June 19, 2015
By Paul Gallagher
Most importantly for our economy and our future, one 2016 Presidential candidate, former Maryland Governor Martin O’Malley, is out campaigning for restoring the Glass-Steagall Act; other candidates are close, and may join that effort.
This is the one “real” and immediate feature of the Presidential race thus far – pending the possible defeat of the Fast Track/TPP swindle — and constituencies should mobilize to force it out front. We must have Glass-Steagall restored, to break the power of the Wall Street megabanks over the President, Congress, and economy, before they trigger another speculative crash of the U.S. financial system.
The essential second step is a surge of national credit to generate productive employment and build new, modern infrastructure platforms. Alexander Hamilton, our first Treasury Secretary, launched the American economy by national credit methods; his methods work, as they did when Lincoln and FDR employed them. Breaking up the banks, protecting commercial banking and bankrupting the insane debt and derivatives speculations is urgently necessary; but it will not, by itself, get productive lending started. A buffer of credit from Hamiltonian national banking institutions will do it.
Starting a national grid of high-speed rail corridors, on the order of 25-30,000 miles, is exemplary of what such a surge of credit is for. China has built 10,000 miles of operating high-speed rail in one decade; what about the United States? Another critical example: Producing water in the drought-stricken West by modern technology, nuclear desalination plants, Continental-scale water diversion projects, electrical ionization of the atmosphere.
The BRICS nations have launched a half-dozen new international development banks to lend for new economic infrastructure. The United States should join the BRICS, using its national credit institution. The world needs the scientific and economic development and growth they are promoting, not perpetual wars.
Paul Gallagher writes regularly about finance for Executive Intelligence Review