●The more budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity starves the economy to feed the government, and 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.
As everyone knows, the best way to treat a victim of anemia is to drain their blood, the only question being, how best to do it. Shall we use leeches? Or is a direct tap into an artery better?
I thought of this when I saw two articles of the same ilk:
CNN MONEY.COM POLL
How would you balance the federal budget?
The headline doesn’t ask, “Should the federal budget be balanced?” No, it assumes everyone knows it should be balanced, and only wants to know how.
Balancing the federal budget means federal taxes would equal federal spending, so the government would add $0 net dollars to the economy. Combine that with our $50 billion negative trade balance, and a balanced budget would cause the economy to lose $50 billion every year.
Imagine that your own personal expenses equaled your salary, with nothing left over (balanced budget), but in addition you had to pay thousands every year to support your parents. How would your personal “economy” look?
The notion of a federally balanced budget not only is wrong; it’s downright stupid. But stupid is as stupid says, and here are the answers given:
15% of the respondents said to Cut Medicare
29% of the respondents said to Raise Taxes
13% of the respondents said to Cut Social Security
43% of the respondents said to Cut Defense Spending.
In total, 57% of the respondents wanted the government to remove dollars from their pockets, to help crash the economy. As for the other 43%, apparently they aren’t among the millions of people who work for defense-related industries, or for vendors to those people, and who would see their paychecks disappear if defense spending were cut.
In short, 100% of the respondents have been fooled by the 1% into believing the federal deficit and debt are too large. The poll names sample members of the 99% who would vote against their own best interests:
Josh Smith, 35, IT manager, New York City said: “Cut defense. We have the world’s largest budget.”
Shola Asenuga, 44, Physical therapist, Hampton, VA said: “Taxes should be raised across the board.”
Russ Homsy, 38, Attorney, Boston said: Cut Social Secuirity. The system is broken, anyway.”
This is the belief of America: Cut military spending because we spend the most. Raise my taxes and reduce Social Security. Yikes!
I can’t blame these people too much. They have been fed this nonsense by the media and the politicians, all owned by the 1%. But gosh, how difficult is this to figure out.
For instance, the article says:
$125 billion: Projected savings by 2021 if the Medicare eligibility age were raised from 65 to 67, today.
$208 billion: Added to revenue by 2016, if the tax rates on ordinary income were raised by one percentage point.
$125 billion “saved” for whom? America, the government would take $125 billion out of your pockets. $208 billion “added” for whom? America, the government would take $208 billion out of your pockets. This is what you want?? Really?
But there’s more: Consider the article in the June 18th Newsweek (“Middle Class, R.I.P”), by Paul Begala, excerpts of which are:
A recent report from the Federal Reserve documents the collapse of the middle class. Between 2007 and 2010 median wealth dropped a staggering 40 percent. As ever, the rich did fine, actually seeing their wealth increase as everyone else’s disappeared.
Today we again face a debt crisis. But where are the blue-ribbon commissions on the decline of the middle class? Our president rightly describes this era as “a make-or-break moment for the middle class,” but across America governors and mayors are forced to lay off teachers, cops, and firefighters—the kinds of people who serve, protect, and educate the middle class, and who can help poor people lift themselves up into the middle class, and members of the middle class lift themselves into prosperity.
Of course we have to cut spending. And, obviously, we need more tax revenue. But we have to do it in a way that protects the promise of opportunity for all. The key to paying off our crushing debt, ultimately, is economic growth. And the key to growth is an expanding middle class.
Have you ever read such nonsense? What is “crushing” about the debt? The federal government, being Monetarily Sovereign, has the unlimited ability to pay any debt of any size. Has anyone heard of any federal checks bouncing?
Sure the state, county and city governments are being crushed by debt. They’re not Monetarily Sovereign. They don’t have the federal government’s unlimited ability to create dollars. Mr. Begala doesn’t understand the difference (or pretends not to) — and he writes about economics for a large medium!
Mr. Begala claims to love the middle class, so what does he want to do? He wants to cut federal spending, the vast majority of which benefits the middle class, and he wants to increase taxes, thereby removing dollars from the economy. And this is supposed to benefit the middle class?
But the worst part of all is the casual assumptions we see in all our media and hear from our politicians: “Of course”. . . we have to cut spending. “Obviously” . . . we need more tax revenue. It’s so “obvious,” there’s no need for thought or debate.
And that is what the minions of the 1% rely on — the reluctance of people actually to think. How much easier just to float along, believing the pap you’re being fed, than to think to yourself, “Hmmm . . . The federal government can’t run out of dollars. It creates the dollars — as many as it wishes. I don’t create dollars and I can run short of dollars. So why is the federal government asking me for more money?“
Josh, Shola and Russ, the 1% has sold you and your fellow Americans a bridge to Brooklyn. Too bad you’ll have to pay the price, while the 1% laughs at you, as you grow poorer and they grow richer.
If you ever become anemic, and a quack doctor wants to remove your blood, I guess you’ll agree to that, too.
Rodger Malcolm Mitchell
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Medicare — parts A, B & D — for everyone
3. Send every American citizen an annual check for $5,000 or give every state $5,000 per capita (Click here)
4. Long-term nursing care for everyone
5. Free education (including post-grad) for everyone
6. Salary for attending school (Click here)
7. Eliminate corporate taxes
8. Increase the standard income tax deduction annually
9. Increase federal spending on the myriad initiatives that benefit America
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 Imports