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My Plan for Economic Recovery

Posted by libhom Saturday, February 21, 2009

In my comments on a post on Mock Paper Scissors, I suggested some positive ideas for helping to get us out of the mess we are in. I thought I would elaborate on them here. So many people are in panic mode, when what we need to be in is action mode. I encourage other liberal and progressive bloggers to make their own proposals on how to get us out of this mess.

1) Raise taxes on the rich and use the money for jobs programs, especially ones which would provide long term benefits for the economy. The Stimulus Plan had some public works spending, but nowhere near enough. Two examples include:

- A massive expansion of our nation's public transport systems: Even NYC is underserved by its subway system, and we have it better than most. Expanding mass transit nationwide, especially fuel efficient rail transit, would prevent future economic problems by reducing Global Warming, cutting back on trade deficits, and reducing obesity . (Public transit encourages more physical activity than car culture.)

- The Gulf Coast Civil Works Project: Due to corruption, racism, and incompetence, the Gulf Coast region still hasn't even come close to recovering from Katrina and Rita. The GCCW would fund the reconstruction of this region and employ displaced people to do it. This is the kind of common sense approach that is long overdue. Here's an Action Alert to support it.

2) Pass legislation to fire all the CEOs at the struggling banks and automakers. The legislation also should nullify the golden parachutes. A major reason why these companies are failing is bad management. The CEOs need to be removed in order to improve the idiotic directions they have taken their companies in. In the auto industry, the unions should be put in charge. They have pushed for fuel efficient vehicles for decades and they have more incentive to promote long term sustainability over short term profits.

3) Freeze interest rates on Adjustable Rate Mortgages. Given that interest rates have been low, there is no excuse for the interest rates of so many Adjustable Rate Mortgages (ARMs) to be jumping so astronomically. These predatory lending practices are making people homeless, destroying home equity, and bankrupting the banks led by the idiot banksters responsible for them.

4) Withdraw all troops from Iraq ASAP, ending a diversion of US resources to the destruction of another country’s economy.

5) Start busting the trusts: There needs to be far greater enforcement of our antitrust laws and legislation closing loopholes sleazy corporate lawyers and conservative judges have created. Legislation should also give consumer groups and unions standing in court to sue to block mergers. The number of lawyers involved in antitrust work at the Dept. of Justice should be expanded dramatically. Mergers inevitably lead to job losses, job losses our economy cannot afford. Also, when any company is "too big to fail," it is just plain too big and needs to be broken up.

This also applies to breaking up Microsoft. If not for the corruption of the Bush regime, the Redmond blue screen of death generators would have been broken up into several companies under our antitrust laws. This still needs to happen. Our economy is damaged by Microsoft's use of anticompetitive tactics to make its low quality products market dominant. Our economic productivity is too important to allow Microsoft to get away with this.

I'll be updating this post when I read about other good proposals or think up ones of my own.



  1. Anonymous Says:
  2. I like your ideas!

    Why not nationalize the banks (at least for a while?)

    Why not let the workers own and run the auto companies?



  3. C Woods Says:
  4. I couldn't agree with you more.

  5. Christopher Says:
  6. Makes sense to me.

    The $10 billion a month on Iraq is simply outrageous because we don't have the coin in the Treasury to pay for it.

    All the appropriations funding is being done on credit -- obligating this country and future generations for years to come and for what?

    The mess on the Gulf Coast is shameful. New Orleans isn't as good as pre-Katrina and neither is Mobile, AL. A massive works project would help the region rebuild and create jobs, jobs and more jobs.

  7. Nathan Says:
  8. I really enjoyed the fact that you mentioned public transit. I drafted a very long and detail specific post about this very concept a few months ago, but didn't publish because the ideas weren't polished yet.

    The fact that you are thinking the same thing tells me perhaps it's an idea worth writing about.

    I like your ideas and your solutions.

  9. JayV Says:
  10. Great ideas, which I'm book-marking. OK I sent off a letter about the Gulf Coast initiative to my congressional delegation and noted even though the people in my Vermont city send relief to its sister city in Mississippi, that area still needs the benefits of the GCCW.

    Oh, and it's going to take quite a shift in thinking, but you are spot-on: public transit encourages more physical activity than car culture.

  11. Pyzahn Says:
  12. I'm voting for you next election!

  13. Anonymous Says:
  14. I think history will show that one of the biggest factors that caused our current financial meltdown (or the inability to respond to it) is the billions spent in Iraq. Of course, no one seems to be talking about this.

    The other ideas sound good, but I have reservations about #2. I think, instead, the banks and other companies should just be allowed to fail. If this is a condition of accepting bailout money, fine, but otherwise I don't want the government (which tends to be just as sluggish, bloated and inept as some corporations) making personnel decisions. Nor the unions. On one level, I can see the point, but shareholders would never let it happen. It's an impasse, so there needs to be a solution somewhere in between.

  15. libhom Says:
  16. CWoods, Christopher, JayV, Pyzahn: Thanks for the postivie feedback.

    Nathan: I encourage you to write about public transportation. It is a practical approach that can help to solve so many of our nation's problems.

    Tengrain and Riverwolf: I parsed the language on the section on CEO firings carefully. However, Tengrain is correct that workers should run the show at the auto makers. In practice, that means union control because "employee ownership" plans not run by unions have ended up being shams controlled by the same CEOs as before.

    Riverwolf: I'm not sure I'm completely comfortable with bank nationalization myself, though it is starting to look inevitable for the biggest banks. However, I have no problem at all with legislation forcing the big banks to fire their CEOs. They should have taken care of this themselves.

    As for government inefficiency, the private sector tends to be even more inefficient than the public sector, at least when you are talking about large corporations. However, the main problem with the banks is not inefficiency. The main problems are irresponsibility and a lack of accountability and oversight. Government has much more accountability and oversight than the private sector, though it definitely should have more.

    Unions sometimes have some financial problems, but they manage their finances better than corporations in general and much better than the Big Three automakers have. We are deluged with anti union propaganda by the corporate media. We need to learn to not take it so seriously.

    As for shareholders accepting the changes, I'm against giving them any choice. If the government is going to bail out companies, the shareholders should consider themselves lucky and STFU.

  17. John Says:
  18. good ideas!

    Why not also add: MAKE ALL CHURCHES PAY SALES TAX!

    PS-great blog you have!



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