Ed Goertzen Dear Ed, Your kind words of encouragement are a much needed reward for what I think and hope I am doing. That is, bringing into public view a subject matter that belongs in sixth grade arithmetic and eighth grade science, but is not yet taught in our universities. In one of his books, Daniel Patrick Moynihan remarked, (If the calculus were not taught in school, how many of us could invent it when we need it?). The subject presented as a graphical global model on three web sites, where I am a guest at the pleasure of the site owners, is not at all like the calculus. Instead, the subject is intuitively obvious to a majority of successful businessmen, because it consists only of the truth, that in any enterprise the risk and the investment must precede the production, sales, and profits of the enterprise. And as soon as each businessman reduces that great truth to practice, his/her competitive instinct makes them deny its existence and obstruct any inquiry which might disclose the subject to their competition. You will notice that the same great truth applies to a person over the human lifecycle. Nearly every sixth or eighth grade student can handle that great truth for one person at a time. But, applying the same truth to a population of 270 million Americans is palmed off by our universities as too simple for such a complex problem. The cardinal message of the macro model Figure 6 of the ten figure global model is to show that the value-added or Gross National Product is common to the capital plant (Gaia, government, and private sector) at 90 degrees, and, to the workforce and its dependents at 270 degrees on Figure 6. Of course, the GNP is C. H. Douglas' A flow in his A+B theorem, and a proper macro model must also show the B flow from the capital plant to other capital plants, at 150% of A flow, according to Wassily Leontief's Input/Output Economics, 1966. Without the B flow, it is impossible to reconcile the current US money measure M1 (which is less now in 2000 than when the models were last up dated in 1994) with the current value of GNP. For this kind of crude analysis the conclusions will not be modified by correcting defects of omission in the GNP measurement. Democratic Capitalism sucks, where the people are ignorant of this simple truth, that investment precedes production for both human and capital productive assets. Foreign policy, like domestic policy, seems to consist of keeping your competitor nations ignorant of this simple truth, by any possible means, so our global economy consists of two hundred nations, each one with a perennial deficiency of purchasing power in the lower half of the work force and a corresponding excess of purchasing power in the upper half of the workforce. Many writers recognize this unbalance of purchasing power and propose higher progressive tax rates, but still fail to direct the additional public revenue to the source of the deficiency in the lower half of the workforce. So nothing changes. Not one of the two hundred nations speaks to this subject, even those who have reduced it to practice, like Switzerland, maintain a sullen silence, perhaps for fear of a cruel retribution from unknown powers that be. The source of the deficiency in purchasing power is not visible in the macro model Figure 6, but the micro model Figure 7-9 which presents a break even analysis of one worker, as easily as 130 million workers, makes it obvious to sixth and eighth grade students that the deficiency is caused by not including both the costs of education and the cost of subsistence in the interest free development loan which every person draws upon between birth and entering the workforce as a self-sufficient adult. The US dependent exemption of $2,000/year per dependent is equal to a tax credit of $300/year at the 15% tax rate and $560/year for those in the 28% tax bracket. Them as has, gets! And the zero tax rate above $63,000/year on the Social Security payroll tax (complements of the Presidents 1986 Commission on social security reform) completes the picture of our present condition. Ed, there is no need for anyone to visit my graphical models on the web. Anyone who gives the subject a little thought, and wants to present the subject on two sheets of paper, instead of in a 300 page book which only Keynes' "one man in a million" can read, will arrive at the same graphical figures that I arrived at in 1994. Thanks again, Ed, for the words of encouragement. I am going to copy this note to my copy list, just to see how many of my favorite mail lists are still distributing my posts in Y 2,000. Kind Regards, Wesburt
