The sad reality and absurdity of our economic situation is on display in today’s New York Times. Two front-page stories, conveniently – thoughtfully? deliberately? – placed next to each other, present two sides of “the economy.”

First, because it’s higher on the page, is:

$3.4 Billion Profit at Goldman Revives Gilded Pay Packages

(Online title: With Big Profit, Goldman Sees Big Payday Ahead.)

Here are a few key sentences:

Goldman posted the richest quarterly profit in its 140-year history and, to the envy of its rivals, announced that it had earmarked $11.4 billion so far this year to compensate its workers.

At that rate, Goldman employees could, on average, earn roughly $770,000 each this year — or nearly what they did at the height of the boom.

Senior Goldman executives and bankers would be paid considerably more.

Second is:

In Recession, a Bleaker Path for Workers to Slog

(Online title: Part-Time Workers Mask Unemployment Woes)

A few key sentences:

In California and a handful of other states, one out of every five people who would like to be working full time is not now doing so.

It is a startling sign of the pain that the Great Recession is inflicting, and it is largely missed by the official, oft-repeated statistics on unemployment. The national unemployment rate has risen to 9.5 percent, the highest level in more than a quarter-century. Yet it still excludes all those who have given up looking for a job and those part-time workers who want to be working full time.

The complete articles are here and here.

The article on unemployment includes a link to a labor department data report:

U-6 Total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached worker … 16.5 percent.

The complete table is here.

Income security for all – a guaranteed basic income for every adult citizen, say $1,000 a month – will ensure that all “marginally attached workers” can afford food and shelter, at least. Plus, people spending that money will stimulate economic growth from the bottom up by demanding goods and services. That would be by far the most direct, rapid, just, and democratic way to end the recession.

Recent economic policies, the conventional approaches using bailouts and subsidies, have directly and obviously enriched Goldman Sachs, but not done a lot for the rest of us.

Some of the questions I ask:

Do we still believe that government should “promote the general welfare”?

Does it make sense to continue subsidizing mostly the special welfare of Goldman, AIG, GM, et. al.?

How much are these absurdities and inequities a result of Goldman execs. holding key government positions over the past two decades?

What kind of society do we want to live in?

We need a peaceful, positive revolution.

It’s time to update ideas from the 1890s, 1930s, and 1960s and enact a guaranteed income. The updated idea is to set some amount, say $1,000 a month, and provide that to every adult citizen. It should be enough for food and shelter, but just enough, so people still have strong incentives to work and earn.

Why don’t we have that? Because we individuals and We the People are not demanding it.

The complete plan, the idea, the benefits, and how we can make it happen, is in Peaceful, Positive Revolution,.

Additional information is on the home page and elsewhere on this web site.

I hope you’ll also comment on this blog. And please help spread the word.

Steven Shafarman

Moderate Democrats and Republicans supported guaranteed income in the 1960s — so did leading economists, liberals and conservatives — and a plan to provide it passed in the House by two-to-one, but was blocked in the Senate. Before that, in the 1890s and 1930s, there were mass movements for income security, and those movements succeeded in winning major reforms. Today, however, almost no one is talking about any form of guaranteed income.

Getting these ideas into public discourse will require lots of us posting material and links on the web, phoning talk radio and TV, writing articles and letters to the editor, talking to our family members, friends, and neighbors. You can make a real contribution. IncomeSecurityForAll.org is designed to assist those conversations and writings, and we can cite the history of serious people who endorsed earlier income security proposals to add credibility. It’ll help if we can find some prominent individuals who are willing to invest their money and reputations.

Here, from the home page of IncomeSecurityForAll.org, is the updated idea:

·   Set some amount and provide it to every adult citizen; enough for food and shelter, but just enough, so there will still be lots of incentives to work and earn.

·   Cash payments, monthly, for the very poor; tax deductions for everyone else.

·   Periodic adjustments to offset changes in the cost of living.

·   Possible supplements from local revenues where living costs are high.

·   The same amount for every citizen, to promote justice and equality while minimizing government intrusiveness and bureaucracy.

Everyone will have some income, guaranteed, in addition to what we earn or get from other sources. You and the rest of us will have more money to spend. We’ll spend, stimulating economic activity and creating jobs. You and the rest of us will have more money to save and invest. We’ll save, and our savings will help recapitalize banks. People will have money to make mortgage payments, reducing home foreclosures.

You and the rest of us will have some secure income even if we lose our jobs. Everyone who’s unemployed will have some secure income, and therefore the ability to manage while they look for work or create jobs for themselves, perhaps starting their own businesses.

Ordinary Americans will have the money we need to solve most of our personal financial problems. Our spending, saving, investing, job-seeking, and job-creating activities will solve our national economic problems.

We pay for it by stopping the bailouts and handouts to banks, Wall Street, and big corporations. And by cutting other government programs that become superfluous, individual welfare and corporate welfare.

Our government will promote the general welfare only, and will do so directly, efficiently. That’s what our government is supposed to do, according to the Constitution: promote the general welfare. Everyone’s basic welfare will be guaranteed. Everyone’s basic welfare, moreover, will be guaranteed equally, with every citizen receiving the same amount. That equality will make it easier for us to unite, organize, and work together as We the People, cutting and eliminating special welfare programs, outvoting and overpowering special interest groups.

America’s free market economic system will be more free and more fair. Markets serve only those who have money, after all, and this universal income will ensure that everyone can participate in the market. Markets will be more free and more fair, also, because bailouts and special interest programs distort markets and we’ll be eliminating many such programs.

This ought to appeal to liberal Democrats, conservative Republicans, and the rest of us as well. Liberals can cheer the way Citizen Dividends will create a baseline of economic justice and economic equality. Conservatives might embrace the prospects for cutting government programs that become superfluous. All of us can rejoice in transcending the old partisan divides, liberal vs. conservative, left vs. right, Democrats vs. Republicans. The new politics will be We the People vs. the status quo and the special interests that have been profiting from the status quo.

Income security for all will be a peaceful, positive revolution. Let’s enact it and make history.

Steven Shafarman

Everyone is looking for the guy – the guy who can tell you exactly what ails the world’s financial system, exactly how we get out of this mess … But here’s what’s really scary: The guy isn’t here. He’s left the building.

No, Tom. You’re wrong about that last point. The guy didn’t leave the building. He wasn’t invited to the party. Though he knocked on the door and offered to contribute his ideas, as he has done many times over many years, he was kept out. Again.

Davos is for the elite. Heads of state and CEOs of global corporations, billionaires and celebrities and special guests, and scores of sycophants who report on the elite, their comings and goings and pronouncements. Tom attends regularly. That’s his scene. Those are his people.

Here’s what Tom and his friends want us to believe:

There is no magic bullet for this economic crisis, no magic bailout package, no magic stimulus. We have woven such a tangled financial mess with subprime mortgages wrapped in complex bonds and derivatives, pumped up with leverage, and then globalized to the far corners of the earth.

They believe it too, apparently. And they think they know what’s best for all of us. They must know – right? – because they’re heads of state and CEOs and billionaires and celebrities, and their thoughts are reported in the New York Times.

But their worldview doesn’t have to be ours. We can do much more than sit around and wait for them to supply the answers, and we must do more because sitting and waiting and expecting magic leaves us lost, powerless, and just as uncertain as the elites at Davos.

Income security for all is not magic – and that’s good for several reasons. First, it seems that Tom and his friends don’t believe in magic. Even though they didn’t invite us to their party, we want them to appreciate our ideas and join us in realizing income security for all.

Second, with magical solutions generally, and on stage invariably, the end result is the restoration of the status quo. The magician waves the wand and says the words, and everything goes back to normal. In reality, however, with our economic and political situation, that’s not good enough. The status quo wasn’t working very well. Too many of us were hungry, homeless, without health care. All of us were living with serious threats and uncertainties, most notably terrorism and climate change.

Third, and perhaps most fundamentally, the search for magical solutions maintains a fundamental and dangerous illusion: someone else is responsible, and he or she will take care of things and solve our problems for us.

Tom likes quotes, and here’s one from Einstein: “You can never solve a problem on the level on which it was created.” Income security for all is a new way of thinking. That’s what makes it so important and necessary.

That’s also why this idea and its advocates are not at Davos. Income security for all will upset the status quo. When everyone has a basic income for food and shelter, everyone will be more able to demand a stronger democracy, real equality of opportunity, greater social and economic justice. These are universal values, professed by ordinary Americans and the elites at Davos, so we can hope and expect that some of those elites will sacrifice willingly, will invite us to their party, will join us in our cause and campaign.

Another reason the Davos crowd might welcome income security for all: These ideas are not just for Americans. Versions can be enacted in any country, and the people at Davos are from around the world. Perhaps someone from somewhere will bring these ideas to next year’s forum.

Steven Shafarman