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I don’t know how many of you are paying attention, but the Federal Reserve is playing with fire.  In an effort to cushion the falling economy, the Fed is making available to the market lots and lots of money.  This is going to help keep the investment firms that have been playing fast and loose with risky instruments from going belly-up, and theoretically going to keep the stock market from beginning the death spiral of decreasing confidence and increasing panic.  But it also runs the real risk of further devaluing the US dollar in relation to other world currencies.  Just like with boy bands, flooding the world with more dollar bills makes each one of them worth a little less.

Now, presumably, (have you noticed how many assumptions we have had to make to get this far?), because consumer spending is down, firms won’t be expanding capital and borrowing from banks and therefore the money will only trickle into the market and we can avoid the devaluation problem.  But I worry that is a big IF, and sets up a gamble with which I am not comfortable.  For if we’re wrong, and the dollar continues to slip, there may come a time that another government (Japan, China?) will buy up all those worthless dollars and essentially own us.  Do we want to risk this so that the recession we’ve been postponing for 7 years can be less drastic than it probably needs to me to make our political system face some of these looming problems that threaten to drown us?

Oh well, at least we still have more nuclear warheads than any other country.  Maybe that will make other world leaders think twice before utterly destroying our economy… sorry, don’t have a lot of time to post, and am worn down enough to let the doomsayers move me to expect the worst.

After spending three days in a conference on Regional Equity, I feel inspired to discuss my ideas about equity and what it means to me. 

To many people, the word “equity” means equality of outcomes, as in “everyone should be equal and experience equal  outcomes.”  While this definition of equity is a beautiful idea, and warms the heart, it leaves off an important value of the American system - incentive.  Why would anyone work hard if, in the end, everyone will be compensated the same way?

There is also the idea that equity means equality of opportunity.  Again, while a noble dream, this is not very likely nor very helpful.  There are millions of Americans who work hard every day to make a better life for their children and to create opportunities for those children that they themselves did not enjoy.  Is it fair to those who sacrifice so much to then have those sacrifices come to naught while all else is given the same opportunity?  Again, it is about incentives and motivating individuals to better their family’s lives.

I would argue that part of the American promise is that everyone has some opportunity to better his or her life.  While there will be some with phenomenal opportunities, we can’t all go to private boarding schools and travel with the elite economic or political  circles.  But there has to be a base level of adequacy every American starts with, and that includes a healthy environment and access to quality education.  Every person should have the chance to make the right choices and prosper in this country.  Yes, that is going to be more difficult for some than others, and there is a good argument right now that it is too difficult or even impossible for too many Americans.  That is something we should certainly address, for without opportunity our country will fall apart.

I believe a good working definition for equity is based on the complex equity model.  In this model, there are many different spheres which relate to each other but are distinct in their power structures.  There is an economic, political, religious, educational, and neighborhood sphere, among a plethora of others.  It is possible and even desirable to be influential or powerful in any one of these spheres.  But to achieve equity, no one could use his or her position of power in one sphere to influence or gain power in another.  A classic example would be the Pope’s ability to influence political and economic spheres in Medieval Europe.  In contemporary society, successful businessmen and wealthy individuals should not have undue influence in the political arena.  Or more accurately, people with lesser means should have the same opportunity to influence the political sphere that high socio-economic individuals enjoy. 

With this model we can accurately assimilate the incentive to work hard and “get ahead” in whatever sphere most concerns a person, while taking into consideration the need for balance and opportunity.  We can also see the glaring discrepancy of today’s US system - the fact that those with wealth and economic power do in fact heavily influence other spheres, particularly politics but increasingly religious, educational, and others.  Within this model we can fairly represent our concern and begin to address this problem in constructive ways that do not limit the credit one can develop through hard work and innovation.

I am still developing this idea, so if you have thoughts, please let me know.  I am particularly interested in other’s understanding of equity, the value of the topic, and how we might work to better understand it.

To all my faithful readers out there, I am unfortunately taking a slight hiatus on posting to the blog.  I have been using what little free time I have to create a simple website from which I can provide information about myself to potential employers.  It is still in Beta stage, but if you’d like to see what we have thus far, here’s the link www.teamthronson.com/eric.html.  Please check back regularly as I finish up this site and then will be able to turn my attention once again to my blog.  Thank you for your patience!