A stimulus plan that did work well

Tuesday October 9, 2012

Those Republicans whose knickers are in a twist over the thought of stimulus plans are too young to remember the wildly successful granddaddy of them all. It is true that today our infrastructure is falling apart, millions of citizens are "ill clothed, ill housed, and ill fed" and our educational system is a national disgrace compared with the rest of the developed world. But compared with the state of Europe after World War II, we are filthy rich and largely healthy, if somewhat uneducated.

When the Big War was finally over, Europeans were literally starving from a wrecked agriculture system. Today we are merely dying of obesity. We actually have a lot of good jobs available but not the educated college graduates to fill them. And yet, four or five years after World War II was over, Europe was doing fine. Factories were being rebuilt, people were working, fields were being planted. How? Because of that granddaddy of all stimulus packages, the Marshall Plan. The United States simply gave, loaned or granted funds to build a continent.

The minute there was money circulating again people could work, and work they did. The entire world benefited. Remember how GE was thriving in the 1950s? Remember the Halloween parades? Witch Hazel? The immense dragon that roared at the kids and whose red eyes went on and off? How Pittsfield’s population expanded to 50,000 and we had to build three new elementary schools?

Here’s the point. A country doesn’t thrive in proportion to the number of dollars it has in circulation. It thrives in proportion to how fast the money circulates. If lots of its dollars are immobilized in huge fortunes or surreptitiously sucked into the cost of an Iraq war instead of moving around to pay citizens to build roads, teach kids, finance college and develop science, the country will stagnate.

But George Marshall was no dummy. The loans were subject to limited time and strict, carefully monitored regulations. So, tightly controlled and regulated, they became the kick-start that the wheel needed to get turning. It is hard to imagine, but true, that in just five years and $15 billion in loans later, Europe was on its way.

Of course, no self-respecting billionaire wants his taxes to go up or to have the government telling him how to run his business. That is not the way to jump-start the economy today. It is much easier. You just establish reasonable public financing of all elections, from dog-catcher to president. Each candidate would have a given amount to spend and it must be, as it was in the Marshall Plan, strictly monitored. Then political decisions would be made by a candidate’s views, not his bank account.

It’ll never happen. Just the thought of it is enough to give the 1 percent the heebie-jeebies.




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