EB: Thanks for the comments, Renada and Steve. Steve, I never understood why we need the point of sale rebate. Why not just a national dividend?
Me: 1) It immediately doubles the purchasing power of any dividend. If you can purchase $100 worth of groceries for only $50 that’s a helluva deal, and if you can purchase a $30k automobile for $15k and a $300k house for $150k that’s the deal of the entire history of human economics and money systems.
2) A $1000/mo. dividend is basic, palliative at best and hence aligns more with the scarcity/austerity of the current monetary reality. $2000/mo. worth of purchasing power puts one almost $6000 above the poverty line. Ironically, a $1000/mo. dividend becomes enforced serfdom in an AI world where employment is scarce.
3) It eliminates any possibility of inflation and, “miraculously” from an orthodox theoretical standpoint, beneficially integrates price and asset DE-flation into profit making economic systems. This FRED graph shows that normal garden variety inflation is always a small single digit percentage except during wars or when the cost of a major commodity like oil has been manipulated upward 300-400%, and then it never has gone above 15%.
High tech capital intensive economies are costly and competitive. Hence inflation normally stays between 1-4%, and if a producer ups their price by 20-25%, retail purchasing agents aren’t stupid, they’re going to purchase your competitor’s products and your market share goes down severely. And If you used tax incentives for frugality, competition and innovation and tax penalties for inflating your prices you’ll never have more than a 1-4% inflation rate and then all you do is make the discount 51-54% and everyone’s purchasing power is still doubled by the 50% discount/Rebate policy.
4) If everyone has guaranteed above poverty purchasing power at 18 years of age for life what do we and every enterprise need to be taxed for welfare, unemployment insurance and even social security? Hence the 50% Discount/Rebate policy eliminates the need for those taxes, increases net earnings….and potentially most important integrates the self interests of the traditionally opposed political constituencies of labor and management…..against the real problem, i.e. private for profit finance and their monopolistic paradigm of Debt Only.