How to End the Great Recession.

And, dramatically reduce unemployment, create 4 million high paying jobs, eliminate the retirement savings crisis, solve the student loan bubble, create unprecedented innovation, stoke social security and Medicare, and do actual real good in the world. Sound incredible? It isn’t. Follow along.

I want you to think about 10 people you know who are under or un-employed and write down their names, and under each write down the first three skills that come to your mind, even if they don’t seem like skills (e.g. she’s patient, a nice person, and she treats people with respect). Then, think of the one thing that you have always wanted to do (could be anything, including hiking across the country, baking the best chocolate chip cookies, driving an 18 wheeler across Alaska, inventing 5 new cocktails, writing that book, opening that restaurant with your grandmother’s recipes, anything.).

Now, create 10 jobs for those people whose names you wrote down, and write down what each person’s role would be. Then, figure out how to monetize your dream. Write down the amount of money you think you can make each year starting with year one, and then do the same for year two and year three. Next, figure out how much money you will have to spend to get that done. If your spending rate is higher than the money you will make, cut the spending until you show a profit. There. Now, you have a business plan.

What? You can’t figure out how to make money hiking across the country? How about a theme? How about interesting cities? How about a camera? How about a diary? Do you think Ken Kesey had a plan? You don’t know who Ken Kesey is? That’s OK. I KNOW you can come up with a way to make money at whatever your dream might be. 

Maybe you think you are not worthy. We all have self-esteem issues. Especially people like Paul Allen, Bill Gates and Larry Ellison. As you probably know unless you are living under a rock somewhere, all three men dropped out of college. None of the three of them invented anything.


All three of them used someone else’s invention to start them on their path. All three of them became dirty, filthy, and ridiculously rich. Doing what? Doing what they loved. Gates played with very rudimentary computers. Computers that would make the Apple I look like a Fujitsu K by today’s standards. Allen loved writing software in BASIC, a language that is dumber than the firmware that connects your keyboard to your PC. Then, after hooking up with Gates and finding IBM in a stupid marketing pinch for its entry into the PC market without an Operating System, bought a product called Quick and Dirty Operating System (QDOS) from a random programmer in Seattle named Tim Paterson, for $50,000, sold licenses to IBM, and the rest is Microsoft. While working as a grunt at Ampex, Ellison ripped off a relational database scheme described in a paper written by Edgar Codd, and used it on a project for a database system for the CIA. That became Oracle. How’s your self-esteem doing now?

So, you have your business plan, and you have your future employees identified, and your self-esteem is a little jacked up. What do you do now?

Before I lay out my plan to End the Great Recession, I should mention that a similar (though tongue-in-cheek) plan was proposed in an article by Sheila Bair, the former head of the FDIC, which she called the “Get Rid of Employment and Education Directive.”  But, not to be confused with hers, my plan is anything BUT tongue-in-cheek and here’s how it goes:

1) The Fed agrees to loan $400 Billion to the “American Future Entrepreneur Growth Fund” (it has no corny acronym, so it might have trouble passing Congress), at an interest rate of .5%, the exact same rate it charged the 6 big banks it lent $9 Trillion to back in December of 2010. This amount by the way, is half of the TARP bailout that saved the biggest investment banks in the world with your tax dollars, back in 2008. Half.

2) The AFEGF is organized like a Venture incubator, and the first thing it does is hire 100,000 really good recruiters who are then tasked with finding the most promising 400,000 entrepreneurs in the US, with fungible business plans. This will take 6 months. The criteria are a track record of entrepreneurship in one form or another, successful or otherwise, a business plan that passes a few tests, and the passion to do something big.

3) Those entrepreneurs are each loaned $1,000,000 and are given a goal of 3 years to turn that loan into positive cash flow. They must immediately hire 10 people from their list and assign them roles. They are each assigned a mentor from the VC community who VOLUNTEER their services to guide these start-ups to success. VCs like Joe Rizzi, Val Vaden, Don Dixon and Vinod Khosla who are all about making really smart investments and guiding them to ridiculous profitability, while looking for ways to make a positive difference in the world.

They will also be assigned community mentors. People like Joy Amulya from Global Family Village, Shawn Ahmed of the Uncultured Project, Beth Kanter and Allison Fine of The Networked Nonprofit, and  Craig Kielburger of Free the Children, to help entrepreneurs focus on global community projects where their energy, capital and spirit can turn their entrepreneurship into real and lasting good.

The entrepreneurs are each assigned a regional incubation lab where they will work out and implement their plan. The incubation lab will be staffed by accountants, sales and marketing leaders, PR, Advertising and communication consultants, lawyers, human resource professionals, and prototype design and manufacturing engineers who will provide the back-office infrastructure for 100 separate entities. The entrepreneurs agree to quarterly board meetings where their mentors review progress and manage their growth track. At anytime along the way, the entrepreneurs can use Crowdfunding to raise additional capital, allowing a whole lot of ordinary people to get a piece of this amazing action, and to potentially create even greater wealth.

4) There will be NO RULES (operationally).

5) At the end of this 3 year period, the Fed will either be re-paid the loans with interest or optionally be able to take an equity stake in the most promising enterprises, equivalent to their loan amount, and over a 10 year period, will recoup all of the money lent to these enterprises as the result of a 1 in 20 success rate (for every 20 start-up who fail, there is one who becomes the next Google, Facebook, Adobe, Apple, Microsoft, etc. These are the odds that the VC have been gambling other people’s money with since the late 1960’s and history says it always works).

That’s it.

If these 400,000 start-ups fail and succeed at the historic rate of Silicon Valley start-ups, they will create over 5 million jobs. They will re-pay all of the debt several-fold to the Fed and they will have solved at least 5 significant world problems. Along the way, their employees will have fully funded Social Security and Medicare for the next hundred years and created more wealth and innovation than the world has ever seen. Including a sustainable, endless and ultra-cheap alternate energy source. Trust me. I’ve done the math.

After Gates sold QDOS to IBM, Big-blue hired Microsoft (13 random guys and girls) to build their next release operating system, OS/2 for their cool new PC. Gates, by this time, was smart enough not to transfer the copyrights for QDOS or the new OS/2 to IBM, believing that there would be other hardware manufacturers of the new PC in the immediate future. Then, due to design differences, the IBM/Microsoft partnership broke down allowing Microsoft to go off and become, well … Microsoft.

You can argue with and debate my plan, and I agree it has holes, and there are always tons of devils lurking in the details, but there are always holes and devils in every plan, and there is also the undisputed history of the Silicon Valley and Microsoft and Apple and Google, and the unfettered tenacity and passion of the American people. And, you can’t argue with that.


About Steve King

iPeopleFINANCE™ Chief Operating Officer. Former CEO of Endymion Systems, Inc. a $36m Information Systems Services company. Co-founder of the Cambridge Systems Group, the creator of ACF2, the leading IBM Mainframe Data Center Security product; acquired by Computer Associates. IBM, seeCommerce, marchFIRST, Connectandsell alumni. UC Berkeley alumni. View all posts by Steve King

4 responses to “How to End the Great Recession.

  • Chris Neighbors

    Great post. I like your exercise at the beginning. I’m a firm believer that we wouldn’t be in a recession if people made a career out of what they loved to do. So many people (myself included) work for the money, but aren’t satisfied with their careers. We’re scared of the unknown so we stay put. Security becomes more important than fulfillment. It’s unfortunate but it happens all the time.

  • SteadyCheddar

    I think the first step to improvement is to educate people. Learning to put a condom onto a bannana is great but there should also be a 3 month course about personal finances. It should be mandatory to educate kids on credit cards, debt, savings, etc. I think the US would be in better shape if people understood debt and loans better.

  • Tim S Handley

    The next big idea… Great post Steve. I would rather my tax dollars flow to a plan like this than F22’s. And the number is roughly half our defense spending for… One year.

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