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] would tax capital gains as much as ordinary income for the same reason. Level the playing field. Solow saw most of the truth, but didn’t go far enough. Mill saw more. And even Mill stopped short. All we have to do is look at the charts and tables. Capital accumulation does not exist. Any attempt lowers consumption with no growth to show for it. Keep track of national wealth including human capital by my method here, and also by Petty’s of 1664, 1676 and 1685. What would we think of corporate management that added up only the smaller part of corporate assets? We now consider physical capital only. Political parties debate what taxes and the national debt should be without the key facts. Policy prescriptions can also aim at schools and what they teach. Macroeconomics should start over. It reached most of its present form in the “years of high theory”, in the 1920s through 1950s, without the concepts of human capital or market-valued capital. It is founded on the inaccurate Y = C + I equation and the concomitant belief that output equals pay plus profit. It recognizes ex ante — ex post distinctions only crudely as to saving, by taking it as either invested or uninvested, and not at all as to investment itself. By missing the lag between market effects and book reaction, it misreads some of our worst years as our best and conversely. The path forward is omnibus funds and devolution of commercial banks. Bank reform along the lines I suggested should need no help from lawmakers. But for gosh sakes, let’s not set up barriers against it. Commercial banks and 10:1 leverage make slumps inevitable. Crashes are as sure as death and taxes until we phase them out. Summary Macro has meant a tightrope walk between the risks of inflation and recession. That doesn’t have to be. The problems are detachable. Even today, It should be practical to redefine legal tender as real or inflation-corrected dollars. But the deeper Chapter 8 Banks, Money and Macroeconomics 2/8/16 24 HOUSE_OVERSIGHT_011113