Introduction.

Our podcast today is titled The U. S. Covid Economic Recovery Plan, and begins with an alternative to the conventional political view that the U. S. economy will “bounce back” to pre-lockdown levels.

We tend to abstract from the conventional economic wisdom that “bouncing back” to the economy that existed prior to March 17, 2020 is a great idea.

The economic structure in America was already deeply flawed and damaged from 20 years of economic integration with the rest of the world and particularly China. (Vass, Laurie Thomas, U.S. National COVID Economic Collapse and the Collapse of the U.S. Dollar. (April 14, 2020). Available at SSRN: https://ssrn.com/abstract=3575761).

The rate of private capital investment had already begun to decline in the last two quarters of 2019, primarily due to the structural weaknesses in the economy that limited capital investment opportunities in small, high tech ventures.

Nondurable goods manufacturing decreased 3.1 percent in the 4th quarter, primarily reflecting a decrease in food and beverage and tobacco products manufacturing.

Durable goods manufacturing decreased 2.4 percent, which was more than accounted for by a decrease in motor vehicles, bodies and trailers, and parts manufacturing.

The last two quarters of 2019 economic performance would not represent the kind of economy that would be desirable to “bounce back” to, and while we do not dwell on the logic or reality of the arguments supporting the “bounce back” view, we disclose our ideological predisposition that the entire notion of “bouncing back” is wildly naïve and Pollyanna optimistic.

 

We argue that the 70% of the U. S. economic structure that was locked down resembles the shambles of the German economy after May 8, 1945.

Part of the German economy that was connected to large global corporations was still functioning, but the domestic economic structure in Germany had been reduced to rubble.

The full extent of the U. S. economic damage has not been experienced yet, because the economic damage to the commercial rental market and the mortgage loan market have not yet been reflected in the data on the number of citizens who no longer have an income to pay rent or mortgages.

We argue that the domestic spending part of the U. S. GDP has been reduced to rubble by the covid lockdowns, but that 30% of the corporate crony capitalist economy that is connected to the global economy is still functioning.

Something like the Marshall Plan is required for the U. S. economy, to repair the economic damage caused by the lockdowns. The goal of the covid economic recovery plan is to build a free enterprise, new venture creation, entrepreneurial economy in each metro region that operates independent of the global crony corporate capitalist system.

One mission of the Marshall Plan was to prevent the spread of Communism in Europe.

We argue that the contemporary U. S. covid recovery plan must also prevent the spread of Chinese communism, which entails a policy response to limiting the damage caused by the promotion of the China trade deals by crony corporate capitalism, such as the members of the Business Roundtable and the U. S. Chamber of Commerce.

The political power of global corporate crony capitalism is responsible for implementing the trade deals with China, which weakened the industrial diversity of the U. S. domestic economy, leading to a bifurcation between a global corporate part, and a domestic consumer spending services sector part.

As a result of the bifurcation, the domestic services sector accounted for 70% of all GDP, and 80% of total civilian employment. The economic effect of the lock down was worsened because of the lack of economic diversification in the U. S. economic structure.

The economic recovery plan aims to restore a balance in the GDP between domestic investment in manufacturing and consumer domestic spending. Private domestic annual  investment in manufacturing should be increased from around 12% of