Dr. Norman Kurland
Center for Economic and Social Justice
Post Office Box 40711
Washington, D.C. 20016-0711
Center for Economic and Social Justice (CESJ): www.cesj.org/
The Center for Economic and Social Justice, established in 1984, promotes a free enterprise approach to global economic justice through expanded capital ownership. CESJ is a non-profit, non-partisan, ecumenical, all-volunteer organization with an educational and research mission.
CESJ's global membership shares a common set of moral values and works together toward a common purpose, transforming good ideas into effective action.
Norman G. Kurland, CESJ President
Mr. Kurland is a lawyer-economist, pioneer of employee stock ownership plans (ESOPs) and a leading global advocate for “the Just Third Way,” a post-scarcity development model that transcends both capitalism and socialism by combining free markets with the democratization of economic power and capital ownership. He serves as President of the all-volunteer Center for Economic and Social Justice (CESJ), a non-profit think tank headquartered in Arlington, Virginia that he co-founded with Fr. William Ferree and other economic and social justice advocates in 1984. Mr. Kurland also founded and heads Equity Expansion International, Inc., an “investment banking firm for the have-nots,” which implements “Just Third Way” strategies around the world to turn non-owners into owners. He is a co-founder of Global Justice Movement.org (based in Canada) and the American Revolutionary Party(.US) launched in April 2005. He has taught binary economics and binary policy reforms in privatization seminars at the International Law Institute in Washington, D.C. In 1985, President Reagan appointed Mr. Kurland as deputy chairman of the bipartisan Presidential Task Force on Project Economic Justice, to promote economic democratization through ESOP reforms in Central America and the Caribbean.
He was a close colleague for eleven years of Louis O. Kelso, author of binary economics and inventor of the ESOP. With Kelso, Kurland co-founded the Institute for the Study of Economic Systems. He later became Washington Counsel for Kelso’s investment banking firm. Collaborating with Kelso, Kurland authored and lobbied the first and subsequent ESOP legislative initiatives in the U.S. Congress. He is the principal architect of several model ESOPs and legal systems for expanding ownership, as well as: the first ESOP and worker shareholders association in the developing world at the Alexandria Tire Company in Egypt; the “Capital Homestead Act” (a comprehensive package of national monetary and tax reforms); the “Community Investment Corporation” (a vehicle enabling community residents to share land ownership and profits); and “Justice-Based Management” (a system for applying principles of economic justice and building participatory ownership cultures within business corporations).
Business Week described Kurland as “the resident philosopher of ESOP in the capital.” He was the recipient of CESJ’s first Kelso-Ferree Lifetime Achievement Award, an honor he shares with Senator Russell Long, the legendary champion of ESOP on Capitol Hill. Mr. Kurland has authored numerous articles on the Just Third Way, binary economics, capital homesteading and related concepts for universalizing access to capital ownership. He was a contributing author to the 1994 compendium Curing World Poverty: The New Role of Property (John H. Miller, ed., Social Justice Review), and was the principal author of CESJ’s comprehensive economic reform agenda, Capital Homesteading for Every Citizen: A Just Free Market Solution for Saving Social Security (Economic Justice Media, 2004).
Before joining Kelso, Mr. Kurland was director of planning of the Citizens Crusade Against Poverty, a national coalition headed by the labor statesman Walter Reuther. Before that Mr. Kurland, as a Federal government lawyer, became deeply involved as a civil rights investigator in the Mississippi “one-person, one-vote” movement and later with the core group shaping economic empowerment initiatives in President Johnson’s “War on Poverty.” He came to Washington in December 1959 after receiving a Doctor of Laws degree from the University of Chicago, where he studied law and economics, following five years as an officer on flying status in the U.S. Air Force.
For Every Citizen
A Just Free Market Solution
for Saving Social Security
Norman G. Kurland • Dawn K. Brohawn • Michael D. Greaney
© 2004 Center for Economic and Social Justice (CESJ)
Published by Economic Justice Media
• The proposed Capital Homestead program would offer a private
property and free market oriented alternative for saving the Social
Security System as a national retirement income maintenance
plan, while introducing a new national policy to foster “capital
self-sufficiency” as a means to achieve true economic independence
for all Americans.
• Following the precedent of Abraham Lincoln’s Homestead Act of
1862 that democratized the ownership of frontier land, this economic
policy would universalize access to capital credit — the 21st century
equivalent of the 160 acres of land — to every citizen. This would
provide access to the means for every citizen to accumulate over his
or her lifetime an independent income-producing capital homestead
in the ever-expanding technological frontier.
• Based on four pillars of a free and just market economy — (1)
expanded capital ownership, (2) limited economic power of the
state, (3) restoration of free and open markets, and (4) restoration
of the rights of private property — the Capital Homestead
program would strengthen the political constituency for linking
supply-side with demand-side economic policies. It would add
social justice and compassion to conservative principles. It would
also reduce the political pressures for redistributive, anti-growth
and protectionist policies.
• Capital Homesteading would introduce basic reforms in the monetary
and tax systems, geared toward maximizing private sector
growth without inflation, shifting from a debt-backed to an assetbacked
currency, while systematically building a nation of owners.
• Capital Homesteading would reduce pressures on the present payas-
you-go Social Security and Medicare systems, while leaving in
place a social safety net for those individuals whose capital home-
stead accumulations were insufficient to generate an income to
meet their basic needs.
• The Federal Reserve would revive its existing money-creating powers
under Section 13 of the Federal Reserve Act, opening its discount
window to provide sufficient money and capital credit to
finance the estimated $2 trillion needed annually for new plant
and equipment, new technology, new rentable space, and new infrastructure.
Channeled through each citizen’s Capital Homestead
Account (CHA), Fed-monetized credit would be allocated by the
competitive banking system to financially sound investments and
irrigated through mechanisms that systematically create new owners
of the new wealth, without taking old wealth from existing
• Five central banking innovations would be introduced: (1) a twotiered
Federal Reserve credit policy that favors broadly owned private
sector growth over nonproductive government and consumer
borrowing; (2) a shift to the Federal Reserve’s discount mechanism
from its Open Market Committee for controlling the money
supply, thus freeing growth from its current dependency on past
savings; (3) 100% reserves (the “Chicago Plan”) to replace fractional
reserve banking; (4) the Federal Capital Credit Corporation
(FCCC),1 a Fannie-Mae-type “bundling” operation to facilitate
Capital Homesteading loans and establish national standards
for lenders; and (5) the Federal Capital Insurance Corporation
(FCIC),2 to provide an alternative to traditional forms of collateral,
thereby eliminating a major barrier to widespread citizen
participation in significant capital ownership.
• Capital Homesteading would offer an economic growth model
based on access to private property as a fundamental human right,
encouraging other countries to emulate America by lifting themselves
into economic prosperity, thus building a more free, just
and unified global market, the economic foundation for enduring
political democracy and peace around the world.
Social Security is a system built to collapse. While the horrific events
of September 11, 2001 wrenched the nation’s attention away momentarily
from retirement security to national security, the economic costs
of this one terrorist assault on America, coupled with an already ailing
economy and the “bursting of the bubble” of publicly-traded securities,
placed an even greater burden on America’s public retirement
system, hastening its day of bankruptcy.
Prior to the September 11 attacks, according to the Washington Post,
congressional estimates projected that the government would drain
almost all the Social Security surplus to operate at current levels through
2011, “imperiling the retirements of the baby-boom generation.”3 In
the face of massive layoffs and economic displacement caused by the
attacks, Congress must now consider in its budget debates the billions
needed to cover the replacement of destroyed property, insurance
losses, homeland security, rebuilding postwar Iraq and Afghanistan,
and other related costs. In the long-term, Federal Reserve Chairman
Alan Greenspan warned that the demand for added security will force
firms to cut back on employment and productive activities such as
research and capital investment.4
The bipartisan Presidential Commission on Social Security issued
its final report, Strengthening Social Security and Creating Personal
Wealth for All Americans, on December 11, 2001. The report concluded:
“Social Security is in need of an overhaul. The system is not sustainable
as currently structured…. (p.7)” While the commission members
agreed on the use of Private Savings Accounts (PSAs) to allow Americans
to invest in the stock market a portion of their Social Security funds,
they were unable to offer a unified set of recommendations. There was
no consensus on what percentage of Social Security assets should be
put into publicly traded securities. It was also assumed that there was
no better way for workers to invest than to place their wages and savings
in the stock market (mainly via mutual funds). Even more important,
as many commentators observed, the commission failed to recommend
any significant structural reforms for maintaining the long-term
viability of Social Security.
Flaws in the Foundation
At the inception of the Social Security program in 1936, the United
States Government promised explicitly, “What you get from the
Government plan will always be more than you have paid in taxes and
usually more than you can get for yourself by putting away the same
amount of money each week in some other way.”5 Unfortunately and
predictably, however, the increase in benefit obligations over time has
made the original promise unsupportable, even though today 76
percent of Americans pay more in payroll taxes than they do in federal
Most people are living longer than age 65, the life expectancy
projected when the Social Security program was born, and they are
getting higher benefits than the system had originally expected to pay
out. As the population growth rate in the U.S. declines, there will be a
shrinking pool of working Americans paying higher taxes to cover
Social Security benefits for a growing pool of retirees. As the Wall Street
Journal summed it up in 1988: “Baby boomers and their children will
pay more for their own retirement and get less in return.”7
Some analysts have warned that, calculated at present value,
projected Social Security deficits combined with those of Medicare
could reach $43 trillion.8 This dwarfs the projected $3.5 trillion in
federal budget deficits that the government officially reports as its
current level of public debt. In contrast to credit extended to private
enterprises, there are no productive capital assets standing behind
public sector debt.
Part of the reason for the present crisis is that shortly after its
creation, Social Security abandoned its original purpose as a social
safety net/insurance program to ensure every working American a
minimally adequate income after retirement. It is now expected to
provide the bulk, if not all, of a person’s retirement income. If Social
Security collapses, many retirees will be left economically vulnerable
and dependent on their families, public welfare or charity.
Society’s great expectations, and the efforts of policymakers to satisfy
them, rest on a shaky edifice erected on a flawed foundation. Three of
the most serious structural weaknesses are:
1. Social Security is a pay-as-you-go system and has no productive
assets, but rather government debt in the form of government
bonds and Treasury bills to stand behind the government’s
mounting promises. Nobel economist Paul A. Samuelson even
proclaimed the system “the greatest Ponzi game ever contrived.” 9
The problem with pyramid schemes, however, is that they
eventually leave someone “holding the bag.” It is anticipated that
by 2020, Social Security could begin to pay out more than it
collects, forcing the Federal government to reduce benefit levels,
tap into general revenues, or print money to meet the deficits.10
2. An unhealthy generational political split is inevitable between
younger workers and aging Social Security recipients. Potential
beneficiaries are growing larger in number. 75 million baby
boomers will soon join their ranks. The working population who
pay into the system (and whose payrolls are taxed from dollar
one) is shrinking in proportion to the recipient population. In
1940, soon after the program was launched, most Americans died
before reaching the eligible Social Security age of 65, and the
burden ratio was roughly 42 to 1. Now the burden ratio is about 3
to 1, putting the weight of more and more dependents on fewer
and fewer backs.11
3. The rich are largely exempted from sharing in this mounting
burden. Not only is there a cap on salaries taxed for the so-called
trust fund,12 but also there is no tax on incomes from dividends,
interest, and capital gains to support Social Security. The payroll
tax is extremely regressive, placing the greatest burden on the
working poor who must pay into the system from the first dollar
of earnings. Thus high-income workers and the wealthiest
Americans escape the responsibility to meet the nation’s promises
to poor and middle-class workers.
Dear Dr. Dalia Steiner,
Many thanks for your excellent introduction me with the outstanding economist and CESJ (Center for Economic and Social Justice) President Dr. Norman Kurland. I attentively read the basic pages of CESJ Website, concerning CESJ's Mission, CESJ's core values, CESJ's Code of Ethics and etc. I looked also Dr. Kurland’s rich biography and some other pages. I share the CESJ main principles which are in many respects crossed with the GHA main principles. Certainly, between them there is a distinction which, however, can be a source of development and mutual addition. I very much like Dr. Kurland’s theoretical and educational approach, his Economic and Social Justice and «soft technologies». I fully share his thought, that “the real enemies of human progress, freedom and justice are not primarily bad people, but bad and defective ideas”. Both our teams differ the unique constructive ideas. I fully share equally negative estimation and capitalism and socialism, but in this time a necessity of synthesis of their advantages. I highly appreciate the CESJ outstanding contribution to advancement of global justice during 25 years (since 1984). I think, that in these years, at your ample opportunities with President Reagan support, you can not carry out your Just Economy project. In my opinion, the similar economy is possible and necessary not for industrial but for harmonious civilization which beginning the GHA fixes to 2009. All it gives the strong basis for close cooperation of our organisations, the ideological, organizational and human potential of which mutually supplements and strengthens each other.
Let me to offer you following concrete forms of mutual cooperation.
- I invite you to discuss a question of mutual affiliation (or collective membership) our organisations, first of all in the USA, with Dr. Laj Utreja, American GHA President (email@example.com). It will allow our organisations to participate in actions each other.
- I would be happy to create your personal page under such approximate name: “Norman Kurland: Just Economy for Harmonious Civilization” on our Website “Peace from harmony”. Do you agree with this title?
- I invite you to exchange our books. Dr. Laj Utreja will be glad to send you 2 copies of our book “Harmonious Civilization” which you could look preliminary on our site “Peace from Harmony” to the address: http://peacefromharmony.org/? cat=en_c&key=379. In turn, Dr. Utreja and I will be happy to receive from you on 1 copy of any your book of last years. We will be happy to publish your review of our book and back.
- I invite you to join to Club-2009, about initiation of which I am glad to send you the GHA Resolution in an attachment.
- I like to send you also my short offers which I sent on January 4 together with the book “Harmonious Civilization” to Mr. Kofi Annan (the UN Alliance of Civilizations President) and Ms. Irina Bokova (UNESCO Director General). In case of creation of "Harmonious Civilization Center” and “World Harmony Academy”, GHA will be happy to invite in them you and your colleagues.
Such are the GHA first offers for you and your remarkable organisation. With hope of effective cooperation for the sake of a harmonious civilization and its Just Economy.
Dr. Leo Semashko, GHA President 30/01/10
Attached also are two pictures from a 1987 visit to the Vatican of a delegation I headed, accompanied by some members of the Polish Solidarity Movement before the collapse of the Soviet Union.Pope John Paul II's philosophy of Personalism and our philosophy for Peace through Justice share common principles, centering on the inherent dignity of every person.
For one of our current initiatives, please see my letter to President Obama.