By Ralph Benko
June 5, 2014 for The Hill.
Jack Kemp was one of very few transformational political leaders of the 20th century. He incontrovertibly was the political prime mover in raising the world’s wealth to $100 trillion (trillion with a t). As this writer elsewhere has observed:
“According to the World Bank, the world’s GDP in 1980 was around $11 trillion. Today it is around $60 trillion. The added $50 trillion-per-year capitalizes to over $100 trillion in new wealth… even when adjusted for inflation.”
$100 trillion is a lot of money… even by Washington standards. Thanks to the work of Rep. Jack Kemp (R-N.Y.) and his tiny team, America was instrumental in bringing a billion people out of abject poverty into decent working affluence. Not incidentally, Kemp’s work created the conditions for the generation of nearly 40 million jobs, under Reagan and Clinton, in America. Abandoning the Kemp formula, America has stagnated.
Kemp’s honors include the award, posthumously, of the Presidential Medal of Freedom, America’s highest civilian honor, by President Obama.
The White House described Kemp this way:
“In Congress and as a Cabinet Secretary, Kemp was a self-described ‘bleeding heart conservative’ who worked to encourage development in underserved urban communities. In the years leading up to his death, Kemp continued seeking new solutions, raising public attention about the challenge of poverty, and working across party lines to improve the lives of Americans and others around the world.”
Equitable prosperity, a little more than ten years ago, lost the momentum imparted to it by the Kemp formula. This faltering mostly was due to the ending of the “Great Moderation” of Federal Reserve Chairmen Paul Volcker and, in his first decade, Alan Greenspan. The Great Moderation was a reflection of the Kemp playbook.
As a result of neglecting Kemp’s demand for “good money,” choosing instead the seductive but bad road of “cheap money,” job creation — and upward mobility by workers — slowed to a snail’s pace. Presidents Bush and Obama would have considered themselves fortunate to see the creation of as many jobs in a term as Reagan and Clinton saw in a year (or even less).
It is cheap money that is demolishing job creation. Now the Democrats are calling for symbolic, patchwork, and sometimes counter-productive measures such as increasing the minimum wage. But at least the Democrats have the political sense to be taking the problem of wage stagnation seriously even if their proposed solutions do not appear promising. Most Republicans look clueless.
Kemp had many good ideas for igniting sizzling, equitable, job creation and economic growth. The GOP is groping for an agenda relevant to voters. It need look no further than the trove of ideas harbored by the Jack Kemp Foundation, beginning with completing the main task left undone: institutionalizing good monetary policy, most preferably through the gold standard.
Kemp: “Because of its inherent connection with the federal deficit, the trade deficit, and economic instability, the gold issue will not go away.” The Jack Kemp Foundation’s president Jimmy Kemp characterizes the gold standard as his father’s most important piece of unfinished business.
The Jack Kemp Foundation, with American Principles in Action, is assembling the Kemp Brain Trust to discuss just that, this Friday. At a Kemp Forum on Growth to be held on Capitol Hill, Jack Kemp Foundation president Jimmy Kemp; Dave Hoppe, chief of staff to Rep. Kemp; John Mueller, economic counsel to the House Republican Conference under Kemp’s chairmanship; Jeffrey Bell, national co-chairman of Kemp’s 1988 presidential campaign; and this writer, later a junior associate of Team Kemp and founder of the Prosperity Caucus will be discussing the Gold Standard Act of 1984 on its 30th anniversary.
Kemp’s Gold Standard Act, the missing link for restoring job creation and equitable prosperity, is even more important today than it was when first introduced. Want more jobs, better jobs, stable prices, and a quickly diminishing deficit — and happy voters of all parties?
Look no further than the Gold Standard Act. The Spirit of Jack Kemp rides again.
Benko is a senior adviser to American Principles in Action, a conservative advocacy group.