Summary

It is time for an economic recovery plan in America that will offer a fresh start for American families. It is time for U.S. citizens to be granted access direct liquidity infusions.

America needs a plan that employs a qualitatively new approach to strengthening our nation’s economic foundation. It needs a plan driven by popular appeal, rather than by politics.

Considerations of a new direction in the recovery plan must include these critical factors:
1. Economic health at the family level must be restored before America can hope to emerge from the current crisis.

Despite trillions of dollars in bailouts, big bank pump-priming and stimulus programs, the U.S. Economy remains lethargic. Despite the hundreds of billions of dollars spent on social welfare programs each year, millions of American families remain financially distressed. As of June 2014, approximately 92,120,000 working age Americans were not participating in the workforce.

American families are in need of debt relief. The Fed reported that in April 2014 that consumer credit had exploded up to $26.85 billion. Total household debt remained high, at well over $11 trillion. Real Median Household income has been in a steady decline for over a decade.

2. The national debt of the United States remains an enormous, potentially destabilizing problem for the future of our country, and America must have a plan to address it – a plan that will stimulate the economy and generate healthy, long-term tax revenue growth – and reduce dependency on government.

America’s true, GAAP-based sovereign debt has been reported in the U.S. Treasury Statement of Social Insurance in the Financial Report since 2005. The GAAP-based debt, which accounts for the net present value of unfunded liabilities, was recently estimated at $86.6 trillion. This represents 550% of the U.S. GDP, and it represents 150% of the global GDP. The U.S. sovereign debt is clearly “beyond containment.” There is no possible way of bringing it back under control.

The GAAP-based deficit over the past 5 years (2008 – 2012) has averaged more than $5 trillion per year (with the 2012 deficit coming in at $6.9 trillion). At these levels, the Government could take all of the income earned by everyone in America, and it still wouldn’t cover the deficit. America’s sovereign debt is now clearly “beyond containment.”

America has its back to the wall. The Federal Reserve, over the long term, is faced with a ‘print or collapse’ scenario. With their goal of maintaining an “interest rate cap,” the Fed will need to continue on with Permanent Open Market Operations (POMOs) and other forms of liquidity support for Treasury Auctions.

Risk is rising for an on-going, long-term Dollar debasement – one that would be potentially devastating to the financial health of millions of American families and destabilizing to America’s economic system. The clock is ticking. America needs a new plan and a new beginning.

3. U.S. citizens deserve nothing less than the same access to liquidity, for resolving debt issues and financial distress at the family level, that have been accorded to major U.S. and foreign financial institutions.

The Federal Reserve has opened the Fed Discount Window (“Fed Window), extending
credit (providing liquidity at “zero” or “near zero percent interest”) to most of the major U.S. bank holding companies which led us into the financial crisis in the fall of 2008 with their excessive risk exposure to subprime debt and credit market derivatives.
Two of the investment banking giants, Goldman Sachs and JP Morgan, earned free interest (at taxpayer expense) through their access to credit extensions at the Federal Reserve discount window, and within two years, Goldman Sachs was paying out $111.3 million in “delayed bonuses” for the years 2007 and 2009 (NY Times 12-15-10).

The Fed Window was also opened up to foreign banks, including: Dexia SA (DEXB) – Brussels, Paris; Depfa Bank Plc – Dublin; Arab Banking Corp (at the time “29 percent owned by the Central Bank of Libya”).

Additional foreign banks/financial centers, as members of the Fed’s designated Primary Dealers, have been allowed access to the Fed Window: BNP Paribas Securities Corp; Barclays Capital Inc; Credit Suisse Securities; Daiwa Capital Markets America, Inc; Deutsche Bank Securities, Inc; HSBC Securities (USA) Inc; Mizuho Securities USA, Inc; Nomura Securities International, Inc; RBC Capital Markets, LLC; RBS Securities, Inc; SG Americas Securities, LLC; UBS Securities LLC.

The Leviticus 25 Plan rollout ($16.8 trillion – assuming an 80% participation rate by U.S. citizens), delivered through a ‘Citizens Credit Facility’ would hardly be prohibitive, in light of the trillions of dollars in Federal Reserve and Treasury outlays over the past 5 years to major U.S. banking and financial institutions (Morgan Stanley, Citigroup, Bank of America, State Street Corp, Goldman Sachs, Merrill Lynch, JPMorgan Chase, Wachovia, Lehman Brothers, Wells Fargo, Bear Stearns) and major foreign financial institutions (Royal Bank of Scotland, UGS AG, Deutsche Bank AG, Barclays, Credit Suisse. Dexia, BNP Paribas).

The Federal Reserve’s various credit facilities, Discount Window transactions, emergency loans, Foreign Exchange swap lines, Interest on Excess Reserves (IOER) for foreign banks, and Treasury’s TARP and stimulus programs have done little to improve the financial status for the majority of American families. These government programs have also done nothing to change the dominance and risk profile of “too big to fail banks,” and they have done little to lessen the counterparty default risk in the global derivatives markets.

5. The Leviticus 25 Plan, once fully implemented, would immediately balance the budget of the federal government.

The projected federal deficit for FY 2014 is in the range of $500 – $600 billion.
The Leviticus 25 Plan recapture provisions would generate approximately $1.67 trillion each of the first 5 years, and this does not include the highly certain additional dynamic benefits of an improving economy.

There would be a budget surplus of approximately $1.1 – $1.2 trillion each of the first 5 years of The Plan. The surplus, however large, would be transferred back to the Federal Reserve for ongoing reductions of the Citizens Credit Facility balance sheet.

6. The Book of Leviticus, Chapter 25 outlines a divinely inspired plan which “the Lord spake unto Moses” in proclaiming a unique period of Jubile. “And ye shall hallow the fiftieth year, and proclaim liberty throughout all the land unto all the inhabitants thereof” (verse 10).

Debtors – bondmen and bondmaids – were granted liberty from their indebtedness. Property was returned to the rightful owners, and distinct benefits were accorded “the poor, who now were acquitted from all their debts, and restored to their possessions” (Wesley). Leviticus 25:17 sets forth the solemn reminder, “Ye shall not therefore oppress one another; but thou shalt fear thy God: for I am the Lord your God.”

Jubile “set bounds both to the insatiable avarice of some, and the foolish prodigality of others, that the former might not wholly and finally swallow up the inheritances of their brethren, and the latter might not be able to undo themselves and their posterity forever, which was a singular privilege of this law and people.” (Wesley).

Jubile provided a fresh start with economic liberties and a societal rebalancing to counter permanent class structures.

America needs a plan that is modeled upon these divine concepts – an economic recovery plan that directly benefits American citizens in a timely manner.

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