On March 10, 2013, Nathaniel Popper writes in The New York Times:
During the last few years, when stocks and corporate profits soared primarily because of cost-cutting and increased productivity from a shrinking or slow-growing work force. The Federal Reserve’s stimulus programs helped corporate America, but they did little to help improve the lives of most American workers, whose wages declined while unemployment remained stuck at high levels.
The improving job market could falter, particularly if cutbacks in government spending mandated by the so-called sequester take a substantial bite out of economic growth. But even a more modest upturn comes not a moment too soon for American companies.
Most Americans are still far from the income they had before the crisis, and many of the new jobs are not particularly stable or high paying.
The Capital Homestead Act is a comprehensive program of tax and monetary reforms that puts the powers and fruits of capital ownership back in the hands of every citizen, individually and jointly, not collectively. It doesn’t involve tax-payers dollars or the savings of the wealthy. It would use an existing, yet untapped source to finance sustainable, broadly owned, private sector growth. Supported by a greatly simplified tax system designed to pay the costs of government and deconcentrate future ownership, the key to this source of new money and credit for production lies in Section 13, para. 2 of the Federal Reserve Act.
This existing power of the Federal Reserve is rarely used except to bail out too-big-to-fail banks and allow the government to spend beyond its means. The Capital Homestead Act would give local and community banks access to the discount window of the twelve regional Feds in order to finance private sector agricultural, industrial, and commercial growth, but through ways that create new owners of future wealth without redistributing the wealth of present owners.
Big problems demand big solutions and leaders with the courage to think in new ways. New ideas, however, need great communicators and effective modes of communication. Leadership requires really big and new ideas for the future of the American economy.
As former Governor Ronald Reagan said during the Conservative Political Action Action in Washington, D.C.:”Let us explore ways to ward off socialism, not by increasing government’s coercive power, but by increasing participation by the people in the ownership of our industrial machine.”
