At the risk of sounding redundant, this week’s news items differ only in detail from those of previous weeks. The only antidote is to adopt the Economic Democracy Act as soon as possible:
David Ricardo
• Smartest Dumb Thing, or Dumbest Smart Thing? Many people today accept the labor theory of value as formulated by David Ricardo as established fact . . . most of the time. Recently (especially with the rapid rise of AI), there has been something of a shakeup in valuing everything in terms of labor, with economists — even the Keynesians — cautiously suggesting other factors might be productive. Evidently Elon Musk hasn’t gotten the word. As reported in an article in Benzinga, “Speaking on the ‘People by WTF’ podcast with host Nikhil Kamath in November, the Tesla CEO peeled back the idea of wealth to something far less flashy. Strip away the markets, the people, the systems, and what's left is not power. It’s a tool. And without a system to plug into, that tool does nothing. Musk put it simply: ‘It’s just an information system for labor allocation.’ Then came the line that reframed everything: ‘If you're stranded on a desert island with $1 trillion, it's not useful because there’s no labor to allocate. You just allocate yourself.’” Musk is almost right. The fact is “money” is how I exchange what I produce for what you produce; it has no meaning by itself and, yes, it needs other people and is an information system . . . but labor is not the only thing that produces, and money doesn’t “allocate” labor. It conveys a private property interest, as Irving Fisher pointed out. As Louis Kelso explained, “Money is . . . a yardstick for measuring economic input, economic outtake and the relative values of the real goods and services of the economic world. Money provides a method of measuring obligations, rights, powers and privileges.” (Louis O. Kelso and Patricia Hetter, Two-Factor Theory: The Economics of Reality. New York: Random House, 1967, 54.) The problem today is not money per se, but the fact that many people do not have productive power through either labor or capital, and fixing the money system as proposed in the Economic Democracy Act will go a long way toward making everyone productive and able to pay his or her own way without having to rely on the rich, the government, or somebody “allocating” his or her labor.
• Another Proposed Social Security “Fix”. It’s that time of year — you know, between January 1 and December 31 — when all the experts tell us how to fix Social Security . . . and still don’t have a clue how to do it. The latest (at least according to an article in FastCompany) is (as described in the article), “With Social Security on track to go broke in less than seven years, a new report from the Committee for a Responsible Federal Budget (CRFB) is proposing a solution: Cap Social Security payouts to $100,000 a year for couples, as part of an overall plan to save it from insolvency. (That’s $50,000 for a single retiree.)” Here’s a better idea: make receipt of benefits need-based, merge the FICA tax into general revenues, and adopt the Economic Democracy Act. Everybody will be better off.
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| Robert Kiyosaki |
• Fake Fed Money. Moneywise. Robert Kiyosaki has some good things to say, but he is picking the wrong target, or at least the wrong real target. It’s all the fault of the Federal Reserve, as Kiyosaki was quoted in an article in MoneyWise. As reported in the article, “In an appearance on The Iced Coffee Hour podcast, Kiyosaki issued a blunt warning: America’s boomers will face a wave of homelessness — and he’s placing the blame squarely on one institution. ‘The reason we have homelessness today is because we have a Federal Reserve bank — it’s a criminal organization,’ he said. ‘Look how homelessness is exploding. People can’t afford homes.’ Kiyosaki argued that by printing fiat currency, the Federal Reserve fuels price increases that make everyday life harder for ordinary Americans. He noted that Social Security isn’t enough on its own, and that, ‘we’re going to get wiped out via inflation.’” We agree with Kiyosaki . . . up to a point. The fact is, however, the Federal Reserve was not set up to print money for government, but to provide “accommodation” to the private sector and other key functions . . . for the private sector. It is not a criminal organization unless the government is a criminal organization, since (despite what you might hear about its independence) it is completely under the control of government. It’s use as a government money machine came in with John Mayard Keynes and has been used to screw things up royally ever since — but only because the government insists on using the Federal Reserve the wrong way. To fix it, it is essential to implement the monetary reforms proposed in the Economic Democracy Act.
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| "I'm Batman" |
• “The Worst is Yet to Come.” Remember the old Batman TV series which ended the first half of every episode with a cliffhanger and the admonition to tune in tomorrow because “the worst is yet to come” . . . usually the ludicrous nature of the dilemma and the even more absurd solution Batman came up with. Now, at least according to NBC News, the world is experiencing a severe hit from the cost-push inflation caused by Trump’s Iran war, but “the worst could still be on the way.” As the report states, “The concern is that beyond immediate knock-on effects from rising gasoline prices, the war’s disruption could come in waves — ones that will play out over weeks and months and leave few parts of the global economy untouched. ‘We haven’t seen the brunt of it yet,’ said Samantha Gross, director of energy security and climate at the Brookings Institute. ‘I feel like markets are so far underestimating the effect of the war. It seems that they expect this war to go quickly, and they expect that we can go back to the world before when it’s over. And I don’t think either of those ideas is true.’” The problem is that finance and the economic work on the assumption that it is possible to know with a reasonable degree of probability what the future will be. The current administration’s addiction to utter chaos in all spheres of life — public, private, civil, religious, or anything else — makes it virtually impossible to predict what will happen with any degree of certainty. Consequently, people either go crazy trying to prepare for everything and anything, or give up and go effectively comatose, preparing for nothing. This is a recipe for financial and economic disaster, for nobody can make any plans for anything. The only solution is to adopt the Economic Democracy Act, restore power to ordinary people, and let the rich and powerful play whatever games they want without dragging the rest of us down with them.
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| Jerome Powell |
• Define “Unsustainable.” Whether the glass is half full or broken into pieces and completely worthless might be a matter of opinion, but it’s hard to see how. Similarly, as reported in Fortune magazine, Jerome Powell cautiously saying that the gargantuan national debt is “not unsustainable” (then what is it?), but this is not going to “end well.” As the article stated, “Federal Reserve Chair Jerome Powell offered a sobering assessment of America’s fiscal health on Monday, telling a Harvard economics class that while the nation’s $39 trillion debt load is not immediately dangerous, the path the country is on demands urgent attention from lawmakers. ‘The level of the debt is not unsustainable,’ Powell said during a wide-ranging conversation before roughly 400 students, ‘but the path is not sustainable. It will not end well if we don’t do something fairly soon.’” No kidding. Yet, what could be done? We have an answer: adopt the Economic Democracy Act (EDA) so we can start paying down on the debt instead of adding to it.
• Getting In on the Crypto Craze. There is nothing wrong with gambling, at least so long as you do it with your own money and don’t hurt anyone else. There is also nothing wrong with saving and investing for retirement, so long as you do it prudently. It’s when you combine the two that potential trouble comes down the pike. That is why a story which appeared in The Washington Post is somewhat troubling. Possibly seeking to boost sales of his own venture into crypto currency, President Trump is pushing for allowing people to invest (gamble, really) in more crypto in their 401(k) plans, which traditionally have been geared toward “blue chip”, non-speculative investments. As the Post reported, “Employees could use their workplace retirement plans to invest in cryptocurrencies, private equity and other “alternative assets” under a proposal released Monday by the Trump administration. The plan is a victory for Wall Street, which has lobbied for wider access to these products, many of which have long been the domain of the wealthy and large institutional investors like pension funds and insurance companies.” Qualified plans can already invest in crypto, although the more prudent investors tend to avoid crypto and other “alternative assets” due to their extreme volatility — such as an 80%(!!!!) draw down, leaving investors high and dry. It would be much better to adopt the Economic Democracy Act (EDA), which has much more stringent requirements about what can and cannot be put into a qualified retirement plan.
• No Kidding. Utter chaos under the current administration has become so typical that it is beginning to be engrained in investment algorithms . . . not that it is doing any good, for how do you allow for predicting the unpredictable? What happens in “real life” (meaning the surreal environment of Wall Street) often bears no relation to what is going on in the real world, and of course no one can predict what Trump will do or how long he will do it before he gets bored and moves on to something else. Thus, as reported in Yahoo! Finance, “An eager market has proven itself primed to turn on every new detail from the White House, even as investors and analysts remain skeptical of what President Trump says and the administration's timelines for a conclusion. Even people outside the finance world are familiar with the TACO (‘Trump Always Chickens Out’) trade, where Trump boldly proclaims something only to back down. (Though it sounds pejorative, the phrase has been co-opted by apolitical Wall Street analysts as a trading framework.) The market has tried to get ahead of all of that by pricing in the president's anticipated reversal. . . . Investors may also be wary of putting too much conviction behind definitive theories of where things are going. Hanging over all of this is the specter of insider trading related to prediction market bets, and the too-perfect oil trades placed just before Trump called off attacks on Iran's power plants.” Clearly, Congress needs to restore order (and a modicum of sanity) by adopting the Economic Democracy Act (EDA).
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| Sir Thomas More |
• Trump’s Dystopia. In Sir Thomas More’s satire Utopia, More has the king of Utopia take stock of his resources and decide whether it is economically and politically expedient to conquer a neighboring country. Of course, the point was to ridicule the Tudors’ proclivity for going to war for questionable reasons, regardless of the morality of it. More, perhaps the greatest lawyer and statesman of his day, was fully aware that war is the failure of politics, not its extension, and to go to war except in a just cause was, well, vile — and “just cause” was in More’s lexicon pretty narrow, even stringent. War was a last-ditch when everything else had failed, not the first recourse, even if — like the king of Utopia — you can afford it and it makes political sense. That is why Trump’s emphasis on military solutions as a first recourse and at the expense of domestic needs simply does not make sense. As reported in the Associated Press, Trump is seeking a gargantuan increase in the military budget and, frankly, letting domestic needs go hang: “President Donald Trump is asking Congress to boost defense spending to $1.5 trillion, the largest such request in decades and the latest signal of the president's emphasis on U.S. military investments over domestic programs. . . . Trump, speaking ahead of an address to the nation this week about the Iran war, signaled the military is his priority, setting up a clash ahead in Congress. ‘We’re fighting wars. We can’t take care of day care,’ Trump said at a private White House event Wednesday. ‘It’s not possible for us to take care of day care, Medicaid, Medicare — all these individual things,’ he said. ‘They can do it on a state basis. You can’t do it on a federal.’” Of course, it’s questionable whether the states can handle it, even apart from the questionable nature of Trump’s demands. Another “of course” is that none of this would even be an issue if Congress would adopt the Economic Democracy Act (EDA).
• Greater Reset “Book Trailers”. We have produced two ninety-second “Book Trailers” for distribution (by whoever wants to distribute them), essentially minute-and-a-half commercials for The Greater Reset. There are two versions of the videos, one for “general audiences” and the other for “Catholic audiences”. Take your pick.
• The Greater Reset. CESJ’s book by members of CESJ’s core group, The Greater Reset: Reclaiming Personal Sovereignty Under Natural Law is, of course, available from the publisher, TAN Books, an imprint of Saint Benedict Press, and has already gotten a top review on that website. It can also be obtained from Barnes and Noble, as well as Amazon, or by special order from your local “bricks and mortar” bookstore. The Greater Reset is the only book of which we’re aware on “the Great Reset” that presents an alternative instead of simply warning of the dangers inherent in a proposal that is contrary to natural law. It describes reality, rather than a Keynesian fantasy world. Please note that The Greater Reset is NOT a CESJ publication as such, and enquiries about quantity discounts and wholesale orders for resale must be sent to the publisher, Saint Benedict Press, NOT to CESJ.
• Economic Personalism Landing Page. A landing page for CESJ’s latest publication (now with an imprimatur), 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., 52 or more copies) at the wholesale price, send an email to info@cesj.org 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 155,000 total views. The latest Sensus Fidelium video is “The Five Levers of Change.” 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 persons place in society.
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 well see that it gets into the next “issue.” Due to imprudent and intemperate language on the part of some commentators, we removed temptation and disabled comments.
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