San Jose Mercury News
A wonderful review of my book, "America is not Broke!" in the San Jose Mercury News by Retirement Planner Steve Butler (the reviewer found it on a plane!):
On our return trip from France, the United flight was delayed by a full day for inexcusable reasons, but upon boarding the same aircraft, one of the first announcements by the crew was, "Who left a book yesterday entitled 'America is Not Broke!' by Scott Baker?" On the 11-hour return flight I had time to read some of the best parts twice.
I'm beginning to sense a ground swell of interest in restructuring our banking system, tax system, and now our accounting system as it applies to all government financial statements. Baker, in this new book, offers a simple explanation of the advantages of having banks owned by the public for two reasons. First, they would loan money directly to end users (unlike the too-big-to-fail banks that have been hoarding what they received from the Federal Reserve) and second, they would create a profit center for the public that would reduce what would otherwise be required in the way of tax revenue.
See the rest here:
America is not Broke, by Scott Baker
Review by Jeff Graubart - https://www.facebook.com/jeff.graubart/about?section=overview&pnref=about
Baker’s book is both refreshing and enlightening in a world hooked on the toxic medicine of austerity. In the first part, he examines the effect of Congress using its legal authority to produce debt-free cash, as it did during the Civil War, to pay for infrastructure improvements. Such cash distributions would not be inflationary, because the increase in productivity would exceed the cash spent. In fact he cites several studies that show how even Social Security payments, which are not direct payments for productive labor, still increase productivity by 1.8 to 2.0 times. This is due to demand-driven economic expansion, what I like to call bubble-up economics.
Baker describes our current fractional reserve banking system, where money is not created by Congress, but rather anytime a bank makes a loan. Few people realize that except for coins, our entire monetary system is controlled by the banks, not government.
In the second section, Baker talks about Georgism, and the land value tax. This is the tax Milton Friedman called “the least bad tax” since it does not interfere with productivity, and land won’t go away if it is taxed. He quotes Mason Gaffney, a leading Georgist, who has calculated that, the $5.6 trillion currently collected in taxes at all levels could be raised from a land value tax. That is $1.6 trillion higher than my own calculations, but included is the interesting taxation of such monopoly resources as time-slots at airline gates. Baker goes on to say, “Whatever the exact number of trillions, this untaxed rent could be taxed and returned to the public whose demand created it in the first place without damaging the economy, and in fact spurring it on.” That is the crux of Georgism, that land value is created by the community and should be returned to the community, and Baker gives a nice introduction to the ideas.
Another interesting “land” tax is one on monopolies in virtual space, huge internet sites like Facebook or Google. I would agree that sites should be taxed in proportion to the bandwidth used. Facebook value is created by the social networking community, just as physical world land value is created by the community. However, Baker’s argument that virtual land is time-constrained, that the site should pay a tax for the time I spend on the site, as opposed to just the bandwidth I utilize, strikes me as unfair and non-Georgist.
Baker succinctly expresses a concept that I have been trying to put into simple words for some time on the exploitation of natural resources, particularly in third world countries. “Whenever labor needed to develop land is the least, the human suffering will be the most.” This harkens to the Georgist concept of wealth creation being a product of labor acting on land. Baker further enlightens by expressing a correlation between the degree of wealth and the degree of labor.
Due to the power of the Chinese Communist Party in shaping the Chinese economy, along with their newfound fondness for free markets, some Georgists, me included, have hoped China would follow the path of Sun Yat-Sen and be the proving ground for a land value tax. Baker includes compelling letters from associates sent to the Chinese leadership. These are more than ordinary letters, in as much as they were accompanied by high-level meetings with Chinese officials.
Baker’s discussion of “The new neo-slavery” is a compelling account of the violence caused by Reaganomics and all that followed. Requiring “volunteered” servitude for $2.50/hour to receive public assistance is nothing short of codified slavery, and a great hardship to the public service organizations that must accommodate these “volunteers”. Massive denial of public assistance and massive fraud are the two logical outcomes. Baker calls for a minimum living wage or a Basic Income Guarantee, but to me those two are in different leagues. Raising the minimum wage will end up increasing land rents, while a BIG, paid for from land rents and/or the debt-free cash Baker eloquently describes, will truly end poverty.
Baker ends the book with some technical essays on how much assets cities and states have on their books, even when they claim to be broke. Actuarial data is manipulated to increase required return and assets are considered untouchable in determining return. Thus low interest rates like we have now make all returns inadequate even though there are billions on the books.
The book is a good introduction to monetary theory and Georgism. I strongly recommend it.
By Midwest Book Review: Small Press Bookwatch on July 1, 2015 - http://www.midwestbookreview.com/sbw/jul_15.htm#EconomicStudies
Synopsis: "American Is Not Broke: Four Multi-Trillion Dollar Paths to A Thriving America by Scott Baker belies the commonly held belief that the American economy is unsustainable, That there is no money for social programs, no money to run the government, no money to cut taxes, and above all, we have to cut spending on all domestic programs. But it is simply not true. Instead of familiar complaints about the national debt, leading to just slicing a shrinking economic pie differently, or worse, to Austerity Economics, the reality is that we already have all the wealth we could ever need. The tried and proven proposals in "America Is Not Broke" would guarantee America's prosperity, fairness, democracy, and economic and ecology on a sustainable basis. "America is Not Broke" showcases four multi-trillion dollar reforms: Sovereign Money, Georgism, Public Banking, and Ending Government Financial Asset Hoarding, plus a few other major reforms that demonstrate just how we can have it all, if we only learn where to look.
Critique: Exceptionally well researched, written, organized, and iconoclastic, "America Is Not Broke" by Scott Baker (Managing Editor/Economics Editor and writer for Op Ed News" is impressively informed and informative. Very highly recommended for community and academic library Economics reference collections and supplemental studies reading lists, "America Is Not Broke" is ideal for the non-specialist general reader with an interest in the true workings of the American economy. It should be noted that "America Is Not Broke" is also available in a paperback edition (978-0996418430, $19.99) and in a Kindle format ($9.99).
By Clifford Johnson on May 13, 2015
Scott Baker's new book, America Is Not Broke!, focuses on 4 radical and (if fully implemented) multi-trillion dollar economic solutions. True sovereign money comes first. The others are public banking, ending government financial asset hoarding, and Land Tax Valuation (aka Georgism).
The perspective is that of a vigorous and broad economic activist, who has worked hard to promote all of the economic fronts he presents. Besides establishment opposition, Scott has run into most schools of thought in each area of economic reform, some of which are at odds with each other. Scott has either worked with and/or butted heads against each school, and his strong personal and intellectual encounters are naturally interesting and enlightening. As a result, Scott has produced a book that takes one on a tour of economic reform movements, full of diverse perspectives and studded with telling references to online resources that you won’t find in any other place, let alone spun into a single text.
By Andy Mazzone on November 7, 2014
Scott baker’s first book on economics is a comprehensive description of some of the quickest and most robust ways to fix the American economy. Mr. Baker documents the true amount of resources in this country which are available to affect social change, and improve the economy.
He describes robust methods of taxation, which would free up the productive power of the nation, reduce monopoly, and allow free enterprise to flourish. He demonstrates alternatives to the dysfunctional banking systems that we now have, and ties all of this together with a wealth of documentation and suggestions that would excite any fair minded person to think about the availability of solutions.
Scott Baker is in the alternative economics tradition, a tradition that has been historically delegated to the margins of ideas. But the nature of the fundamental problems of this country, as he so thoroughly documents, would have laid low our economy sooner or later, and could only be fairly described by alternate schools of economics. Bad and perverse policies, are the culprits, it just took time for them to manifest into a dysfunctional economy for the majority of the population.
Now to expect Scott’s book to cause a thorough going reform, would be too much to ask.
Scott is not a fire breathing polemicist, what he does is to supply provable methods to correct the economy that are practical, robust, and persuasive to fair minded people.
So then the obvious question is, why haven’t these proposals been implemented? And here the author doesn’t confront that. The reason of course is a few powerful people throughout the history have always gained wealth by means of perverse policies, ultimately detrimental to the vast majority of any society.
Why would the people who gain from such policies change?
This is the question. But this question is an existential question, and calls for another book to explain why elites are detrimental. Until that book is written, the author’s current book will have to do. But the author does provide realistic solutions that would benefit everyone.
Informed Americans must read this book.
Scott’s Book - it’s the necessary book for our times.
Henry George School of Social Science New York