The CNBC segment shares a perspective on the Jobs Act and the current status of access to capital, with Richard LeFrak, The LeFrak Organization. According to LeFrak, banks loan only to credit-worthy applicants. “If your credit is good, it’s easy to get a loan. If you don’t need the money you can get it. If you don’t need the money they’re [banks] throwing it all over you. If you need the money because your credit is marginal it’s quite tough.”
We need to extend capital credit to every citizen to really rev up the American economy and at the same time propel job growth.
Serious investment in new productive capital formation on a large scale is necessary to rev up the economy. The Federal Reserve Bank should provide insured loans to qualified corporations as investment capital. Federal Reserve Bank supported investments should be concentrated in areas of long-term productivity growth with the benefit of promoting the diffusion of advanced technology into civilian industries. The loans would be used to modernize technically backward industries and build new superautomated and computerized robotic factories. Where necessary the monies would be used for supplemental retraining of labor workers to qualify them for the new jobs created. Most important, the profits from the investments would be fully paid out to new capitalists owners––the corporate employees and other citizens. This would be a condition to receive the capital investment loans. The goal would be to create new capitalist owners simultaneously with the growth of the economy financed with Federal Reserve Bank support. The desired result would be to decrease, rather than increase, the existing concentration of productive capital ownership and thus economic power in the hands of the 1 percent. The credit mechanisms supported by the Federal Reserve Bank would not involve the expenditure of any tax money.
The proposed 2012 Capital Homestead Act is the means to extend capital credit to every American citizen (www.cesj.org/homestead/summary-cha.htm).
