•7:59 PM
In response to a friend's question about what would I do regarding the economic stimulus plan and the current situation, I put this forward as a possible solution. At first pass, this is the direction I think we should go:
Communicate with Hope and Vision
It is the role of all leaders to lead us to a better place. The words we say have a powerful effect on the feelings we feel and the actions we take. If I were responsible for the country, I would hope that I would recognize this important trust and communicate the truth of the present and a vision of optimism and hope for the future.
Understand the Long Term Issues Facing the Country
One of the primary problems I see with the current economic situation is that the TARP and current stimulus plan being debated is, as most legislation is, very reactionary. Politicians are never voted in for their 10-20 year plans. They are voted in for what they can do for the problems people were facing yesterday. As a result, the actions in congress are very reactionary and sadly do little to avoid problems and create strategies for the future.
It is important to note that I believe that for those long term needs for the safety and general welfare of the People that the free market has failed to see profit in, the Government has a role to ensure the need is met. Please know up front that I do not believe that the role of government is to interfere in the marketplace where there is a marketplace but in those places where there is not one. The government cannot be, and should not be, the be all and end all of everything as it is quickly becoming. The place of government is not to prop up crippled institutions, cap executive salaries, flood markets with endless streams of cash, nationalize institutions, purchase private equities in firms or place an impossible burden of debt on the backs of the People for immidiate, short term boosts.
I would therefore not take any short term action that would adversely affect the long term future of our nation's children. Those issues that must be addressed to ensure long term success for the nation are:
1. The Breakup of the Family as the Basic Unit of Society
It is in the interest of the citizens of our nation to help ensure that each child born into our country is born to a father and a mother who honor their marital vows. Children that are raised in a loving home gain the self confidence they need to succeed in life, a foundation of love and respect for their fellow man, and a commitment to generally a sense of personal honor and commitment. The breakdown of the family will be a country of individuals whose hearts have grown cold through abuse and neglect and who will desire love but not know how to find it. The dissatisfaction with this kind of life leads many to a life of a relentless pursuit of selfishness. Selfishness only brings more misery and heartache along with the other ills of an uncivilized people. As a leader I would promote fidelity and the virtues of honor, commitment, love, respect, and forgiveness.
2. The Growing Lack of Creativity
Western civilization has primarily grown out of our ability to create. Inventions that bless the lives of individuals whether for increased work productivity or leisure are desired commodities. The United States is producing fewer and fewer creative inventions. This decline in America's ability to create will cause a real shift in global positioning that is concerning for our children.
The government must actively be finding ways to help more people become interested in engineering and the sciences. The government must understand its place in funding the sciences of all kinds and in removing barriers to the country remaining competitive on this front. Creativity in renewable energies is a key area for our nation to gain core competencies. This leads us to the next long term problem.
3. Education
Natural born citizens have fallen far behind the rest of the world in education. Our children do not learn much in school and our parents are not concerned or trying to help them learn more. Instead, they want their children's lives to be dominated by extra-curricular activities rather than academic ones. Learning must be enshrined as part of our culture - not just entertainment. As a leader, I would work with leading business and education leaders to help re-shape the American education system to help our children be prepared for and to help shape the 21st Century.
4. Immigration Reform
Because our schools are not producing the number of graduates that are needed to fill the creative jobs in our country, we must make it easier and not harder for the dreamers, the creators, the engineers of today in foreign countries to become American citizens. The doors of our country should open to the people of all nations and we should welcome them into our nation and culture.
5. Energy Independence
The long term success of the west is dependent on energy independence. The government must take a strategic role in helping our country leave behind its dependence on foreign oil. The country must enact true, long term energy policy that would greatly reduce or entirely eliminate our need for foreign oil. Just yesterday it was announced that China purchased more cars last month than the United States for the first time. Imagine what a billion more cars on the road will mean for the oil supply. We are in an insecure place if we are all relying on the same source of energy. America must see the greater need for long term energy policy. The safety of our nation largely depends on this one piece - energy independence.
Understand the Short Term Problems Facing the Country
As I see it, the true short term problems of our nation are:
1. The Housing Market
The housing market was one of the primary sources of our current economic problem. In the short term, relief must be given to those deserving home owners who are facing foreclosures. Rather than give hundreds of billions to banks to compensate them for their losses, the government should step in and force a renegotiation of contract and interest rate that ensures the people of this great country are served as well as the interest of the banks.
2. Inflation
The Government and Federal Reserve have already spent or committed nearly $10 Trillion on the economic bailout. That is a lot of extra money that has gone into the economy. Additionally, M2 - the Nation's money supply - is growing at a rate of 24%. That is scary - do you want to see 20% inflation? I don't - that is a very dangerous thing. The Federal Reserve must stop flooding the markets with money and the government must stop this as well or else I fear our economy would be incredibly hurt. So, not just those who have been unwise would be hurt - but those who have been wise as well. As a leader I would make this hard decision.
3. Credit
The lending institutions who have been given money in the TARP funds should be required to use the funds or return them to the government. The only way they will return to solvency is by earning money and they cannot do that by "strengthening their balance sheets" alone. They have to produce something and that "something" is financial services and credit.
4. Reaction
As a leader I would urge Congress to not react with haste but with positive energy and a long term strategy to create the right solutions for our nation's current and future issues.
5. Energy Costs
In reality, many people and businesses were hurt over the recent high energy costs which is a result of the country's complacency in creating alternative fuel sources. The government has a place to ensure that monopolies on energy are charging fair and reasonable prices for the fuel they provide. There needs to be some government oversight for industries where there is not a true free market.
6. Out of Control Government Spending
I need to say nothing more than the banner at the top of this page. By living way beyond our means we are quickly laying the foundation for certain economic, long term doom.
For an infrastructure bill we should understand the key structural issues that need addressing.
I do not believe that roads and bridges are a huge problem to our country's present and future growth. If there are real problems with some roads and bridges we should by all means fix them. However, the current financial crisis is not the time to be working on roads that simply need widening or freeways that need expanding for no real reason other than to create jobs.
The real structural problems that need addressing are as follows:
1. Fiscal Policy
It is my belief that the Federal Reserve Act should be amended to allow the Fed to only increase the money supply according to the increase in productivity. Any exceptions to this should be approved by the House of Representatives. Allowing a private bank to control the wealth of the nation, which is the labor of the people, puts the people at odds with business and slaves almost to the wealth they should own. The People of this nation are the wealth thereof and should be the ones responsible for the money supply.
2. Tax Reform
Our government must look at true tax reform and investigate a more representative tax system.
3. Government Oversight
For the country to not repeat the same problems that led to this, the White House should investigate and find the places where oversight failed or was non-existent and propose corrections. We have laws and police to enforce those laws. This is a place that certainly needs some attention. As a good friend posted a comment on dirivities, this would certainly be the area to monitor that.
4. True government fiscal reform
To save our country we must end the entitlement state, allow market forces and the common descency of our people to fill in the gaps, and restore Government to its proper place. By following the Long Term plan I put forth above, we would be able to better position our country for future economic success and help to create a better and safer world.
Conclusion
If I were responsible for such a monumental task, I would like to think this is where I would start. This is what I feel the proper role of government is. There are those that believe that any government involvement is bad involvement (I have found that to be mostly partisan rhetoric). I disagree and know that history would disagree along with some of our greatest founding fathers. Hamilton, Madison (as they wrote in the Federalist) and Washington would have believed in some limited involvement for the benefit of all in these types of situations.
I do not believe the government should be hands off but I also do not believe it possesses the solutions to the problems. It can only work by communicating with optimism and creating the proper structure for the true creative forces to work - the People of our great land. To do this, the government should avoid destroying the people by stealing their wealth through inflation, taxing them for their whole lives for a benefit that will last a few months, and creating a nationalized system that takes the true creative forces out of the market that blesses our lives.
The answer lies in the People and if we are true to the principles of individual liberty and justice for all, we will make tomorrow better than today for you, me and our children.
Communicate with Hope and Vision
It is the role of all leaders to lead us to a better place. The words we say have a powerful effect on the feelings we feel and the actions we take. If I were responsible for the country, I would hope that I would recognize this important trust and communicate the truth of the present and a vision of optimism and hope for the future.
Understand the Long Term Issues Facing the Country
One of the primary problems I see with the current economic situation is that the TARP and current stimulus plan being debated is, as most legislation is, very reactionary. Politicians are never voted in for their 10-20 year plans. They are voted in for what they can do for the problems people were facing yesterday. As a result, the actions in congress are very reactionary and sadly do little to avoid problems and create strategies for the future.
It is important to note that I believe that for those long term needs for the safety and general welfare of the People that the free market has failed to see profit in, the Government has a role to ensure the need is met. Please know up front that I do not believe that the role of government is to interfere in the marketplace where there is a marketplace but in those places where there is not one. The government cannot be, and should not be, the be all and end all of everything as it is quickly becoming. The place of government is not to prop up crippled institutions, cap executive salaries, flood markets with endless streams of cash, nationalize institutions, purchase private equities in firms or place an impossible burden of debt on the backs of the People for immidiate, short term boosts.
I would therefore not take any short term action that would adversely affect the long term future of our nation's children. Those issues that must be addressed to ensure long term success for the nation are:
1. The Breakup of the Family as the Basic Unit of Society
It is in the interest of the citizens of our nation to help ensure that each child born into our country is born to a father and a mother who honor their marital vows. Children that are raised in a loving home gain the self confidence they need to succeed in life, a foundation of love and respect for their fellow man, and a commitment to generally a sense of personal honor and commitment. The breakdown of the family will be a country of individuals whose hearts have grown cold through abuse and neglect and who will desire love but not know how to find it. The dissatisfaction with this kind of life leads many to a life of a relentless pursuit of selfishness. Selfishness only brings more misery and heartache along with the other ills of an uncivilized people. As a leader I would promote fidelity and the virtues of honor, commitment, love, respect, and forgiveness.
2. The Growing Lack of Creativity
Western civilization has primarily grown out of our ability to create. Inventions that bless the lives of individuals whether for increased work productivity or leisure are desired commodities. The United States is producing fewer and fewer creative inventions. This decline in America's ability to create will cause a real shift in global positioning that is concerning for our children.
The government must actively be finding ways to help more people become interested in engineering and the sciences. The government must understand its place in funding the sciences of all kinds and in removing barriers to the country remaining competitive on this front. Creativity in renewable energies is a key area for our nation to gain core competencies. This leads us to the next long term problem.
3. Education
Natural born citizens have fallen far behind the rest of the world in education. Our children do not learn much in school and our parents are not concerned or trying to help them learn more. Instead, they want their children's lives to be dominated by extra-curricular activities rather than academic ones. Learning must be enshrined as part of our culture - not just entertainment. As a leader, I would work with leading business and education leaders to help re-shape the American education system to help our children be prepared for and to help shape the 21st Century.
4. Immigration Reform
Because our schools are not producing the number of graduates that are needed to fill the creative jobs in our country, we must make it easier and not harder for the dreamers, the creators, the engineers of today in foreign countries to become American citizens. The doors of our country should open to the people of all nations and we should welcome them into our nation and culture.
5. Energy Independence
The long term success of the west is dependent on energy independence. The government must take a strategic role in helping our country leave behind its dependence on foreign oil. The country must enact true, long term energy policy that would greatly reduce or entirely eliminate our need for foreign oil. Just yesterday it was announced that China purchased more cars last month than the United States for the first time. Imagine what a billion more cars on the road will mean for the oil supply. We are in an insecure place if we are all relying on the same source of energy. America must see the greater need for long term energy policy. The safety of our nation largely depends on this one piece - energy independence.
Understand the Short Term Problems Facing the Country
As I see it, the true short term problems of our nation are:
1. The Housing Market
The housing market was one of the primary sources of our current economic problem. In the short term, relief must be given to those deserving home owners who are facing foreclosures. Rather than give hundreds of billions to banks to compensate them for their losses, the government should step in and force a renegotiation of contract and interest rate that ensures the people of this great country are served as well as the interest of the banks.
2. Inflation
The Government and Federal Reserve have already spent or committed nearly $10 Trillion on the economic bailout. That is a lot of extra money that has gone into the economy. Additionally, M2 - the Nation's money supply - is growing at a rate of 24%. That is scary - do you want to see 20% inflation? I don't - that is a very dangerous thing. The Federal Reserve must stop flooding the markets with money and the government must stop this as well or else I fear our economy would be incredibly hurt. So, not just those who have been unwise would be hurt - but those who have been wise as well. As a leader I would make this hard decision.
3. Credit
The lending institutions who have been given money in the TARP funds should be required to use the funds or return them to the government. The only way they will return to solvency is by earning money and they cannot do that by "strengthening their balance sheets" alone. They have to produce something and that "something" is financial services and credit.
4. Reaction
As a leader I would urge Congress to not react with haste but with positive energy and a long term strategy to create the right solutions for our nation's current and future issues.
5. Energy Costs
In reality, many people and businesses were hurt over the recent high energy costs which is a result of the country's complacency in creating alternative fuel sources. The government has a place to ensure that monopolies on energy are charging fair and reasonable prices for the fuel they provide. There needs to be some government oversight for industries where there is not a true free market.
6. Out of Control Government Spending
I need to say nothing more than the banner at the top of this page. By living way beyond our means we are quickly laying the foundation for certain economic, long term doom.
For an infrastructure bill we should understand the key structural issues that need addressing.
I do not believe that roads and bridges are a huge problem to our country's present and future growth. If there are real problems with some roads and bridges we should by all means fix them. However, the current financial crisis is not the time to be working on roads that simply need widening or freeways that need expanding for no real reason other than to create jobs.
The real structural problems that need addressing are as follows:
1. Fiscal Policy
It is my belief that the Federal Reserve Act should be amended to allow the Fed to only increase the money supply according to the increase in productivity. Any exceptions to this should be approved by the House of Representatives. Allowing a private bank to control the wealth of the nation, which is the labor of the people, puts the people at odds with business and slaves almost to the wealth they should own. The People of this nation are the wealth thereof and should be the ones responsible for the money supply.
2. Tax Reform
Our government must look at true tax reform and investigate a more representative tax system.
3. Government Oversight
For the country to not repeat the same problems that led to this, the White House should investigate and find the places where oversight failed or was non-existent and propose corrections. We have laws and police to enforce those laws. This is a place that certainly needs some attention. As a good friend posted a comment on dirivities, this would certainly be the area to monitor that.
4. True government fiscal reform
To save our country we must end the entitlement state, allow market forces and the common descency of our people to fill in the gaps, and restore Government to its proper place. By following the Long Term plan I put forth above, we would be able to better position our country for future economic success and help to create a better and safer world.
Conclusion
If I were responsible for such a monumental task, I would like to think this is where I would start. This is what I feel the proper role of government is. There are those that believe that any government involvement is bad involvement (I have found that to be mostly partisan rhetoric). I disagree and know that history would disagree along with some of our greatest founding fathers. Hamilton, Madison (as they wrote in the Federalist) and Washington would have believed in some limited involvement for the benefit of all in these types of situations.
I do not believe the government should be hands off but I also do not believe it possesses the solutions to the problems. It can only work by communicating with optimism and creating the proper structure for the true creative forces to work - the People of our great land. To do this, the government should avoid destroying the people by stealing their wealth through inflation, taxing them for their whole lives for a benefit that will last a few months, and creating a nationalized system that takes the true creative forces out of the market that blesses our lives.
The answer lies in the People and if we are true to the principles of individual liberty and justice for all, we will make tomorrow better than today for you, me and our children.
3 comments:
Great post Ken. I like a lot of your ideas. Don't forget about the derivative problem. Read more about it here: http://is.gd/jikf
Mike - thank you for your comment. Always appreciated. I believe the derivitive problem is a real problem and falls under the poor "Government Oversight" category. Government generally takes the side of supporting business and until things like this happen they rarely act. It is a chronic problem - there is almost never any proactive approach to managing problems like this. This will not change that problem unless there is a real change in Washington. So far no good.
Thanks for reading (I did add a little extra if you wouldn't mind reading again and letting me know what you think - again) that would be great.
What would you do Mike?
Ken