Selling Utah is Actually a Good Idea.

A Florida Congressman, Don Ross, half jokingly said that we should "sell Utah" to pay down the national debt.  That is not a half bad idea, if done right.

Why it will work?

Currently, Utah has 70% of it's land controlled by the Bureau of Land Management.  This is land owned by the Federal Government but not dedicated to the Military, Native Americans, National Parks, National Monuments or National Forests.  That is currently, 29.9 million non-forest acres lie inside the borders of the Beehive State.  At worst, that land is worth $5,000 per acre.  Selling this land at that value would raise at least 149,500,000,000.00, or about 1% of the National Debt.  Some of that land is on top of valuable oil and gas reverses and some of this land is prime recreation property and some of this land is valuable range land for the raising of cattle and sheep.  Even land that is only used for cattle and sheep could be worth more that 5,000 per acre.  Therefore, selling Utah will likely net a lot more than 149 Billion.

Why not other states?

Utah is not the only state with a lot of Federal Land.  There is more land controlled by the BLM in Nevada, some 40 million non-forest acres.  Although there is not as much water and the likelihood of valuable minerals is much less.  But still, it could be worth some 200 Billion.  Alaska had the most land, it has 87 Million acres that have not been granted to National Forest Service, which is worth at least a Trillion dollars and probably much more, but most of it is only accessible by air at this time.  In the west, there is are 253 million acres of Federal land under BLM control.  Some of this over very valuable mineral deposits.  There is likely enough money tied up in Federal Land to pay the National Debt and then some.  At the low-ball price of 5,000 per acre, it's only about 1.2 trillion, but likely worth a lot more.  Again, an acre of wilderness in Alaska is worth a lot more than an acre of desert in Utah.  I will put pen and paper to this at some other time and come up with a more accurate figure.

What else can the Federal Government Liquidate?

There are closed military bases, and other federal buildings all over the country that are no longer in use.  Selling this surplus property to private buyers is bound to raise additional funds for the government.

Other Positives?

Let's take Garfield, County Utah as an example.  The county has 5208 square miles.  97% of that land is owned by the Federal Government.  The County can not levy taxes on this land, and has to fund it's law enforcement and schools by property tax on just 3% of it's land.  Much of this land lies within the boundaries of National Monuments and National Parks, so the County has to rely on tourism dollars to operate.  Roughly the eastern third of the county is BLM-managed federal land.  This is land is occupied by the Henry Mountains and lies between Lake Powell and Capitol Reef National Park.  It would be land that could be used for tourism and ranching.  The middle third of Garfield County is occupied mostly by Capitol Reef National Park, Bryce Canyon National Park and the Grand Staircase-Escalante National Monument.  The western third of the county is mostly occupied by the Fishlake National Forest.

If this land were sold; that is if about 1/3 of the 5208 square miles or were sold and privatized, the county would be blessed with about 1,111,040 additional acres it could levy taxes upon.  The property tax rate in Garfield County is about 7 dollars per 1,000 of property.  At a price of 5,000 per acre, the county would be blessed with about additional 38 million dollars of new property tax revenue annually.  (And this is a very conservative estimate and would the case if there were no improvements made to the property).  Imagine how well they could pay teachers in Panguitch with an extra 38 million per year?  Imagine how Garfield County could improve their police force with this much money?  If this model were followed in the rest of Utah, there would be enough funds to bring Utah from being very last in per-pupil spending to at least the 2nd quartile.

There are some positive consequences nationwide.  Credit rules will have to be relaxed to qualify people to buy some of this property.  This can help the housing market recover all over the country.

Any negatives?

Yes, there will be unintended consequences.  First, liquidation is something that can only happen once.  The government will still have to figure out how to balance the federal budget and live within their means, but it will be an easier task when with much less allocated to pay interest.  Second, there will be economic consequences.  If the Feds pay off all of their debt at once, interest rates will plummet further.  This could spur inflation.

And one more that can not under-stressed enough. The Sierra Club and other environmental groups will never sit idly by and will do everything in their power to stop something like this.  They like the land idle and doing nothing.  They will complain about the loss of habitat.  There will be a petition to ask President Obama to use the Antiquities Act to block the measure.  My response to them is ask them what they would give up to balance the budget.  Selling Utah will not happen easily, but most of the consequences will be positive.