–Why America is losing: Just one cost of austerity Wednesday, Apr 16 2014 

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

Mitchell’s laws:
●The more federal budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor,
which ultimately leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
●The penalty for ignorance is slavery.
●Everything in economics devolves to motive,
and the motive is the gap.
======================================================================================================================================================================================

Please go to, and read, the following article. (Here are just a few excerpts):

Grads Remake China Workforce as High-End Threat to U.S.
By David J. Lynch Apr 15, 2014

Close to 7 million Chinese this year will graduate college, up from 1.1 million in 2001. By 2020, China’s college-educated talent pool is expected to number 195 million people — more than the entire U.S. labor force that year.

“We’re going to have to compete with Chinese banks and Chinese insurance companies and Chinese software companies,” said William Overholt, president of the Fung Global Institute in Hong Kong. “We’re not used to thinking of China as a powerhouse in these areas.”

That change is already happening. More than half of China’s $4.2 trillion in trade last year involved significant value added by Chinese workers, while lower-value processing trade fell below one-third of the total, down from almost 39 percent in 2010, according to the Chinese Ministry of Commerce.

Dan Breznitz, co-author of “Run of the Red Queen: Government, Innovation, Globalization and Economic Growth in China,” says China soon will have a surplus of college graduates to devote to research on fields the West is neglecting, such as power grid improvements, and to innovate in the way many goods are produced.

“It’s not necessarily competing head to head,” Breznitz said. “They’re going to outflank us.”

If they do, it will be partly thanks to what globalized Chinese have learned at American universities. China sends roughly 200,000 university students to the U.S. each year, 10 times the number of Americans who study in China.

Then, re-read this article:

Five reasons why we should eliminate school loans

It’s all part of Steps #4 and #5 in the “Nine Steps to Prosperity.”

Rodger Malcolm Mitchell
Monetary Sovereignty

====================================================================================================================================================
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)
9. Federal ownership of all banks (Click here)

—–

10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
Two key equations in economics:
1. Federal Deficits – Net Imports = Net Private Savings
2. Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

THE RECESSION CLOCK
Monetary Sovereignty Monetary Sovereignty

Vertical gray bars mark recessions.

As the federal deficit growth lines drop, we approach recession, which will be cured only when the lines rise. Federal deficit growth is absolutely, positively necessary for economic growth. Period.

#MONETARY SOVEREIGNTY

Bloomberg in dreamland: Our wonderful, declining deficit. It’s all so simple. Monday, Apr 14 2014 

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

Mitchell’s laws:
●The more federal budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor,
which ultimately leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
●The penalty for ignorance is slavery.
●Everything in economics devolves to motive,
and the motive is the gap.
======================================================================================================================================================================================
According to Bloomberg’s Ian Katz, things are looking great:

Obama’s Shrinking Budget Deficits Silence Foreign Fiscal Critics
By Ian Katz Apr 13, 2014

The Congressional Budget Office is projecting the 2014 deficit will be the lowest in six years and down more than 60 percent from the record $1.4 trillion in 2009. With the annual April 15 tax filing deadline looming, the U.S. has received about $80 billion more in income taxes this fiscal year than it had 12 months earlier.

Translation: Whoopie! That’s an additional $80 billion removed from the economy.

The Treasury’s coffers are swelling as the almost five-year economic expansion gains momentum, generating more corporate and personal income-tax revenue and reducing spending on social services. Stronger growth, in turn, will depend less on government spending to fuel growth than it has in the past.

Translation: Never mind that the U.S. Treasury has no “coffers.” (We all should write to Bloomberg’s Mr. Katz, and ask him, “Exactly how much money is in the Treasury’s ‘coffers’?”)

GDP = Federal Spending + Non-federal Spending – Net Imports. With “more corporate and personal income-tax revenue and reducing spending on social services,” where will the dollars come from the grow the economy? Don’t ask.

Corporate tax revenue may climb further as accelerating growth and declining unemployment boost sales and earnings.

Translation: More dollars will be pulled out of the economy.

(Last October) IMF Managing Director Christine Lagarde warned that failure to lift the (U.S.) debt limit risked triggering a global recession. The administration of Barack Obama and Republicans in Congress eventually agreed to end the 16-day shutdown and suspended the $16.7 trillion limit.

Translation: Er, uh, see it’s like this: Debt and deficits are bad and should be reduced. But failure to allow for more deficits and debt risks “triggering a global recession.” Perfectly illogical.

Now, Michael Darda, chief economist at MKM Partners LLC in Stamford, Connecticut, estimates the U.S. deficit fell to 2.9 percent of gross domestic product in the first quarter from a peak of more than 10 percent in 2009.

Among the reasons, he said in an April 11 note: “a sustained, albeit moderate, economic recovery” and the 2013 automatic spending cuts and tax increases known as sequestration.

Translation: As everyone knows, spending cuts and tax increases grow the economy. If we could cut spending to $0, and increase taxes to 100%, that would grow the economy even faster.

The deficit will shrink to $514 billion this year from $680 billion in 2013, according to the CBO, After that, the deficit will start rising every year, reaching $1 trillion by 2022.

The increase will be driven by “dramatically” rising Medicare and Social Security payments needed to care for an aging society, said Jersey of Credit Suisse.

Translation: To keep filling the non-existent Treasury “coffers,” Medicare and Social Security benefits will need to be reduced — and reduced, and reduced — until those non-existent “coffers” are full. But, of course, since there are no “coffers,” and so we can’t know how much is in them, we never can know how much money needs to flow from the private sector to the Treasury.

The only solution is to keep cutting the private money supply until there is none left.

For now, a slower pace of decline in the budget deficit will provide a tonic for the economy because fiscal “drag” — the contractionary effect of reduced fiscal stimulus — is abating, says Lou Crandall, chief economist at Wrightson ICAP LLC in Jersey City, New Jersey.

“If the projected declines over the next couple of years were larger as a percentage of GDP, they would be giving rise to more fears about fiscal drag,” he said.

Translation: Its good that the deficit, which we are glad to see decline, will decline less, because the decline causes fiscal drag. In short, we want “fiscal drag” (to fill the Treasury’s “coffers”), but we are glad there will be less fiscal drag.

Simple, huh?

(Treasury Secretary Jacob J.) Lew, in his April 11 statement, said the U.S. expansion “is expected to strengthen further this year as private-sector demand increases, the fiscal drag lessens, and household balance sheets and the housing market continue to improve.”

Translation: It’s kind of like magic. We cut deficits, which puts fewer dollars into the economy. Having fewer dollars causes the private sector to spend more. This makes fiscal drag lessen and the housing market improve.

If we did the opposite, that is, add more dollars to the economy, the private sector would spend less.

It’s all so simple, really. Ask the writer, Mr. Katz.

Rodger Malcolm Mitchell
Monetary Sovereignty

====================================================================================================================================================
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)
9. Federal ownership of all banks (Click here)

—–

10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
Two key equations in economics:
1. Federal Deficits – Net Imports = Net Private Savings
2. Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

THE RECESSION CLOCK
Monetary Sovereignty Monetary Sovereignty

Vertical gray bars mark recessions.

As the federal deficit growth lines drop, we approach recession, which will be cured only when the lines rise. Federal deficit growth is absolutely, positively necessary for economic growth. Period.

#MONETARY SOVEREIGNTY

–Note to those economists who refuse to tell the truth Thursday, Apr 10 2014 

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

Mitchell’s laws:
●The more federal budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor,
which ultimately leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
●The penalty for ignorance is slavery.
●Everything in economics devolves to motive,
and the motive is the gap.
======================================================================================================================================================================================

This is a note to all economists, even to those who do tell the truth about the economy, but not about the politics of the economy.

I mean you Bill, Matthew, Stephanie and Randy of UMKC. I mean you, Warren, founder of MMT. I mean you, James at UT — all of you who are well aware the politicians are lying, but who refuse to say outright that they have been bribed to lie.

OpEd News
Retiring Obama Administration Prosecutor Says the SEC Is Corrupt; Prior Reports Indicate Administration’s Corruption

Bloomberg News reported, on April 8th, that a Securities and Exchange Commission prosecuting attorney, James Kidney, said at his recent retirement party on March 27th, that his prosecutions of Goldman Sachs and other mega-banks had been squelched by top people at the agency, because they “were more focused on getting high-paying jobs after their government service than on bringing difficult cases.”

As we have been saying for months and months, the politicians have been bribed by campaign contributions and promises of lucrative employment, later. Perhaps I missed it, but to date, I’ve not seen those words come out of UMKC, UT or MMT.

President Obama personally led in this lying. (He) . . . said: “This bill nearly doubles the FBI’s mortgage and financial fraud program, allowing it to better target fraud in hard-hit areas. That’s why it provides the resources necessary for other law enforcement and federal agencies, from the Department of Justice to the SEC to the Secret Service, to pursue these criminals, bring them to justice, and protect hardworking Americans affected most by these crimes.

“It’s also why it expands DOJ’s authority to prosecute fraud that takes place in many of the private institutions not covered under current federal bank fraud criminal statutes — institutions where more than half of all subprime mortgages came from as recently as four years ago.

“I’m asking my Attorney General to create a special unit of federal prosecutors and leading state attorneys general to expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis.

“This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans.”

That’s what Obama said. This is what he did:

Two years later, the Inspector General of the U.S. Department of Justice issued on 13 March 2014 its “Audit of the Department of Justice’s Efforts to Address Mortgage Fraud,” and reported that Obama’s promises to prosecute turned out to be just a lie. DOJ didn’t even try; and they lied even about their efforts.

On 27 March 2009, Obama assembled the top executives of the bailed-out financial firms in a secret meeting at the White House and he assured them that he would cover their backs; he promised My administration is the only thing between you and the pitchforks.

So, Bill, Matthew, Stephanie, Randy, Warren, James et al — you who speak out about the need for deficits and lies about “debt,” — why have you been so reluctant to tell America the reason WHY the politicians lie?

“It is not enough in a situation of trust in the commonwealth, that a man means well to his country; it is not enough that in his single person he never did an evil act, but always voted according to his conscience, and even harangued against every design which he apprehended to be prejudicial to the interests of his country.

“This innoxious and ineffectual character, that seems formed upon a plan of apology and disculpation, falls miserably short of the mark of public duty. That duty demands and requires that what is right should not only be made known, but made prevalent; that what is evil should not only be detected, but defeated.

“When the public man omits to put himself in a situation of doing his duty with effect it is an omission that frustrates the purposes of his trust almost as much as if he had formally betrayed it. It is surely no very rational account of a man’s life, that he has always acted right but has taken special care to act in such a manner that his endeavours could not possibly be productive of any consequence.”

Edmund Burke

Why do you MMTers seem to attribute the lies to ignorance rather than to corruption and bribery? It isn’t ignorance. It’s fraud, and you know it. And by not saying it, you participate in the fraud.

If you witness a crime, but excuse it as ignorance, you are culpable.

Everything in economics devolves to motive. What’s yours?

Rodger Malcolm Mitchell
Monetary Sovereignty

====================================================================================================================================================
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)
9. Federal ownership of all banks (Click here)

—–

10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
Two key equations in economics:
1. Federal Deficits – Net Imports = Net Private Savings
2. Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

THE RECESSION CLOCK
Monetary Sovereignty Monetary Sovereignty

As the federal deficit growth lines drop, we approach recession, which will be cured only when the lines rise. Federal deficit growth is absolutely, positively necessary for economic growth. Period.

#MONETARY SOVEREIGNTY

–Surprise! Every American really does understand the basics of Monetary Sovereignty Tuesday, Apr 8 2014 

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

Mitchell’s laws:
●The more federal budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor,
which ultimately leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
●The penalty for ignorance is slavery.
●Everything in economics devolves to motive,
and the motive is the gap.
======================================================================================================================================================================================

Among the groups of people who cannot be taught, there are those who know the facts but do not want to acknowledge the facts

That is why it is impossible to teach Monetary Sovereignty to mainstream economists, the media and politicians. They know the facts but have been paid not to acknowledge the facts.

So, we have been left with trying to educate the public, the only people in America who seemingly don’t know the facts. Or do they?

How do we teach people that the government never can run short of money, the federal debt is meaningless and that the federal deficit is necessary for economic growth? Perhaps an new analogy?
Until recently, I’ve been a shareholder in Google. A couple weeks ago, Google had a stock split. Those who owned Google stock received one additional share for every share they owned. At the press of a computer key, Google doubled the number of Google shares in the world.

And that gave me a thought.

Have you ever bought one or more shares of stock? If so, what does one share look like? What do 100 shares look like? How much do they weigh? How do they feel? How do they smell and taste?

Actually, you never have seen a share of stock. No, it doesn’t look like this:
monetary sovereignty

This is just a certificate saying you own a share of stock. This piece of paper was pre-printed by the thousands. Until it was issued, that is, until a secretary typed in a name a number to show how many shares it represented, it had no value.

Very few shareholders possess even one of these certificates. I personally have been trading stocks for more than 60 years and so far as I recall, I have seen but a half dozen of these certificates.

If you’ve been reading about High Frequency Trading (HFT) lately, you know that computers make millions of trades each second, and no one ever sees a stock certificate.

The shares themselves are just numbers in accounting balance sheets. They have no physical existence. No one can see, hear, taste, feel or smell shares of stock.

Google, the issuer of the above pictured certificate, never can run short of shares. It is sovereign over Google shares. It can create as many shares as it wishes. If Google wished, it could offer a 10-for-one stock split or a million-for-one.

Having the unlimited ability to create Google shares, Google never needs to borrow shares, and if it issues more Google shares than it receives (i.e runs a deficit in Google shares), that’s just normal. That stock split I mentioned was Google running a deficit in its shares.

Not only do you know all the above, but virtually everyone knows all the above. So, I find it surprising that we find it difficult to think of money as an invisible concept rather than as a physical thing.

Google is sovereign over Google stock; Google can create infinite amounts at will, never needs to borrow any, and can run a “deficit” (issues more than it takes in) in Google stock forever. If Google has a debt denominated in Google stock (i.e. owes stock), there is no burden on Google. It could issue a trillion shares tomorrow, at the touch of a computer key.

So too does the federal government have the ability to create infinite amounts of dollars, just as Google can issue infinite numbers of shares. The federal government never needs to borrow dollars, and can run deficits in dollars forever.

Google is “God” of Google stock; the federal government is “God” of the dollar.

And just as a stock certificate is not a share of stock, neither is a dollar bill a dollar.

monetary sovereignty
THIS ISN’T A DOLLAR. IT’S A CERTIFICATE SHOWING THE BEARER OWNS A DOLLAR

In summary, America understands the basic concepts of Monetary Sovereignty — that the government has the unlimited ability to create dollars, so never needs to borrow dollars, never relies upon or uses taxes, and easily can pay any debts denominated in dollars.

All the concerns about federal deficits and debts are as silly as worrying about whether Google will run short of shares of its own stock.

Americans know this. They just don’t know they know it.

Rodger Malcolm Mitchell
Monetary Sovereignty

====================================================================================================================================================
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)
9. Federal ownership of all banks (Click here)

—–

10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
Two key equations in economics:
1. Federal Deficits – Net Imports = Net Private Savings
2. Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

THE RECESSION CLOCK
Monetary Sovereignty Monetary Sovereignty

As the federal deficit growth lines drop, we approach recession, which will be cured only when the lines rise. Federal deficit growth is absolutely, positively necessary for economic growth. Period.

#MONETARY SOVEREIGNTY

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