An interesting proposal. However, how would you pull off that type of major change? John Cavanaugh is write in using the term "Wall Street Casino." Maybe if there is a next wave of bail out money corporate abuse "nationalization" of the banks might be considered. However, at best we would hear about a short term arrangement as proposed by Paul Krugman. Otherwise, this would be seen as a major shift toward socialism, something I think Americans would reject.

John is on target about "phantom money." We are far too dependent on making money by money investment. Due to a sickening level of deregulation, loan shark tactics have been used to try to sucker in the public to set up the type of high interest loans that will suck the life out of their bank accounts. This created a gargantuan number of toxic loans, but the loan shark executives were able to manipulate books or otherwise sanitize the picture for shareholders.

So suddenly the speculative bubble bursts? Ralph Nader and others saw it coming as far back as 2002. As Nobel Prize winning economist Joseph Stiglitz pointed out, the regulation that corporations needed to maintain a balance between equity / (real) assets and debt was eliminated, and this led to our current situation. We need to restore this regulation and impose very aggressive regulation and oversight with a mandate for 100 percent transparency.

I would propose the opposite of a phantom money economy. We need to go back to industrial production, the type of healthy economy we had after WWII. In short, an economy based on production. Then production is based on jobs. Jobs means paychecks, which stimulates buying and selling.

I agree that Korten's book is visionary and filled with insight. I also find myself in total agreement with Korten's prescriptions. The problem is that Obama is still married to corporate hegemony. In this regard your article represents wishful thinking at best, and at worst, and unwarranted belief that justice will ultimately carry the day.

Obama and company are light years behind the visionary praxis of Korten. The underlying presupposition of your article is that Obama will suddenly be 'born again' (see the light) and follow your glowing and admirable advice of, "clos[ing] down the Wall Street casino." And then, "Replac[ing] it with a revitalized Main Street by resetting economic priorities to support local economies and dignified work that best serve us all[?]" Or that Obama might issue a new executive order that seeks to crush "phantom wealth[?]"

If you really want to see this type of visionary thinking embraced in the market place of Power, then you need to first start voting a authentic progressive ticket like the Green Party. As it stands now, this proposition looks more like advocating for results one might find in a Dickens Novel.

I think it time for contributors of CD to stop making speeches for each other and develop a strategy that actually works, instead of hoping for the best.

Ayuh.
Korten prescribes a start. Reform needs to include bulldozing K Street and turning it into a public park.
Then, remove the designation of "personhood" from corporations, and the designation of "speech" from money.

I'll be eagerly waiting for the corporate-owned congress to act on the former and for Roberts and his Loonitary Executive chums on the Supremely fascist Court to OK the latter.

The overall vision of Korten's book will not happen in any of our lifetimes, but some of his insights could be. Another CD article today ends with "Another possibility is a rising tax on fossil fuels. Government could invest the revenue in renewable energy and conservation. Or we could return the money to individuals through income tax cuts and let the market map the detour around costly fossil energy." I've been saying this for a long time, and I'm always met with dead silence. Ideas of change come very slowly to us humans and ideas that might have us driving cars a bit less is truly a horror of horrors.

I'm reading Korten's new book and am in the 3rd week of a 4-week book study group at my church in Portland, Oregon. I highly recommend his book and you can see a video he did at Trinity Wall Street at the Radical Abundance conference on 1/23/09 via google.

All of us know we need systemic change. Nothing on the current agenda will be sufficient to deal with climate change, peak oil and a collapsing economy. David Korten offers such a vision and it is entirely within our means.

It starts by talking about the system and understanding it's shortfalls. The global/corporate economy was created by man and a local, green, main street economy can replace it.

The pessimist will say it won't be easy but what is the alternative? More of the same. That is insane and a recipe for disaster. It is time we educate ourselves and make the changes necessary for a livable future.

Money making money is at the heart of the problem. Anytime liquid assets in the form of "money" can be shifted about to create "wealth" it at the expense of real wealth. It smoke and mirrors and little more then illusion.

It is a CON game.

As to the return to an industrial economy, I suggest the proponents of such look at the larger picture. An industrial economy means the manufacture of goods to sell to a marketplace.

It seems reasonable on the surface but when one goes deeper and uses our history as an example , such economies are dependent on the CONSUMPTION of resources that grow scarcer and scarcer. Trying to gain access to such resources has fueled the MIC and wars the world over.

Where do you get the raw materials to fuel such an economy? The electricity, the iron ore, the Silver, tantalum and such?

China has ramped up industrialization and now is polluted more then ever and sends agents the world over to secure the resources of other countries.

What happens when THOSE resources depleted?

An economy based on Consumption is NOT the answer. The end game is EVERYTHING is consumed.

The thing about capitalizing on crisis, like in the shock doctrine,
is that most of these crises are manufactured in order to prevent change...
In Chile, when a democratic socialist was elected to be president,
Allende vowed to nationalize the copper industry, and use the proceeds for public works...
This did not sit well with Anaconda Copper, who stood to lose their cash cow...
So Kissinger orchestrated a bloody coup in '73, and installed Pinochet, who privatized everything...

Same goes with so many other manufactured crises that led to exploiting a window of opportunity...
Gulf of Tonkin, Pearl Harbor, USS Maine, and the US spyboat off the coast of Korea... All led to wars...
The market crashes of the 1890's, 1907, 1929, dot.com bubble, and 2008... All manufactured to consolidate power...
The CIA's use of Al Queida in Afghanistan, the former Yugoslavia, Sudan, and eventually NYC...
9-11 was a staged event to ram fascist legislation through a scared congress and populus...
The CIA backed coups or military invasion in over fifty countries that were going "communist":
Guatemala, Colombia, Haiti, Indonesia, Iran, Nicaragua, Brazil, Vietnam, Cuba, etc...

It sounds like Korten has the answer.

I've agreed with most of Korten's analysis since "When Corporations Rule the World" came out about 10 years ago. His prescriptions seem uniquely pragmatic and sane. And Obama will embrace them about as soon as Bush would have. There is absolutely no political support for Korten's ideas, because the political and media cultures fully support Wall Street and corporate domination of the economy, on principle. If we had any kind of populist movement to advance Korten's vision we might get somewhere. But all we have are a few isolated "study groups" and tiny organizations working locally, which is good but hardly enough. Trouble is, there is never "enough" when it comes to even thinking about putting ideas like these into action. We'll continue with about .05% even knowing about what Korten is saying, full of optimism and hope.

re: 'workers screwed, rich scum happy' - class warfare or nothing

"...the victims are the millions of workers who have lost their jobs...and the millions of families who are losing their homes. The villains are the executives whose reckless behavior got us into this crisis and continue to pocket massive bonuses and redecorate their offices while the economy burns."

Well that halfway says it:
Workers screwed, and bankers and their rich shareholder scum who screwed YOU making out - and government and media helping the rich and fast talking you...and laughing. Laaaaaaaaaaaaaaughing!

Whether movement or party, or both, people will act effectively when they get this "shock doctrine" in their gut.

Korten's book is for analysis and discussion - whereas what is needed to change anything is a widespread, visceral, 'unreasonable' rejection of 'reasonable' discourse. Roosevelt's reforms were enacted at a moment of militant, threatening, 'unreasonable' widespread insurgency, not in a spirit of compromise and deliberation.

That's what made Baker end his piece today like this:

"Geithner can design as complex a dog and pony show as he wants, but if his plan takes up hundreds of billions of taxpayer dollars and does not involve wiping out the shareholders and sending the bank executives packing, then he has ripped us off."

While Korten's analysis and ideas are sound, they are irrelevant unless we build power bases that are intelligent enough and courageous enough to execute them. The status quo will not roll over and go "OK, these are good ideas so we'll voluntary relenquish our power and wealth." They must be forced to change.

>>He has sharp ideas on how to get the market price of goods to reflect their full costs of production, including their adverse impact on workers, the environment, and communities.

I've been saying this for quite some time: If a major role for the military is to ensure reliable supply of oil and gas, then, like any other importer, let the oil companies pay for their own insurance - if it involves having armed guards and armed escorts, let them pay for them, and pass on the cost to the consumers. Any invasion and occupation of other countries would have to be paid for by those companies as well. Then we'll know the real cost of gas at the pump. Then the way we design our cities and suburbs, the way we travel and commute, the kind of food we grow and eat, will all start to change.

Highintel: Can we do better?

It would appear that Korten is long on goals and short on methods, like other writers getting the cart before the horse.

It does not matter the merits of an idea if you lack the means to actualize it. In order to reorder the economy you first need a responsive political system, which we now lack.

We need to abolish the Congress, redefine the Presidency, and put direct simple plebiscitary democracy in place by taking advantage of the lowly electron. This could take a few years.

By then maybe our intellectuals will have figured out how a static economy on a finite planet would work. Then we could take intelligent action, which would at least be amusing for its novely value.

Gorsegrower

Of course we can set up a new, fairer economy. But that's the last thing that the Masters of the Universe want. They will prevent anything that robs them of the opportunity to rip people off and make mega-profits.

Only NEO-HUMANS can stop them, humans that can actually think, who can work out what needs to be done to depose these 'Masters' and set up a whole new world.

Are you a potential NEO-HUMAN? Could you make the grade?

www.dangerouscreation.com

Frankly, I didn't see anything new in this article -- these ideas are all over, and more specific in many other places. I'm wondering what the purpose of the article is besides a plug for a book.

The economy will be shaped by the frame of reference - 'bottom line' being the spiritual orientation that informs choices. As long as we can rationalize 'survival of the fittest' with hundreds of millions losing out and as some sort of selection process, its on the skids. By my mind this is the real challenge. We must use less, share like our lives depend on it - because ultimately they do.

The great big sucking noise is still drowning out millions of voices that have been paternalistically labled as 'losers' by 'winners'. That mindset needs to be revealed for the narrow straw it is. It is the straw that has distorted history, polarized and in short called itself god when its been a bare bottom emperor. It is the straw that will break the imperial camel's back.

I agree with the article.

But why aren't the ones who caused it all forced to cough up the money they have earned??? Surely there's a legal basis for putting every one of them in jail until they cough up the dough they've stashed somewhere?

If you cause such a meltdown just because you are greedy, you ought to be persecuted for crimes against society and ALL your assets and that of your entire family ought to be seized to pay for the damage.

Because that's why you did it, right? To amass so much money that one's family's next 5 to 10 generations would still be affluent.

Well, teach these criminals a lesson no manager will ever forget. Confiscate everything they own.

And THEN we can start with a clean slate and with a new idea about how to conduct our economies. Including the ideas of this article.

I know I will not get much agreement for this comment but it is too bad that people did not listen to Bush when he tried to reregulate Fannie Mae and Freddie Mac in 2001. He was consistently blocked by Congress, Reps and Dems alike. Alan Greenspan also warned of "catostrophic consquences " if they were not reregulated, although he foolishly kept interest rates too low, adding fuel to the fire. Once Barney Frank and Chris Dodd were at he helm of the banking committees, it was a lost cause. John McCain also co-sponsored a bill in 2005 to reregulate them but Dodd would not allow the bill out of committee for a vote. However Bush also must share in the blame because he should have been screaming about the issue, he gave up too easily, a simple address to the nation would have brought the issue to the forefront. He choose not to do it.