Mr. Donald Trump
c/o the Trump Tower
721 Fifth Ave.
New York, NY 10022

Dear Donald:

I’ve been searching for someone who can kick start the economy by first kicking a few plump rear ends in Washington. And—ouila!—there you are. Come to think of it, you may be the only person who can do both.

By way of introduction, I am also a sharp cookie (actually I’m very sharp), so here is something you will never hear from any other source. It has to do with a concept that is incredibly simple; it costs almost nothing to implement; yet it is so powerful in its consequences it surpasses in magnitude the good that it can do beyond that of the 10 best ideas you have ever heard before, or are likely to encounter in the future. And it is all free. Before I proceed, I can back up every word I have written up to this point—trust me! If you were to pay me just 10 percent of the value of the benefits that can flow from it over the next 4 to 8 years, that commission alone would be in the trillions of dollars. But I repeat—my contribution is free.

You, on the other hand, are the master of the Art of the Deal—or so I hear. So, I propose that you cut a big one with the bankers and the CEOs of America. American businesses have $2.7 trillion in overseas locations. Convince them to do what Apple has already offered to do: Pay a one-time tax on the money of 8 percent and bring it home. But it all must come home in the next 2 years. In return you will lower the corporate tax rate to 15 percent. And, if I recall correctly, that is exactly what you proposed as a candidate for the presidency. So far, so good…right?

But here is the negotiation part: No CEO gets the option to do whatever they want with that money. Oh no. For example, they cannot acquire or merge with any other company, or buy back some of their own outstanding stock with that money. That would just add more and more into their own wealth accounts. But your job is to be the president of all the people, and that means you are now accountable to them, and you need to help them—as promised.

That money needs to get into circulation. All they have to do is spend it. Technically, money in circulation is called M1. And all economists know that M1 times its turnover rate is equal to GDP. And that means that $2.7 trillion times 6 = $16.2 trillion in new GDP. But even the best deal maker of all time could not achieve anything quite that bold. Still, if you managed to get $1.67 trillion of that money into circulation, that would amount to $10 trillion in new GDP ($1.67 trillion times 6 = $10 trillion). And that comes to 2.5 percent GDP growth per year above the projected growth rate for a new total of 5 percent per year over each of the next 4 years. You would be hailed as the greatest deal maker of all time—by the world.

You would also need to bring the Fed and the Treasury on board with your plan. With a little arm twisting (and oversight by Elizabeth Warren—the toughest fighter in Washington), everyone could monitor M1 data to make certain that $1.67 trillion got into circulation. Now here are the benefits:

$10 trillion in new GDP = $8.5 trillion in new personal incomes. Businesses would be awash in cash, enough to hire an additional 48 million workers at $50,000 each. That number of new hires is possible but improbable, still, workers at all levels would be in the position to bargain for higher wages—and they would get it. The inequality gaps (both incomes and wealth) would fall, the need for government assistance programs would fall, crime rates would fall, poverty would fall, and all the social ills associated with poverty would fall. You could argue that the art of the deal and free enterprise made it all happen. And by the way, that would be the truth. But you would have to convince bankers and CEOs that they would also be a lot better off with $10 trillion in new GDP, with higher profits and new opportunities than with trying to grab the $2.7 trillion repatriated dollars and take it themselves. It would create $3.8 trillion in new tax revenues (local, state, and national); new revenues to the Treasury would be $1.6 trillion. You could reduce the public debt with $600 billion of it, and use the other $1 trillion for infrastructure rebuilding.

In a nutshell, Donald, you could fulfill a big chunk of your campaign promises, and all it would require from you is to do what you are best at doing—making a deal, only this time with the Fed, the Treasury, and the CEOs of America. In fact, to the counter argument that such a large infusion of cash into the economy would be inflationary, tell the Fed that is why they exist—to see that inflation stays under control. Besides, the top Fed officials need something to do other than to debate about a 0.25 percent short interest rate hike for another two years—that they seem destined to continue doing until they all retire.

I have other ideas, but that's enough for now.

Sincerely,

Ed Phillips