Tag Archives: Economy

The Ohio Investment Bank

What’s so great about the Ohio Investment Bank, the poorly named idea that I have put at the center of my campaign? Well I’ll tell you in 500 words or less!

The OIB is one stop shopping for all your entrepreneurial needs. Through an initial funding by the Ohio government, the bank provides seed capital to new businesses as well as existing small businesses not as loans or grants but as an investment which the bank aims to earn a profit on. So the bank has every interest in your business becoming sustainable and profitable.

The OIB offers a number of services through its municipal partners/branches for entrepreneurs to build a successful enterprise including:

  1. Business management services so that you have the expertise necessary to build your business right.
  2. Export and supply chain services so you can navigate the complexities of the global economy in building your product or service and then find customers around the world and build Ohio’s export surplus (that’s how you do it without starting destructive trade wars!)
  3. Help you raise capital from outside investors so your company can grow to keep up with demand. This in addition to any investment from the OIB which will allow you to choose where your capital comes from so you don’t have to rely on any shady investors or corporate raiders who do not have your economic success at heart.
  4. The OIB partners with the technology transfer offices of Ohio’s many exceptional universities so that technologies and advancements developed in the lab can be quickly brought to market and start changing the world while earning additional funding for the universities to pursue their work.

Targeting the right businesses and industries, the OIB will jumpstart Ohio’s economy and make us a leader not just in the United States but around the globe. The OIB gives Ohio’s economy the initial kick but the economy will begin expanding rapidly as economies of agglomeration and clustering make Ohio a destination for skilled workers, new industries, and investment.

Gradually the bank will create the technologies to transform Ohio, to deliver energy, food, health care, and transportation cheaply and conveniently to all Ohioans without the government directly providing them through large spending programs or welfare. And as the economy grows, unemployment will decline and wages will rise. The Ohio government will have significantly lower obligations and the size of government and the welfare state will shrink allowing us to lower taxes significantly. Additionally, as the OIB earns returns on its investments it will be able to reinvest the profit in Ohio’s businesses or, if need be, transfer funds to the Ohio government. Ideally, within a few decades, Ohio’s government could be entirely funded by the profits of the OIB and taxes in Ohio could be completely eliminated.

Seems like a fantasy but it is entirely possible given the right circumstances and the commitment of all Ohioans to break the mold. This is the role for government in the 21st century, a facilitator of the market, an investor in our future. We can do this; the opportunity is now. Let’s put the state ahead of the pack, let’s fight for our future, let’s save Ohio! Vote for me, Tim Grady, this November and make this reality!

The Next Recession

It is unusual for a bull market to last much longer than ten years. Increasing instability would suggest that this one is nearing its end. This has some important implication for the coming decade.
 
Since the financial collapse and the Great Recession we’ve seen little action by the government or anyone to fix the problems that caused the collapse. In many ways these problems have gotten worse; the Too Big to Fail banks are larger than ever, the shadow banking sector has expanded, private equity firms have caused housing prices to rise while homeownership has fallen, major US corporations have taken on considerable debt to fund stock buybacks (arguably stock market manipulation) rather than invest in R&D. Meanwhile government debt has skyrocketed and the Fed has held interest rates low for a decade. This means the government has little fiscal or monetary tools to counteract the effects of a financial crisis and ensuring recession.
 
Many households are in such a precarious economic position with debt and mortgages that the next economic downturn will lead to mass foreclosures and inability to cover both debt and living expenses. Considering rather stagnant wages the last decade, rising household debt, and the loss of wealth in 2008, most Americans are in a worse position than they were in 2007 meaning another recession has the potential to be considerably worse. Debt is dragging down growth and it has the potential to strangle the economy when the next recession hits. 
 
I am not fear mongering here, I am trying to properly express the urgency of the situation so that appropriate action can be taken while we still have the opportunity. Remember folks, before the Great Depression we used to call the depression of 1873 the Great Depression. It is a mistake to think the course of history is perfectly linear, that the present is a good indicator of the future. History has a way of taking sudden, unexpected turns.
tl;dr: The economy is going to slow down, the government and households aren’t prepared for it.