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OpEdNews Op Eds    H1'ed 8/14/12

America is Not Broke!

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Scott Baker
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America Is Not Broke!

Americans of all political beliefs have been told repeatedly that America is broke, that something must be cut and/or taxes raised or we will drown in debt. While the debt is real, it pales in comparison to the 10s of trillions available to us - if we know where to look.

In short, America is Not Broke!

The following multi-trillion dollar economic reforms would completely turn the American economy around to the positive, forever. The first three have all been implemented to some degree in our history.   All  are consistent with American values of competition, fair play, economic and ecological sustainability, meritocracy, profiting from one's own labor, and Lincoln's ideal of an America by, for and of the People.


1.   Debt-free Money: Like coins and stamps (for a limited purpose), debt-free United States Notes (http://en.wikipedia.org/wiki/United_States_Note) can be issued by Congress anytime, for any reason, in any amount under the Constitution's Article 1, Sec. 8. Congress did create these original Greenbacks under the first Legal Tender Law (1862) by president Lincoln ($450 million) to fund the Civil War, and they continued through 14 series until 1996. This money would not have to be borrowed, raised in taxes, or backed by gold. It need not cause over-inflation if put toward those sectors that are in deflation. It is a "Public Option for Money." Perhaps $4 trillion, spread over 10 years, could be directed towards infrastructure, or Social Security.   Several recent attempts to do this, including the Rep. Kucinich's Bill, HR2990, are part of larger reform packages, but we can re-issue U.S. Notes anytime, producing an immediate gain in the government's accounts. Correcting Treasury & GAO's misleading statements on this issue is part of an ongoing lawsuit here: http://tompainetoo.com (Johnson v. Treasury) featuring my petition (Exhibit B): http://www.change.org/petitions/end-the-debt-crisis-with-debt-free-united-states-notes


2.   Land Value Taxation, aka the Single Tax (http://en.wikipedia.org/wiki/Georgism):   This Henry George ("Progress and Poverty," 1879. George was a Greenbacker too; see above) idea would make public the currently private collection of resource and locational rent.   It would end speculation by taxing economic rent, and eliminate Land-based booms and busts like the current one, forever.   Furthermore, by taxing the 33%-40% of GDP (http://economics.ucr.edu/papers/papers08/"-08-12old.pdf ) that is collected by idle rentiers on location and natural resources, one could untax all actual production (wages, sales, fixed capital like buildings), thereby vastly simplifying the tax code, removing opportunities for corruption, and freeing up major American productive capacity in a naturally efficient, green, scalable, and sustainable way.   This idea has been successfully applied in towns and cities all over the world and is perhaps the most established theorem in economics. See petition: http://www.change.org/petitions/a-new-form-of-capitalism-geonomics

3.   Public Banks (http://publicbankinginstitute.org/home.htm) like the highly successful State Bank of North Dakota (est. 1919) would force state accounts to be invested in State needs, and not in Wall Street speculative gambles - money which was raised through taxes but then has to be borrowed back, at interest rates of 4%-6%!   The agency and pension funds of most states are invested in risky, often underperforming asset classes, sometimes below investment grade, by managers who charge millions in fees. The Bank of North Dakota manages $4 billion in loans conservatively and constructively.   Public Banks can respond directly to community needs and even occasional emergencies in a way that would decentralize the Money Power, returning taxpayer money to We The People. Multiplied in all 50 states, and at the community level too, and America could save trillions in unnecessary gambles, bailouts, and interest costs.


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Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a former blogger for Huffington Post, Daily Kos, and Global Economic Intersection.

His anthology of updated Opednews articles "America is Not Broke" was published by Tayen Lane Publishing (March, 2015) and may be found here:

Scott is a former and current President of Common Ground-NY (http://commongroundnyc.org/), a Geoist/Georgist activist group. He has written dozens of (more...)

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