The U.S. needs a plan to pay its bills. Prudent tax reform is a great first step. The federal government loses $1.1 trillion in loopholes and exemptions every year. We should put that lost revenue to better use. A huge chunk could be used to lower individual tax rates for individuals and businesses. Given the severity of our national debt, remaining savings also could be used toward deficit reduction.

The most important element in controlling the spending side of the equation is looking at where the money is: Medicare, Medicaid, Social Security and national defense. Common sense reforms such as gradually raising the retirement age and allowing Medicare to buy prescription drugs in bulk could save trillions over the long term. Making countries around the globe pay for the American soldiers on their soil could make a similarly large dent in our deficit.

Start a green revolution

The quickest way to restore economic dynamism in the American economy is to institute a national energy policy. Eliminating ethanol and oil subsidies in the tax code could free up money to fund green patent competitions. We could start drilling immediately for natural gas, which emits almost 30 percent less carbon dioxide than does oil. Increasing fuel efficiency standards would push all industries to emit less carbon dioxide. Conservatives could claim drilling and market competition as wins. Liberals could tout the government played a role in pushing the market to create greener technologies. And it would create millions of jobs in the process. It should be an economic and political no-brainer.

Create a national infrastructure bank

America has fallen behind noticeably in infrastructure compared to foreign competitors. Maintaining infrastructure is critically important to any nation seeking to retain talented businesses and workers. For example, some Asian cities have brand-new airports. Reallocating federal dollars already being spent to create a national infrastructure bank would help close this gap. Banking experts would objectify the process of choosing which infrastructure projects to finance. That’s far better than the system of politicians picking pork barrel projects in their districts. Additionally, an infrastructure bank would provide financing less costly than what would be charged by private financial institutions.

Rewrite No Child Left Behind

In a global economy that requires skilled workers, there is no more urgent policy debate than education reform. The No Child Left Behind Act was designed without considering we have a large, diverse nation whose students find themselves in varying education circumstances. Accordingly, we should empower state and local governments to create solutions specific to the challenges faced by their students. Arbitrarily punishing schools that fall short of federal standards ­— even if they made exceptional progress — incites schools to dumb down standards. On the flip side, we should reward our best teachers with some variant of performance pay. Finally, we should reward all programs that work, regardless if they come from public schools or charter schools.

Remain optimistic

It’s incredible to see the difference between the tone of news anchors and what’s happening on the ground. It is true that polling shows Americans are concerned about the direction our country is going, and rightfully so. But it is also true that Americans are optimists by nature. We expect to be the best and freak out when things don’t go as planned. That isn’t the character of a declining nation; that is the character of an exceptional nation that needs to retool to compete in the 21st century.

It’s true certain policy debates come down to what degree of government efficacy you accept as true. But in so many cases, it’s not a matter how much government should spend; it is a matter of how government can spend differently. Falling back on principles can be important, and we are all proud partisans. But thinking through public policy issues first wouldn’t hurt Washington, D.C.