The economic genius of Herman Cain
October 24, 2011
“It is not my intention to do away with government. It is rather to make it work–work with us, not over us; stand by our side, not ride on our back. Government can and must provide opportunity, not smother it; foster productivity, not stifle it.”
*Ronald Reagan* First inaugural address 1/20/1981
Herman Cain rolled out a plan last week for Economic Opportunity Zones that should have Americans, especially those who support sound economic theory and equal opportunity, cheering. Herman Cain calls the plan his vision for “Opportunity Zones: Renewing Cities Across the U.S.A.”
This plan is ingenious because it is simple in economic terms. It combines proven economic theory with the current conditions that occur naturally in an economic downturn, such as low property values, and an abundant pool of available labor, i.e. unemployed Americans. With a focus on distressed American cities–Detroit for example where residential and commercial properties have plummeted in value–the Opportunity Zone plan would create a friendly atmosphere in which entrepreneurship and investment are encouraged, and jobless or underemployed Americans would be put to work. It revitalizes America’s cities by giving hope to those want to build a businesse, take risks, work hard, and renew the American Dream in the cities which are dear to them.
The Opportunity Zone Plan will succeed largely because it clears away the outrageous hurdles of government regulation and taxation which now exist, and have grown to beastly proportions, under the Obama Administration.
- It ends bureaucratic micromanagement.
- It creates an atmosphere of productivity and competition instead of trying to control outcomes.
- It allows for freedom and creativity on the part of entrepreneurs and investors.
- It eliminates the unnecessary regulations, the “government wedge,” that are designed for social engineering but which are so burdensome that they discourage business growth.
- Opportunity Zones will be based on the philosophy that the economy is “production based,” rather than “consumer based.” This naturally encourages efficient and sustainable business models; companies that are favored by a community because they benefit the neighborhood as well as the consumer.
- The plan draws upon the natural human response to incentives. It replaces incentives to be idle, such as endless unemployment benefits, with incentives to work and produce, in which hard work and success are rewarded.
- It addresses the problems with means-tested benefits to inner-city populations and encourages people with low incomes to work and earn more without taxing those additional dollars earned.
- The Opportunity Zone plan will provide some payroll-tax relief to new companies who often don’t make a profit for several years, giving those entrepreneurs who are just starting out additional incentives to hire and expand.
- This plan will be competitive and will require those who seek Opportunity Zone incentives to meet the specific needs and standards set forth by the cities and states where the would place their businesses. In other words, opportunities will come to those most willing to work hard and implement business plans that make economic sense and benefit their communities.
Herman Cain’s Economic Guiding Principles are:
- Production guides the economy, not spending
- Risk taking drives growth
- Measurements must be dependable and focus on how reducing the “government wedge” enhances productive activity
This is a plan that will most benefit those in America’s cities who are beset with high unemployment rates and a dearth of potential jobs. Herman Cain has resurrected the American Dream with this plan. All Americans, regardless of location, economic status, race, or background, can take hold of the opportunity provided by this plan, to use their ingenuity, hard work, and commitment to create better cities and a better country, and enjoy the wonderful fruits of prosperity.
By Marjorie Haun 10/24/2011