Imagine a Private Sector, Free Market Economy That Guarantees Enough Predictable Income,,,

Imagine, if you can, a private sector oriented, free market economy which is designed to systematically guarantee that every American citizen, regardless of race, ethnicity, gender, or sexual orientation, has ENOUGH PREDICTABLE INCOME to pay for decent food, shelter, clothing, education, basic transportation, and yes, health care. In other words, imagine, if you can, a free market economic system that’s specifically designed to produce…

• No homelessness

• No people living in cockroach and rat-infested slums or ghettos

• No single moms having to choose between raising their kids and feeding them

• No wage slaves working on corporate plantations for exploitative corporate dictators

• No old folks eating dog food in order to pay for their meds

• No systematically induced anxiety and stress due to financial instability

• No militarized cops trying to control angry mobs

• No cyclical recessions or depressions, bankruptcies or home foreclosures

• No need to escape inhumane living conditions through booze, drugs, and mental illness

• No debt created whether consumer debt or governmental debt

• People who are actually free to fulfill their individual potentials, whatever they may be

• And in the long run, no need for social safety nets (i.e. Social Security, Medicare, and Medicaid) because everyone has ENOUGH PREDICTABLE INCOME to pay their bills!

Although this list sounds almost impossible, consider these FACTS. On average, the American economy grows at the rate of $4 Trilli Dollars annually. That translates into about $12,000 for every man, woman, and child in America. But generally speaking, the beneficiaries of this annual growth are currently limited to those people who can afford to buy the stocks, bonds, real estate, and technological developments that account for this growth.

 

90% Lack the Opportunity

More specifically we’re talking about less than 10% of Americans who have the means to take advantage of this relatively predictable growth, and 90% who lack the opportunity to participate. Thus, we now have a 21st century wealth gap that is wider and more toxic than any time since the stock market crash of 1929 and the Great Depression which followed in its wake.

To make matters worse, this was the case long before the current pandemic oriented economic crisis raised its ugly head. In response to millions of workers losing their incomes and healthcare due to the virus, the Federal government has increased unemployment benefits for several months, and issued so called “stimulus checks ($1,200)” to millions of people in an effort to artificially jump-start demand and to prevent the ship of state from sinking into oblivion.

 

Unpalatable But Necessary Steps

In taking these unpalatable but necessary steps the government has significantly increased the already massive debt load, which means it’s a short-term not a long-term solution. The hope of course is to artificially resuscitate demand, which in turn should recreate jobs and get we the people back to work and lead us all back to where we were before the virus struck.

The problem is that, even before the virus struck, we the people were not in a very good place. Even before the virus erupted over half of all Americans were living paycheck to paycheck, unable to afford a $500 bump in the road without having to borrow money in order to pay for it. Things are dramatically worse than they were several month ago before the virus. But the place we were is still not the place to which we the people are longing to return. So, what can we do?

 

The $4 Trillion Dollar Idea That Creates No Debt!

In that light let’s recall that on average, the American economy grows at the rate of $4 trillion dollars annually. Once again, that translates into about $12,000 annually for every man, woman, and child in America. But the beneficiaries of this annual growth are those who can afford to buy stocks, bonds real estate, and new technology. This generally excludes we the people.

The question I want to raise here is, how can we make sure the average American citizen has systematic access to the ownership side of the economy, where most of the wealth is being generated? How can the average Joe gain access to that $4 trillion dollars-worth of predictable growth in order to generate a second stream of investment income, while eliminating the fear and instability that so many Americans suffer from in today’s incredibly imbalanced economy?

 

Paying “We the People” to Pull Together…

Consider this. What if the Federal Reserve, through local banks issued $12,000 of INSURED CAPITAL CREDIT to every American citizen annually, along with a stipulation that these funds could only be used to purchase shares of new and transferred capital assets that were predicted to generate enough future profits to pay for the purchase of these assets and to create a predictable, stabilizing, residual income for its owners?

This strategy, known as Capital Homesteading, would cost American taxpayers NOTHING. It creates no government debt! And no consumer debt! And, rather than government debt-backed currency, the purchase would be backed (collateralized) by real, productive, private-sector assets

And it won’t be inflationary. All money created would instantly be backed (collateralized) by the full value of private sector assets that citizens would receive insured loans in order to purchase. Citizens would actually be purchasing newly issued, full dividend payout, voting shares of companies that need new capital assets in order to grow.

What this would do however, is give every American citizen equal access to the ownership side of the American economy, where most of our nations’ wealth is being generated. In the long run it will help democratize the free market.

In this moment of political division and strife Capital Homesteading literally pays all Americans to pull together, at the same time, in the same direction, towards the same goals! It translates mere political talk (such as… we’re all in this together) into real live, results driven action!

 

It Systematically Counteracts Concentrated Wealth!

Over time, each American citizen will accumulate more equity, more residual income, and benefit from their investment income in a way that only the wealthy can today. As the result, the need for federally backed social safety net programs (i.e. social security, Medicare, Medicaid, food stamps) will gradually fade into the sunset. More people will be able to pay taxes, which in turn decreases the load on those among us who still pay taxes. It systematically counteracts and impedes concentrated wealth as it gradually democratizes America’s free-market economy!

 

Today’s Crisis Wouldn’t Be a Crisis

If Barack Obama, George W. Bush, or Bill Clinton had implemented Capital Homesteading during their respective administrations, today’s COVOD 19/Unemployment crisis would not be a crisis. We the people could afford stay at home and still have sufficient income to weather a much less severe storm. Trump has had the same opportunity for 3 years now, but he’s shown no interest in actually making America great again. Joe B? How about you?

 

Capital Homesteading In Detail

I confess, this commentary has been a generalized portrait in dire need of more detail. So, for a full and detailed explanation of how this strategy could be implemented, go to CESJ.ORG and check out the concept that Dr. Norman Kurland calls the CAPITAL HOMESTEADING ACT. It’s an ingenious idea whose time is long overdue. And it’s one very good thing that could actually come to fruition as the result of this horrific COVID 19 crisis.

 

Addendum…

UBI vs. Capital Homesteading Comparison

Stimulus checks are effectively a short-term form of Universal Basic Income (UBI), an idea which has been advocated by among others, former presidential hopeful and serial entrepreneur Andrew Yang, as well as Mark Zuckerberg of Facebook, and Elon Musk of Tesla. Although the suggested annual amount of money issued ($12,000 annually) is the same as Capital Homesteading, that’s where the similarity ends. Check out the differences.

1. Since it issues insured capital credit loans that are paid back via pre-tax future earnings, and can only be used to buy wealth producing capital assets, Capital Homesteading creates NO GOVERNMENT DEBT and NO COMSUMER DEBT! UBI and stimulus checks create government debt that will eventually be paid back by we the people (not the 1% who are spectacular at avoiding taxes) in the form of higher taxes.

2. Capital Homesteading systematically creates universal capital ownership opportunity and access to the means of acquiring wealth producing capital assets. UBI does not.

3. Capital Homesteading systematically finances predictable and sustainable growth of the economy. UBI does not.

4. Capital Homesteading systematically enables individual citizens to become economically empowered and liberated through capital ownership. UBI does not.

5. Capital Homesteading systematically enables citizens to become economically independent of the government. UBI does not.

6. Capital Homesteading systematically generates mass purchasing power through ever-broadening citizen ownership of income producing capital. UBI does not.

7. Capital Homesteading systematically creates new owners of advanced technologies and green growth assets UBI does not.

8. Capital Homesteading systematically creates a growing tax base to pay the costs of government, thereby eliminating deficit spending and eventually paying off the currently massive government debt. UBI does not.

9. UBI/Stimulus checks are simple and immediate. That’s their strength.

10. Capital Homesteading requires some time (usually a number of years) in order for benefits to accumulate. That’s why UBI should start immediately and be phased out over time in favor of Capital Homesteading.

 

Private Sector

The private sector generally refers to the part of the economy that is owned and controlled by individuals or privately owned businesses, as opposed to the public sector, which includes government-owned entities and services. The private sector encompasses a wide range of industries and activities, including manufacturing, retail, finance, technology, healthcare, and more.

Here is a general overview of the private sector and its characteristics:

1. Ownership and Control: In the private sector, businesses are owned and controlled by individuals, families, or groups of shareholders. These entities have the freedom to make decisions regarding their operations, investments, and strategies, with the goal of maximizing profits and shareholder value.
2. Competition: The private sector is characterized by competition among businesses operating in the same industry. This competition encourages innovation, efficiency, and the delivery of high-quality goods and services. Market forces such as supply and demand determine prices and drive the allocation of resources.
3. Profit Motive: Profit generation is a primary objective of private sector enterprises. By maximizing profits, businesses aim to grow, expand, and provide returns to their owners or shareholders. Profits can be reinvested in the company, distributed as dividends, or used for other purposes.
4. Employment: The private sector is a significant source of employment opportunities, creating jobs across various sectors and industries. Private sector companies often contribute to economic growth, job creation, and wealth generation.
5. Entrepreneurship and Innovation: The private sector fosters entrepreneurship and innovation. Entrepreneurs can establish and operate their businesses, bringing new ideas, products, and services to the market. This entrepreneurial spirit drives economic development and societal progress.
6. Risk and Investment: Private sector enterprises undertake risks and require investments to start, operate, and expand their businesses. Investors provide capital in exchange for ownership or returns on their investment, assuming the risks associated with the business’s success or failure.
7. Regulation: While the private sector operates independently from direct government control, it is subject to various regulations and laws designed to ensure fair competition, consumer protection, labor rights, environmental standards, and other considerations. Governments often establish regulatory frameworks to balance the interests of businesses, consumers, and society as a whole.

The private sector plays a vital role in the economy, contributing to economic growth, innovation, and employment. It interacts with the public sector, which provides essential services such as infrastructure, education, healthcare, and defense. Together, the private and public sectors form the foundation of a mixed economy in most countries.

If you have any specific questions or need information on a particular aspect of the private sector, please let me know!

 

The Free Market Economy: Promoting Prosperity and Efficiency

Introduction:

A free market economy is an economic system in which the production, distribution, and pricing of goods and services are determined by the interactions of individuals and businesses in a competitive marketplace. It is characterized by limited government intervention and the absence of price controls. In a free market economy, the forces of supply and demand guide the allocation of resources, fostering competition, innovation, and economic growth. This article explores the key features, benefits, and criticisms of a free market economy.

Key Features of a Free Market Economy:

1. Private Property Rights: In a free market economy, individuals and businesses have the right to own and control property, including land, capital, and intellectual property. This encourages investment, entrepreneurship, and the efficient use of resources.
2. Voluntary Exchange: Participants in a free market are free to engage in voluntary transactions based on mutually beneficial agreements. Buyers and sellers negotiate prices and quantities without coercion, leading to the efficient allocation of goods and services.
3. Competition: Free markets thrive on competition, as it drives innovation, quality improvement, and cost reduction. Competitive pressures encourage businesses to offer better products and services at competitive prices, benefiting consumers.
4. Price Determination: Prices in a free market are determined by the forces of supply and demand. As market conditions change, prices adjust to reflect the scarcity or abundance of goods and services. This flexible pricing mechanism helps allocate resources efficiently and signals information about consumer preferences and production costs.

Benefits of a Free Market Economy:

1. Economic Efficiency: Free markets encourage the efficient allocation of resources. Through competition and price signals, resources flow to their most productive uses, resulting in the optimal production and distribution of goods and services. This efficiency leads to higher living standards and overall economic growth.
2. Innovation and Entrepreneurship: Free markets provide a fertile ground for innovation and entrepreneurship. Incentives for profit motivate individuals to develop new products, technologies, and business models. The competition fosters a climate of continuous improvement and dynamic economic progress.
3. Consumer Choice: A free market economy offers consumers a wide range of choices. Competition among producers leads to diverse product offerings, allowing individuals to select goods and services that best meet their needs and preferences. This freedom of choice empowers consumers and enhances overall welfare.
4. Wealth Creation: Free markets have proven to be powerful engines of wealth creation. As individuals and businesses succeed in the marketplace, they generate income, create jobs, and contribute to economic growth. This prosperity can lead to improved living standards, poverty reduction, and social mobility.

Criticisms and Challenges:

1. Inequality: Critics argue that free markets can exacerbate income and wealth inequality. Without intervention, market forces may concentrate wealth in the hands of a few, leading to social disparities. Critics call for policies to address these inequalities through progressive taxation, social safety nets, and targeted interventions.
2. Market Failures: Free markets are not immune to failures. Market failures occur when the efficient allocation of resources is hindered, such as in cases of externalities (costs or benefits not reflected in market prices), monopoly power, or information asymmetry. Critics argue that government intervention is necessary to correct these market failures and ensure fair outcomes.
3. Lack of Social Safety Nets: A criticism often raised against free markets is their potential to leave vulnerable individuals without adequate social protection. In times of economic downturns or disruptive technological changes, individuals may face unemployment or income loss. Critics argue for the need for government intervention to provide safety nets, such as unemployment benefits, healthcare, and education subsidies.

Conclusion:

While no economic system is perfect, a free market economy has demonstrated numerous benefits in fostering prosperity, efficiency, and innovation.

Its emphasis on voluntary exchange, competition, and property rights has been instrumental in driving economic growth and improving living standards. However, challenges related to inequality, market failures, and social safety nets highlight the importance of finding a balance between free markets and appropriate government interventions to ensure a fair and equitable society.

Author: Mohammed A Bazzoun

If you have any more specific questions, feel free to ask in comments.

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