Chapter 13.	Planning and National Goals
		Capitalism vs. Socialism
		Central Planning	
		Long Term Planning
		National Goals
	            National Referendums
		Industrial Planning
		

I.  Introduction

	Alice:  Will you tell me please, which way I ought to go from here?
	Cat:  That depends a great deal on where you want to get to.
	Alice: I don’t much care.
	Cat:  Then it doesn’t matter which way you go.
			–––Lewis Carroll  Through the Looking Glass

The difficulty lies not in developing new ideas as escaping form the old ones.––Keynes 

If we didn’t have a dream, how are we ever going to make a dream come true?

This chapter is on planning and the government.  We wish to make it very clear that we are not in favor of governmental planning for us,  but rather for planning of the government for the government’s sake, that is internal to the government.  Planning should not be for control’s sake but for futurist  purposes. Instead of reacting to crises and emergencies, active planning is desired, that is, to be in forefront of the problems developing instead of responding to their occurrence, proactive not reactive.


The National Goals that we are going to develop and in the Long Term Planning we are going to address those attitudes that we think are worth documenting publicly announcing as national policy and national goals and work towards them.  The intent in this phase is to address the initial point, “Where Do We Want To Go?”  and be able to measure our progress as we move in that direction.  It is very much similar to business plans do for businesses . 











II.  Planning

For without vision, the people perish . . . Isaiah

A sense of the future is behind all good politics.  Unless we have it, we can give nothing--either wise or decent to the world. ––––– C.P. Snow.

	Planning occurs any time a unit makes a decision in anticipation of some future set of conditions.  Planning is nothing less than a manifestation of  fundamental characteristic of human intelligence, foresight.  The debate over planning is simply one of deciding who does the planning.  Planning must be done.  Will it be done centrally by one authority for the whole economic system or to be divided up among many entities. The limits of central planning is that the mechanism used to disseminate the information is inferior.  Because the bulk of the knowledge required is highly specialized and specific to the particular circumstances of time and place, it is impossible to centralize the decision and still retain the speed and flexibility needed for timely action.   The beauty of the market is that it allows so much more flexibility than public sector planning.  Government functionaries usually do not have access to the information that reflects the dynamism of supply and demand conditions.  The need in the United States is not for a planned economy.  What is needed is economic planning, where the government would do what is it now supposed to do only do it better, an eye focused on future implications of policy action.  Early warning systems are eminently  capable of locating some if not all of the emerging problems,  some focus on probable long range needs for sustained economic growth to place a spotlight on possible shortfalls in supply and taking the lead in formulating long range goals for the nation.  The government of the least historically has been a reactive government, responding to crises  as they arise but never planning, thinking ahead creatively, coherently about needs, providing a vision about where the government is going.  We believe  government can do both, plan, be proactive, and do so without infringing on personal and property rights. 
	Although we indicate that government should be run like a business with plans in place, Government is not  the the same as a business.  Public employees view risks and rewards differently than private employees.  The incentive in government is not to make mistakes.  Government is necessarily more open so it moves slower.   Government is dedicated to serving everyone equally.  Democrats have confused government with governing.  They think the public wants more government when in reality they want more governing. We do not  have  the wrong form of government nor do we have too little government.  What we want and need is better governance. 







III.  Capitalism versus Socialism

Capitalism is based on self-interest and self-esteem; it holds integrity and trustworthiness as cardinal virtues and makes them pay in the marketplace, thus demanding that men survive by virtues not vices . . .                                       							             ––––Ayn Rand

The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.                     –– Winston Churchill

Capitalism and communism stand at opposite poles. Their essential difference is this: The communist, seeing the rich man and his fine home, says: "No man should have so much." The capitalist, seeing the same thing, says: "All men should have as much."    –– Phelps Adams

	Many believe politics and economics are separate and unconnected; that individual freedom is a political problem and material welfare an economic problem; and any kind of political arrangements can be combined with any kind of economic arrangements.  Proponents of ‘Democratic socialism’ would have us believe that individual restrictions on freedom would not be permitted while the state commands the economic bulwark. History suggests otherwise; that capitalism is a necessary condition for political freedom, especially for the democracy we so proudly claim. This is the case because both are ‘bottoms up’ systems, whose core values are at the individual level. Collectivist economic planning interferes with individual freedoms. Economic power, if kept in separate hands from political power, can serve as a check and balanced to political power.   
	Two ideological paradigms exist concerning the role of government: individualistic, which stresses the individual over the community, and communitarian, which is the reverse.  In an individual society, the role of the government is limited to protecting property, enforcing contracts, and keeping the marketplace open so that competition among firms may be as vigorous and free as possible, separate from business.  It intervenes in the affairs of business only when the national health and safety are involved. Intervention is reactive, from crises, and temporary.  An individualistic society is inherently suspicious of government, anxious about centralized power, and reluctant to allow government to plan, especially over the long-run. Individualism tends to produce a regulatory state in which the market shapes business activity and government regulates business only in order to achieve ends that the market cannot meet.
	The role of government in a communitarian society is prestigious and authoritative, sometimes to the point of authoritarian.  Its function is to define the needs of the community over the long as well as short term and see that those needs are fulfilled.  It sets a vision for the community, defines and ensures the rights and duties of community membership and plays a central role in creating (imposing) consensus to support the direction in which it decides the community should move.  Communitarian states are developmental in nature in which a government’s task is to define the nation’s priorities and see that they are met.
	Governments can bring business activity into line with the needs of the community in any of four different ways:
	•Promoting the marketplace competition, both defining and fulfilling community need
	•Regulating the marketplace in instances where competition by itself is either unreliable or unacceptable
	•Establishing a partnership with business
	•Requiring in the corporate charter granted by the community to the corporation that the corporation serve a predetermined need.
Individualistic states prefer the first two methods while communitarian states prefer the third and fourth methods.
	Economic liberalism is the doctrine that economic life should be as untrammeled by constitutional, legal, and administrative constraints as it is possible to achieve, consistent with the maintenance of a stable society and marketplace.  Adam Smith showed how under free competition, the operation of the market continually tends to produce prices as low as is consistent with supplying the product while yielding a fair return on the effort expended in its production.  Freedom of exchange produces a natural harmony of interest, which needs to be let alone in order to produce as much economic advantage to everyone as the circumstances permit.  Freely working markets produce outcomes which maximize both individual and social benefits.  The superior values of capitalism over socialism can be detailed by:
	•values of market are superior to the values of the political process because it allows people to express their judgments, preferences, feelings, prejudices, likes and dislikes as individuals without going through the political filter of majority approval
	•respect for the unique individual is the basis of moral life.
	•individuals learn only by living as they know best and making mistakes. well meaning political dependency can undermine the learning process.
	•Even when the individual can learn nothing from mistakes where their effects for him are final and fatal, they can teach lessons for others.
	•Private property is the indispensable requirement for the individual to learn the lessons of responsibility by benefiting from success and suffering from failure.
	•The machinery of economic activity must put the interest of man as consumer over his interest as producer.  This is only done in capitalist societies.
	•Competition is essential to enable consumers to compare and contrast alternatives. This is not present in socialist monopolies.
	•The decentralization and diffusion of political power is the necessary condition for economic freedom in the use of scarce resources. 
	•Government tends to over-regulate industry because of the risks of underregulation but the public interests are better served by the latter.  It overtax covertly because it is more popular to reduce than to raise taxes.  
	•The case against detailed central planning is that is undemocratic, bureaucratic, inflexible and subject to great error and confusion.  Any planning must be confined to those spheres where it is considered most important to modify the results that market forces, acting alone, would yield.  Government activity should be limited to the provision of public goods.
	Capitalism can not work as an instrument of socialism: if held on a tight leash as a controlled agent of the state, it requires taxation low enough not to distort market signals, must be allowed room to explore and innovate, to discover and make mistakes. The political process of socialism is to dominate, not liberate. The faults of capitalism:  relative poverty, inequity, injustice, unemployment, inflation will reappear, they will always be withy us, even in the most ideal form of capitalism.  They are a product of unpredictable social and technological change, fallible humans, incomplete knowledge and imperfect political institutions.  “Socialists see private enterprise as a tiger—a predatory animal to be shot.  Others see it as an old cow to be milked.  But we conservatives see it as a sturdy horse that pulls along our economy,” said Winston Churchill.
	Capitalism is the system that makes as little use of the political process (socialism) as necessary and as much use of the market as possible; socialism, contrarily, makes as much use of the political process as it can without arousing public revolt and as little use of the market as is required to maintain tolerable productivity and to minimize politically dangerous privation.  essence of totalitarianism is the assertion that the collective, the party, the state, the race, is absolute.  If the good of xxx is the truth then truth can be defined as whatever helps, strengthens, and advances the party, the state, etc. Our beliefs is to return to a capitalist state. By doing so, and by relying primarily on voluntary cooperation and private enterprise, in both economic and other activities, the private sector can act as a check on the powers of the government sector and an effective protector of the freedoms.

IV. Central Planning	

All human beings are futurists, but some people may be more futuristic than others. 

Democracy is good. I say this because all other systems are worse.
                                                                                                                      –– Jawaharlal Nehru

Centrally planned systems have proved to be relatively weak in applying and diffusing the output of R and D, and this is reflected in:low and declining rates of increase in factor productivities;a continuing position as a technical follower rather than a leader; little sign of any closing of the international gap in diffusion, with the exception of certain defense technologies; declining technological competitiveness compared to the newly industrializing countries, reflected in manufacturing export shares, the diffusion of key technologies, and the  prices of exports;  and negligible technology exports, together with technology imports that are restricted in volume, in channels of acquisition, and  effectiveness of use. Central planning societies are poor innovators due to their intrinsic resistance to change, their inability to provide incentives and autonomy to  managers, and their general alienation towards the marketplace. Planning has been time and again proven untenable, infeasible and suboptimal.
	Another major issue for centrally planned economies is the degree of independence of research and development from the  government. In totalitarianist political states, the degree of effort and direction is totally directed by the government. In general, technological innovation, especially commercial innovation, is not usually noteworthy or consistent in such jurisdictions. The Soviet experience is just one of many examples. Scientists who work for the state learn to restrict their research to politically expedient topics.  Perhaps even more telling than political pressures, the simple numbing effect of conducting R&D in the setting of cumbersome bureaucracies discourages innovation. A centralized fund has supported the introduction of new technology, but only when such technology has been approved in the central plans.  One result has been one-sided emphasis on process innovation to the exclusion of product innovation. Only 7 percent of industrial innovation has consisted of product innovation as opposed to 60 percent devoted to mechanization and automation of production processes.  The Soviet system failed to support more revolutionary inventions due to institutionalized funding and reward structures that favor attainment of short-term production plan quotes over long-term advances.  It seems ironic that centrally planned economics, emphasizing five-year plans, fall prey to the same short-cycle annual budgetary pressures blamed for American shortsightedness in innovation investment.
	The Soviet system was a “goal-directed” economy where central planners directed ministries to achieve annual output quotas; ministries commanded enterprise managers to meet detailed microplans; incentives provided included piece-work payments and bonuses; goals were imposed and choice influenced by price-fixing and input rationing; and wages and prices were determined by a State Pricing Board. However, because prices failed to reflect demand and  opportunity costs, they offered unreliable information with respect to value and production costs.  Domestic prices tended to be fixed for long periods, preventing demand from influencing supply. The state  used quotas to restrict the use of certain inputs in most nonmilitary industries.
	Managers produced output in accordance with their own bonus functions, domestic prices, and input constraints.  Since full employment was one of the system’s major objectives, unrealistic output targets were the norm.  Soviet firms were capable of  producing large volumes but since the State purchased all items, consumer demand was  often ignored.  Therefore, goods created were  usually shoddy, irrelevant, and undesirous to any consumer demand  which  may have existed.  
	Even if the enterprise manager could have reacted to consumer demand, there was little he could have done. Rationing of inputs meant that parts, even if available and on time (which was more the exception than the rule), were usually substandard.  It was also illegal for enterprise managers to develop and market products of their own initiative.  State design bureaus determined product characteristics based primarily on engineering and cost criteria––not on any consumer demand basis.  Incorporating new technology was also not encouraged: state officials approved most readily those designs similar to ones already employed. Once the state-designed good was produced, the pricing and marketing of the product was done by a separate entity.   
	In the former Soviet Union, the core of the traditional hierarchy was called the structural task unit or STU.  It was a form of collective and designated essentially any group charged with performing a specified task.  Each Soviet enterprise was a STU and each contained as many administrative, service, and production STUs as were necessary to carry out its assigned mission.  Members of STUs showed cohesion, solidarity, and camaraderie.  Information flowed vertically up to the STU manager and down to the STU members.  Divulging information, no matter how trivial, to outsiders (not belonging to your STU) required the STU manager’s approval.   Innovation was stifled by fiefdoms, inter-STU rivalries between managers and technicians which  blocked the flow of information necessary for either the sourcing or successful adoption of innovations.
	Centrally planned systems can indeed waste relatively large proportions of national resources for three core activities of:  R&D, investment, and scientific and technical education. A relatively high proportion of the former Soviet R&D was for defense equipment, and of Soviet investment was for buildings rather than plant and equipment.   Centrally planned systems have proved to be relatively weak in applying and diffusing the output of R&D and other innovative activity, and this is reflected in low and declining rates of increase in factor productivities; a continuing position as a technical follower rather than a leader; and declining technological competitiveness compared to the newly industrializing countries.  Another major issue for centrally planned economies is the degree of independence of research and development from the  government.   This integration also carried through to the working level where scientists who worked for the state learn to restrict their research to politically expedient topics, as illustrated by Soviet biological research earlier in this century.  Perhaps even more telling than political pressures is that the simple numbing effect of conducting R&D in the setting of cumbersome bureaucracies discouraged innovation.
	A centralized fund supported the introduction of new technology, but only when such technology had been approved in the central plans.  One result was one-sided emphasis on process innovation to the exclusion of product innovation. Only 7 percent of industrial innovation consisted of product innovation as opposed to 60 percent devoted to mechanization and automation of production processes.  The former Soviet system failed to support more revolutionary inventions due to institutionalized funding and reward structures that favored attainment of short-term production plan quotes over long-term advances.  It seems ironic that centrally planned economics, emphasizing five-year plans, fall prey to the same short-cycle annual budgetary pressures blamed for American shortsightedness in innovation investment.
	Capitalism benefits from profit-based incentives that tend to be quite flexible to meet changing situations and accommodate innovation.  Communist systems, in attempting to find substitute schemes to motivate individuals and organizations but remain within the Marxist philosophies, face severe difficulties. Soviet management in many instances   confronted   incentive  structures that discouraged innovations that might conflict with planned production targets. No effective incentive existed to improve product quality or to produce goods that were truly novel.  Indeed, separate laws for inventions and for new technologies (even new process techniques) combined with centralized planning to cause the costs of introducing product inventions to be borne by the enterprises themselves, whereas minor process innovation could have been financed through other (central) funds. (note: costs were always much less important to planners than output.) In the Soviet-style central planning, as exists in all central planning operations, first, second, and third world, it was inputs that always matter more than outputs and political processes that were always of more importance.
	The price system under Soviet-style central planning was a further major impediment to innovative initiative. Thousands of separate “state” prices existed. The pricing of ”new” goods presented the clever enterprise manager with opportunity: he could make a few small changes in an established product, present it as new, and apply for a temporary price higher than the original one––often using padded costs estimates.  In market oriented economies, prices reflect scarcity, for enterprises compete for production factors and the prices of end products reflect value and competing supply and demand.  Under the former Soviet system, prices of end products often failed to reflect scarcity and the risk of introducing new or improved products and/or production methods.  This undermined the incentive for enterprises to innovate, for the allowed margin does not adequately reward the risk  inherent in innovation. Soviet planning relied heavily on the supply side of innovation.  Demand side initiatives were limited to directives and promotional campaigns launched at motivating managers. Unlike  Hungary,  Poland, and the pre-Tiananmen  Mainland China, the former Soviet Union (even with Perestroika) was not willing to experiment with enterprise profits that were sufficient to encourage meaningful entrepreneurial activities. In essence the failure of central planning societies in sourcing technological innovations can be attributed to their high penalties for failure, their deeply entrenched bureaucracy, a much slower diffusion rate and a slower withdrawal of obsolescent items, negligible patent rights, dependence on government policy and planning and not market forces, short-term orientation in meeting this year’s plan, no effective price system, no incentives (and in fact actual disincentives) for innovation, a system that discourages risk taking, and a negative view of competition and the marketplace.			Where governments maintain a high degree of control of the economy, whether in the Soviet Union or in third world socialist nations, inadequate capital inevitably occurs. Post-war France created the Plan Indicatif which was an effort at central planning.  This was done under the belief that planning yielded superior results to the unplanned capital allocation of the market, both in total output and in output per unit of investment. However as the plan evolved, the French determined conclusively that under both types of planning, the productivity of capital is very low.  Under central planning, additional units of capital investment yielded less and less output. As a result, they shelved the plan and the economic planning concept. The Russian experience was different.  They retained central planning.  The productivity of capital in the former Soviet Union kept on falling.  Agricultural investment during the 1970s rose steadily until it took the majority of all available non-defense money.  The more money poured into planning, however,  the smaller the harvest.  The same negative productivity of capital occurred in the civilian industries in the Soviet Union.  This was a major factor in the collapse of the Soviet economy.
	However poorly the market may be harnessed to democratic purposes, only within market-oriented systems does political democracy arise.  Not all market-oriented systems are democratic, but every democratic system is also a market-oriented system.  Apparently, for reasons not wholly understood, political democracy has been unable to exist except when coupled with the market. 	The association between liberal constitutional democracies and market is clearly no historical accident.  Democracies were established to win and protect certain liberties:  private property, free enterprise, free contract, and occupational choice.   For both the specific liberties and for the exercise of self-help, markets in which the options can be exercised are required. The connection between the market and the particular liberties prized in the liberal tradition is still intimate.  The two are historically tied together because in the forms in which they have arisen, both are manifestations of constitutional liberalism. If you and I as ordinary citizens are to be free to choose our own occupations, we need a labor market, rather than an authoritative system of conscription.  If we are to be free to travel, and do not want to ask a government official’s permission, we must be able to buy tickets on the market.  If we are to be free to read, we must be able to buy books.  The liberal notion of freedom  was freedom from government’s many interventions. and for that kind of freedom markets are indeed indispensable. Logically, people can enjoy a great deal of liberty even if they do not live under a democratic regime, or be unfree on many counts although under a democratic regime.
	The relationship between industrialization and democracy has been oft studied.  Correlations between the two have been substantial and significant. The reasoning is  that industrialization leads to increases in wealth, education, communication, and equality; these developments are associated with a more moderate lower and upper class and a larger middle class.  As it is the middle class which is the main pro-democratic force, this increases the probability of stable democratic forms of politics.  Thus it is the economics that lead the politics!  Demands from democracy arrive with unmet (but realized) economic needs.  The collapse of Eastern Europe and the Soviet Union were driven by economic forces; the rise of Democracy in India is being led by the large increasingly affluent middle class.
	Authoritarian regimes usually perform worse, not better than democratic ones.  Gary Becker, Nobel-prize winning Economist from the University of Chicago, has concluded that democratic countries grew more rapidly in per capita incomes in the last three decade, even when compared with other countries that started with similar per capita incomes and education levels.  Authoritarian regimes typically do not like the decentralized economic power found in a competitive market economy; it takes away some of their own power.   When authoritarian regimes promote competition and markets, they encourage political opposition.  The intensive contact with other countries such a market naturally brings, undermines support for totalitarian political leadership.   The fall of the Berlin Wall and the Iron Curtain in 1989 and the collapse of the Soviet coup in 1991 are perfect examples of this phenomena in action.  That is why North Korea has built a high wall around its country; too much outside contact can only create further instability.
	A characterization of communist politico-economic systems would look like the following:   They display great concentration of political authority  in the hands of one man or a ruling committee instead of the diffusion characteristic of democracies.  Authority is much less constrained by rules than in democracy, and so also less constrained by constitutionalism.  Leadership is committed to collective goals, rather than to facilitating personal liberty and individualistic goal achievement.  In the pursuit of them, the scope of  government is near all-encompassing- wider that in any other politico-economic system.  Government owns most productive assets   of the society-private property in the means of production is not the general rule-and  government immediately and directly organizes the economy. When power is concentrated, that group tends to curb the rights and liberties of other groups and tries to distribute the spoils of power in a manner which suit the group’s interests.  When power is shared by many, the spoils of power are shared among many.  The economic incentives due for economic growth and innovation would be far more likelier in the latter.	

V.   Planning--For the Government, not by the Government

Democracy is the theory that the voters know what they want and deserve to get it good and hard. 
----George Bernard Shaw

Que sera sera.  Whatever will be, will be; the future’s not mine to see, que, sera, sera.

As we peer into society’s future, we must avoid the impulse to live for only today, plundering for our own ease and convenience the precious resources of tomorrow––––Dwight Eisenhower.

	Therefore, it is  a requirement that any planning activities which are to be undertaken be limited to planning for the government, not by the government.  As related by the central planning, economic planning mandated and controlled by the government not only leads to totalitarianism but to great inefficiencies. Central economic planning tends to be coordinated by representatives from government, big business and labor unions, none of which tend to be responsive and open minded. 
	 Government has typically been a set of myopic decisions.  The political technology of the industrial age is not longer appropriate technology for the knowledge age.  Industrial age produced mass society.  But in this age, we tend towards mass customization, production of goods or services in mass quantities but individualized towards each consumer’s needs.  We need new system of governing to accommodate the changes that have occurred in the last fifty years.  Our political decision making machinery, both legislative and executive, was never designed to cope with such high levels of diversity.  It was designed to produce uniform, basically repetitive decisions for a much less differentiated environment, a simpler, more comprehensible, management environment. Huge government bureaucracies that were established during the industrial era and they too were designed to operate in an homogeneous mass society. They were to the service economy was factories were to the goods economy:  a tool for mass producers.  this mismatch is among chief reasons for gridlock and ineptitude we see at all points in government. As consumers have grown more diverse, industry has accommodated by product differentiation, product variation.  Government bureaucracies have been far less adaptive.  Constrained by anachronistic political boundaries, by well-intended but simplistic notions of ‘equality’, by organizational ossification and rigidity, lacking even the spur of competition, government keeps pumping out essentially uniform services for an increasingly non-uniform population.
	The problem is not simply that government does ‘too much’ but that what most of what it does is simply wrong or too late.  People who need help don’t get it.  People not in need receive lush benefits.  Programs are not adequately tailored for local needs.  Old programs which should have died continue to regulate while new ones proliferate beyond the ability of anyone to manage them.  Pressures for accelerated decision making runs up against increased complexity and unfamiliarity and the opposing views of dozens of special interests.  The world is not stable, routine, predictable.  Therefore, the political decision makers swing wildly back and forth between doing nothing about a problem until it explodes into crisis, and alternatively, racing in with ill-conceived poorly pre-assessed crash programs. 
	Two ways exist to approach decisional overload.  One method is via  the center: to attempt to further strengthen the center, adding more and more bureaucrats, experts, politicians in the hope of outrunning the acceleration of complexity.  The other method is to begin reducing the decision load by sharing it with more people, allowing more decisions to be made lower down  or at the periphery instead of concentrating them at the already stressed and malfunctioning center. One leads to ever greater centralization, technocracy, and totalitarianism; the other towards a new, more advanced level of democracy.  The second method has the advantage of increasing channels for feedback between citizens and government decision makers, thus decreasing the risk of error.  Errors, once made, can be more quickly and cheaply corrected.  In less democratic feedback, the more decisions become divorced from reality, the greater the danger that  errors will go uncorrected until they escalate into crisis.   What we need and what we recommend is to combine citizen participation with future consciousness, beyond participatory democracy. This  challenges notions that long range goal setting is best left to politicians, planners, or futurists.  In essence, this is a fusion of freedom and futures.  Citizen participation must concern itself increasingly not merely with ‘here and now’ decisions but with those that influence the long-range future.  By doing so, this creates a constituency for the future, a large number of active citizens who recognize that time exists beyond the next election.
	Two crucial problems endanger the stability and survival of our political system today: lack of future consciousness; lurching from crisis to crisis, instead of anticipating the problems and opportunities of the future. This failure of foresight is due mainly to the system: the failure of our political leaders to look beyond the next election.  The second  crucial problem is the lack of participation: most people feel powerless, seldom consulted or asked about ideas. People know their voice doesn’t count much.  Voting has become the functional equivalent of the rain dance, a traditional but irrelevant ritual--good only for entertainment, many people do not take it seriously anymore. They are not necessarily apathetic but disinterested.  Issues that effect voters still turn out large numbers of interested participants. Most citizens, nonetheless, find themselves in a system stacked to favor entrenched powerful parties, thus increasing frustration with the system results.  Citizen participation (called ‘anticipatory democracy’ by Alvin Toffler in the book of the same name) tackles both these problems simultaneously.  This program would create new channels for genuine, broad-based citizen participation.  These goals are not set by elites or experts only.  Goal-setting must be open to all sectors of society, to involve them at all levels of leadership,  to share in the shaping of general goals and policies, and to press for attention to longer-range futures. The most promising way to make a place for citizen participation in American government and politics is to adapt and apply new communications and information technologies.
	The planning we espouse is to involve a wide range of citizens and government officials in a comprehensive analysis of the current problems and future options of a region, and a subsequent definition of goals. By encouraging widespread participation, the sense of isolation from government that citizens feel should be reduced and the creativity provided by the diverse opinions of a wide range of people will be given. Extend the planning both long term and across agency jurisdictions to provide a more holistic view of policy issues. 
	Why is it difficult for Congress to anticipate emerging problems?  Members have their own goals that creates conflicts within the decision setting apparatus.  The 535 individual members of Congress, limits organizationally  what can be done.  Committees and subcommittees rarely consult among themselves on matters of mutual concern.  Because Congress’ agenda is so crowded, its policy making is harried, inconsistent, and not clearly thought out.  The agenda is predominantly set by current and past issues embodied in existing legislation.   Forcing both the country and Congress to deal with crises before they appear necessitates foregoing current expenditures and satisfaction, requiring a discipline that isn’t typical in either personal or political lives.  Programs cost money.  The public does not want something they don’t think they need and they often do not see the current need for dealing with anticipated problems.   Only a crisis helps sell the urgency of the need to deal with the problem.
	In addition, Congress tends to follow the ‘Law of unintended consequences.’  One of the core beliefs of American liberalism was its faith in the ability of politicians and planners to analyze social problems rationally and to formulate quasi-scientific  solutions.  One well intentioned program after another has failed, often solving (however poorly) one problem only to create a new one which turned out to be far worse than the original problem.  Pushing down one problem often yields another and larger problem somewhere else.  Daniel Patrick Moynihan said liberals have to accept that there were certain problems “we do not fully understand  and certainly do not know how to solve.  . .  “  The War on Poverty’s Community Action Program was “ a program launched that was not understood, not explained and this brought about social losses that need not have occurred . .  the government did not know what it was doing.  It had a theory, a set of theories. . . nothing more.” Forced busing often drove so many whites from public schools that racial segregation grew worse, not better.   High levels of welfare payments might encourage the poor not to work at all.  The burdens of affirmative action fell most heavily on poorer white males.  Bilingual programs left Spanish-speaking children far less able to compete in a predominantly English-speaking country than previously. And so on and so forth, the examples are limitless.
	Congress excels at oversight. Oversight by legislative bodies entails looking backward to see how well the executive branch is implementing programs, a regular part of the work of congress.  Foresight, the systematic looking ahead, is a concept only emerging and still not well accepted nor performed at all, let alone adequately, by Congress. Foresight requires Congress to take a longer and broader look at its policymaking, time frames not conducive to election year mentalities.   Foresight can contribute to the legislative process in four major ways:
	•By providing early warning--identifying emerging issues that may require prompt attention
	•By forecasting the long term impacts of and alternatives to proposed legislation
	•By setting directions and priorities and clarifying the cross impacts and trade offs among different policies and programs. conscious coordination of policies across committees or agencies by identifying cross impacts of legislation.
	•By adding  a further dimension to the oversight responsibility of the legislature by clarifying the expected future effects of the legislation.to develop greater awareness of the future in drafting and preparing legislation, secondary or side impacts of legislation.

VI.  	National Goals

	Governments are most successful when they take time to analyze the economy before acting, that is they plan.  By performing strategic audits, Pennsylvania and Michigan focused in on their economic bases, identified their strengths and weaknesses, and developed initiatives that exploited those strengths and remedied those weaknesses.  The Federal government can do likewise if only it were to take the time and effort to do so. Long range planning is performed in most other countries but not in the United States. We need a standard planning committee, a master planning committee as a planning group. If one were present and their findings listened to and responded to, then governmental actions, which otherwise would be inclined to be expedient, could then  work on longer term goals more easily. Planning committees could operate quickly, effectively, independently, operate under a charter with a specific goal and disband when their assignment was completed. 
	The whole idea  is to create the goals for the United States for the future. What this boils down to is  the notion of a business plan for America  You have to plan it. To create a plan and then review everything that Congress is doing against that plan. Under our proposal, the President of the United States will probably appoint a Planning Commission consisting of deserving members from  most of the professions and most of the vocations in the United States, especially from among the National Academy (see Chapter 1). The Senate would confirm them.  Currently, the United States has a wide variety and assortment of planning commissions. However, more are political in nature and have special interest dominated objectives. The difference with this commission is that it would be apolitical,  would be a long range planning commission whose charter is to  come up with  goals for the United States over the next  century. This plan would be presented to Congress which would have to approve it in principle.  Afterwards,  anything that is passed in Congress would be measured against this plan to insure they are moving  in the right direction. If proposed legislation goes against the proposed plan, it should have a   more difficult time getting passed.  The Planning Commission should meet annually for several weeks to review, update, and upgrade their plan. Now instead of drifting aimlessly, we will have a plan and a set of objectives to shoot for. The Plan will be published and disseminated, in simple terms, so every citizen has a copy.  This should help  the American public  have a better idea of what the government and Congress is trying to do and where they are headed.    That is ultimately the goal.  An example topic would be:  ‘Education: where do we want to be by year 2125.’  And so on.
	Functional planning committee could be established for each particular area of relevant governmental activity, that is   one for justice, one for state, one for defense, one for treasury, one for infrastructure.  Academy members would serve on them for four years, being rotated on and off and between committees.  They would continuously review the future and  provide ideas of future scenarios to both the private and public sectors.  Suggested ideas of what new legislation would be needed for foreseen problems would be proposed.   On such committees should be the most distinguished members.  After its review and recommendations are made, a representation of the group would meet with the master planning committee, a group consisting of members from each individual committee.  This would allow coordination and discussion between separate committees.  A final report would be issued, discussing particular committees as well as interfaces and commonality between groups. Committees would also have the capability of reviewing existing programs and proposed legislation and providing comments and criticism on them. 
 	Goals.  Aspirations.  Objectives.  Whatever you want to call them, the intent is to set down on paper a carefully thought out plan of  what we aspire to accomplish within the long term, even out 100-200 years.  We should set up the goals or aspirations and then  test everything we use against them.  If they meet the standards and aspirations they are okay and approved.  If they don’t, we back off and find and redesign them to meet the standard and aspirations that we have decided on.  So they will ultimately move in that direction without any constraints of time.  So we are going in the right direction and to do that you have to set up standards.  The Education 2000 goal education is one example of trying to do what we are espousing. We do not know if it is good law.   The fact is that it is a plan, some thought has been given to the future of education,  a plan for improving our education.  In this thesis, We are setting up a plan to improve our government.  It is  exactly the same thing as Goal 2000, except the 2000 plan is limited to education.  
	The ideal thing is for the federal government to develop ideal goals  for which we should move towards in the same way that a business develops a business plan so that they can measure there progress and purpose of over sight of what they are doing and I think the gentleman should have both a ability to measure his process and to properly oversight what he is doing against some standard without a standard you really don’t know the quality of what you are doing. To develop and define the goals that we should be aiming for at least some of the goals hopefully other people will add goals to that and to try to explain a number of objectives to reach these goals specific programs that will move in that direction  and probably meet the goals.  We can cover a lot of varying areas certainly the government its self is subject for review and some aspects of the government such as justice, defense, cabinets of the government, education.  
	The way we operate today without a plan we have a tendency to go from conflict to conflict we have a problem and we immediately consider it sufficiently important to try and correct it and we go into maybe a hurry way of attempting to direct it.  Another words, in any kind of decision the philosophy is the more lead time you can give yourself to resolve a problem the better decision you are going to make. We have a tendency not to do things right the first time because we say that we don’t have the time or the resources but when we finally make a mistake we always have enough time to correct it with resources and with people and with time. This is what we are trying to avoid  by anticipating problems by making a plan and this plan is going to be very flexible.   The master plan would be periodically updated (we suggest every 2 years) and amendments made to it.  The idea for this plan  would be to have the President appoint a cadre of people initially  as the planning commission with Congress passing on the people and then the people develop the plan the plan is then presented to the Congress or possibly even to the public for a referendum.  Here is what we would like to see the government and the country look like down the road (not in any specific time). These are the things to shoot for, to have the public vote on in a referendum and maybe make the referendum a 2/3 majority.  In another words the public has to support it.  You can’t just have Congress pass it, it has to be publicized giving the public a chance to look at it and say yes, these are the things we would all love to see.  If the public doesn’t approve it perhaps you can get the public to approve it by sections.  Then those sections not approved would have to be revised and put through again.  This process may take several years but, it is still the right direction and so we are not putting a time limit on anything what we are trying to do is develop something that this planning commission may work for years.  But at least something is being done the public is becoming aware of the fact that the government is planning and it can respond because as this is developed the media should be able to support it.  The media will feed back to the public what is going on and the public can read through its congressman and senators can feed back on how there feelings are when the congressman come back into there district. So there is this exchange between the government, public and the media and the media has to absolutely be in it.  But the idea is now that we agreed to a philosophy that some long range  planning is favorable.
	 Once the people know that we are not going to attempt to set out what the government must do in all matters but merely setting a plan and putting up the  framework for what it is and must do and then setting in motion so it can operate on its own, criticism should be minimal.  It is not dictating in the system.  It is instead, putting a flexible plan in to place and the structure to allow it to operate.  
	We might even want to call it a plan.  Maybe a better term is we want to develop a Social Contract For Our Government.  A Societal Contract is where the government says I support you and you must take some responsibility and in turn the government will handle certain items. And of course the people have to support the government and financially they have to support the laws but, unsupportable laws aren’t going to work and they won’t be proficient. The relationship between people and their government and laws is probably one of the most complex things to write about. Few have really caught the imagination of the people. No current book describes the Social Contract in a way that has goals and aspirations that grabs the interest of the grips of the pragmatic people.   This interrelationship between people and the government that is the rights and what rights are inherent in the people and individual and what rights are inherent in the government. The goals and aspirations of a Social Contract between the people and its government
	Again the words ‘Social Contract’ has been referred to in many books.  We are not originating the term.   A Social Contract is a contract between the people, the public, and the rulers.  What we want to develop is the best social contract between the government and the people to  run that system.  That is the aim of what we are proposing. Maybe the word “Plan” rings too sterile and does not actually portray what we are trying to do.  People say plan how you plan to do the government.  How do you know  everybody says how  do you know what is going to happen in advance and that isn’t what a plan is it doesn’t try and predict what is going to happen.  A plan is a flexible tool to try to get you from point A to point B in the best way possible.  It is certainly does not forecast or predict anything because, it is flexible.  We won’t use “Plan” any more we will say, ‘A Social Contract.’  
	In the business world,  you may set out with a 5 year plan you don’t want to set it in concrete.  You don’t want to make it such that this is the way it is going to be regardless because you must allow for the flexibility to operate in a dynamic  world.  And therefore what you try and do at a point in time that we issue this is the best that we see right now.  Knowing that 2 days from now is going to be in need of a change because times have changed. And the thing to remember too is in this plan for a Social Contract what we are doing is establishing goal, goals that we all agree might be the way to go.  Then as we go and write our programs see my understanding of Plan and a Program is:  A plan is a set of goals.  The programs are the way to get to these goals.  A program isn’t any good.  A plan does not need resources and it doesn’t need money and it doesn’t need people it is simply a one set of goals.  Now to be a program requires two elements:  people or resources and a time element.  A program isn’t any good unless it set up a timeframe and it has the resources, money, people, equipment, and whatever else it takes.  So what we are doing is we are setting up a series of goals then later down the road we are going to give you some programs which we think will meet those goals.  So that is how we differentiate between the two.   
	Most people don’t really understand planning.  The criticism we are going to have is:  You can’t plan government. Our system of  transition from one President to the other needs a look at  we bring a man in with absolutely no background in government because we think he can run the government and the other man feels a little reluctant to pass on to much to him and even though there is a short transition the transition is very short especially in changing jobs and there isn’t continuity that we perhaps we should have and we ought look at that in more detail, the most important job in the world. We have to create the something in our government policies we have to plan ahead so we are able to better react to various problems and that is the importance of planning. 
	 When the  original astronauts were asked what the most important element that perhaps made them more successful and made them stand out and they said the ability to anticipate, the ability to plan ahead so that if a crisis happens you are able to correct for it. 
	Some of the programs that can be done include:
	•agenda setting
	•long range issues analysis and legislative planning
	•institutional reforms
	•an avenue for citizen participation and a wider expression of values. 
	•demographic information in policy planning
	•long range budgetary decisions
	•assessment of the impacts of federal and private sector decisions.

Goals to be done.  Ends to be achieved.  Offer means to accomplish them. A set of national goals, programs ultimately to shoot for.  For example:
	• Physically secure society. One should be able to traverse the streets of any city at any time of day or night and feel safe.
	• Have a balanced, growing national economy with wise use of debt.
	• Selection of a leader, motivated for welfare of people.  Integrity and interested in subordinating his/her own self interest to that of the people.

The objective is simplified, efficient, cheaper government, a reengineering of  government for the twenty-first century. 
VII.  National Referendum

	Three vehicles currently exist for the people to participate in their representative activities: National initiative  (allows citizens to propose  legislation by petition) and referendums (provides veto power  over particularly sensitive and important legislative acts) and the recall (provides an opportunity for citizens to specify a particular set of grievances against a legislator or other elected official and to require a special election by petition).  These have generally been in reaction to a crisis or scandal.
	 Has the time come for a national referendum?  With the much discussed information super highway  or 500 cable channel TV, has the time come for United States to have a truly affective national referendum and at almost any time on any subject within a few days notice? If the government creates an environment where a referendum becomes a instrument of the government being guided by the people the interactive system of the technology will take care of itself.  The technology in our country has the capability   of being able to respond to demand and if there is a apparently a demand and people can make money to create this technology the technology will be there I think.  It may not be today or tomorrow but interactive technology will be expedited and the catalysts for it will be this kind of plan because it will lend itself to inactive responses.
	The  technology may be here or shortly will be able to be here to allow us to through out to the public  various questions like:  Do you and let the public give there preference and all 200 million or 150 million eligible voters can get on there cable TV or on there on line system or internet and vote for various phases. And that would mean that politicians now here we are we are having this and if this is the case with a national referendum effective that means what does that mean to the power of congress will these over-ride  I don’t envision  at any point in time where a referendum becomes the ruling creator of actual policy what it is simply guides. 
	Ratifying an amendment.  Is 2/3’s a pretty good number? Because anytime you get 66% of the people. If you say 50%-51%-49% quite much dissolution but if you have well over 62%-65% than it means you have a definite majority and that is what we are looking for.  The   provides that definite majority there is a little consensus formed as the way we should go.  It takes 2/3 to over-ride the president to do other things where we want a definite majority.  That doesn’t mean in any way that will ignore the minority.  We have to be careful that the principals of democracy requires that the majority protect the minority. This an attempt to do things better. 
	We will have the public “Town Hall “  system from which delegates  will be voted into maybe a states system, ranking local to state and from that state group small group would go and maybe meet with the President twice a year and they will vote at each of there different levels - what are the important issues to discuss with the President and by vote they will come with a limited amount maybe 10-15 important issues that the people down below feel are important and meet with him twice a year maybe 15 people out of this big group of people gradually by election and meet with the President twice a year to present to him there views of the public down at the grass roots.  Again this system of interactive system can help us do that. So one reason the book was written  we are creating a new technology that can really be applied better to the government that is now currently being applied.  That is now of the goals.  To apply technology to make the government least intrusive into the public and yet give us enough controls to maintain a good climate.
	So if the referendum is a failure or sufficiently popular go in and find out what parts about it are not appropriate and fix it.  So that you can build up to what they want or at least try.  Like product development if they don’t like it because they are afraid of going in the defense.  It is a choice of going into the volunteer army or peace corps.  That would be we would go ahead and find out what would do it before the referendum throw the idea around see how it flies.  Make changes in the policy accordingly and hopefully offer to a form and have the majority support you. 
	To be part of the referendum is: do you want your children to go from High School for two years into some form of public service.    If they say they don’t want that contribution from their children after the features of it are described,  the risks mentioned, and the advantages and disadvantages portrayed,  we will just have to accept the fact that they are not ready.  We may try again 5 years later.  We can put it in a plan and say let’s give it another shot in another 5 years.  But I think that the public if it is properly prepared for this kind of participation on the part of the youth because this will be a spin off and the spin off will effect the crime, education, health, drug, national defense area, fiscal area all of these spin off will be favorable if we can get the program and the participation on the part of our youth for a limited period of time.  We will emphasize that as one of our major People programs but, at the same time  with the least amount of government.  So we are going to offer it to the public and if they don’t want it we are not going to force it or force it down there throats.  It will not work unless it is supported by the public.
	Technology have overrun the public’s ability to use it.  We have the technology in place to conduct national referendums but not an informed and engaged electorate able to act upon those ideas.  The result is a government that neither knows nor implements the public’s will.  Direct democracy such as direct participation in a national referendum offers an appealing alternative to many people who have lost confidence in the ability of both elected representatives and the media to act in their interest.  Instead of physically going to the polls, people could vote from their homes.  With more convenient and less expensive voting, people could be expected to vote more frequently and on more issues.  direct democracy, though, could lead to information overload since the average person does not have the time, ability or inclination to become an expert on issues and candidates.  


VIII.  Industrial Policy

Industrial policy.  Picking winners and phasing out losers.  Winners should have the following criteria.  1) industries of significant size  where country would have future comparative advantage as the relative supplies and costs of factors of production change with domestic growth and evolving international economic conditions and as learning curve economies achieved (infant industries), 2) industries for which domestic and world demand have high income elasticity, 3) industries internationally price competitive. American industries threatened by foreign competition have also been propped up by a wide assortment of government subsidies, special tax provisions and subsidized loans and loan guarantees.    In 1980, such costs were $62.4 billion (3 percent of GNP).  Targeted federal loan guarantees now total more than $221.6 billion.   
We must be very careful about industrial policy.  It has never worked in Europe; despite the press about Japan’s successes, more than a few failures  have bee noted.  The private sector is best at picking winners and losers.  Government can only skew the results. 

Home Page	
Preface & Introduction	
Chapter 1: Responsibility  
Chapter 2:  Leadership   
Chapter 3: Government  
Chapter 4:  Congress    
Chapter 5: Regulations and Bureaucracy   
Chapter 6: Defense  
Chapter 7: International Affairs 
Chapter 8: Crime and Justice  
Chapter 9:  Civil rights 
Chapter 10: Economic  
Chapter 11:  Education  
Chapter 12:  Health  
Chapter 13:  Planning and National Goals  
Conclusions  

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