Sustainable Economic Policy VI

Financial/Engineering Checks and Balances

In the previous section we discussed general principles of checks and Balances. Now we address some specifics.

For our economic system to be sustainable there has to be built in checks on the largess of those who hold funds, coupled with built in checks on those who would spend them. The way we do this is with forms that vet projects and other forms that review them on completion. This is the real reason we need an Infrastructure Bank. The Treasury Department, or the Department of Transportation, can perform these functions, but they need to be done universally and systematically. But to do that fairly and justly an inclusive process must be in place. An Infrastructure Bank, could in theory, just print money, but that would be a disaster shortly after the decision to do so. Bureaucracy, as much as we hate it, is a necessary evil in checking people's ambition and hubris -- when done right. One has to grant certain powers to local persons to develop and execute projects. But those projects must be reviewed for financial, engineering and marketing sanity. The principle problem with a "bridge to nowhere" is that nobody will use it. When executed right projects make sense from the get go. And that requires us to constitute an Infrastructure bank that is well constituted -- so we can't complain later that it built bridges to nowhere, or worse, bridges that fell down.

Sustainable Economic Policy IV

Adding to the Federal Reserve "Toolkit"

Janet Yellen is having a meeting at Woods Hole:

"The Fed's annual conference in Jackson Hole, Wyoming, where Yellen speaks on Friday, is due to focus on how to improve central banks' "toolkit," but the unanimous message from the Fed's top policymakers is that those tools are not enough." [Reserve Meeting]

And you hear the usual complaints from the Federal Reserve that:

"Monetary policy is not well equipped to address long-term issues like the slowdown in productivity growth," Fed vice chair Stanley Fischer said on Sunday. He said it was up to the administration to invest more in infrastructure and education."[Reserve Meeting]

It is Up To Congress!

Fischer is expressing the World Banker conventional view. However, if the Federal Government appropriates money for Infrastructure and Education, under current law, it is forced to either borrow money at interest ("deficit spending") or to raise taxes to "offset such spending". Raising Taxes means the government must rob Peter to Pay Paul. Borrowing money means that any profits from infrastructure investment will go to Investors and not to the people "as a whole."

Congress Can Authorize an Infrastructure Bank and Delegate that function!

An Evil time

I knew it was an evil time.

I could feel the weight trying to pull me down.

I don't know if it was my imagination,

but an army of reapers seemed to be walking the earth.

And one of them seemed standing near me.

Tugging on my sleeve.

 

I said, keep away from me!

And went on to grieve,

for all who I knew were passing away

these evil days.

 

It may be just my imagination.

But I can feel when some folks are letting go.

And while i know I'll miss them deep in my soul.

At least they could let go

of the weight of an evil world.

And I know, they were taking both the good and evil.

But especially those who committed no crime.

And I say to the ineffable lord of the Universe;

Please take your evil eye off of me.

and roll the other one around.

But then I consider the better people you take

....instead of me

and I say, if it is my time, let it be.

But let me finish a few things first.

Over the weekend it felt like the very gravity of the earth was tugging me down. Today I find out that so many people I love from afar, passed. It's not my time yet.

Christopher H. Holte

Helping Veterans

In my little town of Brunswick, I have two sets of friends who are both trying to help Veterans. This post is a stub:

1. Building Veterans: [http://www.buildingveterans.org/index.html]
2. http://www.uswaterwarriors.org/

And outside of Brunswick I've made indirect contact with other veterans groups trying to help Veterans. One of them is trying to get hemp legalized again as the industrial super-product it was before it was lumped in with Marijuana and outlawed.

http://www.growingwarriors.org/

I'm putting these links here so I can find them quickly. If you want to help veterans, there are lots of vets and their groups who need your help. A lot of vets don't need anyone's economic help. Many just need us to love them. As a Navy Brat, I know this first hand. I'm also trying to help some other folks, so these links are also for reference:

• Thomas Hart's website [http://www.otpvideo.com/]
• The website I manage is gabbidc

A Sustainable Economic Policy III

Management for the Public Good

The 19th century economist Henry George, articulated the principles of commonwealth public policy in 1890:

"With respect to monopolies other than the monopoly on land, we hold that where free competition becomes impossible, as in telegraphs, railroads, water and gas supplies, etc., such business becomes a proper social function, which should be controlled and managed by and for the whole people concerned, through their proper government, local, state or national, as may be." [[Paragraph 11 Georgist Plank]

Proper Government

By "proper government", one must understand that local, state and national government all have "proper" roles in regulation and operation of the kinds of goods and systems that tend to become monopolized. Certainly healthcare, most of our infrastructure of all kinds, and many other public goods risk being mismanaged and tyrannically managed when managed of and for private cabals (corporations) -- especially when they involve public monies (bills of credit/paper money) and government function. The record shows a little more than risk, more like severe threat that private management leads to monopoly and exploitation.

These attributes apply to all our national infrastructures to one degree or another: Banks, Healthcare, Defense, Communication, Transportation and Energy. They all require that the US manage them in the public interest. And ignoring Georgist principles has led to these public goods being allowed to become monopolies run for the private, separate Interest.

A Sustainable Economic Policy II

Asserting Sovereignty over our finances

To have a sustainable economic policy for the USA, we have to assert sovereignty over our finances. Warren Mosler writes:

"the government’s interest is the public interest. The government is there to provide for the general welfare, and there is no correlation between this interest and a position of surplus or deficit, nor of indebtedness, in the government’s books." [Galbraith/Mosler]

Mosler is talking about the Federal portion of our Federated Government. Of course, such a correlation is IMPOSED on subsidiary governments, as if they were subjects rather than coequal and vital parts of a sovereign entity. In the United States, local government is relegated to the role of competing for funds as if it were just another private enterprise, and has almost zero sovereignty over it's own finances and this hamstrings it's efforts to pursue the public interest. States are under less constraint, largely because of their relationship with the Federal Government, but they too deal with internal, external and artificial constraints that oppress their ability to serve the Public Interest.

Yet:

"the government is sovereign. This fact gives to government authority that households and firms do not have. In particular, government has the power to tax and to issue money. The power to tax means that government does not need to sell products, and the power to issue currency means that it can make purchases by emitting IOUs. [Galbraith/Mosler]

And to be fully functional a Federated Democratic Republic should extend the benefits and privileges of that power to the whole of the country, including its parts, as well as to be able to exercise it for itself. Henry George Recommended in the 1880s that the money power be exclusively with Government [On Greenbacks]

"the power to issue money is a valuable privilege which, to secure the best circulating medium and to put all citizens on a footing of equality, ought to be retained by the general government, and to be permitted to no one else, either individual or corporation. The greenbackers, who have insisted that national bank notes should not be permitted, and that all money should be the direct issue of the government , are in the right." [Greenbacks]

At the very least our Federal Reserve should be an agency of the Government rather than protecting bankers. Unfortunately our pirates have had more influence on the Government than reformers.

Current System Privatizes Rule over Money

While this is true, Around the world centralized financial centers give responsibility to local government and then impose artificial constraints on their power to deliver service by stripping this IOU money power from them, or by privately taxing it by imposing artificial compounding interest, fees, penalties. Instead our system gives the power to emit IOUs, collect interest on them, and essentially put a lien on public and private property, to privateering banks. Essentially the International banks, through exercising this power over the money supply, act as if they were pirates. This infuriates both left and right, and it is a main driver of worldwide economic inequity. But something can be done about it if folks can avoid the over drama. This system is an outgrowth of feudalism, international chaos, warfare, trade and colonialism and of Private Government. To fix it requires an assertion of Governance in the public interest. It is not the product of diabolical conspiracies. To fix a thing one must understand it.

A Sustainable Economic Policy I

The Problem

I was reading someone calling for Quantitative Easing, but Quantitative easing has little effect on the economy. The Banks will only loan to folks who aren't underwater, owing more than they are worth -- and to folks who have the surety to provide something the bank can take if the business fails. The term for an economy that is over-leveraged is a "liquidity trap." Quantitative easing is a waste of public money when banks won't lend to the people the Fed claims it intends to be helping. We saw that in 2009-2012 when the banks foreclosed like crazy on ordinary people -- and bought each other out -- instead of helping those people get a job.

1. To borrow money on the credit of the United States
2. To regulate Commerce
3. To coin Money, regulate the Value thereof, and of foreign Coin,

Emitting bills of credit (money) is a power implied from the power to borrow money and the prohibition of that power to the States in Section 10. Rather than our country passing a constitution to make that power explicit, the USA has let the courts define whether the Federal Government can print money, and the result has been a 200 year fight, which is ongoing. The Federal Reserve is the latest "Missouri Compromise" on this subject in the battle between centralizing bankers and local financial interests. At this point the centralizing bankers have pretty much won their war and thus we have the Fed, which does a dance between a which privatizes and privateers on the ability to "emit bills of credit" as money and to which Congress has delegated almost all the powers just listed.