Join Jim Cramer, Doug Kass, Helene Meisler and other RealMoney pros at TheStreet.com Investment Conference on "Best Ideas to Make Real Money." Save the date: Saturday, May 2! More details here.This blog post originally appeared on RealMoney Silver on March 5 at 8:17 a.m. EST. An important role in public policy is to manage a downturn. But what about the private sector? Does it have, or should it have, a more important role or obligation? In his magnum opus, The General Theory of Employment, Interest and Money, John Maynard Keynes wrote about the " Paradox of Thrift," also called the "Paradox of Savings." Keynes' "Paradox of Thrift" suggests that while saving may be a private virtue, it is a public vice. According to Keynes, when an individual saves, it is a healthy phenomenon, but a community that seeks to increase its rate of saving would end up impoverishing itself and actually saving less, resulting in a catastrophic negative feedback loop and a downward spiral in economic activity.
- Isn't it time for the private sector to adopt a shared responsibility and to think more creatively about the present and future?
- Isn't it time for some large publicly held corporations, with strong balance sheets and good reputations as corporate citizens, to draw a line in the sand?
- Isn't it time for one of these corporations to start a precedent by telling its employees that, despite the weak economic backdrop and continuing economic uncertainty, there will be no more firings and that these corporations are prepared to take a hit for the benefit of the broader society?