The important New York Times columnists (Krugman, Herbert) are backing a big stimulus bill and warning that what looks likely to pass is not nearly big enough. Furthermore, precious time is being wasted in a futile attempt to court Republicans.
Krugman says:
Obama's attention to Republicans is like Dorothy transfixed at the sight of the Wicked Witch as she melts into a puddle of toxic waste. Let them melt down and let's get on with it!
Bob Herbert had a funny story about John McCain:
Senator John McCain echoed many of his Republican colleagues on Friday when he indignantly asserted, “This is not a stimulus bill; it is a spending bill.”
It was an objection that had been addressed by an incredulous President Obama on Thursday night. “What do you think a stimulus is?” the president asked, his voice rising. Spending, he said — to laughter from his audience — “is the whole point.”
Which brings me to an article that illuminates the money mess very well and points to the way out. David Korten in YES says, "Don't fix Wall Street, replace it." Yes! And he has a longer piece in the magazine that outlines a prescription: Beyond the Bailout - Agenda for a New Economy,
This is a very wise analysis covering several points, but the most important one is the idea of completely changing the monetary system. Korten says we must convert to debt free money. Currently, banks create money for businesses and individuals who come in to ask for loans. They have to keep making more loans in order to have enough money coming in to pay interest on their accounts. That locks the whole system into a growth imperative. As Korten puts it: "The demand for repayment with interest of nearly every dollar in circulation virtually assures the economy will fail unless GDP and inequality are constantly growing." Not such a great idea on a finite planet.
The alternative, Korten says, is government issued money with no debt: "government creates debt-free money by spending it into existence to fund public goods like infrastructure or education."
That's your stimulus plan. Clearly $865 billion or whatever it is today is not going to be nearly enough. No wonder the Republicans have their knickers in a knot. The stimulus is the first step in replacing the entire predatory financial system with a new publicly owned and controlled financial system.
There are lots of advantages, says David Korten: "Publicly issued debt-free money would greatly reduce debt, taxes, and environmental harm, be more equitable, and increase financial stability. In a democracy, it should be ours to choose."
I vote for that.
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