commitment visible and directing actual surpluses to principal repayment. The original $35T opening debt is a scenario input, not a current debt reading.
Debt, annual deficit, interest and principal are separate quantities. Moving service responsibility to communities does not make its cost disappear: the associated funding and obligations must move with it.
The Spending = Tax Rule
The proposed ordinary-budget rule is to fund commitments through identified receipts. A published rate formula would connect spending, taxable receipts, collection losses and other revenue. A forecast tax rate cannot guarantee realized collections; governments still need reconciliations and contingency authority.
The drafts contain two emergency alternatives: reserve-first financing with a temporary recovery surcharge, and borrowing limited to 3% of GDP with repayment within ten years. They are alternatives to decide, not simultaneous rules. The intended approach should avoid worsening a recession through automatic immediate tax increases.
Debt Elimination Timeline
| Milestone | What must be demonstrated |
|---|---|
| Opening position | Establish the opening debt stock, maturity structure and interest costs. |
| Transition | Fund old obligations and new capital investment without counting future account balances as cash today. |
| Principal reduction | Apply actual surplus once; separate scheduled principal payments from additional surplus repayment. |
| Debt-free destination | Reach zero debt under a year-by-year cash-flow model, including adverse scenarios. |
| 2.5% target | Test whether the remaining tax base supports reserves and remaining public responsibilities. |
The earlier Year 30 and Year 40 endpoints conflict. Neither is an established payoff date.
Interest Savings Reinvested
A reduction in interest expense can free resources for principal repayment, infrastructure, lower taxes or international development. These are competing uses of the same money.
The earlier $55.3T cumulative-savings claim and $20T/$15T/$12T/$8T allocation did not reconcile to an annual model (the allocations themselves total $55T). Retain those priorities for deliberation, but calculate available savings from the actual debt path before assigning amounts.
Annual Budget: Surplus & Deficit Built Into GRT
Publish five separate lines: current services, account capitalization, debt interest, debt principal, and reserve contributions. Publish the jurisdiction responsible for each. Local service budgets remain locally determined under state oversight; the federal budget increasingly concentrates on international duties and transition commitments.
| Emergency option | Decision needed |
|---|---|
| Reserve first | Define target, startup funding, permitted uses and replenishment trigger. |
| Recovery surcharge | Define when recovery is sufficient and who authorizes the surcharge. |
| Limited emergency borrowing | If adopted, define legal cap, duration, debt accounting and repayment. |
The retained Year 1 reference has a $301.6B gap. It does not already fund an extra principal-repayment or reserve program.
Government as Wealth Creator
The initial public seed gives each person an ownership stake in productive capital. The proposed $25,000 seed is made once at birth, not annually for each child. At 3.6 million births, that is $90B per annual cohort; at four million births it is $100B.
Under the 6.88% constant nominal illustration, one seed grows to approximately $1.89M over 65 years before costs. The investment balance belongs to the individual. Only defined, legally authorized repayments become public receipts; the remaining balance is not confiscated and may pass to heirs.
Investment growth and the wider social benefits of education are different returns. Neither can be counted as current Treasury revenue without a specific payment mechanism.
After Year 30: Long-run fiscal objective
Birth-seeded accounts need 65 years to reach the illustrated retirement point. They do not begin producing full retirement settlements in Year 30. Older participants have shorter growth periods and different financing needs.
The long-run goal remains individual independence, debt elimination and a 2.5% GRT. Reaching it requires evidence that individual capital can meet obligations and that remaining public revenue covers continuing duties and reserves.