Just jotting down some "progressive" and "not-so-progressive" ideas I've had. Many have been expanded upon before, but it doesn't hurt to reflect on these. I also borrowed ideas from quite a few people and sources---notably the People's Budget, which I hope gets more awareness with each passing day. These focus on America, which has some of the worst problems, but can be applied generally to other Western countries as well.
1-Slashing military budgets---while maintaining care for veterans, and certain research programs, the large standing armies of today are more or less obsolete. A lot of savings can be acheived here.
2-Legalizing, taxing and regulating marijuana. Not only would this allow freer access to medical marijuana (which has a ton of benefits), it would also curtail the stupidest way of inhaling THC (through smoke inhalation which is the deadliest) since now regulated, legitimate businesses would be responsible for marijuana rather than fickle criminals. Would reduce violent crime, expand government revenue, and curtail governmental expenditure on shutting away small-time weed dealers and users.
3-Limit Pell grants/financial aid programs to science/business/engineering etc.---i.e professional pursuits. I'm sorry, as much as I love the liberal arts, we've got to cut somewhere, and a slew of English literature PHDs is going to get the country nowhere. If this incentives students to pursue mathematical-related/more productive fields, than so much the better.
4-Legalize online poker, and tax it. I'm a strong advocate of gambling being a tax on the stupid, but I also know a lot of very skilled people make a killing on those sites, and being somewhat of an avid poker player myself, I think it's more of a sport with a degree of fluctuation rather than gambling. Realistically speaking, it's also one of the fairest games out there, even if you deem it to be gambling (at least the probabilities are somewhat known to you, and not tilted 70/30 to the house). Also, if you're like Australia, and you're leaving it legal, but not taxing it, well...
5-Start taking credit-default swaps on a government's bonds, than bomb the s*** out of that country.
---well, it would be a good money-maker.