The fourth chapter of Organic Wealth is the longest chapter and could have been expanded to become a book all on its own.

I wrote in my previous article that we can define wealth as the saved monetary value from meeting demand.

Even the stocks you own that appreciate in value fit this description. Stock prices primarily go up when a company is meeting demand and has increased its earnings (unconsumed income). For the shareholder, the profit could be distributed or reinvested in the company to increase revenues. Either way, the increase in wealth for the shareholder represents the saved monetary value from meeting demand.

The previous article, Wealth is Created, leads us perfectly to this post. Some of the ideas in this article are from chapter two of Organic Wealth fittingly entitled, Equal Transactions. I’m not going to give away all the gold here; there’s much more that’s left out of this article. But please keep reading for enough nuggets for some mind blowing revelation.

Organic Wealth takes you on a journey. It begins with how wealth is created in capitalism and finishes with how wealth is destroyed in socialism. The winding road between them makes the drive both enlightening and inspiring. You’ll agree that it’s worth the ever changing scenery.

Wealth tax advocates will be attacking the Supreme Court’s 1895 Pollock opinion which maintains that a tax on property is a direct tax.

They have to do so if they want to enact a wealth tax because for the last one and a quarter century, Pollock has protected Americans’ private property from government mobsters.

Despite what you may have heard, a federal wealth tax would be defeated at the U.S. Supreme Court. Such a tax is a way of taking accumulated wealth from those who have too much as determined by government policy makers.

It’s no wonder that voodoo is no longer being used as a smokescreen. In 2017, when the tax reform package was being hashed out, the Democrats were disparaging the legislation, calling it, “tax cuts for the rich” or “trickled down economics” and of course, “voodoo economics.”

Corporate welfare is receiving a bad rap as Amazon chooses Virginia and New York to split its second world headquarters. New York has promised more than $1.5 billion in incentives to attract Amazon’s 25,000 tech jobs to Long Island City. This is an excellent deal for NYC and NYS. All the critics must just be jealous because their city lost in the bidding war. Those within New York that are scoffing need to stop listening to the likes of Alexandria Ocasio-Cortez and television pundits and consider the boon that’s coming their way.

The Democrats have already signaled that they will support a significant component of Donald Trump’s economic growth plan, infrastructure spending. The Republicans do not have the same old ideas though, but have a much more nuanced plan than what the Democrats are used to.

Whenever there is talk about stimulating the economy, the Democrats immediately begin talking about infrastructure spending. After the 2008 economic crisis, for instance, President Obama turned to government spending to stimulate the US economy with the passage of the American Recovery and Reinvestment Act (ARRA) of 2009. 

Everything is ready for President-elect Trump and the Republican led Congress to take the reins of this economy. The environment for pro-growth economic policies couldn’t be any better. The Fed Fund rate (short term interest rate) is near zero and the inflation rate has still not reached the Fed’s target of 2%. This is a much better situation than it was in 1980.

The economy wasn’t doing well when Ronald Reagan took office in 1981. The Federal Reserve raised the Fed Fund rate to a whopping 20% (today it’s 0.25%) as they tried to curtail the high 12.5% inflation rate (today it’s 1.6%). The country was also experiencing high unemployment. Reagan’s task was to grow the economy in that volatile environment to create jobs.

The new Trump administration has an economic agenda for the US economy to create jobs as well, but in a much less volatile environment. Our economy today is like someone through a wet blanket over it.