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Sunday, May 11, 2014

It’s the Engine, Stupid, not the Oil!

Money is the lubricant of the "real" economy. It is the thing that facilitates frictionless transactions, is created to enable investment in productive capacity, and that ensures our national resources are fully utilized. The real economy is the engine that produces everything we need and want. At least, that's how it should be. 

But we’ve made oil the object and our engine has been relegated to a role of giving us more oil, and so of course it’s running inefficiently and blowing smoke! We have cylinders that aren’t running at all, sitting idly unemployed. We think that by saving enough oil we can have anything, while neglecting the engine that actually produces what we need. 

We have created huge incentives to save extra oil rather than invest in our engine, so our engine suffers from inadequate lubrication. Saving oil won’t help the next generation have the real production needed to eat, gain skills, work and live well. It’s the engine that produces, and it can produce whatever the next generation needs if we run it with enough oil and keep investing in it, replacing old parts and upgrading with the latest technology. The next generation needs a healthy engine, not a broken engine and a stockpile of this generation's oil.

How often have we heard it said lately, “this is the first generation in US history not to live as well as their parents”? It is tragic, and completely unnecessary. I'm not willing to resign to such a pathetic outcome for our children and grand children! Are you? 
  • Do we not have food or housing? In fact housing is nicer than ever, and the move toward organic sustainable agriculture is restoring our food supply. 
  • Do we lack the ability to educate and train? No!
  • Do we lack energy or natural resources? Hardly!
  • Do we not have the means to build state-of-the-art production systems? Of course not!
  • Has innovation died? Are we no longer a nation of entrepreneurs? I am as excited today as I have ever been with the inventiveness, creativity and innovation happening throughout the country.

So why are so many unable to work? Why are businesses not growing and investing? Why is our engine spluttering and smoking, barely able to keep running? We’ve become afraid to put more oil in to compensate for all the oil being saved (and yes, we should address the excessive “saving” (extraction) part too, but I won't go there now).

This generation can and should be the most remarkable of all. They will transform every part of our economy to be more efficient and less destructive to our natural resources, dramatically improve our food supply, invest life-saving devices and science, lead us to improved health, and so much more!

Don’t believe the lie that we’re doomed to live in austerity. There’s no shortage of this kind of oil – we have the monopoly on its production! Let’s focus on what really matters, and stop fearing the use of money to benefit the real economy and society.