The key idea, missing in this discussion, is that the government MUST switch from the now failed model of free market capitalism to a model more like that lf Europe and Japan where the government itself is a major investor.
The essence of 19th century capitalism was the concept that entrepreneurs would do the tight thing by investing in productivity AND helping the consumer increase his purchasing power to but the new goods. That idea is now fundamental to all economics, even in China. What is different is that we developed a bizarre system that diverted capital from productivity to money itself. A HUGE part of our capital was invested in financial schemes that drained capital from everything else.
Those schemes were like the pre-capitalist idea of money as a goal itself, an idea that led to the failure of pre capitalist systems. We are, I suggest, now paying a huge price for a return to the ideas that drove Imperial Spain to ruin.
This is why the idea of subsidizing the consumer is bad. We need to find ways of investing in our national .. and now world .. productivity.
A good start is to think of large, successful nations, as competitors for capital. Leave aside the religious belief of laissez-faire and communism but create world law that encourages countries to compete with each other commercially.
Done well, that sort of competition should benefit the citizens of the country that “chooses” the best system for its citizens. As a Jeffersonian, I believe that system will be American.
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