The problem is not that the junk is out there, it is that it is spread out all over the place and causing a collision hazard. Repairing or gutting and re-purposing old satellites in place and getting them back into their positions after having drifted (like NASA was dong with the shuttle) would help, but for the other large junk like boosters and stuff it would help to push it together into more easily avoided and tracked clumps. Remote junk wrangler robots with electric or nuclear drives could do the job and the materials that cost so much to boost into orbit in the first place could be reused for making other stuff like orbit-launched space probes (only the lighter modern components would have to be sent up with other space station supplies), space station parts, and whatever else might be needed.
There was talk long ago about using old boosters as micro-meteor shields for stations with a lot of EVA going on for one thing by clustering them in the right directions (I have no idea if that is really practical though). With the heat and electricity (via solar panels or other techniques) available from the sun reforging metals should not be a big problem so use could be made of the junk in making new parts taking advantage of the zero-g environment too.
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