On February 5, 2013, Brian Beutler writes on http://tpmdc.talkingpointsmemo.com
Here’s the buried lede from the Congressional Budget Office, which on Tuesday released its Budget and Economic Outlook for the coming decade: D.C.’s deficit obsession has been quite effective at cutting deficits at the expense of the still-struggling economy.
“[E]conomic activity will expand slowly this year, with real GDP growing by just 1.4 percent,” according to CBO’s projections. “That slow growth reflects a combination of ongoing improvement in underlying economic factors and fiscal tightening that has already begun or is scheduled to occur-including the expiration of a 2 percentage-point cut in the Social Security payroll tax, an increase in tax rates on income above certain thresholds, and scheduled automatic reductions in federal spending. That subdued economic growth will limit businesses’ need to hire additional workers, thereby causing the unemployment rate to stay near 8 percent this year, CBO projects.”
In other words, intentional efforts to reduce annual deficits and stabilize the debt are working. But if you retrain your gaze from the government’s balance sheet to the real economy, you’ll see the impact of that austerity is fewer people working and slower growth. According to CBO, the recovery won’t really pick up steam until next year, and the economy won’t have recovered until the end of 2017, when it will reach its output potential, and unemployment will fall to 5.5 percent.
CBO notes that the U.S. hasn’t experienced six consecutive years with unemployment exceeding 7.5 percent in over 70 years.
By any measure 1.4 percent GDP growth and real employment opportunities are anemic compared to the double-digit growth rates that are required to enable EVERY American to attain an income to support a decent, affluent livelihood and enjoy “the right to life, liberty and property” (“pursuit of happiness” phrase in the Declaration of Independence was interchangeable in those times with the word “property.”)
The CBO report is wishful thinking as long as we continue to ignore the necessity to broaden productive capital ownership and align the demand for consumption goods with the demand for capital goods using future savings instead of past savings to increase future production. When this framework is implemented and there is no need to restrict consumption in order to save, we can naturally balance production and consumption. Not only will double-digit economic growth be achievable but in addition to broadening ownership of FUTURE productive capital assets “full employment” would result (at least to the extent workers would be needed to build a future physical world to support affluence for EVERY American), and allow us to eliminate deficits and steadily pay down the national debt.
What is needed is a balanced Just Third Way approach to building a FUTURE economy that supports affluence for EVERY American. This requires investment in FUTURE income-producing productive capital assets while simultaneously broadening private, individual ownership of the resulting expansion of existing corporations and future corporations. Not only is employee ownership the norm to be sought wherever there are workers but beyond employee ownership the norm should be to create an OWNERSHIP CULTURE whereby EVERY American can benefit financially by owning a SUPER IRA-TYPE Capital Homestead Account portfolio of income-producing, full-voting, full-dividend payout securities in America’s expanding corporations and those newly created to produce the future products and services needed and wanted by society.
Political and private sector leadership is required to transform the American economic system, especially our terribly flawed money and credit systems, to enable every citizen to become an empowered citizen-owner as a fundamental human right. The social technologies for turning formerly propertyless citizens into participatory and empowered capital owners on pure capital credit repayable with future savings have been successfully proven.
Policies are needed to ensure that where taxpayer monies (whether obtained from tax extraction or debt, as in national debt and deficits) are expended to “stimulate” the private sector (through government subsidies, loan guarantees, grants, and contracts with corporations building infrastructure and economic development, including the military-industrial complex), that stipulations are attached that the financial benefit results in broadened private, individual ownership of the particular companies and that the full earnings of the investments are paid out to their owners.
In order to ensure that the economy operates most efficiently, productive capital must be broadly owned. This is because as technology advances, people cannot produce enough by labor alone to permit them to purchase everything that others produce with their productive capital assets. Logically, if productive capital is doing most of the work of production (the physical aspect of producing products and services), and private property includes the right to receive the income generated by what is owned, as labor becomes less productive (essentially less necessary when replaced or devalued by human-intelligent machines, super-automation, robotics, biobotics, digital computerized operations, etc.) relative to productive capital, people who formerly relied on labor must shift to owning productive capital to carry out the work of production.
A National Right To Capital Ownership Bill that restores the American dream should be advocated by the progressive movement, which addresses the reality of Americans facing job opportunity deterioration and devaluation due to tectonic shifts in the technologies of production.
There is a solution, which will result in double-digit economic growth and simultaneously broaden private, individual ownership so that EVERY American’s income significantly grows, providing the means to support themselves and their families with an affluent lifestyle. The Just Third Way Master Plan for America’s future is published at http://foreconomicjustice.org/?p=5797.
Support the Capital Homestead Act at http://www.cesj.org/homestead/index.htm and http://www.cesj.org/homestead/summary-cha.htm
Sign the Petition at http://signon.org/sign/reform-the-federal-reserve.fb23?source=c.fb&r_by=3904687
We need to reform the Federal Reserve Bank to create new owners of future productive capital investment in businesses simultaneously with the growth of the economy.
The solution to broadening private, individual ownership of America’s future capital wealth requires that the Federal Reserve stop monetizing unproductive debt, including bailouts of banks “too big to fail” and Wall Street derivatives speculators, and begin creating an asset-backed currency that could enable every man, woman and child to establish a Capital Homestead Account or “CHA” (a super-IRA or asset tax-shelter for citizens) at their local bank to acquire a growing dividend-bearing stock portfolio to supplement their incomes from work and all other sources of income. Policies need to insert American citizens into the low or no-interest investment money loop to enable non- and undercapitalized Americans, including the working class and poor, to build wealth and become “customers with money.” The proposed Capital Homestead Act would produce this result.
