On August 8, 2012, Henry Blodget writes on Business Insider:
I had high hopes that Presidential candidate Mitt Romney might have a compelling plan to fix the U.S. economy.
After all, as Romney often observes, he has spent most of his life working in the private sector, buying and restructuring businesses.
And Mitt Romney’s overall economic plan certainly does have some positive points, at least with respect to streamlining the economy over the long term.
But unfortunately, Romney’s plan is not likely to help the economy out of its current funk.
Romney’s plan, in fact, suggests that Romney does not actually understand what’s wrong with the economy. The solution he is proposing–giving rich people and companies more cash to spend and invest–will not solve the problem the economy faces right now. So Romney’s policies, if fully implemented, aren’t likely to help anything.
(In fact, arguably, they will make things worse.)
Specifically, Romney’s policies are designed to give more money to wealthy Americans and companies, on the theory that they will then use this cash to invest in other companies and create jobs.
This treatment plan ignores two important things:
- The wealthiest Americans and corporations already have plenty of cash to invest. The reason they are not investing it aggressively is not that they don’t have it–it’s that the investments won’t produce a compelling return (because the customers of the companies they would be investing in, average Americans, are strapped).
- Contrary to common wisdom, rich people do not create the jobs in this country. Rich people (investors) help create jobs, but no sustainable job is created without the help of a healthy economic ecosystem–one that depends heavily on the financial health of hundreds of millions of American consumers.
The argument that “rich people create the jobs” is repeated so often that many people regard it as fact.
Specifically, the argument goes, entrepreneurs and investors, when incented by low taxes, build companies and create millions of jobs.
And these entrepreneurs and investors, therefore, the argument goes, can solve our nation’s huge unemployment problem — if only we cut taxes and regulations so they can be incented to build more companies and create more jobs.
In other words, this thinking goes, by even considering raising taxes on “the 1%,” we are considering destroying the very mechanism that makes our economy the strongest and biggest in the world: The incentive for entrepreneurs and investors to build companies in the hope of getting rich and, in the process, creating millions of jobs.
The solution is to create a balance between production and consumption.
Without a policy shift to broaden productive capital ownership simultaneously with economic growth, further development of technology and globalization will undermine the American middle class and make it impossible for more than a minority of citizens to achieve middle-class status. We have a dysfunctional “system” with barriers for ordinary Americans to acquire income-producing FUTURE productive capital assets and pay for their acquisition out of FUTURE earnings, not dependent on PAST savings. This is a problem that was solved by binary economist Louis Kelso over 50 years ago. Having experience the absurdities of the Great Depression with essential food products “dumped” because the owners of the companies producing the products could not sell their products, he conceived of an alternative organization of the economy that would free economic growth from the slavery of past savings. His solution was to enable EVERY child, woman and man to rightfully earn income from their private property-protected individual ownership in FUTURE new productive capital assets.
I suggest that every concerned person and those hungry for an alternative workable solution to the non-solution of “full-employment” read Kelso’s writings. You can download free “The Capitalist Manifesto” and “The New Capitalists” in the Library section of the Center for Economic and Social Justice at http://www.cesj.org/cesjsitemap.html. Also purchase a copy of Kelso’s “Two-Factor Theory: The Economics Of Reality” and “Democracy And Economic Power.” Granted that this is a lot of reading but if you really want answers and solutions for a troubled nation and economy, then you need to exert yourself and study. There are no short-cuts, though to start you can read my overview article “Democratic Capitalism And Binary Economics: Solutions for A Troubled Nation And Economy.” These ideas have been put forth in a piece of advocacy legislation known as the “Capital Homestead Act” (http://www.cesj.org/homestead/index.htm) proposed by Norman Kurland of CESJ and other supporters, such as myself. Also, just released is the new CESJ publication “The Restoration Of Property: A Reexamination Of A Natural Right” authored by Michael D. Greaney. And support the Capital Homestead Act at http://www.cesj.org/homestead/index.htm and http://www.cesj.org/homestead/summary-cha.htm
As a note of significance, Bill Perk, RAND emeritus* personally gave a copy of this paperback book to then Candidate for “Senator from Illinois”, one Barack Obama, when he visited Carbondale, Illinois seeking support.
According to Perk: “after Barack Obama became the elected Senator from Illinois (and came again to his Marion office to thank those who had supported him) I was able to personally hand him a letter from my colleague, Norman Kurland, inviting him to meet in DC “after he had settled in” to discuss the new Senator from Illinois becoming — as Senator Russell Long had been — the “champion for the Capital Homesteading Act” (analogous to Lincoln’s justly famous original “Homestead Act”, with all that that had led to…). You might find it interesting that when I gave this letter to then Senator Barack Obama, he put his arm around my shoulder to show his thanks…while putting the letter from my colleague in his inside jacket pocket.
“Alas, nothing further came of this! No meeting was held with Norman Kurland by Senator Obama, and nothing further came of that contact. (Except: I learned by email from a gal who had met at a rally for Obama while he was running for President, that she had asked him if he was familiar with the ‘Capital Homesteading Act’ proposal, and — to her surprise — she said that indeed “he was familiar with it.’)”
If that is the case then advocates for putting America on a path to prosperity, opportunity, and economic justice should be hammering President Obama and the national media to address the CONCENTRATED OWNERSHIP issue and WHO SHOULD OWN AMERICA and HOW! The focus on JOB CREATION will not result in REAL job growth until there is REAL and SUSTAINED national economic growth with EVERY American becoming a new capitalist in the FUTURE productive capital economic engine of growth and the income-producing assets of our business corporations that constantly seek to lower costs by shifting the making of products and services from labor to the non-human factor––productive capital, e.g. land and resources, structures, human-intelligent machines, superautomation, robotics, digital computerized operations, etc.
If President Obama, and for that matter his challenger Willard Romney, wanted to seriously CHANGE the direction of the country then in the future debates ALL one of them has to state is: “I want to create an OWNERSHIP CULTURE whereby EVERY American can become a new capitalist!” That will start the national discussion and debate on the BIG ISSUE facing us, that is CONCENTRATED CAPITAL OWNERSHIP and who should OWN America. It will put them both on the spot to address this critical issue. The result would be that the national discussion in media and academia, AND politics would zero in on what this potential is all about.
In the final analysis, for the Coalition for Capital Homesteading to go viral, numbers of people need to contact the national media, the White House, their representatives in the Senate and House of Representatives, and their network of friendly activists and advocate for them to address the issue of CONCENTRATED OWNERSHIP and WHO should OWN America.
None of the political parties or advocate leaders on the national stage are offering a just and comprehensive solution to the economic system problems facing this country and the world. Leaders should adopt the vision and specific proposals of the Coalition. The candidates of a political party who do adopt this high middle road position deserve to win and be followed.
http://www.businessinsider.com/mitt-romney-economic-plan-jobs-2012-8#ixzz29cHAGh00
