In this important book, Southern Methodist University economics professor Batra offers practicable solutions to many of the economic problems plaguing America. Most promisingly, these ideas can be implemented without involving Congress and the party loyalties that so often gum up the legislative works. Batra denounces our current system of monopoly capitalism as the main problem, positing free markets and competitive capitalism as the solution. While free markets would by necessity involve congressional input, Batra states that the President can bring about truly competitive capitalism without political hindrance. Batra's cogent inventory of what he sees as the current obstacles to be overcome includes a “Do Nothing” Congress, high unemployment, monopoly capitalism, and stock market bubbles. He finds the cure for these economic ailments in the sectors of banking and finance, oil and gasoline, big pharma, and foreign trade. This worthy treatise concludes with a concise summation of its key proposals, including creating a bridge bank to bring down credit card interest rates, gradually raising the minimum wage in concert with inflation and national productivity levels, and preserving competition by not allowing large profitable firms to merge. Even readers new to this level of detail should recognize the wisdom of Batra's ideas.
A novel publishing strategy stands behind this book. After holding an enthusiastic audience with then speaker Nancy Pelosi, a Southern Methodist University professor with unique economy-busting ideas isthen referred to (at the time) fed chairman Ben Bernanke. Nothing happens. So why not write a book? Batra, in an atypical academic fashion, details all the issues that led up to the U.S. wage gap, horrendous oil prices, and high-interest rates-and, yes, a loomingly alarming high-unemployment rate. He does so in simple English (no economists' jargon), plain charts and graphs, and a straightforward approach that compels without selling. Part 1 diagnoses all possible issues, from oligarchy (the concentration of wealth) to monopoly capitalism and wage gaps throughout the world, ending with an intriguing town-hall-style debate. Part 2 is the cure, with some startling yet commonsense recommendations, such as don't allow mergers and acquisitions among large and profitable firms; reform the FDIC as a bridge bank and competitor to other financial institutions; raise the minimum wage; and offer five-year bonds for retirees at a fixed-interest rate of 3.5 percent, among others. Much food for thoughts; write your congresspeople now.
Booklist Advanced Review
Batra offers far-reaching proposals to end joblessness quickly. Taking a broader overview of unemployment than the narrow definition employed to boost claims for the strength of economic recovery, the author offers a macroeconomic look at the causes of joblessness and income inequality. "The ultimate source of joblessness," he writes, "is monopoly capitalism, which enables industrial giants…to charge exorbitant prices while restraining wages and extracting huge productivity from employees. This creates overproduction, hence layoffs." Batra disagrees with those who believe that domination by virtual monopoly corporations is part of the proper functioning of a free market. He advocates for the use of the executive branch to adopt and enforce regulations to launch a shift away from corporate domination and toward truly freer markets. Interestingly, he recommends as a model the approach adopted by American occupation authorities in Japan and Germany after World War II. Japanese industries were configured as vertical monopolies and called Zaibatsu, which "earned high profits by keeping wages low." The U.S. military dissolved them and the owners were removed from their positions. The conglomerates were then broken up into the smaller, more agile and creative pieces, which helped Japan recover from the war with free market methods. The U.S. military did the same to Germany's war economy, breaking up IG Farben, which provided the gas for many concentration camps. Batra believes "the president has to take charge and deliver the poor and middle class from the damning status quo." The author argues that the president should break up the corporate monopolies of the finance and retail sectors, along with oil and pharmaceutical industries, by administrative fiat.
This book really reads like a suspense novel. Turning each page, new tracks appear that the villain left behind in this economic whodunit of all time. Of course, this is no idle fiction but the harsh truth of life in our world. The description of the economy the book offers is straightforward, yet profound and easy to grasp at the same time. Its message will have an impact. There is no way around it.
- Thorsteinn Thorgeirsson, Senior Advisor to the Governor, Central Bank of Iceland.
For the aficionados of economics prophecy, Professor Batra has always been a legend: in this new work, however, his focus is on economic policy. He has little time for padding or rhetoric: instead, he sums up very quickly, in simple, lay terms, what must be done to bring to the U.S., and thence the world, out of its long-drawn doldrums. Even better, he shows how this might be accomplished bypassing the slow-moving processes of Congress, via Executive edicts. It is the economics primer for our times: a must read for all--especially President Obama with time still left in his tenure to carve himself a permanent niche in History.
- Prof. RajaniKanth, Harvard University