• The “Evergrande Moment”. China has been fueling its economic growth in infrastructure and production of marketable goods and services with massive amounts of government debt, but Chinese citizens are putting their savings into real estate, according to today’s Wall Street Journal (“America Risks an Evergrande Moment’.” WSJ, 09/24/21, A-17). This has a double whammy in traditional Keynesian terms, as it 1) diverts savings from reinvestment in productive capital 2) to a speculative investment that doesn’t create jobs. In Just Third Way terms, it makes five mistakes: 1) it diverts income from consumption, 2) ties economic growth to what was not consumed in the past, 3) does not use future increases in production to finance growth, 4) limits investment opportunity only to those with savings, and 5) shifts from real growth to speculation. Of course, China isn’t the only economy in the world making these same mistakes. It is, however, making them faster, and with a lot less to back them up if things blow up. Of course, the U.S. is looking at a similar situation, as the article states, but the solution is not to redirect people’s savings from real estate investment to marketable goods and services. Rather, it’s to get out of the past savings game entirely, as proposed under the Economic Democracy Act.
• Federal Reserve Reforms. What with the way the stock market reacts each time the Federal Reserve Board of Governors decides to tweak the U.S. economy, we think it would be better to return the Federal Reserve to its original purpose of providing a sound, uniform, elastic and asset-backed reserve currency and providing adequate liquidity for the private sector, not politicians. To do this would, in our opinion, require five key reforms: (1) Qualified new industrial, commercial and agricultural capital investment would be financed with newly created, private sector asset-backed, no-interest (but not no-cost) money extended through the commercial banking system and rediscounted at regional Federal Reserve Banks in ways that create new owners. (2) Monetization of government deficits would be phased out. (3) Open market operations would be limited to dealing in qualified private sector securities once all government debt is retired. (4) 100% reserves would replace today’s fractional reserve banking by immediate rediscounting of all qualified new capital investment. (5) Private sector insurance and reinsurance companies would offer capital credit insurance and reinsurance to replace reliance on traditional forms of collateral.
• EDA Projections. At what we think is a reasonable guestimate — meaning we took our figures from official Federal Reserve sources instead of trying to calculate them ourselves — The United States economy has new capital needs, both public and private sector, of approximately $4.976 trillion each year. Of this, approximately $4.716 trillion would be income-generating (infrastructure should be self-liquidating, but breakeven). This works out to around $14,000 per U.S. resident. At a very conservative pre-tax ROI of 15%, each year a participant in the Economic Democracy program would get an increase in dividend income of $2,000. By age 65, that would translate into $120,000 or so in pre-tax gross annual income for each participant.
• Hortense and Her Whos. In case you’ve been wondering how you might advance the Just Third Way by introducing it to legislators at any and all levels of government, we’ve made it easy for you, with the “Hortense Hears Three Whos“ initiative. Visit the explanatory website, and consider downloading the postcard to send to people in government. Don’t worry if you think they won’t be open to it, as the postcard is intended to get them to open their eyes.
• Economic Personalism Landing Page. A landing page for CESJ’s latest publication, Economic Personalism: Property, Power and Justice for Every Person, has been created and can be accessed by clicking on this link. Everyone is encouraged to visit the page and send the link out to their networks.
• Economic Personalism. When you purchase a copy of Economic Personalism: Property, Power and Justice for Every Person, be sure you post a review after you’ve read it. It is available on both Amazon and Barnes and Noble at the cover price of $10 per copy. You can also download the free copy in .pdf available from the CESJ website. If you’d like to order in bulk (i.e., ten or more copies) at the wholesale price, send an email to email@example.com for details. CESJ members get a $2 rebate per copy on submission of proof of purchase. Wholesale case lots of 52 copies are available at $350, plus shipping (whole case lots ONLY). Prices are in U.S. dollars.
• Sensus Fidelium Videos, Update. CESJ’s series of videos for Sensus Fidelium are doing very well, with over 150,000 total views. The latest Sensus Fidelium video is “The Four Pillars of a Just Market Economy.” The video is part of the series on the book, Economic Personalism. The latest completed series on “the Great Reset” can be found on the “Playlist” for the series. The previous series of sixteen videos on socialism is available by clicking on the link: “Socialism, Modernism, and the New Age,” along with some book reviews and other selected topics. For “interfaith” presentations to a Catholic audience they’ve proved to be popular, edging up to 150,000 views to date. They aren’t really “Just Third Way videos,” but they do incorporate a Just Third Way perspective. You can access the playlist for the entire series The point of the videos is to explain how socialism and socialist assumptions got such a stranglehold on the understanding of the role of the State and thus the interpretation of Catholic social teaching, and even the way non-Catholics and even non-Christians understand the roles of Church, State, and Family, and the human person’s place in society.
• Shop online and support CESJ’s work! Did you know that by making your purchases through the Amazon Smile program, Amazon will make a contribution to CESJ? Here’s how: First, go to https://smile.amazon.com/. Next, sign in to your Amazon account. (If you don’t have an account with Amazon, you can create one by clicking on the tiny little link below the “Sign in using our secure server” button.) Once you have signed into your account, you need to select CESJ as your charity — and you have to be careful to do it exactly this way: in the space provided for “Or select your own charitable organization” type “Center for Economic and Social Justice Arlington.” If you type anything else, you will either get no results or more than you want to sift through. Once you’ve typed (or copied and pasted) “Center for Economic and Social Justice Arlington” into the space provided, hit “Select” — and you will be taken to the Amazon shopping site, all ready to go.
• Blog Readership. We have had visitors from 37 different countries and 28 states and provinces in the United States and Canada to this blog over the past week. Most visitors are from the United States, Australia, the United Kingdom, India, and Ireland. The most popular postings this past week in descending order were “A Certain Personality,” “News from the Network, Vol. 14, No. 37,” “JTW Podcast: Importance of Power,” “Social Justice, IV: The Characteristics of Social Justice,” and ““The Purpose of Production”/“Corporatism versus Distributism”/“Investment v. Speculation” (three-way tie).
Those are the happenings for this week, at least those that we know about. If you have an accomplishment that you think should be listed, send us a note about it at mgreaney [at] cesj [dot] org, and we’ll see that it gets into the next “issue.” Due to imprudent language on the part of some commentators, we removed temptation and disabled comments.#30#