A new initiative, USA Positive Expectations, proposes a transformative approach to address the federal deficit and opportunity disparities by investing in early childhood education. The plan, which relies on private sector action and Federal Reserve monetary policy, aims to create 'receipts money' to reduce the national debt without causing inflation.
The proposal centers on the idea of 'first-things-first equal opportunity,' where better and best early education outcomes for children starting first grade would be funded by the private sector. The financial mechanism involves the Federal Reserve purchasing assets related to these educational investments, effectively monetizing the positive expectations and future economic value of a well-educated workforce. This purchase would be gifted to the U.S. Treasury, reducing the federal deficit by the market value of the assets, without increasing the money supply in circulation.
According to the proposal, the scale of this transformation is significant. Estimates suggest that if 4.5 million children start first grade with an investment of $75,000 each, the Federal Reserve would purchase $340 billion annually, potentially reducing the federal debt by $3.4 trillion per year at full scale. A county-level test with 10,000 children could see $750 million in annual purchases, contributing $7.5 billion to debt reduction over time.
The private sector's role is crucial, as it would provide the initial funding for these educational programs. The proposal argues that the public sector has not achieved better and best outcomes, and that private investment in human capital, particularly in early brain development, is a form of 'Brain Gold' that has tangible present value.
The plan also suggests that local taxes could be reduced from grades Pre-K to 12 down to grades 1 to 10, alleviating the property tax burden on communities. This would directly address local affordability crises while still funding essential education.
The initiative calls on private sector members to join an 'email march' to the Federal Reserve, urging consideration of these 'FED NEXT' elements. The proposal acknowledges that getting the Federal Reserve on board will be challenging, but it has received positive input from AI sources like Grok, prompting a restart of the effort.
The proposal draws on the ideas of George Gilder, who emphasizes the power of private sector investment in human intellect and creativity. By extending his thinking into early childhood development, the plan argues that the resulting cognitive networks are a form of real wealth that can be monetized to benefit the nation.
For more information, visit the USA Positive Expectations website to read the letters and understand the tone of the proposal.
