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Could a $5 billion investment save the U.S economy?

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posted on Jul, 25 2010 @ 02:59 PM
While I am discussing the solution I am offering for criticism is framed in U.S. terms, it should be considered globally applicable in proportion to relative economies.

It seems to me that years of corporate/financial mismanagement, miisjudgment, and ignorant greed has succeeded in killing off the economic plankton necessary for the ecoweb to survive. Everyone's too familiar, or should be, with the litany that got us here. Well, forget that crap for a moment and let's focus on the quickest and best way out.

The failure of vision in the capitalist camp is undeniable. They've been given trillions and haven't the foggiest clue how to use it to create jobs because that's not what they are trained to do. They are trained to create profits. So looking to that class for a way out is futile.

But the solution is simple and, most of all, best of all, cheap.

Here it is:

Congress should fund a $5 billion Entreprenuerial Grant Program.

Its mandate would be to provide 100,000 block grants (not loans) of $50K each to any individual or genuine Mom&Pop who had a reasonable idea for a new tangible product that could be manufactured locally within their own community. Corporations, mid-size businesses, small businesses would not be eligible. Microbusinesses would be.

Sure, not every seed thrown out grows into a healthy, productive plant. But a hundred thousand seeds? If even 10% succeed, that means ten thousand NEW products available for eventual development by corporations doing what they do best.

It also means 10K + x new jobs, and y jobs saved. Seems like pretty cheap job creation to me with the bennie of bringing new ideas and new products into the marketplace, unleashing the ingenuity and drive of those with good ideas.

It's a gamble, yes, but one I'd be willing to bet on.

What do you guys think?

[edit on 25-7-2010 by apacheman]

posted on Jul, 25 2010 @ 03:40 PM
Anytime money passes through the government, you get pennies on the dollar back.

Anytime you keep money out of the government, you get dollars for every penny saved through leverage.

It's far more efficient to cut taxes than to create grants. This is why the stimulus programs were so ineffective and wasteful.

posted on Jul, 25 2010 @ 04:09 PM

we lost hundreds of billions.

posted on Jul, 25 2010 @ 04:38 PM
reply to post by Dbriefed

This money wouldn't pass through and be diluted. It shouldn't be too hard or expensive to administer. The requirements shouldn't be excessive either: a reasonable idea proposed by an individual. First 100K individuals with a decent idea gets it.

This would be $50K awarded to an individual who would spend it locally on tangible products. At a minimum you get $50K spent locally and cycled through the local economy at least twice, generating activity. If the idea dosen't work, various people have gained experience in the real world of business and economics, as opposed to spending the same amount of money providing them with book lessons that may or may not be relevant to the local conditions.

On the high end of the result scale, at least 1% should evolve into productive small businesses that employ a few thousand people producing something that is more efficient, provides a better environment, or otherwise adds substantially to the economy. Plus you get the wild card factor of initiating a technological leap.

$5 billion is basically cushion change in the federal budget. Using it to offer direct stimulation of the economy through creative entreprenuership would seem like a no-brainer, acceptable across the political spectrum.

Don't just say it won't work, please explain why you think so.

[edit on 25-7-2010 by apacheman]

posted on Jul, 25 2010 @ 04:41 PM
I think it would be like that episode of South Park

....And .. . .it's gone ..

Some rich people would only become more richer and things would be pretty much the same.


posted on Jul, 25 2010 @ 05:13 PM
reply to post by satellite1

Rich, corporate types would be ineligible for this grant program. Perhaps I should clarify. This would be restricted to people who aren't involved with the corporate world.

An income/net worth limit should be used to prevent exploitation by the already-rich.

Not eligible if you own a business that employs more than two people including yourself.

Not eligible if your net worth exceeds $1 million.

Not eligible if you are employed by a corporation.

This would be a once-in-a-lifetime grant, intended for the delevopment of NEW tangible products.

NEW would be defined as an entirely new device that fulfills a legitimate new, an improvement upon existing devices that is sufficiently different to warrant its production as an alternative to existing products, or a new service that would be locally unavailable without the grant.

There would be no further funding from this grant program: it is entirely intended to be a seedbed with both predictable an unpredictable outcomes. It would be a competitive program; not competing with other programs, but rather its grantees would be competing in the daily arena of the marketplace.

For the US, $50K is essentially a micro-grant. Most businesses would consider it it inadequate to start anything with. But a true entrepreneur will take it, multiply it, and create a new business, eventually bootstrapping into the realms where standard credit avenues begin to open. Isn't this what capitalism is supposed to do?

It would represent a faith in the ingenuity and drive of the American people that appears to be sorely lacking in some parts of this country. Me, I'm pretty sure that out of some 300 million plus Americans, you can find at least a couple of thousand good ideas that will translate into new jobs, and lots of them.

posted on Jul, 25 2010 @ 05:29 PM
the only way a 5 billion dollar donation would help the US...or any if the money was divied(sp) up to every adult citizen in the country.

guy above me has the right idea also....eligibility is to be key.

[edit on 25-7-2010 by ahmonrarh]

posted on Jul, 25 2010 @ 05:31 PM
this headline made me laugh, of course they can't. if they can't do it with 5 trillion dollars, how will they fix it with 5 billion? Your idea would make sense and would help the economy, but they aren't interested in that, they want to make things more dependent, not more self sufficient. Plus, the absurd products families would come up with wouldn't really help the economy too much, it would be better used simply to pay off people's debts, so they can have more disposable income to go shopping.

posted on Jul, 25 2010 @ 06:23 PM
I believe the government would find a way to ruin this idea, such as by making it a long and difficult process to get a simple loan. That said, they would never implement an idea that makes sense and therefore you should stop wasting your effort making suggestions. Its hard enough getting a for-profit corporation to adapt obviously profitable ideas when you work for almost any company.

Its better that you get together with people and make some loans without waiting for the government. Try starting with 10 loans of $5,000 each. If those work, then get more funding for more loans. By pitching this idea to everyone you know with money, maybe you'll be able to start your idea without the government. If the idea works well, then it can eventually grow to $5 billion dollars or more.

Sadly, whenever I recommend someone do something without waiting for the government, it gets so quiet you can hear a pin drop. Hopefully I won't kill your thread by suggesting it.

posted on Jul, 25 2010 @ 06:56 PM
Any idea that is truly any good, does not have a problem getting funding from the private sector. There are plenty of wealthy individuals interested in investing in good ideas.

This would only end up funding ideas that could not get support or would be money simply pocketed by the unscrupulous.

The problem is not so much lack of innovation or funding for innovation, although that isn't what it used to be due to our deteriorating education system.

The problems are

1. Our wage/cost requirements are simply to high to compete with manufacturing in third world nations.

2. The population lacks the ability for further discretionary spending due to high debt load - 61% of Americans are living paycheck to paycheck.

3. Taxation is too high as it is, and is about to get much higher with the mountain of government debt that has been built up.

4. The rich have too much power - they own the politicians and thus have been able to allow themselves to steal from ordinary Americans without any penalty.

[edit on 25-7-2010 by proximo]

posted on Jul, 25 2010 @ 07:40 PM
reply to post by apacheman

I do not think billions could help us.
The only way to truly save the US is to collapse our banking system and start fromn scratch with a bunch of safeguards in place.

reply to post by apacheman

You have a good idea there that these rich corporate types get no money.
But, most of those rich corporate types have less money than you do.
Cars and homes and suits and all of the nice things are owned by the company not by the ridh types.
That way they are all business expenses.
Even though only a small amount of people can use said business expenses.
It's all in playing the game.

posted on Jul, 26 2010 @ 12:43 PM
reply to post by truthquest

This would be a GRANT, not a loan.

You don't pay back a grant. The $5 billion would be the total amount actually given out, so the total cost of the program would be in the neighborhood of $5.2-$5.5 billion.

If I knew folks with that much cash to invest, I'd already be working on that. But nearly everyone I know is living paycheck to paycheck, up and down the economic scale. Those that do have the capital to invest, want guarantees and excessive returns. Mostly they have no vision of the future except a nebulous idea of "more money". They are averse to anything that might change the marketplace, because that introduces unknowns they are uncomfortable with.

[edit on 26-7-2010 by apacheman]

posted on Jul, 26 2010 @ 12:59 PM
Great idea but you'd have to install safeguards against fraud.
I'd be one of the first to apply.

posted on Jul, 26 2010 @ 01:30 PM
reply to post by proximo

I have less faith in the omniscience of the private sector than you do.

The private sector values stability and predictability. Just watch any of the financial channels for a week, and you will understand just how much they value them. They absolutely detest anything that introduces unknowns into the economy.

So they won't fund technologies that compete with the established system. Why do you think it's taken so long to get electric vehicles? Why is solar technology so focussed on high-tech manufactured solutions to the exclusion of low-tech?

There are thousands of good ideas out there that $50K in free, no-strings-attached money would blossom into pools of strong economic activity. There are citizens who have spent years grooming their ideas, shaving costs, honing efficiencies because they lacked the budget to do anything else, and the idea was too good to let go of. Millions of hours of daydreams about gadgets that would solve this particular little problem.

The "private sector", when you stop to think about it, is really only a few hundred families comprising a few thousand individuals. This group will never fund ideas that would revolutionize anything in a way that would threaten their frip on power, that would fundementally change the way the economy works or is set up. So lots of good ideas won't ever be funded by the private sector.

So here's how I would set it up:

100K grants of $50K each.

Grants apportioned to each state based on population as reported in the latest census.

Within each state grants will likewise be apportioned by population according to the latest census.

Each state shall create local entrepreneurial screening boards to review applicants' plans and disburse grants.

Screening boards shall be comprised of fifteen members selected according to the folowing criteria:

All members are drawn from within the boards' geographic area of responsibility, minimum two years' residency.

2 members from the agricultural community, actual farmers/growers, not corporate office farmers.

2 members from the art community, again, actual artists, not executive directors of art institutes.

2 practicing members of the medical community.

2 independent retailers.

2 under-30 successful entrepreneurs.

2 members drawn from local manufacturers.

2 classroom educators.

1 generalist who is uncategorizable, nominated at large.

Potential members should be nominated from within their respective groups based upon their degree of pragmatism, intelligence, courage, vision, and relative freedom from bias. A pool of 20 potential members for each class of 2 and 10 for the generalist would be created based on the field recommendations. Whenever sufficient applications accumulate, say twenty, the board would be convened by selecting randomly from the available pools and the applications analyzed and voted on by the board.

The board members may vote yes, no, abstain. Any application that receives more yes votes than no votes will receive the full grant within 72 hours.

Applicant must be a US citizen and have resided within the board's area of geographic responsibility for a minimum of one year.

Applicant provides a description of the product to be manufactured or developed for manufacture, or the service to be provided.

Applicant provides a cost/parts breakdown along with at least two bids from local vendors to provide the necessary materials.

Applicant provides at least two vendors who agree to carry the finished product.

Applicant may reapply with a revised or new proposal if turned down.

What else is needed to make sure it would work? From back of the envelope calculations based on 2009 census data, DC would get around 198 grants, North Dakota 213, Arizona 218 at the low end, California would get 12,104, Texas 8,118 and New York 6,460 or so.

Enough boards would be required to ensure that a state's entire allotment isn't controlled by one area or group. This would be a one-year program will all grants required to be disbursed within 15 months of passage, allowing three months to organize the boards. Any state which fails to organize boards will lose out with that state's grants being redistributed as numerically evenly as possible among those compliant, starting with the smallest states to largest states, reversing order for any uneven leftove amounts.

I think that such a program would generate economic activity and hope out of all proportion to its dollar value. The intellectual ferment of bringing these different groups together to look at new ideas would be worth it by itself.

[edit on 26-7-2010 by apacheman]

posted on Jul, 26 2010 @ 02:31 PM

Originally posted by apacheman
reply to post by truthquest

This would be a GRANT, not a loan.

If I knew folks with that much cash to invest, I'd already be working on that. But nearly everyone I know is living paycheck to paycheck, up and down the economic scale. Those that do have the capital to invest, want guarantees and excessive returns. Mostly they have no vision of the future except a nebulous idea of "more money". They are averse to anything that might change the marketplace, because that introduces unknowns they are comfortable with.

Rather than being ordinary grants, I believe they should be pay-it-forward grants. So, if their investment is successful, they should promise ahead of time to create a matching grant when they can afford it, then one more grant twice that size when they can afford it again. So the first match can keep the program inching forward, while the second grant hopefully grows the program.

Of course they could break down the grants to whatever size they feel is best and also chose who gets the next grant if they would like.

If you like my idea about pay-it-forward, then forget about the government because they are not ever going to do anything useful and start this your self. You can start a basic website with a chip-in feature. You don't need any money to start this because you can get it from other people, except unlike the government you don't have to use mafia extortion tactics to get your money. So, when does your program start?

posted on Jul, 26 2010 @ 03:31 PM

Originally posted by g146541
The only way to truly save the US is to collapse our banking system and start fromn scratch with a bunch of safeguards in place.

Yes they have plans to collapse the economy to get us all on the digital amero at $0.50c on the $ and will talk about new safeguards.

tell them to stick the amero, the taxes and police state because that will doom the population to RFID's and personal carbon taxes.

stand firm and if they start to repo people property during the process then burn the houses and thow the bankers on the fire to adjust them to the temputure they will get when they meet there maker and they will soon give that in as a bad idear.

I don't care if you think i'm wrong just remember what i say when it happens and don't fall for the trick because they need us more than we need them and the people are more than a match for any of them.

posted on Jul, 26 2010 @ 04:15 PM
reply to post by truthquest

Actually, I think the pay-it-forward concept is good, if you wanted this to be a continuing program. I had envisioned it as a one-shot stimulus/experiment/expression of faith in Americans.

A voluntary pledge to replenish the pool would probably work best. Perhaps a commitment by each of the grantees to report back to the boards after a year and make a donation into a new pool if they are able would work. If you got an average of even 1% back, you'd have a new pool of $50 million to disburse.This of course means extending the life of the boards for a year, unless you had a consolidated board to handle that aspect. These could become state-level nonprofit entities that would encourage the development of new ideas.

posted on Jul, 26 2010 @ 04:38 PM
$5 billion? nope not enough...yuo have to take in mind, Bernenke admitted to printing over $1 trillion 'off the books' as aditional bailout money, or god knows what he did with it...that has to be compensated into the factor too. along with the hundreds of millions of tax money given to Isreal, which were never gunna get back on a timely manner if at all for that matter...
$5 billion isnt enough
no thanks to our governemnt overspending. lets not forget too, for example in 1994, that $400 hammer they bought, and i think i read, a toilett seat recently for $800..... thiers no opening in this rabbit hole sad to say. that is how greedy and uncarring they have become.

posted on Jul, 26 2010 @ 08:24 PM
No, more money won't work. Innovation and new ideas work.

I hope this isn't a violation of T & C's, but I seriously believe that the legalization of hemp and marijuana would turn our county around in a short period of time. It would save and make the government so much money, and people money.

Reduction of drug enforcement. How much does our country spend on drug inforcement?

New products produced from hemp, a proven renewable resource.

I won't go into the 100's of benefits I can see from this one change, as there is probably already a thread on it.

posted on Jul, 26 2010 @ 09:11 PM
reply to post by apacheman

The Government already has a very large small business loan/grant system in place...... called...

The Small Business Administration.

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