Beyond the Bailout: Self-Finance the Real Economy |
Tuesday Dec 16 2008
By David Korten | Website
Reprinted from "Sustainable Happiness," the Winter 2009 YES! Magazine284 Madrona Way NE Ste 116, Bainbridge Island, WA 98110. Subscriptions: 800/937-4451
Far from serving the financial needs of Main Street, Wall Street treats Main Street like a colony to be managed for the benefit of its colonial master. In alliance with the Federal Reserve, Wall Street players have used a combination of control over the money supply, predatory lending practices, and lobbying and campaign contributions to suppress wages, dismantle social safety nets, and capture the value of productivity gains for themselves. The top 1 percent of U.S. income earners increased their share of national cash income from 9 percent to 19 percent between 1980 and 2005, according to Charles R. Morris in The Trillion Dollar Meltdown. Income for 90 percent of households fell relative to inflation, household savings rates dropped to less than 1 percent, and household debt soared as Main Street workers struggled to hold their lives together.
Creating a fair distribution of wealth by restoring progressive tax rates, increasing the minimum wage, containing health care costs, and regulating mortgage and credit card interest rates is an essential element of a post-bailout economic agenda. This will help those at the bottom, restore household savings and purchasing power, and, combined with the debt-free money system proposed below, eliminate Main Street dependence on Wall Street financing. The financial services needs of Main Street economies are best served by a federally regulated network of independent, locally owned community banks that fulfill the classic textbook banking function of acting as intermediaries between local people looking for a secure place for their savings and local people who need loans to buy a home or finance a business. Evidence that people with savings are moving their accounts from the giant banks with questionable balance sheets to smaller local banks is a positive step.
Wall Street interests have also rigged the economic game to give a competitive advantage to mega-corporations over the local independent businesses that are the heart and soul of Main Street economies. The New Rules Project of the Institute for Local Self Reliance provides a wealth of recommendations for restoring a proper balance in favor of Main Street that also merits serious consideration.
Written by eldering at The Great Turning
Tagged with: local_self_reliance main_street new_rules_project wall_street
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