●The more budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity starves the economy to feed the government
●Austerity 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.
Which is worse: No plan or a disastrous plan? With the Romney/Ryan team, you get both, and both have the same goal: To increase the income gap between the upper 1% and the lower 99% by starving the economy.
Mitt Romney (the indecisive) has become notorious for changing directions. He has stood firmly on both sides of nearly every important issue. Depending on his audience, he has been:
For and against raising the minimum wage
For and against stem cell research
For and against women’s choice
For and against health care mandates
For and against Romneycare
For and against Ronald Reagan (really!)
For and against (and for, again) a pathway to citizenship for immigrants
For and against Bush’s tax cuts
For and against a ban on assault rifles
A believer and non-believer in the dangers of global warming
A signer and non-signer of the Americans for Tax Reform pledge
In all cases where his decision would affect the economy, he has turned toward the 1% and against the 99%.
Now that we have a Presidential candidate with no plan, we have a vice presidential candidate with his disastrous “starve-the-economy-to-feed-the-government” plan, a frightening attempt to lift the 1% at the expense of the 99%, i.e to increase the gap.
Here is Paul Ryan, in his own words:
The Path to Prosperity:
A Blueprint for American Renewal, House Budget Committee – Fiscal Year 2013 Budget Resolution
To pay for the public sector’s growth, Washington must immediately tax the private sector or else borrow and impose taxes later to pay down the debt. Unfortunately, the President refuses to take responsibility for avoiding the debt-fueled crisis before us
Translation: “I want you to believe the federal budget is like your personal budget, though the federal government is the creator of the dollar and you are the user of the dollar.
“I do not want you to understand that the misnamed federal ‘deficit’ actually is our economy’s source of personal income, and without this income, there could be no dollars to spend or to lend. We would be a nation without money.
“In short, I certainly don’t want you to understand Monetary Sovereignty, and why reducing that misnamed ‘deficit’ will starve the economy.”
Our budget: Cuts government spending to protect hardworking taxpayers;
Strengthens health and retirement security by taking power away from government bureaucrats and empowering patients instead with control over their own care.
Translation: “I will ‘empower’ you to pay more out of your own shallow pocket to fund your health care, so the federal government can pay less out of it’s deep pocket.”
At its core, this plan of action is about putting an end to empty promises from a bankrupt government,
Translation: “Yes I know it is impossible for a government that creates dollars to go bankrupt. It never has nor ever will bounce a check. But I don’t want you to know that, so I use scare language.”
(My budget) cuts spending by $5 trillion relative to the President’s budget
Translation: “My budget cuts private savings by $5 trillion relative to the President’s budget.” (Basic economic equation: Federal Deficits – Net Imports = Net Private Savings)
For years, bad policies advanced by both political parties have contributed to an irresponsible build–up of debt in the economy, and this debt now poses a fundamental challenge to the American way of life. This build–up of debt has manifested its effects in both the private and public sectors. In 2008, excessive leverage in the financial sector overwhelmed many banks, businesses and families.
Translation: “I want you to confuse you. That’s why I talk about banks, businesses and families, when I really am referring to the so-called ‘federal debt,’ which is not at all like personal debt.
I hope you never discover that ‘federal debt’ is just the total amount invested in Treasury securities, and has nothing whatsoever to do with your taxes or with the government’s ability to pay its bills. The word ‘debt’ has two different meanings, but you should ignore that.”
In Europe, the accumulation of public–sector debt now threatens to cause an even bigger calamity than the one caused by private– sector debt in 2008. The world’s new “toxic asset” is the sovereign debt of irresponsible European governments, infecting the balance sheets of major banks and threatening the stability of the global economy.
Translation: “Nations like Greece, France, Italy, Ireland, Spain and Portual have huge sovereign debts, but here’s something I hope you don’t find out. They use the euro, which is not their sovereign currency, so they can’t pay their debts. The U.S. uses the dollar, which is our sovereign currency, so we can pay any size debt.”
Total federal debt has now surpassed the size of the entire U.S. economy.
Translation: “Another little lie I hope you don’t discover – well actually two little lies:
“1. ‘Total federal debt’ includes dollars the government owes to itself. It’s like your checking account owing money to your savings account. But I use Total debt to scare you, because it’s a bigger number, and
“2. Actually, this has happened in the past – 1967 – with no effect on the economy. The reason: Federal debt is just dollars invested in things like T-bills, which has no relationship to the economy. It’s like comparing dollars invested in Walmart stock with Gross Domestic Product – completely meaningless – but I’ve fooled you by misusing the word ‘debt,’ haven’t I?”
The blue line is Gross Domestic Product. The red line is TOTAL “debt” (i.e. investment in Treasury securities, including investments by the government itself). The green line is investments in T-securities by those not in the government.
Republicans offered a budget last year that would lift the crushing burden of debt and restore economic growth
Translation: “We’ll reduce investment in T-securities by starving the economy. The misnamed ‘debt’ (investment in T-securities) is no burden at all, ‘crushing’ or otherwise, but we use flamboyant language to scare you into giving up your money.”
Too great a percentage of America’s vast natural resources remain locked behind bureaucratic barriers and red tape. This budget lifts moratoriums on safe, responsible energy exploration in the United States, ends Washington policies that drive up gas prices, and unlocks American energy production to help lower costs, create jobs and reduce dependence on foreign oil.
Translation: “To hell with the ecology. To hell with our forests, clean water, clean air and the hundreds of species that are going extinct. Let’s dig those open-pit mines and chop down those trees and pollute. And ‘drill baby, drill.’ It’s what the 1% wants.”
(My budget) strengthens Medicaid, food stamps and job–training programs by providing states with greater flexibility to help recipients build self–sufficient futures for themselves and their families. This budget ends that misguided approach and instead converts the federal share of Medicaid spending into a block grant, thus freeing states to tailor their Medicaid programs to the unique needs of their own populations.
Translation: “The federal government, which has the unlimited ability to pay its bills, will shift the financial burden to the states, which already are going broke. This is what I mean by ‘flexibility’ and ‘freeing states.’”
Medicare is facing an unprecedented fiscal challenge. Its failed reliance on bureaucratic price controls, combined with rising health care costs, is jeopardizing seniors’ access to critical care and threatening to bankrupt the system – and ultimately the nation.
The risk to Social Security, driven by demographic changes, is nearer at hand than most acknowledge. This budget heads off a crisis by calling on the President and both chambers of Congress to ensure the solvency of this critical program.
Translation: You don’t know this, but Medicare and Social Security are federal agencies. Like all other federal agencies — Congress, the White House, the Supreme Court, the military et al –- Medicare and Social Security never can be insolvent unless the government wills it.
“Even if FICA taxes dropped to $0, and benefits tripled, Medicare and Social Security still could continue paying their bills, forever. But because Medicare, Medicaid and Social Security benefit the 99% more than the 1%, these plans need to be cut. How else can we increase the income gap?”
Individual tax reform: The current code for individuals is too complicated, with high marginal rates that discourage hard work and entrepreneurship. This budget embraces the widely acknowledged principles of pro–growth tax reform by proposing to consolidate tax brackets and lower tax rates, with just two rates of 10 and 25 percent, while clearing out the burdensome tangle of loopholes that distort economic activity.
Translation: “‘Consolidate tax brackets’ means: ‘Lower the rate paid by the 1% and raise the rate paid by the 99%.’
And let’s eliminate those ‘burdensome’ loopholes like the mortgage interest deduction, the health insurance premium deduction, the charity deduction, the energy savings deduction, tax preparation fees, disaster area deductions, the retirement tax credit — you know, all those ‘too complicated’ things that can lower your taxes.”
This budget charts a sustainable path forward, ultimately erases the budget deficit completely, and begins paying down the national debt.
Translation: “We want taxes to be greater than spending, i.e to starve the economy to feed the government. As the supply of money declines, the 99% will starve, but the 1% will have far more of their wealth in non-money properties. I’m just hoping you’ll vote to be slaves of the 1%.”
Bottom line: Romney, being the Zelig of American politics, does not have the chops to be the President of the United States. But as a danger to America, he does not compare with Ryan, whose plan would destroy the lives of the middle and lower classes.
I believe the nation is in danger. If you are part of, or even care about, the lower 99% income group, you would suffer greatly under a Romney/Ryan authority.
Rodger Malcolm Mitchell
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:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption + Net exports