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How the Federal Reserve Bank can Put America Back to Work!

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Federal Reserve Bank

It’s called: “The Main Street Plan,” the Solution of Putting America Back to Work

In 2008, many of us learned from the bank bailout that the Federal Reserve Bank does not need the approval of Congress to loan money to banks.The working  people of  America are still suffering financially, emotionally and physically. One of the most capricious problems facing our nation today is the 3.7 million long-term unemployed. Within these ranks are many skilled and semi-skilled people that need and want jobs.  After the Congress approved 800 billion in bailout money, the Federal Reserve loaned these banks an additional cool 1.5 trillion dollars for good measure. This all resulted in the big banks now rolling in billions and billions of profits. This is due primarily to the unprecedented reckless greed of the biggest financial institutions in our Country.The plan that I’m proposing that will put most of the long-term unemployed back to work is called “The Main Street Plan.” The focal point of it is for the Federal Reserve Bank to make available inexpensive money to member banks on the condition that this money be used for business growth and expansion in America. This money must include the hiring of long-term unemployed workers. The long-term unemployed is defined as being unemployed for at least six consecutive months.

There is precedent for this in the “Full Employment Act of 1946″ and the “Humphrey/Hawkins Act of 1978.” Both Acts were attempts by Congress to accelerate job growth by counteracting the effects of a depression and a recession. These Acts of Congress empowered the Federal Reserve to play a role in creating jobs. The 1978 Act requires the Chairman of the Federal Reserve Bank to connect the monetary policy with the Presidential economic policy. The Federal Reserves’ functions of this act also included managing the nation’s money supply through monetary policy to achieve the sometimes conflicting goals of maximum employment and stable prices. This was to include the prevention of either inflation or deflation. Capitalism works best under full employment and very poorly with low employment. The original intent of both of these Acts was to get Congress to commit to full employment but in the end both Acts watered down this intent.One of the very biggest obstacles to the long-term unemployed finding jobs is the practice of eliminating for consideration resumes of applicants who do not have current jobs. There are many good people in Human Resources positions but the mind set of most of them is primarily and basically a bureaucratic one. Bureaucrats are all about maintaining the status quo and protecting their own interests. That’s just the nature of the beast. A prime example of this is the Washington lobbyists and special interest groups. They have become attached to our government like leeches affixed to the human body. They are in essence, part of the governmental bureaucracy and of course, the corporate lobbyists do not give a damn for the unemployed or the working middle class. Their motivation and primary concern is corporate interests.“The Main Street Plan” would give existing companies a big incentive to expand their business now and the long-term unemployed would get back in the game in record time. Further details of this plan will be detailed in Part 2 of the “Main Street Plan.” Additionally, participating state governments would give businesses, both existing and new, a ten-year moratorium on paying state taxes. Recently, the state of New York adopted a new business relocation plan that has catapulted them into the second fastest employment growth state in the United States. The two concepts can certainly be joined providing an enormous incentive for businesses and governments to mutually participate and start changing the way America handles our shameful and harmful unemployment catastrophe.Of course, this project will need oversight. Banks have almost made it an art form in the way they circumvent laws and policies intended to control their behavior. With that in mind, additional jobs need to be created to oversee that the participating banks and businesses really meet the conditions of these loans. It would be best if these overseers are also from the ranks of the long-term unemployed and must be qualified. Those performing this oversight will need a strong will and determination while swimming in the shark infested waters of the banking industry.The new head of the Federal Reserve, Janet Yellen, is on record stating that she believes fixing the unemployment problem is a key if not the primary key to fixing our economy. There is clearly evidence showing that she has the authority and leverage to put this plan into effect. Once “The Main Street Plan” is in effect, it would create a mountain of political capital for those supporting it.

To be continued in Part 2.

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