Ravi Batra’s new book reveals solution to joblessness
Dr. Ravi Batra, a Southern Methodist University professor and renowned economist wrote a new book, End Unemployment Now: How to Eliminate Joblessness, Debt and Poverty Despite Congress. Batra believes poverty can be quickly eliminated all over the globe, especially in the United States. “Global poverty removal has been my lifetime, though elusive, goal, because political opposition and corruption stands in the way,” Batra says. “Finally, I think I have found a way out of the quagmire, and the advanced reviews received by my book testify to that.”
Unemployment and its solution
Written by Professor Ravi Batra
Ever since the Great Recession that started in 2007, the United States has been mired in poverty, joblessness and a mountain of debt. With Congress and the president constantly at odds, the public is clamoring for a fresh approach to our economic problems, and this book delivers just that. Even the fastest growing economies of India and China have seen a slowdown and the analysis and the solutions offered in this book, while based mostly on American experience, actually apply to the whole world. Salient features of the book are:
- The main cause of our myriad troubles is monopoly capitalism, which is a system dominated by giant companies that charge high prices, pay low wages and extract huge productivity from employees. This way supply rises faster than demand and generates layoffs; so the solution lies in breaking up the behemoths and returning to free markets, where small firms engage in price and quality competition.
- That requires new legislation and the cooperation of Congress, which itself is either divided or beholden to monopoly capitalists. So we can’t count on the legislature.
- The president can bring about a competitive-capitalism effect, though not actual free markets, without recourse to Congress.
- A competitive-capitalism effect occurs when, through certain official proclamations or policies, a market arrives at a similar outcome that would prevail in the presence of small firms operating as competitive enterprises.
- With the help of the agencies such as the FDIC and the CFTC that work for him, the president can bring about this effect in several industries including banking, oil and gasoline, pharmaceuticals as well as foreign trade
- The FDIC has the legal authority to start its own bank, which could compete with banking giants and bring down interest rates on credit card balances from the current range of 15 – 30 percent to just 5 percent.
- The CFTC canlegally raise margin requirements for oil futures to control speculation and bring petrol price down to $20 per barrel from the triple digit levels that prevailed until mid-2014,in spite of a relentless decline in American petroleum imports. In 1998 even a puny fall in these imports brought oil down to just $12 per barrel.
- The president and the Federal Reserve should and can eliminate our trade deficit by doing what China and Japan do; he can offer an export-oriented exchange rate to raise our exports to the level of our imports, so that we follow a policy of balanced free trade.
- The rural areas of emerging economies, such as India, China and Brazil, should use a putting-out system of industrialization that was very effective in eliminating poverty in pre-capitalist Europe and the United States. This system required little investment but quickly uplifted living standards in small towns and remote villages.
With these type of measures, nations can not only get rid of unemployment, but they can also make a big dent in poverty, especially rural poverty. Similarly, consumer and federal debt can also be brought down, even though slowly. Economies can then become self-sustaining without the government’s life support.
END UNEMPLOYMENT NOW (Palgrave/Macmillan)
Full Review: In this important book, Southern Methodist University economics professor Batra offers practicable solutions to many of the economic problems plaguing America. Most promisingly, these ideas can be implemented without involving Congress and the party loyalties that so often gum up the legislative works. Batra denounces our current system of monopoly capitalism as the main problem, positing free markets and competitive capitalism as the solution. While free markets would by necessity involve congressional input, Batra states that the President can bring about truly competitive capitalism without political hindrance. Batra’s cogent inventory of what he sees as the current obstacles to be overcome includes a “Do Nothing” Congress, high unemployment, monopoly capitalism, and stock market bubbles. He finds the cure for these economic ailments in the sectors of banking and finance, oil and gasoline, big pharma, and foreign trade. This worthy treatise concludes with a concise summation of its key proposals, including creating a bridge bank to bring down credit card interest rates, gradually raising the minimum wage in concert with inflation and national productivity levels, and preserving competition by not allowing large profitable firms to merge. Even readers new to this level of detail should recognize the wisdom of Batra’s ideas.
End Unemployment Now
Batra offers far-reaching proposals to end joblessness quickly. Taking a broader overview of unemployment than the narrow definition employed to boost claims for the strength of economic recovery, the author offers a macroeconomic look at the causes of joblessness and income inequality. "The ultimate source of joblessness," he writes, "is monopoly capitalism, which enables industrial giants…to charge exorbitant prices while restraining wages and extracting huge productivity from employees. This creates overproduction, hence layoffs." Batra disagrees with those who believe that domination by virtual monopoly corporations is part of the proper functioning of a free market. He advocates for the use of the executive branch to adopt and enforce regulations to launch a shift away from corporate domination and toward truly freer markets. Interestingly, he recommends as a model the approach adopted by American occupation authorities in Japan and Germany after World War II. Japanese industries were configured as vertical monopolies and called Zaibatsu, which "earned high profits by keeping wages low." The U.S. military dissolved them and the owners were removed from their positions. The conglomerates were then broken up into the smaller, more agile and creative pieces, which helped Japan recover from the war with free market methods. The U.S. military did the same to Germany's war economy, breaking up IG Farben, which provided the gas for many concentration camps. Batra believes "the president has to take charge and deliver the poor and middle class from the damning status quo." The author argues that the president should break up the corporate monopolies of the finance and retail sectors, along with oil and pharmaceutical industries, by administrative fiat. A similar approach, he argues, could be adopted to reregulate foreign trade. An innovative approach that will appeal to those who question current claims of economic recovery.
Advanced Review – Uncorrected Proof
Issue: May 15, 2015
End Unemployment Now: How to Eliminate Joblessness, Debt, and Poverty Despite Congress. Batra, Ravi (Author)
May 2015. 256 p. Palgrave, hardcover, $28. (9781137280077). 331.13.
A novel publishing strategy stands behind this book. After holding an enthusiastic audience with then speaker Nancy Pelosi, a Southern Methodist University professor with unique economy-busting ideas isthen referred to (at the time) fed chairman Ben Bernanke. Nothing happens. So why not write a book? Batra, in an atypical academic fashion, details all the issues that led up to the U.S. wage gap, horrendous oil prices, and high-interest rates—and, yes, a loomingly alarming high-unemployment rate. He does so in simple English (no economists’ jargon), plain charts and graphs, and a straightforward approach that compels without selling. Part 1 diagnoses all possible issues, from oligarchy (the concentration of wealth) to monopoly capitalism and wage gaps throughout the world, ending with an intriguing town-hall-style debate. Part 2 is the cure, with some startling yet commonsense recommendations, such as don’t allow mergers and acquisitions among large and profitable firms; reform the FDIC as a bridge bank and competitor to other financial institutions; raise the minimum wage; and offer five-year bonds for retirees at a fixed-interest rate of 3.5 percent, among others. Much food for thoughts; write your congress people now.
"This book really reads like a suspense novel. Turning each page, new tracks appear that the villain left behind in this economic whodunit of all time. Of course, this is no idle fiction but the harsh truth of life in our world. The description of the economy the book offers is straightforward, yet profound and easy to grasp at the same time. Its message will have an impact. There is no way around it." (ThorsteinnThorgeirsson, Senior Advisor to the Governor, Central Bank of Iceland.)
Once again, Dr. Ravi Batra, one of America's most brilliant economists, knocks it out of the park. Everyone - particularly policy makers - needs to read this book! Brilliant, easy to understand, and filled with solid solutions to revive the American middle class. (Thom Hartmann, host, Thom Hartmann Radio Program and The Big Picture)
For the aficionados of economics prophecy, Professor Batra has always been a legend: in this new work, however, his focus is on economic policy. He has little time for padding or rhetoric: instead, he sums up very quickly, in simple, lay terms, what must be done to bring to the U.S., and thence the world, out of its long-drawn doldrums. Even better, he shows how this might be accomplished bypassing the slow-moving processes of Congress, via Executive edicts. It is the economics primer for our times: a must read for all--especially President Obama with time still left in his tenure to carve himself a permanent niche in History. (Prof. RajaniKanth, Harvard University)