Sam Smith – Even in the worst of times, some good news may be hidden in the disaster. In the case of the current virus, we can find an example in an unlikely place: money
The virus has removed some of the fiction from our monetary mythology. We have discovered – at least temporarily – that our vaunted system (aka capitalism) under which Elon Musk has over $70 billion in net worth while more than a half million of his fellow citizens are homeless won’t get us through this crisis. And so we’ve done some things in the name of a real life emergency that we’ve long declined to go for in theory.
For example, the $600 a week unemployment aid and the $2400 stimulus check. Or the protection for renters in danger of being evicted.
Also striking has been the increase in national debt which has occurred with surprisingly little controversy and without the past-projected inflation.
We are now seeking pragmatic solutions in a time when economic theory won’t keep us going.
What’s interesting is whether we’ll learn from this or, in better times, just go back to old ways. My hope – perhaps naïve – is that we can ditch such phrases as capitalism and socialism and begin to treat our economic problems the way we’re doing now – seeking pragmatic solutions to real issues.
Here are a few examples of things we might consider:
- · Redefining our budgets so they reflect the difference between operating and capital debt, the latter having a much more productive effect on the economy – a fact we generally ignore. We could help recover from the virus and its economic effects by a massive program of rebuilding deteriorating structures like bridges. And by making distinctions between types of capital expenses. For example, a bus that helps revive an urban area for a decade or more is far more valuable than a tank that is blown up in six months.
- · Guaranteed income: It work recently with the unemployed. Let’s broaden its use.
- · A shorter work week
- · Cooperatives
- · State banks that help their communities rather than just making money off of them.
- · Postal banking: Big banks often refuse to open branches in poor or minority areas, and the few banks still around shutter thanks to industry consolidation and online banking.
- · Credit unions
- · Time dollars, described in the book Time Dollars: A Currency for the 90’s by Edgar Cahn and Jonathan Rowe, operate like a blood bank. People help others in their community and get credits in a computer data base that they can draw upon in times of need.
- · Corporate codetermination. Wikipedia describes how it works in Germany: “The law allows workers to elect representatives (usually trade union representatives) for almost half of the supervisory board of directors. … It applies to public and private companies, so long as there are over 2,000 employees. For companies with 500–2,000 employees, one third of the supervisory board must be elected.”
And that’s just for starters. The point is that there is a wealth of solutions waiting for us to give them a try. The trick is to forget the theory stuff and experiment with such ideas.
The virus has gotten us started on this. Let’s take it from there,