UNDERNEWS

Undernews is the online report of the Progressive Review, edited by Sam Smith, who has covered Washington under nine presidents and edited alternative journals since 1964. The Review has been on the web since 1995. See main page for full contents

January 15, 2009

WHAT A REAL STIMULUS MIGHT LOOK LIKE

Sam Smith

- Reduce credit card interest. As one politician once put it, "I'd frankly like to see credit cards rates down. I believe that would help stimulate the consumer and get consumer confidence moving again.'' Another politician responded by offering a bill in the Senate to cap credit card interest at 14%. The Senate voted for it 74-19. The first politician was that radical president, George Bush, in 1991. The other politician was that well known progressive, Alfonze D'Amato. Why are Obama and the Democrats more conservative than Daddy Bush and D'Amato?

- Start a movement to nationalize banks. Progressives led by Robert LaFollette did this in the 1930s, giving FDR cover for his more moderate solutions. Today, all the political pressure is coming from Wall Street, which tilts policies in that direction.

- All measures must put the interest of the ordinary citizen first. Neither the GOP nor the Democrats are doing that.

- De-emphasize tax cuts. They are far less effective than many think.

- Emphasize programs that will cheer people up and where they can see things changing for the better. Among the Wall Street bailout scam's many faults was that no one could tell what was happening as a result. Good economies need optimism.

- Use revenue sharing. It's a quick way to get money down to the states and cities and to the people who live there. Sure, some of it will get corrupted but far less than is already happening with the phony stimulus packages. The upside is that citizens have a better idea of what is being done on their behalf and have some say in how it is done.

- Fund public works project that have large spin-off benefits and which will be heavy in blue collar employment. These would include new mass transit service and a massive growth of America's rail system. It would deemphasize fixing up existing systems because the spin off benefits are far less.

- Institute a shared equity program for homeowners in distress under which the federal government buys a portion of the mortgage, renegotiates interest rates with the lenders and then gets its part of the equity back when the house is sold. A similar program could be used for building new homes.

- Decentralize decisions and negotiations on foreclosures and real estate interest rates, using local courts and similar bodies as was done in the 1930s.

- Give the government preferred stock in companies it aids. At one point in the New Deal, the Reconstruction Finance Corporation owned bank shares that would be worth at least $20 billion today.

2 Comments:

Blogger Dave said...

These suggestions are far better than anything I have seen come out of Washington. Too bad they will never see it, but will continue based on the myths they believe in.

January 15, 2009 4:11 PM  
Anonymous Anonymous said...

Suggesting this kind of "stimulus" without the context of a finite planet is like trying to breathe without air. Mr. Smith should know better than to be so negligent.

For context, I recommend:

1) An excellent, big-picture, real-world-perspective interview with geologists, Howard G. Wilshire and Jane E. Nielson

2) The Disconnection Between Financial Assets and Real Assets, by reality-based economist, Herman Daly

3) And, last but not least, an article about the need for Biophysical Economics (*)

The title of the last article is, Biophysical Economics: In the future, economists will return to earth. Unfortunately, and contrary to the article's optimism, economists will not voluntarily adapt to the reality of a finite planet. And--if Status Quobama, the Obamatrix and the negligence of Mr. Smith are any indication--neither will the "ordinary citizen".

We live in a culture of make believe. There is no hope for change as long as hope is based on growth and change means hip-hop videos and American Idol politics.

The only kind of change which will mean a damn is if we--you and I--change our behavior: our way of life.

As Howard G. Wilshire and Jane E. Nielson have astutely observed:

"HGW: [T]he total resource depletion picture of the world is that we’ve got to change our ways, we can’t just find something that’s cheap and easy and go on doing what we’re doing.

"JEN: Because there isn’t anything.

"SFBG: That technological fix doesn’t exist?

"JEN: That technological fix doesn’t exist. We have to realize that we have to adapt to limitations.

"SFBG: So it’s more of a cultural fix?

"JEN: Definitely."

But that implies actual change and we're all about the illusion of change. Which is why Status Quobama is the perfect president, because he is the epitome of style over stubstance: a simulacrum of hope and change.

---

(*) If you want to know what Biophysical Economics might look like, read, How to save the planet? It’s the economy, stupid (article may take a minute to load, be patient), by Peter G Brown and Geoffrey Garver, authors of, Right Relationship: Building a Whole Earth Economy.

January 16, 2009 7:02 PM  

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