WORK BONDS

How many of you remember the newsreels of Clark Gable, Jimmy Stewart and Ava Gardner barnstorming the country selling United States Savings Bonds.  How about Ted Williams, Babe Ruth and Lou Gehrig going into union houses throughout the nation encouraging workers to buy bonds.  Henry Morgenthau, Jr., then Secretary of Treasury, introduced the U.S. Saving Bond in 1935 encouraging Americans to invest in this non-marketable security.  He believed it was a way for small investors to guarantee a return on their investment as well as a way to finance the debt of the U.S. Government's  day to day financial obligations. 

From 1935-1941, his creation was the Baby Bond with denominations of $25 to $1,000.  The American public bought 4 billion dollars worth of these Baby Bonds.  In today's market, that equates to $60 billion dollars.  From Baby Bonds came the Defense Bond in 1941 and then the War Bond from 1942-1945.  Bonds were purchased in record numbers during the 1940's and even today they remain popular with many small and large investors.  They continue to be popular gifts for birthdays, graduations, weddings and the birth of a new baby.     

Today, our nation is faced with an ever-increasing public debt, failure of local and state governments to meet budget requirements, an astonishing nine percent unemployment rate, the implosion of the housing market, the Occupy Wall Street movement, the growing divide between the rich and everyone else,  and the inability of our nation's leaders to work toward compromise in finding solutions to these growing but solvable problems.  Sure sounds like it might be time to pull out Henry's playbook for dealing with finances.        

Why not create a new series of U.S. Savings Bonds designed to put people back to work.  Create a bond that encourages small investors across the country to invest with the government taking that money and putting it to work creating infrastructure jobs, putting teachers back to work, cops back on the street and fireman ready to serve.  The savings bond program has been hugely successful over several generations and all we need to do now is create a new investment vehicle and watch the American people respond. 

There is no question that we need folks to be spending money in stores.  No one argues that point.  Spending is the only way we will work ourselves out of this mess.  However, we need both spending and saving as well as debt reduction and U.S. Savings Bonds just might be the right answer.  The bonds won't mature for 10 to 20 years but the government will have the money to fuel federal projects of building roads, repairing bridges and fixing our national parks.  In addition, monies could be sent to states to help keep teachers employed, cops on the street and fireman at the ready. 

I am confident that someone can find fault with such a program for sure.  It may not even make sense economically in the long run.  I just don't know for sure.  What I do know is that Americans like to be challenged and are willing to do whatever it takes to be successful.  I also am confident that a few simple phone calls to the likes of Matt Damon, Angelina Jolie, Harrison Ford and Johnny Depp enlisting their star power could sell a few billion bonds in a hurry.  How about Peyton Manning, Michael Jordan, LeBron James and Derek Jeter.  Even Bono, Clapton and Springsteen would happily jump on board. 

I still buy bonds every quarter.  I would happily invest $25, $50 or even $100 a month if I knew that my investment would lead to a fellow American getting a job.  I'm sure that you would too.