The Case for Robert Ashford’s Inclusive Capitalism - ONLINE VIA ZOOM

Name: The Case for Robert Ashford’s Inclusive Capitalism - ONLINE VIA ZOOM
Start: 2021-09-22
End: 2021-09-22

Online

Professor Robert Ashford of Syracuse University will be presenting an innovative approach to sustainable fuller employment and per capita growth by broadening capital acquisition with the earnings of capital.

Since the Great Recession, the global, mainstream political/economic debate has converged on two distinct economic strategies: Austerity and Stimulus. Well-meaning advocates of both strategies (1) concede that the world’s major economies are not operating at full employment and (2) seek to promote (a) sustainable fuller employment of labour and capital and (b) enhanced earnings of poor and middle-class people.

Austerity advocates advance the laissez faire approach grounded in classical economics, neoclassical allocational efficiency, and neoclassical growth theories. Stimulus advocates base their strategies on various versions of “Keynesian economics.”

Professor Ashford offers a different strategy based on a distinct principle of fuller employment and per-capita growth. This principle is not found in the economic analysis offered in support of austerity and stimulus policies. Professor Ashford’s approach calls for broadening competitive market opportunities to acquire capital with the earnings of capital. Presently, these opportunities accrue largely to a tiny fraction of the population roughly in proportion to their existing wealth.

Professor Ashford’s principle holds that the prospect of more broadly distributed capital earnings in future years to poorer people (i.e., to people with a higher propensity to consume) creates the credit-worthy expectation of greater consumer demand in future years, which in turn provides greater incentives to employ more labour and capital in earlier years.

Professor Ashford will present reasons to believe that this principle of fuller employment and per-capita growth is both true and very important. If true, the principle suggests that any credit-worthy corporate capital acquisition that can be conventionally financed, may be financed more profitably for the corporation, its existing shareholders, and its new beneficial shareholders if structured in Professor Ashford’s ownership-broadening way.

A growing number of professors of economics have characterized “Professor Robert Ashford’s ground-breaking work on Inclusive Capitalism …. [as] the most important contribution to economic theory in many decades: an idea with many practical, beneficial policy implications for both current and future generations.”

A key institution is the professional investment trust. Presently, existing ones (such as Fidelity, TIAA, and Vanguard) assist mostly wealthier people to acquire capital with the earnings of capital, in rough proportion to their existing wealth. Professor Ashford’s presentation shows how these institutions can also profitably assist poorer people to acquire capital with the earnings of capital – but in proportions not limited to their existing wealth. The trusts would borrow money and use it to acquire for poor and middle-class people beneficial ownership of full dividend-paying common shares issued by participating companies to the trust fiduciaries. The beneficial owners (primarily employees, customers, and neighbours of participating companies) are selected by the participating companies in conformity with legislated eligibility and non-discrimination rules. The share acquisition loans are repaid with dividends representing the earnings of the capital acquired. After the acquisition loans are repaid, the beneficial owners receive the capital earnings as dividends indefinitely. The mechanism is based on standard techniques of corporate finance but modified to produce the benefits of broadening share ownership.

Predicted results include (1) enhanced earnings for poor and middle-class people, (2) enhanced corporate profits, share value, and growth, (3) reduced need for welfare dependence, government spending, borrowing, and taxes, (4) enhanced sovereign creditworthiness and (5) greener, more sustainable growth. These predicted results, if realized, will greatly surpass expectations based on mainstream theories and will make both austerity and stimulus strategies more affordable and politically feasible.

Our symposium will be a first-class opportunity for attendees to explore and evaluate for themselves a highly progressive set of ideas, which may well contain a remarkably coherent argument for fundamental changes in the way we see major socio-economic problems and their potential solutions.