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From: gabor@qantel.UUCP (Gabor Fencsik@ex2642)
Newsgroups: net.politics
Subject: A Modest Proposal
Message-ID: <318@qantel.UUCP>
Date: Wed, 21-Nov-84 04:11:34 EST
Article-I.D.: qantel.318
Posted: Wed Nov 21 04:11:34 1984
Date-Received: Fri, 23-Nov-84 02:37:11 EST
Distribution: net
Organization: MDS Qantel, Hayward, CA
Lines: 51

.
The following is an excerpt from: "The Debtor Economy" by Felix Rohatyn,
New York Review of Books, November 8,1984.

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Between 1980 and 1984, the share of disposable family income of the poorest
fifth of the population actually declined from 6.8 to 6.1 percent. The share
of the most prosperous fifth increased from 37 percent to 38.9 percent. Clearly
that is not an acceptable trend in a society committed to the idea that all
parts of the population should benefit from growth and prosperity.

President Reagan's election in 1980 and the subsequent tax and budget programs 
of his administration showed that there was, rightly or wrongly, a political 
consensus that income redistribution has gone too far.

I think we must examine a wider range of possible solutions. Recently Dr David
Owen, one of the leaders of the Social Democratic party in England, proposed a
new plan for creating capital and savings for those at the low end of the
British economic scale. He suggested that the British government distribute the
shares of government-owned companies such as British Airways, British Tele-
communications, etc. to those below a certain level of income. This would
create some capital and savings for people who would probably have little 
access to both for many years. 

Although the U.S. government does not own industrial concerns to the same
extent that the British govenment does, nevertheless the U.S. goverment is
in many businesses. It not only owns TVA and Conrail but has large holdings
of coal, timber and gas and oil leases, among others. The current proposals
to "get the government out of business" may be reconsidered with such a plan
in mind. Instead of selling Conrail, TVA or others, the government might set
them up as operating companies and devise ways to distribute their shares to
those at the lower end of the income scale. Instead of transferring more
income from one set of Americans to another, we could transfer capital assets
from the government into the hands of its needy citizens.
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Is this a new idea? I like the way it cuts across both right-wing and left-wing
dogma, suggesting, in the same breath, redistribution of wealth and the 
dismantling of New Deal holy cows. The author is a New York investment banker
(i.e., he arranges corporate takeovers for seven-figure fees). In political
terms, he is a liberal with a sense of economic reality. While I'm at it,
here is another quote from the same article:

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The current formula for dealing with [the international debt crisis] is to
impose austerity on Latin America in order to maintain the myth that our 
bank loans are worth 100 cents on the dollar. I believe this policy, if it
continues, will create more communists during the next decade than Fidel
Castro and the Sandinistas could during the next fifty years.
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