I met the singing man.

One night last week, on my way back home, I stopped at a local gas station to fill up two water jugs I keep in the car.  (A habit I acquired while living in the desert for two decades.)  A thin young black man in tattered clothing was leaning against the front of the gas station building. Once he saw my water jugs, he directed me to a short hose connected to a faucet on the side of the building which worked perfectly for filling the jugs.  He said he was the night clean-up guy at the gas station.  He looked to me like he was living on the streets. Since I had been so close to doing the same a few years ago, I’m always interested in the stories of people who are at that extreme end of the American economy.  If my car hadn’t been big enough to sleep in, and if my nephew hadn’t let me surf his couch for a few months, I could have been this guy. 

This guy says he ran away from an abusive career military father and has been a local in this neighborhood ever since.  He’s been sleeping under the I-26 overpass bridge, literally a stone’s throw away from this gas station, since 1996 when he was eighteen years old.  He was born the year I graduated from high school.  He’s two years older than my son. 

I asked where he bathed. With a wry smile he said “what’s that?” “When I occasionally get a shower, the water comes off me black. I’ve learned to wash my arm-pits and other parts so I don’t smell, and I use deodorant, and I wash my clothes every week. I don’t want to offend anyone.”  And he didn’t smell, even when I gave him a hug before I left.

He wanted me to know he is not like some of those other “ignorant niggas” from South Carolina because unlike them, he has lived many different places around the world while growing up and “knows how to work and talk with white people”.  (I’ve been getting hints over the last year that the cultural divide between South Carolina blacks and whites is wider than I can imagine.  This is another one of those hints.)  He said he got third place in a singing contest a couple years ago and some people call him “the singing man”.  He sometimes sings at weddings and parties.  Unfortunately he didn’t demonstrate his singing voice.  I would have sung harmony with him. 

From what I saw, here is a bright, articulate guy, hustling a few under-the-table, very part-time jobs, all paying well less than minimum wage.  And he’s being exploited.  Yes, he is certainly missing a few components that would allow him to be a “normal” employee, which is probably why he hasn’t been able to get a full-time job his entire adult life.  But honestly, which of us isn’t missing a few components?  Some of us are just better than others at covering those holes up, allowing us to win the job offers, and leaving poor bastards like the singing man living under highway overpasses.

I told him I’m running for Congress specifically to help people like him and all of us who aren’t multi-millionaires but are at the mercy of their whims. He asked what Congress does. “What’s their purpose?”  Hmmm.  Yes, he clearly wasn’t paying attention in high school civics class, but the child-like honesty of the question caught my attention.  How do I sum up what Congress is supposed to do in just a sentence?  I finally said, “Congress makes law to help people like you and me.  But lately they’ve been helping only rich people.”  He said he’d be happy to hand things out for me, or take surveys or collect signatures because he meets lots of people, so I gave him a stack of my Cherny-for-Congress business cards.

I couldn’t stop thinking about the singing man.  Why should some bright guy, though not well educated, who grew up with the handicap of being born into an abusive family, be cut out of the workforce, be cut out of achieving what he can dream, simply because of the situation he was born into?  Accidents of birth shouldn’t determine what people can achieve.  That isn’t the American dream.  No one should find that sleeping in a hole in the dirt under a highway overpass is their best option in life. 

My American dream is that the singing man, or anyone, regardless of their specific accidents of birth, regardless of what personality components they’re missing, can find their purpose in life and with some luck and plenty of effort, they can earn a decent living focusing on that purpose.  Unfortunately, the bar to cross to get a job in private industry is a bit too high for some people with too many missing components – too many handicaps from their accidents of birth. 

And frankly, there are more people than jobs – as a matter of federal policy based on faulty economic theories. So with our current game of capitalism, some people will always be unemployed. The headlines on July 4th said we now have only 6.1% unemployment. Yippee! That’s only twelve million people with no source of income.  As many people as the entire population of the New York City tri-state area, wondering how they’re going to make next month’s rent, afford gas to get to any possible job interviews, get food next week.  

The sad truth is that most of those people will struggle to reduce their living expenses, and scrape by with under-the-table exploitative jobs like the guy I met last night, never finding a full-time job providing a living wage.  They will live week to week, from one hustle to the next, and slowly die a miserable life.  With the current rules of this game of capitalism we’ve been playing, that’s just how it’s set-up. 

A guy I worked with at IBM in the early 2000’s got laid off just a few months ago.  He’s now in his late forties.  He’d been making over $100k annually for the past twenty years, has four kids, one in college, a big house in a nice neighborhood on the coast of Florida, and he can’t find any job anywhere in the country that will give him that kind of income again.  That’s the same situation I found myself in by the end of 2008.  I’m sad it’s still happening six years later, even with just a 6.1% unemployment rate. 

Past labor secretary and creator of the movie “Inequality For All”, Robert Reich says the majority of new jobs added to the economy since the great recession have been part-time jobs.  Employers simply aren’t hiring people for full-time work anymore, finding that keeping a collection of part-time workers lowers their costs (they don’t have to provide insurance), and keeps their workers eager for more hours, whenever they can get them. Exploitation. Our economic recovery since the great recession has been great for the one percent.  Not so great for the rest of us. 

How can we stop the exploitation?  How can we give people with too many missing components to ever work in private industry a chance to participate, to find their purpose and work at it, earning enough that they don’t have to live under a highway overpass?

That’s what the Job Guarantee program I’m proposing would do.  Anyone who wants a job, and can be professional enough to keep it, can get a job – guaranteed.  A job providing a minimum living wage, probably $15/hour plus full health care coverage, working at one of a number of local non-profit organizations doing good work in local communities.  While this program wouldn’t help my old IBM friend keep his house and six-figure lifestyle, it would keep future generations of IBM’ers from losing their houses.

Think about it.  If the kids currently getting out of college and facing dismal job prospects knew they could get a decent job at a published wage, no matter what, they might just limit their future expenses to little more than the wage provided by the guaranteed job program. So when they get thrown out of their career tracks in their late forties as I did, as my friend did, as millions of Americans have been, they would not be relying on their six-figure incomes to survive. Yes, it might take a couple generations before the majority of Americans stop living beyond their means, but eventually, job losses and career exits won’t be the financial losses and life destroying events they now are.  Instead our kids and their kids will see job changes as just another mild transition in life and as opportunities for new beginnings. 

Perhaps more importantly, the job guarantee program would set the bottom end of the salary range in America.  Who would flip burgers for eight bucks an hour of part-time work when they could do meaningful work helping other people for fifteen an hour, forty hours a week, with healthcare coverage?  Employers would have to step-up their game to entice and keep employees. 

Of course the first objection people have to this idea is, “won’t that increase the prices of hamburgers at McDonalds?” If the Job Guarantee program were implemented by itself, yes, most likely management and investors would require the same level of profits and would raise prices to get those profits.  However, coupled with the 100:1 take-home pay range, the executives and primary investors of McDonalds would no longer be able to take-home multi-million dollar salaries.  Add in the additional tax enticement for businesses that become sustainable and socially responsible by becoming B-Corps, and it’s likely more profits would remain inside the company, spent on the business, the facilities, the products, research and development, and most importantly on employees.  If every business found themselves with more operating cash, more happy and dedicated employees, improved facilities and better products, hamburger prices may well go down! 

Most importantly, the job guarantee program would ensure that the singing man could earn enough dollars to sleep somewhere other than under the highway overpass, and discover which of his many talents might be his purpose in life.  Multiply that by twelve million and America really would be the land of opportunity.  That's why I'm running for Congress.  

What if George W. had said this instead?

I read about Israeli Prime Minister Netanyahu’s vow to punish Hamas for the murder of those three Israeli teens found in the West Bank.  We know where this story leads.  Israel and the Palestinians have been playing this game of revenge for lifetimes, with no end in sight.  No end in sight that is, as long as they both continue to respond in the same ways. 

America is fortunate that we are rarely faced with situations calling for national vengeance.  But that got me thinking about the last big vengeance-provoking event we faced and how we might have brought about a much better future for everyone by responding in an unexpected way.  A response that I think would have been more appropriate for what many people claim is our “Christian Society”.

What if President George W. Bush had responded to the September 11th attacks with a speech like this?

In trying times, when faced with difficult decisions, I always first ask myself “what would Jesus do”?  We have been attacked on our own soil by angry people from the other side of the planet.  As I think Jesus would, I must ask – what have we done to make these people so angry that they would sacrifice their own lives in order to kill random Americans?  I ask myself, what would make me so angry at someone that I would sacrifice my life to kill other people?

Fortunately we have a clear list of complaints from the man who claims to have masterminded this terrible loss of life and immense destruction – Osama Bin Laden.  I must say that his complaints have some merit when viewed through the lens of someone who grew-up in an Arab Muslim culture, especially for a fundamentalist believer in Islam.  I can respect a man’s deeply held religious convictions – I have my own – but religious faith only begins to explain how he could recruit a dozen people to give their lives to perform this horrible action. 

I could only contemplate killing myself along with the people who limited my future options if I felt that my future looked so bleak that the uncertainty of heaven or hell seemed like a better option than the life laid out before me.  Those men who flew those planes must have felt so oppressed by American actions that they thought death was their best option. 

Whether real or imagined, such strong feelings require a response from America.  First, an apology to all the people in the Arab lands – I’m sorry for the oppression you feel from the American actions and inactions of the past.  We have behaved selfishly with little concern for you.  That will now change.

Starting today, we will begin a gradual withdrawal of all our military forces from all Arab countries so that within five years, no American soldier will be stationed on Middle East soil. 

I wish we could withdraw faster but it will take at least five years for us to no longer have any national interest in the Middle East – that is to say when we no longer care about Middle East oil.  Until America reduces its dependency on fossil-fuels, we must protect the flow of Middle East oil.  That is why today I am announcing a broad federal plan to invest heavily in renewable and carbon-neutral energy sources instead of fossil fuels, so we will no longer have any reliance on Middle East oil.  I have set 2011, ten years from today, as the last year America imports any oil from the Middle East.  In 2011 we will have also reduced by one-third the quantity of petroleum we use from ALL parts of the world and our own territories.  That number will grow to 50% by 2021, and grow again in another ten years – 2031 – to a 100% reduction – no petroleum oil will be used in America by 2031.

Thank you Mister Bin Laden for the wake-up call.  I’m very sorry we didn’t previously take seriously your concerns about American involvement in the Arab lands. However, you claimed responsibility for killing thousands of our people, and if we find your claim valid, you will be held responsible for those deaths. I hope you will turn yourself in peacefully and face trial for your actions.  If not, we will find you and bring you to trial.

Just imagine how the man on the street in the Middle East would have felt about this.  How instead of providing a focal point for the anger of millions of young Arab men with no better options for their lives, we would have turned their attention away from America and back onto their own oppressive governments.  Perhaps that awakening would have brought about an earlier or more effective Arab Spring.  Instead we put a generation of young Afghanis and Iraqis in a war zone, raising them on a violence-filled life ensuring that violence is all they know. If instead, America had responded to 9-11 “as Jesus would”, those millions of young people in the Arab world would now have little experience with war or violence, leaving the minority of angry fundamentalists with fewer and less interested recruits for violence and suicide.  If thirteen years of war in Iraq and Afghanistan have shown us one thing, it is that violence only brings about more violence. Responding to 9-11 with peace would have made the world a much better and safer place today for billions of people around the world.  Instead of being the target of anger for millions of disaffected youth in the Arab countries, America would now be a shining example of how a country should behave.  

The "Cherny Plan" to solve income inequality

In 2013, former secretary of labor Robert Reich released his movie “Inequality for All” which started the conversation of income and wealth inequality in America.  In early 2014 French economist Thomas Piketty published his book “Capital in the 21st century” which describes the culmination of many years of research into income and wealth inequality and his conclusion that capitalism inevitably and increasingly concentrates wealth in the hands of the already rich to the increasing detriment of the rest of us.  At the end of May 2014, the Nobel prize winning economist Joseph Stiglitz published a white paper describing his concerns about income and wealth inequality and providing recommendations for decreasing it.  Consensus in academic and intellectual circles is gathering around the idea that the game of capitalism we’ve been playing is working very well for the rich, but failing miserably for the rest of us.  

Does income and wealth inequality matter?  In early 2014 a team of researchers at the University of Maryland, partly funded by NASA, reported how they used a computer model to analyze a number of collapsed societies to determine the set of critical factors that lead to societal collapse.  What was most surprising about the paper was the identification of not just environmental or climactic destruction leading to societal collapse – factors described nearly a decade before in Jared Diamond’s book “Collapse” – but also that high levels of social inequality lead to societal collapse.  The paper states that most societal collapses were presaged by the splitting of society into primarily two societal divisions – rich people – the elite, and the rest of us – the commoners.

Today we live in an America in which just 1% of us own 40% of all the wealth of America. The poorest 80% of us own just 7% of the nation’s wealth – just 20% of us own 93% of the nation’s wealth. The richest 1% of Americans take-home 24% of the national income. In 1976 the richest 1% took home just 9% of the national income. Since 2009, 95% of the economic recovery dollars have gone to that same 1%.  Since 2009, the median real household income of Americans has declined by 4.4%.  The historical from the last few decades data shows that while the rich get richer, the rest of us get poorer.  How much longer until America becomes the world depicted in “The Hunger Games” books and movies?  If we want American society to continue functioning for centuries into the future so our grandchildren and their grandchildren have lives as good as or better than ours, income and wealth inequality matters more than any other threat we face. 

Unfortunately, none of the solutions offered by Piketty or Stiglitz seem to address the root-cause of our problem - how do we stop humans from dedicating their lives toward the accumulation of obscene amounts of money?  People living with fifty cats are considered mentally ill.  People with houses filled with decades of collected junk are considered mentally ill.  But people who own numerous houses, with bank accounts filled with millions or billions of dollars are considered not mentally-ill but “successful” mostly regardless of how those dollars were collected.  Our society helps people with mental illness and tries to keep them from hurting themselves and the rest of us.  Numerous studies have shown that a majority of people who collect and hoard millions and billions of dollars have highly sociopathic and psychopathic tendencies (think of Donald Trump). Clearly, their single-minded pursuit of dollars has hurt others (think of Wall Street’s recent bail-out).  Should our society continue to revere the obscenely rich, or should we help these poor sociopaths by controlling what they can do to the rest of us?

We are all born into a world ready-made for us. Unless history is examined, people think the way things are today is the way things have always been.  The historic record shows something much different.  Piketty’s work especially shows that for America, the best time to be either a business owner or an employee was when the American economy was growing faster than ever before or since, in the two decades after World War II.  In those years, American society was more financially equal than at any other time before or since.  Yes, America certainly had other social and racial inequality problems in the 40s, 50s, and 60s, but being able to join the middle class and provide a very comfortable life for a small family on a single salary, even as a high-school custodian – as my great uncle did – was entirely possible.  As Piketty’s work shows, in the ensuing sixty years until today, dollars have highly concentrated in the hands of the few with the most dollars – the inevitable result of running the game of capitalism undisturbed for a few generations. The same dollar concentration happened in America in the decades leading to the Great Depression.  It happened in France in the decades leading to the French Revolution. Extreme levels of income and wealth inequality will happen again and societies will collapse again, perhaps American society; as long as the majority of voters allow and encourage a minority of individuals to gather obscene numbers of dollars.   

How can we stop this psychotic quest for dollars?  By simply limiting the amount of dollars anyone can take home after taxes.  More importantly, by tying that maximum take-home pay limit to the minimum take-home pay limit.  We must implement not just a minimum wage, but essentially a maximum wage and clearly define the range between those two points.  I suggest 100:1 as the starting point for the conversation.    

100:1 take-home pay range.
Let’s link the financial success of the richest Americans to the financial success of the poorest Americans.  No American working full-time should take home less than 1% of what the richest Americans are taking home.  Conversely, no American should take home more than 100 times what the poorest Americans working full-time will take home. 

In practice, with today’s minimum wage of $7.25 an hour, the CEO of the Bank of America, or Morgan-Chase, or General Motors, or Google would take home just $1.5 million a year.  Raise the minimum wage to $15/hour and the maximum income level would rise to $3,120,000 per year.  Basketball star LeBron James, with an NBA income of $19M/year, would take home $3.12M/year.  So would Donald Trump.  And Bill Gates. And Warren Buffet.  Regardless of how much they had been paid or earned any other way.  Think about how people and employers would react to that limitation.

If at his current salary level of $19 million, LeBron James would pay $16M in federal taxes every year, both he and his team would probably decide that he should be paid considerably less than that, while still taking home the same amount of dollars, $3.12M every year. The end result for LeBron's team would be a considerably smaller payroll for both their players AND their owners and managers and investors.  Would that lead to lower ticket prices for NBA games?  Would it lead to more basketball teams forming in smaller cities?  Would it lead to smaller stadiums and arenas being built in more cities?  The bottom line, reducing the take-home pay of the people at the top of our capitalism pyramid would most likely lead to more innovation, more invention, a greater distribution of higher incomes across a wider swath of society (think of all the other kids who could now become NBA players with that many more teams) and much more investment at lower levels of the economy, helping ALL of us via a boom in capitalism.

I hear three objections to this plan – two from people who have never started or run their own business; the other from established business owners.  Some segment of American society has bought the myth that people only start businesses because of the possibility of unlimited riches. These people say that by creating a maximum take-home pay limit, entrepreneurs would no longer bother to start those businesses.  To this argument I say balderdash!  I’ve been in private industry for more than thirty years and started three of my own companies.  I’ve met dozens of entrepreneurs who have been much more financially successful than I’ve been, and I can assure you that the majority of those “job-creators” weren’t doing what they did solely for the potential riches.  Yes, earning a comfortable living is high on our list of priorities, but mostly we entrepreneurs are in it for the excitement of the game.  Win or lose, we’d still play.  A big pay-day is just a bonus, not the reason for the effort.

The other argument from the average American is that if we limit their take-home pay, the richest Americans will simply move overseas, taking their money with them.  A recent study showed that national tax rates have little to do with where the wealthy actually live and invest.  Instead they seek countries with the best standards of living – something America is falling behind on.  Might these wealthy people then just cheat the system and hide their money?  I say let them show us exactly how little they care about the success of ALL Americans and become criminals in the eyes of the IRS. Instead of hiding in plain sight as the leaders of industry, sociopaths should be locked-up and kept from harming the rest of us.  

Local Community Mutual Funds
Established business owners are more concerned about the day twenty years from now when they sell their business.  What if the majority of that pay-day they’ve worked twenty years to achieve is all taken away in taxes?  For that reason, we would start a new type of investment security called a “Local Community Mutual Fund” (LCMF).  The LCMF would accept investment from people residing within a local community – city, county, region, or state – and distribute those funds to local businesses, organizations and individuals as equity investments, loans, and grants. 

LCMFs would have two goals – earn a return on their investor’s money, and improve the local community and economy. While LCMFs may only rarely earn double-digit returns, they would be tax-free, just as 401Ks and IRAs are.  So if LeBron James wanted to put a chunk of the rest of his $19million in one of his LCMFs, he could, without paying taxes on those earned dollars.

Much like the local banks of the early 20th century, LCMFs would exist solely to recycle the wealth from a community back into the same community. Unlike the local banks of the last century, LCMFs would be non-profit organizations and would never be subject to consolidation into larger national or international organizations with no interest in the local community.  Unlike investments in the stock market, LCMFs would not just enrich Wall Street banks or help some company halfway around the world, but would actually help local communities.  LCMFs would provide hundreds of millions of dollars previously locked up in Wall Street to local businesses, organizations and individuals all over the country from local investors with a personal interest in helping the local economy thrive.  LCMFs have the potential to start a renaissance of capitalism, innovation, creativity and invention in America. But a few more pieces of the puzzle must be in place before all that could start.

The Job Guarantee program.
First, Americans must not be afraid to risk everything on an entrepreneurial, inventive or creative venture. To eliminate that fear of failure and encourage people to take more risks with their educations, their careers and their lives, we must implement the job guarantee (JG) program.  The JG would provide a good job with a living wage and full health benefits to anyone who wants (and is able to keep) a job. Federal job-guarantee funding in the form of grants for local community non-profit organizations would expand or contract as required to provide local jobs for local unemployed people. Anyone who wants a job paying what will essentially become the national minimum wage, would apply at their local unemployment office.  They would then be offered one of a number of jobs at one of a number of local non-profit organizations performing good and meaningful work in the local community. Think about how people and employers would react to this addition to the American social safety net.

First, recent high-school and college graduates would know that no matter what else happens, they could always get a good job at a nationally published wage. It may not be the kind of work one would prefer, nor in an area of anyone’s particular expertise (we can’t make these jobs TOO attractive), but it IS a fulfilling job nonetheless, providing needed services in the local community, and with full health benefits. In fact many young people, or anybody of any age, may come up with ideas for new non-profit organizations and win job-guarantee grants from the program and begin putting other people to work. Any non-profit organization could apply for JG grants, but like any other grant-receiving organization, they must all show clear benefits to their community and progress toward their goal to continue receiving grants.

Young people who couldn’t find other jobs would likely see the job guarantee as the baseline income they could always rely upon. Hence when they finally do get a better paying job, they may likely keep their expenses at the level they know the job guarantee program could provide and no higher. That’s what I would have done. And knowing they could always fallback to the job guarantee program, they might be willing to take risks they wouldn’t have without that safety-net – risks such as moving across the country, or starting their own businesses, or joining small start-ups with little chance of eventual financial success but plenty of educational opportunities. 

Not just young people would benefit from the Job Guarantee program. Anyone at any age who loses their job could immediately jump into the job-guarantee program and continue getting health benefits and a minimum income while keeping their job skills fresh while continuing to look for other work, or perhaps developing their own entrepreneurial ideas. If every American kept their personal monthly expenses to a level no higher than the job guarantee program could provide, unemployment would no longer be a life and wealth destroying experience – as it was for me – but just another transition point in people’s lives. The Job Guarantee program would be the employee-buffer for the entire nation, providing a fresh and ready group of employees eager to move back into the private economy whenever it is ready to re-hire them.

Think about how this addition to the American social safety-net would affect the attitudes of both employees and employers.  First, business problems that employees are often too afraid to mention to their management today for fear of losing their jobs, would probably be talked about openly. If you knew you could always get a job in the job-guarantee program, would you speak-up about both injustices and potential business errors you see on the job?  Absolutely! The result would be better businesses, making both better employee-focused decisions AND business decisions.  How many businesses have failed because management had lost touch with their customers, while the regular employee could easily identify the problems about to bring the company down, months or years before it happened?  But no one dared speak-up for fear of reprisal. When every American knows that being fired doesn’t mean losing your house or going hungry, I can’t wait to see how employers will respond.

First, employers would have to respond by treating their employees better and paying them more than the job-guarantee program, just to keep them interested.  Also, employers would be much more likely to engage their employees more fully, expecting more than just mindless work from them and using them as actual business partners. When the inevitable business failures DO occur, company owners would likely be quicker to pull-the-plug knowing their employees would have the job-guarantee program to fallback upon – contributing to the creative destruction of capitalism at its best – fail-fast, fail-often.  And possibly, if management was simply incompetent, the employees, with investment from their Local Community Mutual Fund, could buy out management and make a go of the business themselves.  The end result for all of America would be better businesses with more engaged and involved employees and managers, all earning more money, and likely making more profits for the business. Additionally, employers would be happier to hire “fresh” workers directly out of the job-guarantee program, who may have just learned new skills or at least stayed up to date on their existing skills, rather than hiring “stale” workers who may have been unemployed for months or years.   

The national target income - $52k/year.
Businesses that focus more on their employees and pay them well should be rewarded for doing so with decreased taxes.  First, any employee making less than some amount a week – I suggest a thousand a week, $52,000 a year as the starting point for the conversation – should pay no federal tax – no income tax, no medicare, no social security – and their employer should also pay none of those taxes on their behalf.  Why are we penalizing both employers and employees for just barely making a comfortable living? Fifty-two thousand a year in earnings should become the national target income. Couples, both working, could take-home as much as $104,000 a year before they pay any taxes. Let’s set the target for America’s new and expanded middle-class at $1,000 per week.

Promote Benefits-Corporations.
Second, businesses that help their local communities and are certified as “sustainable” should pay reduced or no taxes.  Benefit-Corporations are a type of corporation that state in their formation documents that they will focus not just on profits, but on their people, their local communities, and the entire planet. Benefit-Corporations (B-Corps) are rated by an independent rating agency on their attainment of those statements and their overall sustainability.  The highest rating of 200 is given only to B-Corps that have, and maintain, completely sustainable business models and treat their employees very well.  B-Corps rated 200 should pay no federal income taxes.  Lower rated B-Corpos should pay higher corporate tax rates.  Non B-Corps would pay still higher taxes. 

Why should a company who is doing everything right for their employees, their communities, the environment, and the planet pay ANY taxes? That is behavior that should be rewarded, not penalized. Conversely, why do we not penalize with much higher taxes, any company which shortchanges their employees, screws their local communities, pollutes their environment, and helps to destroy the planet? Taxes are the best “stick” we have to discourage “bad” behavior, and encourage “good” behavior. Let’s use them.

Real-world evaluation.
So would this five-point action plan work in the real world?  Would all the companies that have provided us with the best technologies over the past few decades – Apple, Microsoft, Google, FaceBook – still exist if their founders and investors could have never taken home more than three million a year?  Absolutely.  None of the founders of those companies expected to make millions or billions of dollars and they would have done exactly the same thing if their maximum annual take-home pay had been limited.  In fact, they and their investors might have made some better, longer-term decisions given that limitation – decisions that would have brought in more profits more gradually.

Would General Electric, Boeing, Walmart, or Exxon/Mobil still have the same business models if they had to pay considerably higher taxes for their mistreatment of employees (Walmart), or their destruction of the planet (Exxon/Mobil)? Or would their investors demand these companies become 200-rated B-Corps to eliminate federal income taxes?

General Electric, like IBM, or Monsanto, has reached its current size primarily through acquisition of smaller companies in an effort to continue increasing revenues year over year to increase their stock price.  Without the need to continually show significantly increasing revenues, why acquire little companies that are more profitable on their own?  Investors and business owners both will probably be more satisfied with the continuing small but steady profits provided by smaller companies instead of the big pay-days involved in mergers and acquisitions. General Electric would probably spin-out numerous corporate divisions as individual and more innovative companies, dividing their stock and likely increasing the value of that combined stock for their investors.  Boeing would probably change their business model just a little as their options for spin-outs are limited and their need for consolidation is great.  However, they may show lower corporate profits as they find paying their employees better will provide higher returns to their investors when they become a B-Corp.  Walmart would clearly have to increase their employ compensation plans and decrease their owner’s profits.  It would be very interesting to see what the investors of Exxon/Mobil would demand. At this point, there is little reason other than inertia for Exxon/Mobil to continue mining fossil fuels and we might just see their investors demand they go completely sustainable and carbon-neutral with algae-based oil instead. 

In all companies, these five actions will likely initiate some changes – the 100:1 take-home pay range that links the financial success of the richest Americans with the poorest Americans; the Local Community Mutual Funds that shift dollars from Wall Street back into local communities around the country; the Job Guarantee program that reduces fear of failure or disaster by providing a job to anyone who wants a job; the national target wage of $52,000 per year which eliminates all federal taxes on the first $52,000 earned by any American;  and the support of B-Corps which use the power of capitalism to make America the best it can be.  Those changes will mostly reduce the concentration of corporate profits from the hands of a few people – the executives and investors – and leave more of those dollars within the company.  That increase in dollars within the company would probably be put back into research and development, higher employee wages, improved working conditions, and paying for the economic “externalities” which are currently passed-off on the rest of us, like employee healthcare and childcare, and production waste streams. 

In short, if we implement all five actions described above, all American businesses would be stronger and healthier, though probably smaller.  Companies would invest more of their income into long-term survival instead of short-term profits – into their people, their customers, their suppliers, their distribution networks, their communities, all their physical assets – and less into raw profits passing through to investors. With that transformation, companies would be internally stronger than they’d ever been, making them a better long-term investment, increasing the trading value of their shares on the market, but likely reducing their free cash available at the end of the year for investor dividends.  With most of their profits invested locally in their physical assets, and no one demanding short-term profit growth, local communities would no longer live in fear of the company picking up and leaving for overseas.  Because of that, fewer if any tax incentives would have to be granted to lure expanding companies to new locations.  Instead, an educated and skilled work force, in a town with good distribution channels and a high quality of life for their employees, would be the main criteria for relocation.

Implementation of these five actions, what I’m calling “The Cherny-Plan” until someone comes up with a better name, would lead to an America which would be a free-market capitalist’s dream come true.  That is, for everyone except the handful of people currently taking home more than a few million a year.  But many of those multi-millionaires also support cutting their maximum take-home pay with the argument “how much money do I need to live a comfortable life”?  For all those reasons, it’s time for America to implement the Cherny-Plan that together strengthens local communities and uses the power of capitalism and markets to improve the lives of EVERY American.  Let’s take our American democracy back from Wall Street and create an economy that works for ALL of us by implementing the Cherny-Plan. 

 

 

Is this a futile attempt?

Last week I spent a night in Beaufort, South Carolina.  It’s a lovely town on a bluff overlooking the marshes and estuary rivers which almost completely surround the downtown area.  Much like a smaller and slower, and undiscovered Charleston.  And it happens to be in the 1st Congressional District – my district.  I had a good conversation with a new friend, and as I’ve heard from so many people who support both what I’m saying and my run for congress, she was very skeptical that we can actually change anything in Washington or America.  “The arrogant bastards just have too much power.” 

I get so frustrated with that sort of statement.  And I hear it a lot.  In fact I’ve yet to meet anyone who thinks we CAN make our economy work for all of us.  So here’s my counter-argument in short - we outnumber the arrogant bastards three-to-one.  This is still a democracy.  Let’s make the changes we need before it’s too late. 

I hate to pit this argument as an “us versus them” situation, but elections really do boil down to just that.  So let me take a stab at who “them” may be.

Many people are uncomfortable with me specifically calling out “Wall Street”, primarily because most people are unsure of exactly what “Wall Street” is.  Of course I’m not referring to the actual street itself in lower Manhattan. I’m referring to the handful of ginormous banks, investment companies, insurance companies, and other private financial institutions which control the flow of the majority of US dollars – more than $30 trillion dollars – more than eight times the annual federal budget and almost twice as large as the federal “debt”.

Wall Street exists by collecting interest on loaned dollars and collecting transaction fees on stocks and bonds and other securities traded for dollars. You give them dollars, they give you a piece of paper which you hope sometime in the future some greater fool will buy from you for more than you paid for it.  Fifty seven percent of the 115 million American households have some money invested in Wall Street – 65 million households.  Of those, about a third have a considerable amount invested – only 23% of Americans or 26 million households have their savings and retirement tied up in the stocks and bonds offered by Wall Street. 

So let’s assume those 26 million American households – perhaps 52 million voting age Americans, will never agree with anything I’m saying for fear that their retirement savings will be negatively impacted - (which they won't, in fact the opposite is likely to happen).  That still leaves 77% of American households, perhaps 178 million of us of voting age who DON’T have much, if any money invested in Wall Street.  And because we 178 million are relying almost exclusively on our weekly wages to live, as a group, every year we are doing worse and worse as more money is raked in by Wall Street in the quest for more and more profits.  And every year more and more of that top 23% are forced to drop out of Wall Street and join the rest of us when they lose their jobs, drain their savings (taking all their money out of Wall Street), and end up living paycheck-to-paycheck like most Americans – again all in the quest for profits. 

As far as I know, we still live in a democracy where each person of voting age gets one vote.  Despite the now hundreds of millions spent by candidates to get elected, those dollars don’t buy votes in the general elections.  Just yesterday that point was proven by a Tea Party candidate in Virginia who with just $150,000 beat incumbent congressional majority leader Eric Cantor who’d spent more than $4 million to stay in office.

So let’s just vote the bums out.  We outnumber our wealthier fellow Americans three-to-one – 178 million of us to their 52 million.  So what’s the problem?  Why can’t we make the changes we need?

As I see it, there are two problems involved with making the changes our economy requires to make it work for all of us.

1.       The only people running for office are probably going to be just as bad as the ones we vote out of office.  If every candidate is no better than any other, I’ll agree that we may as well quit right now.  However, I offer myself as an example of a candidate who is nothing like any other candidate.  I’m not a career politician.  I have no interest in going to Washington to make lots of money.  I want to get in, get shit done, and get out.  I have better things to do with the rest of my life than argue with politicians.  Surely there are other people who feel as strongly as I do about our current economic situation and they too are willing to run for Congress in the coming years. Which is also why I decided to run for Congress.  Sometimes, even in failure, our actions inspire other people to take action.  If I get elected this year – great.  If not, perhaps my attempt will inspire other people like me who aren’t politicians, who don’t care about getting rich in Washington, and who can pick up my ideas and carry them forward at the next election in two years.  Even if none of those people get elected, just the fact that we’ve started the conversation may eventually move enough of the career politicians to make changes.  Every previous movement in America has required less than ten percent of the population to bring about sweeping legislative change.  We potentially have 178 million voting age Americans – 77% of us who could force the changes we need to make.  What are we waiting for?

2.       Up until yesterday, when just $150k beat $4M in Virginia, I was going to suggest that the 178 million of us voting age Americans who struggle to earn a living are too easily swayed by the very convincing political ads run on TV. Today I have hope that all Americans are not fooled by slick television commercials and can see past the hype to the candidates who really want to help make our economy work for all of us.

So is my run for Congress a Quixotic and ultimately futile attempt?  Am I asking people to support me in a ridiculous quest with no hope of making our society better for all of us?  I don’t think so, only because as long as we still have a democracy with one vote per person, we who are struggling in our economy outnumber by three-to-one those who are thriving in our economy.  Let’s vote in people who actually care about making a difference for ALL of us, not just the rich. 

Accidents of birth. The strength of America.

I recently watched a very good interview with Michael Lewis, author and former Wall Street trader, regarding the unusual message he neatly tucked within the Princeton commencement address he gave a few weeks ago.   Click here to watch it.  His point is something that's at the core of all the social justice work I've been doing and the reason I'm running for congress - luck and random chance have a lot to do with success and failure – as I’ve learned the hard way over the past few years. 

Luck and chance all start with what family, what race, what culture, what location, what genetic advantages and disadvantages we're all born with - accidents of birth.  This democratic experiment we call the United States, was started with the idea that all men are created equal. The truth is that more than half of us are born disadvantaged in either native intelligence; physical abilities; or the position in society that the families we are born into hold either socially, culturally, geographically, or financially.  It's just plain ignorant to say that some kid born to a teenage mother, as the tenth generation of ongoing poverty in the backwoods of South Carolina, is "created equal" to some kid born as the tenth generation of a family living “South of Broad” in Charleston.  

The Founding Father’s vision was of a class-less society where people were valued for their abilities, not their starting point in life.  As one of my heroes, Martin Luther King Jr. said “…a nation where they will not be judged by the color of their skin, but by the content of their character.”  I want to replace the words “color of their skin” with “accidents of birth” to broaden the American dream to capture EVERYONE regardless of their family, their race, their culture, their gender, their sexual orientation, where they grew up, or what genetic advantages and disadvantages they were born with. 

As any biologist will state, diversity only makes an ecosystem stronger, more resilient, more adaptable.  A decade ago I spent a lot of time in a number of Asian countries.  After spending weeks with people of mostly a single race, arriving back in the US would bring tears to my eyes. It’s a beautiful experience I wish every American could have. No other country has the diversity of race, cultures, and ideas that we have in America.  That diversity IS our strength. The variety of accidents-of-birth – our diversity - is what makes America great. Unfortunately, the inability of all of our people to become all they can, regardless of their accidents-of-birth, will destroy America, as it has many societies before us. 

We MUST make changes to our society and our current game of capitalism to ensure our country will never divide into a relative handful of “elites” and 300 million of the rest of us “commoners”.  I think my five legislative actions will ensure that we WILL become a nation where no one will be judged by the accidents of their birth, but only by the content of their character.

Why ARE we putting up with this?

I'd been working for the last few days on the speech I gave today at the rally, March Against Monsanto.  Every time I'm forced to clarify my thoughts, they're tightening up.  But today, while driving to the rally, the thought occurred to me that might be the core of all my concerns for our future. If you think about all the "bad" things in our civilization - poverty, hunger, violence, war, homelessness, joblessness, pollution, poisonous food, anything you can come up with - at the other end of the economic spectrum, someone is getting obscenely rich off those actions.  Think about it. 

Why have the people at the top of the Ag business denied any problems with GMOs?  Because they're getting rich off them, to hell with the long-term consequences. 

Why have the people at the top of GM denied any problems with their ignition modules?  Because they're getting rich off them, too bad if some people are being killed.

Why have the bankers on Wall Street denied any responsibility for the millions of families  who've lost their homes?  Because they got rich off those people.

Why do the coal and oil companies spend hundreds of millions of dollars every year to create and disseminate disinformation - just like the tobacco industry did - instead of investing those dollars to switch to from fossil-fuels to bio-fuels?  Because they're getting rich off fossil-fuels and they wouldn't get AS rich off bio-fuels. 

Why do we put up with this?  Capitalism is just another human-designed game.  WE, the people who vote for our elected representatives are in control of the boundaries and rules of this capitalism game.  The rules of capitalism change all the time.  Two hundred years ago buying and selling humans was acceptable.  Then we changed the rules.  A hundred years ago child labor was acceptable. Then we changed the rules. Sixty years ago, dumping raw sewage and industrial waste into rivers, lakes, oceans and the atmosphere was standard practice.  Then we changed the rules.

It's time we changed the rules so psychopaths and sociopaths are not incented and glorified for raking obscene numbers of dollars from the rest of us to the detriment of our entire society.