How to end the recession in record time
This is a proposal to Congress and the White House on how to end this recession in record time and how to avoid any recession in the future. In addition it is a proposal to set the economy on track for ever higher standards of living. Sounds too good to be true, but it is really quite simple as you will see.
What is much harder is to get government officials and politicians to pay attention to good ideas and recommendations that come from you or I, the regular public. Ever tried to call or write a letter to any member of congress? It is a total waste of time. You get a formletter back with boilerplate paragraphs of nonsense that hardly adresses any subject in you letter.
This proposal is written in simple to understand language so that the general public can understand what is killing the economy and who is eating our lunch. The general public must get mad enough to force the government to implement these measures, because without such pressure by the general public Congress and The White House will just keep doing exactly what they want. They basically disregard the best interest of "We The People". Congress and the White House are supposed to represent the People's interests but they are doing no such thing. Instead they represent the "Special Interests" for which they get well rewarded by the thousands of lobbyists that work the halls of Capitol Hill and The White House.
TriConomics to the rescue
This TriConomics website explains how the current recession in North America and Europe can be ended in 6 months flat and how those can be propelled to higher levels of prosperity than ever before in only 2 years. That sounds too good to be true, but you must realize that all ideas that are brilliant and too far ahead of their time sound too good to be true.
Are they crooks or are they ignorant
The way elected officials at all levels of jurisdiction run their economies into the ground leads to three conclusions:
1. They like to do the right thing but are ignorant of economics.
2. They are corrupt.
3. They are both ignorant and corrupt.
I trust that the majority of elected officials mean well and want to do the right thing and that only a small number of elected officials know something about economics but they do not have enough political power to be a counterbalance to the large number of ignorant and smaller number of their corrupt collegues in government. The few corrupt politicians are enough to tip the scales at every opportunity that creates legislation or regulations favorable to the large special interest groups that control the governments in most countries through the few corrupt elected officials that can be bribed by the special interests to tip the voting scales in favor of the special interest monopolies (banking, insurance, accounting, legal profession, labor unions). All of this corruption is at the expense of "We The People" whose interests are supposedly being represented by these elected officials.
TriConomics insights
TriConomics is the new set of economic insights that turn the current archaic practice of trial and error (mostly error) economics into a science with predictable guaranteed outcomes.
1. Money in paper or electronic form has no value in itself. It is however vitally important as the lubricant that keeps the economy running. Without this lubricant the economy grinds to a halt.
2. The relative success of an economy cannot be measured by GDP which is a totally useless measure used by most governments to determine the relative success of their economies and to form an opinion about comparative standards of living. GDP is in most people's mind the monetary value of all "goods and services" produced in a country during a year. Alternatively it is the sum total of all income earned by individuals and profits made by businesses. In both of these GDP measurements there are minor adjustments made for exports and imports. "Goods and services" is the total of the work product of all people in a country. Problem is that only a small part of this work product is desired by consumers in the form of products and services that consumers will purchase out of their free will and free choice (food, shelter, clothing, household appliances, vacation travel, restaurant meals, movies and other desired consumer products and consumer services). The vast majority of the work product of the working population is not consumed by consumers out of their free will and free choice because it is not desired and only seen as "necessary" consumption.
Much of it is directly or indirectly forced onto consumers by government laws and regulations that force individuals and businesses into mandated insurance and accounting services.
3. Another myth is that governments must never print money when they need more than what they collect in taxes. The reason why they cannot print money is that when governments print money that it will create very high inflation. The myth is that when governments need money that they must borrow it from banks instead of printing it and that borrowing money does not create inflation. That is the biggest and very costly lie and myth that has been successfully sold to the population by the banking establishment.
The economy will respond to the infusion of money into the economy with the identical inflation rate whether it is printed money or borrowed money. The economy cannot smell whether the money that is infused into the economy is printed money or borrowed money.
When the economy is grinding to a halt it is for reasons that the "lubricant" money is not lubricating the economy and "lubricant" has to be squirted into the economy machinery. It is far better and cheaper to create new lubricant than to borrow lubricant and having to pay it back with interest.
What is TriConomics?
TriConomics is a different way of looking at economics and turning it from a trial and error practice into a very simple, accurate science with easy to understand scientiffic rules that can be understood by the average sports fan and does not require a degree in economics..
No more trial and error nonsense from ignorant members of congress or the White House that use us, the tax payers as guinea pigs for their ignorant and ineffective economic experiments.
Economics that are different in what ways?
The first thing that has to be understood about economics is that it is not about making money, it is about making goods and services and that these goods and services must be living standard enhancing goods and services. Jobs that people have must be examined carefully to determine whether they are useful jobs or useless jobs or even destructive jobs. The economy will improve dramatically if we encourage useful jobs and discourage destructive jobs.
Surprisingly the largest percentage of jobs in a modern society are totally useless jobs that produce nothing of value that consumers would want to consume out of their free will. Most of these jobs are jobs that make paper dirty or create electronic data that get stored on hard drives. The people that perform these tasks are piled up 20 stories high in highrise office buildings and they sit there for 8 hours per day in small individual cubicles and get ill because of lack of physical activity and that adds to the illness problems (which are incorrectly called health care problems). The least we should do with these people that spend 8 hours per day in an office getting sick, is give them 4 minutes of exercise per day http://www.fastworkout.com/ to prevent diabetes, high cholesterol and other illnesses that are as a result of lack of exercise.
Useless jobs can be tolerated because they create the all important consumers without being otherwise harmful to the economy and they keep people busy with at least something so that they are not idle. Idleness is often referred to as "the devil's playground" or "the devil's workshop". When unemployment increases, crime generally increases as well. So keeping people employed in useless jobs is better than having them unemployed and on welfare. Another benefit of useless jobs is that they are a ready labor pool for useful jobs when the economy creates more useful jobs. The only problem there is that unfortunately useless jobs pay generally more wages than usefull jobs. White collar jobs, the ones where people sit behind desks and make paper dirty, pay better wages than the blue collar jobs where people make consumer products and create consumer services. Strange but true. And an even greater problem is that destructive jobs pay even higher wages than useless jobs. That has to change obviously before we can expect to improve the economy.
What kind of jobs are these destructive jobs? A lot of them are in the lawsuit industry and the tax related industries. We have an army of 1,100,000 lawyers in the USA, whereas Japan has fewer than 30,000 lawyers. And all these lawyers keep alot of other people busy with unproductive work and they destroy thousands of useful jobs in manufacturing businesses by suing these manufacturers out of business.
The tax related industry has been created by 30,000 separate taxing jurisdictions in the USA. The IRS is not the only taxing agency in the United States, there are 50 State taxing agencies, thousands of County taxing agencies and thousands of Municipal taxing agencies, then there are water districts and additional other ways in which governments squeeze money out of tax payers. I do not have a problem with the fact that governments need money to perform their services. The thing that I have a problem with is the very labor intensive way in which all these governments squeeze the money out of individuals and businesses so that the whole tax industry has created useless jobs for 12% to 16% of the labor pool of the United States. Totally wasteful and unproductive jobs that are all an indirect tax on all tax payers. Consider the almost criminal 65,000 page tax code of theIRS alone. And all the rest of the 30,000 taxing agencies have tax codes of their own for which they mandate accounting work and the filing of tax forms from individuals and businesses alike. Shocking, that the vast majority of the population does not have the slightest idea of all this lawsuit and accounting insanity in the United States. With this kind of monkeys on the back of the United States economy it is a miracle that we are only in a recession and not in a deep depression. The reason that we are still marginally afloat is the fact that most other countries have alot of insane taxing systems and corrupt government officials that cannibalize their own economies as well.
The only asset every economy has
It is very important now to understand that the only asset an economy has is the working hours that people are willing to work. Working hours are a fleeting asset and if they are used to produce products and services that are WANTED by consumers, then these working hours will produce a higher standard of living. Unfortunately economists understand nothing about this very simple concept. They keep receiving Nobel Prizes for rubbish that the average ignorant polititian cannot comprehend let stand the average voter. The funny thing is that there are thousands of economists that all seem to have opposing views and that governments pick a random sampling of these soothsayers for every economic policy decision they are making. They might do better with reading tea leaves themselves. But help is on the way. After learning the simple guidelines of these TriConomics they can actually create an optimum economy every time with no more recessions ever. Don't expect Washington to pay much attention to my TriConomics any time soon, because it would spell disaster to the useless banking industry, lawsuit industry and accounting industy. These three industries have a vice grip on Congress and the White House and they will not permit much change that would loosen their vice grip. Nothing short of a general uprising of the population like a revolution can be expected to help TriConomics to be implemented. But read it anyway, just for a learning experiment and to slowly get fed-up with all this taxation without representation like the people did in 1776 that stood up against King George lll of England to have the First American Revolution.
Useless jobs create inflation and are an indirect tax on us
The vast majority of jobs in the American economy produce nothing that consumers would wish to spend money for. The so-called goods and services that are produced by these jobs are neither goods nor services. Most of them should be classified as BADS and DIS-SERVICES and a lot of these jobs are totally useless and some of them actually are destructive of the economy and they could be classified CRIMINAL BADS AND CRIMINAL DIS-SERVICES.
TriConomics:
The economy is similar to a tripod stool. The three legs of the economy represent:
1. Production of goods and services (useful goods and services).
2. Distribution, selling, marketing of goods and services.
3. Consumption of goods and services.
The stupid conventional view:
The prosperity of an economy is measured by what is called GDP, or Gross Domestic Product. It is a totally idiotic measurement that is used by most countries to express a country's economic performance. GDP is generally understood as the market value of all goods and services (useful and useless goods and services) made within the borders of a country in a year. There are other ways in which GDP is expressed such as the sum of the income generated through all employment in the country, such as the sum of all employee compensation and profits made by companies, regardless whether this is productive employment, unproductive employment or even destructive employment. As we will learn, all of this is absolute nonsense because the majority of all products and services produced in a country are not of value to consumers and therefor are not voluntarily consumed by consumers and they do not add to the standard of living in a country.
In most modern economies 80% of employed people do not produce anything or provide any service that any consumers will voluntarily pay any money for. These employees then produce useless products and services or they are products and services that can be termed necessary evils or most often they are unnecessary evils. Instead of being called goods and services, as mentioned above, these useless products and useless services should be called BADS and DISSERVICES instead of GOODS and SERVICES.
Irronically the people who produce these useless products and services ,or BADS and DISSERVICES, earn on average much higher compensation than the people that produce real desired goods and services. So, ironically the lower income workers that produce all the goods and services that improve the standard of living consume fewer of the fruits of their labors as the higher educated producers of nothing.
Some examples of these different categories of products and services:
1. True goods that consumers personally are willing to spend their money on out of their free will and at prices they are willing to pay, are all kinds of products that are produced in factories or workshops and are sold in stores or are sold in some different way such as over the internet. True services are those that people are happily spending their money on and that make their lives more pleasant in some fashion or other.
Some examples:
Typical consumer goods like food, shelter and clothing. Consumer electronics, cars, appliances, toys etc. Typical consumer services like restaurants including fast food, vacation travel, massages, day spas, home utilities such as electricity, water, gas, and sewer service.
2. Government provided products and services that consumers have little buying decisions in but do not mind paying a reasonable price for via their taxes that are spent by the government on their behalf:
Roads, bridges, traffic regulation, harbors, airports, parks and other such government services as trash pick-up, water and sewer services and environmental regulations.
3. Government provided products and services that are rammed down people's throat whether they like them or not and that consumers see more as necessary evils but do not mind indirectly paying for via their taxes that are spent by the government on their behalf: Police and fire protection, military, jails, consumer protection services etc.
4. There are many government products and services that consumers see as a total waste of their funds squandered on projects that are seen as completely useless and wanted by few.
The TConomic way of looking at a country's prosperity:
The three legs of the economy must be of closely matched length so that the tripod stool will be in balance and will not fall over. When one or two of the legs get shorter the economy is in decline and out of balance. It is the function and duty of government to optimize the standard of living by aiding the optimization of the economy. To be able to fulfill this duty of optimizing the the economy TRiConomics gives methods with which the length of the 3 legs of the economy will be measured to determine which legs are shortening or lengthening. TriConomics also proposes methods and rules with which a government can very incrementally and predictably lengthen or shorten the size of any one or all 3 legs to optimize the economy.
Without such guide lines it is no wonder that governments are creating so many avoidable economic disasters on frequent occasion. The general population has no knowledge of the simple rules and guidelines by which economies should be operated as explained here by TriConomics. If 5% of the general population would know as much about economics as they know about baseball rules and baseball statistics they could be as vigilant as the small percentage of the population that started the process of the American Revolution that led to the declaration of independence and the creation of the United States of America and its Constitution.
TriConomics consist of three parts:
1. TriConomics Repair Manual, only to be used in emergencies (needed right now to end the recession immediately).
2. TriConomics Operating Manual (operating manual for the economy needs to be used as guidelines allways).
3. TriConomics Maintenance Manual (maintenance manual for the economy).
Since we are currently in a government created economic recession, the TriConomics Repair Manual is the most important manual for immediate application.
The economy needs immediate emergency response
We need the emergency response CPR to our current economic disaster and it should have been implemented in February 2007 when our incompetent leaders allowed the economy to slide into recession. The economy had been in gradual decline from about February 2007 and was creating serious economic damage by January 2008. If the TriConomics Repair manual would have been available and applied immediately in January 2008, we would not be in the mess we are in today.
Lets assume the best
I would like to assume that most of the people in government are trying to do the right thing and that they have the best interest of the public at heart, to create a high standard of living for all and not just for themselves and for all the special interest that buy the votes with millions of lobbying money from the politicians that have their votes for sale to the highest special interest bidders..
It appears that our incompetent leaders are apparently trying to get all the advice they can from thousands of "experts" that call themselves economists. Most of these "experts" just do not have the correct understanding of economics or they are creating and perpetuating the economic myths that serve their employers (the special interests) best. The politicians work with alot of misinformation and promote persistent economic myths. The politicians buy the best myths that money can buy so that they are blameless when things do not turn out for the best.
The present advice they buy could not possibly lead to a prosperous recession proof economy. There is of course also the reality that many special interests benefit from promoting these economic myths to continnue economic chaos for as long as possible at the cost of "We the People".
Following are the two immediate actions that need to be taken to end the recession in as little as 5 to 6 months. Not that we can expect any of the arrogant people in Washington to take the advice from a mere manufacturer. Many of them would like to perpetuate the recession that is so devastating to all of us and creates more poverty. Democrats do very well when there is more poverty because all poor people will swallow their socialist claptrap hook line and sinker and that gives the Democrats more votes. So continnued poverty is not so bad for Democrats. Republicans have their own agenda for which they would not like the economy to improve anytime before the 2012 presidential elections, because Obama would take credit for those improvements and might get a second term in the White House. So what hope is there for an adoption of TriConomics? All it takes is getting about 3.5% of the voters interested in this brilliant economic TriConomics system to get the lethargic general public moving in mass to push for implementation of TriConomics. It only took 3.5% of the people to get the American Revolution going that created this now defunct United States of America. Most people will do absolutely nothing because they excuse themselves by declaring that they as a single person could not possibly make a difference. How wrong they are. So get in gear and join http://www.thesecondamericanrevolution.com/
Two immediate actions
There are two immediate actions that have to be taken and they will stop the downward spiraling of the economy instantly. Our current economic problem is that consumer spending is at a very low level and that kills all the consumption of goods and services which causes all the unemployment. The CONSUMPTION leg of TriConomics is too short and needs to be propped up.
To get the consumer spending back to normal the Federal Government must immediately do the two things explained below. Not wasting time by talking for months about it in Congress and thinking about it and do nothing about it, and allow unemployment to increase ever more. It must be done immediately to save all those jobs. These two actions will stop the bleeding immediately. Keep in mind that we do not have the luxury of time to fix all the other economic problems all at the same time. Lets concentrate on the immediatete most important task first, stopping the recession. We will tackle the other problems after the economy is running again.
The only short-term goal is to stimulate consumption to where we get back to a somewhat bearable 6% to 4% unemployment. Here are the two very important actions that must be taken IMMEDIATELY:
1. The most important thing the Federal Government must do immediately is to issue National Debit cards to the 300 million Americans and residents that have a Social Security number (that includes infants and small children). Then the Federal Government must fund those debit cards on a monthly basis with $200 per month with the mandate that this money MUST be spent within the next 30 days after which the next funding will take place. Whatever has not been spent will be forfeited because the next funding will take place by resetting the amount on the Debit card to the exact amount of the new monthly funding and no more. What will these debit cards do to get the economy back on track again and stop the current downward spiraling? The recession/depression was caused by a lack of consumer spending. Consumer spending is the major driving force of an economy and this lack of consumption of goods and services is the cause of this severe recession and the massive increase in unemployment. As soon as we drastically increase consumption again the recession will stop and that will instantly heal the economy. The National Debit cards will infuse $60 billion dollars into the consumption cycle for every $200 that the debit cards are funded with. The government must not first determine who should be eligible to receive the $200 per month. Poor people, middle clas people and rich people (even billionaires) will help in feeding money into the consumption cycle. The millionaires might do some totally frivolous spending with it and they might catch on to the idea that spending some of their own money would also help this national effort of restarting this economy. The funding of the debit cards must be done very scientiffically so that the consumption will not be too much more than what the product and service providers can produce. If there is too much money thrown at consumption, heavy inflation will be the result. During the recovery period we should tolerate n annualized inflation rate of up to 10% to 12%. If that rate is not exceeded the next month funding of the Natiaonal Debit cards can be again $200. If the inflation rate is lower than that, the monthly funding on the debit cards can be incrementally increased. If the inflation rate is larger than 12%, the monthly funding could be decreased somewhat and the mony not used for funding the consumer debit cards can be used to stimulate manufacturing and service sector industries that provide services that are desired by consumers. More about that below in the text where Triconomics is explained in more detail.
1. The second measure the Federal Government must take is not a very pleasant one to my taste, but it is unfortunately a very important measure to end this recession in the fastest way possible.
The Federal Government must fund all the Governments at all lower levels (State, County, Local Governments) with massive amounts of money to cover the shortfall these local governments have in their budgets so that they need not do layoffs of their employees and they should be given enough additional money so that they can start up all the local infrastructure projects that they have previously put on hold because they ran out of money. They have all these infrastructure projects ready to go. That will immediately increase employment with all the subcontractors that perform the work on these infrastructure projects. Governments will typically cut costs on all the services they are supposed to deliver before they will lay off any of their own employees.
Increasing employment through all the infrastructure projects that are started or will be re-started will get money immediately into the economy and into the consumption cycle and stop further unemployment and actually create additional new employment. These are not the lame large infrastructure projects that the Federal Government is proposing that will be 24 months in the preparation stages before any significant money is fed into the economy. That is way too late to do us any good right now.
It is unimportant that part of the money will not be used properly and that it might get into the pockets of corrupt officials and their cronies. That is nothing new and it is happening all the time anyway. The only thing that is important is that the money gets into the consumption cycle of the economy even if it is money that is fraudulently spent and part of it is being stolen by the politicians and burocrats in charge of spending the money. There should be no specific instructions given by the Federal Government on how the money should be spent, because to make a lot of rules by bureaucrats in Washington will only waste a lot of time in which thousands more people will become unemployed and the corrupt public officials will find a way around the new rules anyway.
The stealing of public funds has always been with us and will continnue to be with us. The only remedy against corruption in government is to reduce the corruption by reducing government involvement in the economy by reducing the functions and scope of things that Government is involved in and receives a budget for. There are very few comptrollers of local governments that are able to keep corruption at reasonable levels. Those comptrollers are thoroughly hated by the politicians whose financial dealings they are expected to oversee. The offices of the comptrollers are usually underfunded and the lives of the vigilant comptrollers is made exceedingly miserable by the politicians that are the targets of the audits conducted by the comptrollers.
The only instructions that should be given are that the money must be spent for proper purposes (and what proper purposes means should be entrusted to the same people at local government level that are making those kind of decisions currently, whether they are honest or corrupt) and it must be made clear that auditing will be done later, that could uncover improper spending and that such improper spending would lead to prosecution and severe punishment of the perpetrators.
Local government officials will be made responsible and will determine how and on what the money will be spent. Local citizen oversight can or will be called upon. But foremost we do not care whether some of the money is misappropriated, as is done routinely all the time anyway, as long as there is severe punishment for such and as long as the money arrives at the local governments RIGHT NOW so that the layoffs and downward spiraling economy is stopped immediately. What we need is speed. We cannot afford the inaction and endless discussions in Congress and the Senate and the widely differing stories and theories of expert economists that are wasting our time. They have not gotten us very far with all their ideas so far.
3. The big question on everybody's mind is: Where does the money come from to fund these local governments and the National Debit Cards? Same place as where the money comes from that is thrown by the truckloads at all those clever financial institutions that helped get us into this mess in the first place. The money will of course come from the money printing presses (most of it is "created" magically electronicly (pouf! and there is another few billions and now even trillions). That is where all money comes from, the printing presses.
Yes, yes, I know that this printing of money will devalue the currency, but printing bonds and treasury bills that are purchased by the Fiddling Reserve will devalue the currency even more because we (the people) will have to pay the Fiddling Reserve all that interest and that loads the next generations up with mountains of debt. So, let's just do without those very clever Fiddling Reserve people and other local financial gurus that seem to have all the power over all the politicians in the Country. Tea parties are not very effective to change our lot. A good fun party to turn the Fiddling Reserve Building into the USA TriConomics department would be a lot more effective.
Let me explain the biggest hoax that the banking industry has sold to the tax-payers and the members of Congress that are getting paid for selling their votes to the banking establishment:
The criminal hoax is this: The bankers have convinced the general public completely that printing of money is an absolute NoNo because they have totally convinced us that printing money will create hyper-inflation and a very bad economy. These banking people will give us plenty of examples of money printing countries that then also had hyper inflation and very poor economies. Such as the German hyper inflation in the early 1920th when it took a wheelbarrow of money to buy a loaf of bread. And then there is a long list of countries that also printed a lot of fiat money and experienced hyper-inflation and very bad economies. But the printing of money did not create the bad economies. Cause and efect were totally reverse in that the bad economies that had developed in all these countries left the governments of these countries without tax revenue and that forced them into the printing of money.
If the Federal Government (we the people) prints money then that money is our money. We printed it, it is ours. So if we now distribute our printed money to ourselves by giving it to our local governments and directly to us via our National Debit cards, we are creating no debt. Very simple and it will instantly stop this insanity of borrowing money from banks and creating a National Debt, and no debt that is passed on to our children. Sounds too simple for you? Well, simple solutions are very difficult to dream up and to accept by the public. Complication is a lot easier and vastly more profitable to the politicians and their cronies. I have a very simple proposal as well to reduce the IRS Tax Code from 65,000 pages down to less than 10. You can see that proposal on the website of the United States Patent Office and also here: http://www.google.com/patents?id=DgCaAAAAEBAJ&dq=alf+temme
The problem with these simple proposals is that it sounds way too simple and it is near impossible to get this information to any member of Congress. The reaction to solutions that sound too good to be true are nearly always as follows: Things cannot be as simple as that, and if they were this idea would have been implemented a long time ago. Or another favorite of mine is: "What makes you think that a simple manufacturer (me Alf Temme) should be able to come up with ideas and solutions that Nobel Prize winning economists have not even thought of? (there actually is no Nobel Prize for economics, the prize for economics is a Nobel Memorial Prize in Economics awarded by Sveriges Riksbank in memory of Alfred Nobel).
All these people that are supposed to govern the country and the economy, arrogantly believe that they know everything there is to know about economics and that a simple but equally arrogant small manufacturer in California could not possibly have a solution better than theirs.
So please do all of us a favor and try to help me get this info to some of these people in government that could actually do something with it.
The question is: Which country will have the least arrogant and smartest politicians and then have the guts to make a quick decision and become the first country to adopt TriConomics as its policy to optimize its economy? The guts to be a leader has largely left the United States, so I am not holding my breath, but I like to be wrong. Surprise me.
(You are encouraged to copy this proposal in its entirety and distribute it widely so that some members of Congress may become acquainted with TriConomics sooner rather than later).
The TriConomics repair instructions are only needed one single time to stop the current economic deterioration in its tracks within 3 months and bring the economy back to its 4% unemployment level within the following 9 months. After that the full application of TriConomics will result in a recession proof economy with ever increasing standard of living to the highest level of optimization possible and the crisis intervention measures of TriConomics will not be needed ever any more when the regular standard insights of TriConomics are followed by governments and their politicians and burocrats.
The present economic crisis dictates that drastic and rapid actions must be taken to avert a national financial catastrophe that could plunge the country deep into depression, and cause a similar impact to global markets. Drastic times call for drastic measures, and the current stimulus proposals, although significant in their scope, are not a guarantee or cure-all for these dire economic straits. All it would take to turn this situation around is a forward-thinking, action-oriented, concerted effort between the administration and congress to fast-track this very simple and tactical TriConomic solution.
More about the National Debit cards
The idea to establish a National Debit Card program, funded by the U.S. Government is not only for this short term emergency economic rescue mission. Every American citizen and legal resident alien regardless of their age will be issued a National Debit Card that will be funded from time to time by the Federal Government with amounts to be determined appropriate to the need for injecting money into the economy at amounts that would not exceed the ability of the market to satisfy the delivery of goods and services matching the sudden increase in consumption. It is proposed that the immediate first funding of the National Debit Cards would be for $200 with a stipulation that the funds must be spent on goods and services within 30 days of receipt of the card. The result of the first 30 day $60 billion money infusion can be carefully monitored to determine whether the following month a higher or lower amount should be infused (maybe $237 or maybe $161, who knows). That will enable the exact finetuning of the stimulation of the consumption with the least amount of undesired side effects of inflation or deflation.
The National Debit card funds would not be convertible into cash or available for deposit into savings, nor could they be used to purchase securities or investment products such as stocks, bonds or mutual funds. The cards would be valid for purchases of goods and services only, and the rapid 30 day expiration date would create an almost immediate boost to the national economy and a return to prosperity for many businesses and people through the instant injection of billions of dollars directly into the consumer markets. The cards should be issued immediately to every person with a Social Security number and that would include small children and poor and rich alike.
Assuming 300 million people with Social Security cards, the economy would receive an instant $60 billion shot in the arm for every $200 funding of the debit cards. It means that during the first $200 funding cycle the economy experiences a potential influx of $60 billion that go immediately into the economy and evenly disbursed to all businesses that consumers wish to do business with. And these $60 billion will flow into banks as well in the form of merchant deposits and helping the banking sector with the same $60 billion in new additional fund deposits (that the banks currently and inanely so are allowed to magically inflate into at least nine times as much or $540 billion and then these same banks are claiming a large amount of the extra $480 billion they have so magically created as profit with which they give themselves multi million dollars bonuses and "profit sharing".
The following month a large percentage of these extra $60 billion will circulate again and ongoing every month thereafter. In addition the banks can now again use these extra $60 billion to create their vicious 900% increase of the money supply by means of their Fed/Government permitted lending of 90% of their deposits (in future this currently allowed 90% lending percentage must be scaled down very gradually from 90% to 50% with the help of Government grants to the financial institutions to achieve the maximum bank created increase of the money supply to be 100% instead of the current 900% and raise the reserve requirement from the current 10% to 50%). The first $200 funding must be done with the projection and assurance of additional funding of at least $100 funding increments at 30 day time intervals for at least 12 months in a row to create the certainty of continued consumption to retailers and manufacturers and service providers so they can do proper long term planning for such continued increase of consumption in the many months to follow. Also the assurance that the National Debit cards will be a permanent fixture to the management of the economy will give reassurance to entrepreneurs that they can count on positive government action to give course correction to the economy whenever needed.
This will boost income and confidence in the retail and service sector and prevent further store closings and loss of jobs in those sectors of the economy. The assurance to the manufacturing sector will also stop further decay of jobs in manufacturing as well. The rate at which money will continue to be funded onto the National Debit Cards can be adjusted according to the size of the funds and expiration times by which funds must have been consumed. This fine-tuning will be based upon the data received from banks (through the AutomaticTax system) as to how fast the funding is being absorbed and the ability of production and services to cope with the sudden larger demand. If the supply of goods and services cannot meet the increase in demand, prices will rise and there will be a price inflation. As long as supply can meet the increased demand and prices do not rise, the amount of funding of the debit cards can be incrementally increased in order to promote an even faster rate of economic recovery and later optimization of the economy.
This very simple National Debitcard solution will be easy to implement, and can be put together in as little as three weeks. Cards will be mailed to every U.S. citizen, rich and poor alike, with a social security number and mailing address. These initial cards will be valid only for the first 30 days and must be replaced with cards that have photo ID and other ID informtion on them. This can be done at local drivers license offices and other government offices that currently issue ID cards and passport offices. Citizens and resident aliens who did not receive cards by mail can pick them up in person at government drivers license offices, while registering fingerprints to prevent fraud and add other identification features such as photo-ID. Illegal aliens who make up significant parts of the economy will also be able to receive the National Debit Cards with the possible stipulations of future total expiration of their cards. The number and identity of these illegal aliens can be captured at the same time and used in the future for other practical purposes. Remember that the first objective is to feed money into the economy. The objective is not to do social engineering within these National Debit cards and thereby delaying the process of economic recovery. The funding of debit cards for all at the same amount of funds should please and satisfy Socialists and Capitalists alike even though Socialists often know no bounds to satisfy their desire to take from the rich and give to the poor whereas Capitalists rarely can be kept from complaining about Socialism. What is called for here is to http://www.agreetodisagree.com/ and get the ball rolling as fast as possible.
Card activation will be accomplished via the same electronic processes currently used by Visa, MasterCard and other providers. Whatever account balance remains after the stipulated 30 day expiration periods will revert back to the government and can be proportionally spread to all other National Debitcard holders during the next funding cycle.
During the first 30 day cycle the immediate economic impact can be monitored on a daily basis from merchant bank deposit data provided by the banks to the federal government. During the first 30 day $200 card funding cycle, it can be measured how fast the money is boosting the economy and which sectors are most favorably affected while the stimulus reverberates through the economy. Based upon these data , if the first funding did not cause inflation and the supply of goods and services was able to meet the increase in demand, the second funding round can be accelerated in time and increased in size and the expiration time for use of the funds could be shortened. Conversely if the first round funding did cause inflation and the supply of goods and services was unable to cope with the increased demand, then the second round would not be funded earlier and would not be increased in size and the expiration time would be increased as well. It is an essential aspect of the plan that the amounts funded to the cards expire after a predetermined period of time (30 days for the first $200 funding round), to maximize the speed and positive impact of each round of stimulus funding.
After the first two rounds of funding, significant improvements in the economy should be noticeable. Subsequent funding rounds could be issued at lower levels on an as-needed basis, to ensure that the rate of consumption does not overtake the production of goods and services. Creation of new money to fund the National Debit Cards would be done electronically, essentially “printing” new money specifically for this program. This can be accomplished without the danger of runaway inflation as long as production of goods and services keeps pace with the increase in consumer demand.
There is probably no other way to achieve an instant economic boost of this significant magnitude . Money is the lubricant of the economy, the enabler of commerce, and without it the economy grinds to a halt. The National Debit Card program is the fastest and best way to get the economy back on track quickly and it should be given serious consideration at the highest levels of government. Please call or write your congressional representatives and urge them to draft and approve a National Debit Card program.
The initial National Debit Card act must be devoid of political manipulation or regulations. As soon as politicians get into regulation of this very effective way to stop the recession/depression, they will surely delay the implementation and regulate the effectiveness of the stimulus to death with endless regulation to prevent fraud and other irregularities and possible improvements they undoubtedly envision. All these sort of prevention measures would slow the process of the recovery in a critical way. Every second counts and endless negotiation and deliberation in Congress leads us ever faster into depression and delay the process of getting out of it. Immediately after the first passing and implementation of the National Debit Card act the deliberations for amending and improving it can start, not before. There will guaranteed be abuses immediately after the first funding and issuing of the cards, and they can still be prosecuted and further abuses can be prevented by immediately amending the National Debit Card Act. Even the fraudulent use of the cards will help the economy because even these fraudulently obtained funds will enter into the economy and will stimulate consumption.
To underscore the extreme urgency of the injecting of money into the economy as fast as possible I might illustrate that urgency with the fact that even throwing buckets of money from rooftops in public places would be a faster way toward economic recovery than giving billions to financial institutions or giving tax breaks to people and businesses or drafting plans for massive infrastructure projects and legislating funding for them. Those tax breaks and infrastructure projects are also good tools to stimulate the economy, but they take way too long to immediately stop the continuing decline of the economy with job losses and business closures. The first order of business is to stop the further decline in its tracks with the National Debit Card money infusion. This needs to be done immediately without the annoying delay from people in Congress that like to hear themselves talk without understanding the basics of TriConomics.
For more information on this and other economic think tank insights from economic theorist Alf Temme, visit other pages on the website of www. OneManThinktank.com
Comments and suggestions to: Alf@fastexercise.com.