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Peoples’ Capitalism A Plan for Prosperity and Economic Justice. James S. Albus, Ph. D. http://www.JamesAlbus.org. A Fundamental Question. Why does poverty exist in a world of plenty?. Modern technology has the capacity to produce enough

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slide1

Peoples’ Capitalism

A Plan for

Prosperity and Economic Justice

James S. Albus, Ph. D.

http://www.JamesAlbus.org

slide2

A Fundamental Question

Why does poverty exist in a world of plenty?

Modern technology has the capacity to produce enough

goods and services for everyone to have a healthy diet,

a decent place to live, good medical care, and a good education

Walk into any mall or supermarket, the shelves are

stuffed with products in attractive packages

Manufacturers would gladly produce more

-- if only there were more customers

slide3

What is the Problem?

For business, the problem is NOT in producing goods & services

-- but in attracting customers

For consumers, the problem is NOT that they are without need

-- the world is filled with people that need more food,

better housing, better medical care, better education

2,800,000,000 people live on less than $2 per day

This is a vast untapped market

These are potential customers!

The problem lies in the distribution of income

slide4

Causes of the Problem Are:

  • For most people, income is derived from sale
  • of labor and intellectual skills
  • Wages and salaries are costs to be minimized
  • Globalization produces a race to the bottom
  • Modern technology reduces need for labor
  • Economic growth is far below its potential
  • Monetary policy is the wrong tool for
  • fighting inflation
  • Monetary restraint limits investment & growth
  • 3% growth is maximum considered sustainable
slide5

What is a Solution?

  • Make everyone a capitalist.
  • Provide credit for capital investment to all.
  • Increase the investment rate by 100%
  • Generate > 6% GDP growth rate
  • Invent a new tool for controlling inflation
  • Based on saving withholdings
slide6

PEOPLES’ CAPITALISM

The Economics of the Robot Revolution

James S. Albus

1976 New World Books

  • What -- Issue credit to everyone for investingin productive enterprises
    • How much -- Double rate of capital investment
  • --About $6000 per capita indexed to GDP
    • -- Double investment in R&D
  • New tool – Savings accounts replace monetary restraint
  • for controlling inflation
  • Result – GDP grows at > 6% per year without inflation
      • --Per capita income floor risesto $1600 in 10 years
  • -- to $29,000 in 40 years
  • -- to $58,000 in 50 years

For details, see“A Plan to Eliminate Poverty”at

slide7

Per Capita Income Floor

$60,000

Double investment

6% growth rate

$50,000

50% increased investment

4.6% growth rate

$40,000

50% increased investment

3% growth rate

$30,000

$20,000

Assumptions:

Borrow at 3%

ROI = 8%

Payback period = 30 years

$10,000

0

10

20

30

40

50

years

slide8

Financing Mechanism

Federal Reserve would open discount window &

issue credit to member banks who would

make loans to individuals for investment in

approved list of enterprises

Details of how this might work can be found in --

CAPITAL HOMESTEADING

For Every Citizen

Norman Kurland, Dawn Brohawn, Michael Greaney

2004 Economic Justice Media

See also:

BINARY ECONOMICS

The New Paradigm

Rodney Shakespeare and Robert Ashford

1999 University Press of America

slide9

Savings Accounts

Purpose: To replace monetary restraint as a

mechanism for controlling inflation

Rational: Enables Federal Reserve to increase

investment rate without fear of inflation

Effect: Saving withholding rate indexed to inflation

-- If inflation low, savings withholdings = 0

-- Provides powerful fast-acting feedback

to stabilize prices

slide10

Summary

  • Make everyone a capitalist. Provide
  • credit for capital investment to all.

2. Increase the investment rate by 100%

  • Use savings accounts to control inflation
  • Achieve sustainable economic growth > 6%
slide11

Benefits

  • Income floor rises to $29,000 in 40 years
  • Poverty ceases to exist
  • No income ceiling
  • Everyone benefits from productivity gains
  • Jobs are plentiful
  • Profits are high
  • Welfare is unnecessary
  • Retirement is secure for everyone
  • Medical and elder care are available to all
  • Environmental solutions are affordable
slide12

So What’s the Problem?

Why don’t people see the beauty of this?

Why hasn’t it been adopted?

-- or introduced as legislation?

-- or debated in the public forum?

Good Questions

If you would like to offer suggestions

or join the debate

E-mail me at JSAlbus@aol.com