THE TRANSITION

The Transition

How We Get From Here to There

The Central Challenge

Transforming the American economic system isn't like flipping a switch. We must honor existing commitments (Social Security, Medicare), maintain government operations, fund the transition, and build new systems—all simultaneously. This document addresses the hardest question: Who pays during the overlap, and how do we sequence the changes?

Phase 1: Foundation (Years 1-5)

Tax Transition

Year 5: Income tax eliminated, GRT sole federal revenue source

IRS transformation: Shifts from individual auditing to business transaction monitoring

Stability Accounts Launch

Cost Year 5: ~$2.5 trillion one-time for full population seeding

Healthcare Transition Begins

Employer mandate: Lifted as universal coverage established

Alliance Foundation

Development Fund: $25B/year initial commitment

Phase 2: Transition (Years 5-15)

Entitlement Transition

Current retirees (65+): Social Security and Medicare MAINTAINED—no changes

Near-retirees (55-64): Choice: stay in SS/Medicare or transition to accounts with sweetener

Workers under 55: Transition to Stability Accounts—stop paying payroll tax, receive account

Dual system: Old system pays out to current beneficiaries, new system accumulates for future

Timeline: ~40 years until last SS recipient passes—gradual wind-down

Who Pays During Overlap?

This is the hardest part. For ~40 years, we must fund BOTH the old system (current retirees) AND the new system (new accounts). Sources:

Healthcare admin savings: $500B/year as single-payer efficiencies realized

Existing SS/Medicare revenue: Payroll tax continues for current beneficiaries initially

Transition bonds: Explicit borrowing for transition, paid off as GRT drops

Growth dividend: Economic expansion from eliminated compliance costs, healthier workforce

Military Drawdown

Personnel: Attrition-based reduction, no mass layoffs

Retraining: Military personnel transitioned to infrastructure corps, healthcare, education

Savings: $100B Year 5 → $650B Year 15

Alliance Expansion

Development Fund: $25B → $100B/year as alliance grows

Condition: Democratic governance, human rights, labor standards required for membership

Phase 3: Maturity (Years 15-30)

System Stabilization

Healthcare: Universal system fully operational, admin costs at 3-5%

Economic Results

Poverty rate: Near elimination as accounts mature

Phase 4: Sustainability (Years 30+)

Ongoing: Self-sustaining system—accounts compound, GRT funds operations

Next frontier: Space resources, Type I civilization advancement, post-scarcity trajectory

Political Sequencing

Order matters. Each reform enables the next:

1. Political reform first: 120-day campaigns, term limits, redistricting. Creates system capable of reform.

2. GRT implementation: Creates revenue stream independent of income tax complexity

3. Stability Accounts: Popular, tangible benefit that builds support for further reform

7. Alliance expansion: Success breeds success—countries want to join

Risk Mitigation

What If GRT Revenue Falls Short?

Rate adjustment mechanism built in

Conservative revenue estimates used

Transition bonds provide buffer

Economic growth from eliminated friction likely to exceed estimates

What If Political Support Wavers?

Stability Accounts create 150M+ stakeholders

Constitutional protection prevents reversal

Early wins (no income tax, accounts) build momentum

Term limits ensure fresh political will

What If Markets Crash?

65-year timeline smooths volatility

DRIPS strategy emphasizes stability

Floor guarantee protects against catastrophe

Historical: No 65-year period has lost money in diversified US equities

Discussion Questions

Is the 5-year income tax phase-out too fast? Too slow?

How do we handle transition-generation resentment ("I paid SS taxes and don't get full account")?

Is $2.5T one-time account seeding feasible?

What if Alliance partners don't join on schedule?

How do we maintain political momentum over 30+ year transition?

What's Plan B if any phase fails?

Note: Transition is the hardest part of any systemic reform. This timeline is ambitious but not unprecedented—the New Deal and Great Society achieved comparable transformations. Validators are invited to stress-test feasibility.