–Message from the rich: The U.S. Treasury is running short of dollars Monday, Aug 31 2015 

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

Mitchell’s laws:
•Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
•Any monetarily NON-sovereign government — be it city, county, state or nation — that runs an ongoing trade deficit, eventually will run out of money.
•The more federal budgets are cut and taxes increased, the weaker an economy becomes. .
Liberals think the purpose of government is to protect the poor and powerless from the rich and powerful. Conservatives think the purpose of government is to protect the rich and powerful from the poor and powerless.
•The single most important problem in economics is
the Gap between rich and poor.
•Austerity is the government’s method for widening
the Gap between rich and poor.
•Until the 99% understand the need for federal deficits, the upper 1% will rule.
•Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

===================================================================================================================================================================================================================================================================================

Here are a few shameless quotes from this month’s Congressional Budget Office bulletin, as written by America’s richest.

As of March 15 (2015), the Treasury has (had) no room to borrow.

The debt limit—commonly referred to as the debt ceiling—is the maximum amount of debt that the Department of the Treasury can issue to the public and to other federal agencies.

That amount is set by law and has been increased over the years in order to finance the government’s operations.

The statement is mathematically illogical and factually wrong. Those of you who already understand Monetary Sovereignty are aware the federal debt does not, and cannot, finance the government’s operations.

First the mathematics. Federal debt is the total of T-securities — securities bought by non-government entities and by government agencies. The “debt” is nothing more than bank deposits in T-security accounts at the Federal Reserve Bank.

From where do these buyers obtain the dollars with which to buy T-securities and make these bank deposits?

All dollars come from two sources: Federal deficit spending and bank lending.

But where do the banks obtain the dollars to lend? Yes, they create most, but they must begin with “reserves.” These reserves come from the public in the form of deposits, and from the Federal Reserve Bank.

From where does the public obtain dollars to make deposits?

Bottom line: The initial source of all dollars is the Federal government. It is the federal government that, back in the 1770’s, created the first dollars from thin air. And it is the federal government that continues to create dollars from thin air, simply by paying bills.

Were it not for federal deficit spending, U.S. dollars could not exist.

The government is able to deficit spend endlessly because it is Monetarily Sovereign, i.e. sovereign over its own currency, the U.S. dollar. Being sovereign, the government can do anything it wishes with dollars.

It can create dollars endlessly (via deficit spending). It can destroy dollars (via taxing). It can change the value of dollars (via interest rate control).

Being Monetarily Sovereign, the federal government never needs to ask anyone for dollars — not you, not me, not China.

Contrary to the CBO’s implications, the U.S. Treasury never can run short of dollars unless Congress wills it.

Although dollar bills technically are not in themselves dollars (They are titles to dollars, much like car titles and house titles), the federal government can print all the dollar bills is wishes.

Being Monetarily Sovereign, the federal government makes the rules. If it wished, the federal government could print a trillion, trillion $100 bills and distribute them tomorrow. These bills would be legal tender for all debts. In short, you could use them the same way you use the dollars in your wallet.

Yes, that could cause an inflation, and yes, that is not how dollars are created. But the point is, the federal government cannot run short of its own sovereign currency — unless Congress and the President want that to happen.

The fact that Congress is able to increase the debt ceiling every year is proof there is no limit to the government’s ability to create dollars.

If the federal government did not create dollars, there would be no dollars for banks to lend and there would be no dollars with which to purchase T-securities (aka federal “debt”).

How does the federal government create dollars by paying bills?

To pay a bill, the government sends checks and wires to the creditors’ banks. These checks and wires are not money; they are instructions, telling the banks to increase the balances in the creditors’ checking accounts.

The instant the banks obey those instructions, and credit the accounts, dollars are created. The money supply (M1 and M2) increases. The Treasury creates dollars by sending instructions to banks.

The Congressional Budget Office projects that if the debt limit remains unchanged, the Treasury will run out of cash between mid-November and early December.

This sentence more properly should read, “If Congress prevents the Treasury from creating dollars, the Treasury will run out of cash between mid-November and early December.

On March 16, the debt limit was reset to $18.113 trillion to match the amount of outstanding debt.

Translation: Congress decided it doesn’t want the Treasury to create any more money. The point is not that the Treasury is unable to create all the money it wishes. The point is simply that Congress, at the behest of rich donors, doesn’t want the Treasury to create money to pay for benefits to the middle class and the poor (the “99%”).

This is not a financial decision. It is a political decision. Congress essentially is stamping its feet and saying, “I’ll take my ball and go home unless you give me my way.”

The annual battle over the debt ceiling is an extortion game, in which one party threatens to shut down the government unless certain laws are passed. And these laws may have little to nothing to do with financing.

Whenever you read that certain federal spending is “unaffordable” or “unsustainable,” you are witnessing the Big Lie.

The purpose of the the Big Lie: To fool you into believing certain benefits must be cut — i.e. Social Security, Medicare, Medicaid, poverty aids, education aids, etc.

It is the wealthy political contributors who want your benefits cut.

What Makes Up the Debt Subject to Limit?
Debt subject to the statutory limit consists of two main components: debt held by the public and debt held by government accounts.

Get it? Congress has limited the amount of T-securities it can sell to itself!

Congress includes under the misleading term “debt,” the amount of money the government has “borrowed” from itself. The purpose: To make the “debt” look more ominous.

If your left hand borrowed $100 from your right hand, would you have any difficulty paying the debt? Of course not. But Congress wants you to believe internal debt is some sort of threat or burden.

Of the $18.1 trillion in outstanding debt subject to limit, $13.1 trillion was held by the public and $5.0 trillion was held by government accounts as of July 31, 2015.

So, not only is the misnamed “debt” a phony issue, but the $18.1 trillion debt is a phony figure.

If the debt limit is not increased, the Treasury will not be authorized to issue additional debt that increases the amount outstanding.

That restriction would ultimately lead to delays of payments for government activities, a default on the government’s debt obligations, or both.

By CBO’s estimate, the Treasury would most likely be able to continue borrowing and have sufficient cash to make its usual payments through mid-November or early December without an increase in the debt limit.

Translation: If Congress fails to increase the “debt” ceiling, that is tantamount to Congress voting to cut Social Security and Medicare payments, military salaries, all other federal salaries and all other payments.

The “debt ceiling” is Congress’s method for cutting benefits to the 99%, without leaving any fingerprints.

Your senators and representatives fear being blamed for benefit cuts, so they pretend the government can’t afford these benefits. The “debt ceiling” provides a handy, no-blame excuse.

Why would Congress do that?

Because that is what the rich of America want.

The rich are rich only because of the Gap between them and the rest of us.

If there were no Gap, i.e. if everyone had the same amount of money, no one would be rich. And the wider the Gap, the richer the rich are.

More than money, the rich want relative power. An easy way for the rich to increase their relative power is to decrease the wealth of the 99% — i.e. to take away your money.

So the rich pay Congress (via campaign contributions) to cut Social Security, cut Medicare, cut Medicaid, cut federal payrolls and cut all other federal benefits to the 99%, under the pretense these benefits are “unaffordable” and “unsustainable.”

They call it “fiscal prudence.”

And they call T-securities “debt” rather than more properly “assets of the economy,” (for that is exactly what T-securities are: Assets of the economy.)

The rich know you always want to cut “debt,” but never would want to cut “assets of the economy.”

So it all is a gigantic con game, with the CBO (being an agency ruled by Congress) as a player.

You are supposed to believe that federal “debt,” (even “debt” owed to itself), is imprudent and must be cut, when in fact, cutting the debt takes dollars out of your pocket and leads to recessions and depressions, while it widens the Gap between the rich and you.

And in a great feat of cynicism and irony, the politicians pretend your children and grandchildren will have to pay the debt, when in fact, your children and grandchildren will pay for the lack of federal deficit spending.

Your children and grandchildren will be punished by needless reductions federal deficit spending, all because the rich instruct Congress to tell you the Treasury is running short of its own sovereign currency, the dollar.

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten 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. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (Click here)
9. Federal ownership of all banks (Click here and here)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)

The Ten Steps will add dollars to the economy, stimulate the economy, and narrow the income/wealth/power Gap between the rich and the rest.
——————————————————————————————————————————————

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.
1. A growing economy requires a growing supply of dollars (GDP=Federal Spending + Non-federal Spending + Net Exports)
2. All deficit spending grows the supply of dollars
3. The limit to federal deficit spending is an inflation that cannot be cured with interest rate control.
4. The limit to non-federal deficit spending is the ability to borrow.

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 growth lines rise. Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

#MONETARYSOVEREIGNTY

–Will we follow the Pied Piper of hatred into hell? Sunday, Aug 30 2015 

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

Mitchell’s laws:
•Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
•Any monetarily NON-sovereign government — be it city, county, state or nation — that runs an ongoing trade deficit, eventually will run out of money.
•The more federal budgets are cut and taxes increased, the weaker an economy becomes. .
Liberals think the purpose of government is to protect the poor and powerless from the rich and powerful. Conservatives think the purpose of government is to protect the rich and powerful from the poor and powerless.
•The single most important problem in economics is
the Gap between rich and poor.
•Austerity is the government’s method for widening
the Gap between rich and poor.
•Until the 99% understand the need for federal deficits, the upper 1% will rule.
•Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

===================================================================================================================================================================================================================================================================================

On July 11th of this year, we published “Of whom does Donald Trump remind you?” It showed the parallels between the rise of Trump and the rise of Hitler and Mussolini.

By appealing to nationalism and bigotry, Hitler and Mussolini dragged their nations to insanity and destruction. Neither the Germans nor the Italians thought it “could happen here.” But it happened, and not only did the Nazi victims suffer, but the nations suffered.

It is what always happens to the people, when bigotry rules. Germans and Italians were devastated by their bigotry. The American South suffered for its bigotry. The Mideast is convulsed by its bigotry.

The abovementioned post, which contained eerily similar photos of Trump and Hitler, said:

Trump has lied to make undocumented Mexican immigrants scapegoats.

He falsely claims Mexicans are responsible for “lots of problems.” He falsely claims they are criminals and rapists, responsible for illegal drugs.

He claims the final solution for these “problems” is to deport undocumented Mexicans.

Hitler, like Trump, falsely had claimed Jews were responsible for “lots of problems,” and that they were criminals.

And now, just like Hitler, Trump proposes to round up 11 million men, women and children and deport them.

How would he do it? Would he have jackbooted storm troopers kick in doors, and drag screaming, crying people out to cattle cars, where they will be sent off to concentration camps?

Recently, perhaps belatedly, others have caught on to what is happening to our nation.

‘Fascist’ Trump Isn’t First Demagogue Laughed Off As A Buffoon
August 25, 2015

Although he is still a clown, nobody laughs at Donald Trump anymore — which may be the real purpose of his candidacy, at least as far as he is concerned.

The casino mogul is pleased to instill fear among Republican elites, as he dominates their presidential nominating contest — and forces them to face a hard question about the man who is exciting such belligerent enthusiasm among Republican voters.

Trump is channeling toxic currents from the past—namely, his appeals to racial bigotry, his xenophobic and truculent attitude toward other nations, and his extremist “solution” to the problem of illegal immigration.

Others have observed that the Republicans have only themselves to blame for encouraging the crude prejudices that Trump now calls forth.

Imagine a country that seeks to round up millions of brown-skinned people by force, transforming itself into a police state, while mobs of vigilantes in militias scourge the frightened families out of hiding.

It is not hard to predict scenes of bloodshed and horror.

And now that Trump has attracted large crowds of willing bigots, the rest of the Republican party may feel obliged to “Nazify,” as they follow him into hell.

Republican Christie proposes tracking immigrants like FedEx packages

(Reuters) – New Jersey Governor Chris Christie said on Saturday if he were elected president he would combat illegal immigration by creating a system to track foreign visitors the way FedEx tracks packages.

With real estate mogul Trump taking a hard line on illegal immigration, other Republican candidates in the 2016 White House race have sought to toughen their stances as well.

Christie did not say specifically how the system he proposes would track people the same way packages are tracked by FedEx, which scans a bar code on the package at each step in the delivery process.

Rather than making the people wear a bar code, how about making them wear a yellow Star of David. There may still be some people in Europe who can advise about how that system works.

Is this what Trump wants?

Donald Trump’s ex-wife once said Trump kept a book of Hitler’s speeches by his bed

Ivana Trump told her lawyer Michael Kennedy that from time to time her husband reads a book of Hitler’s collected speeches, My New Order, which he keeps in a cabinet by his bed.

Hitler was one of history’s most prolific orators, building a genocidal Nazi regime with speeches that bewitched audiences.

“He learned how to become a charismatic speaker, and people, for whatever reason, became enamored with him.”

Does all this sound frighteningly familiar?

But Trump’s bigotry does not end with immigrants, just as Hitler’s did not end with Jews. Hitler built hatred for all other nations:

MAHER: TRUMP’S CHINA RHETORIC ‘THE WAY HITLER USED TO TALK ABOUT THE JEWS’

Maher stated, while talking about one of Trump’s speeches on Tuesday, “Then he goes to China, ‘They’ve taken our money and our jobs. … It’s one of the greatest thefts in the history of the world…’

That’s the way Hitler used to talk about the Jews.

It also is the way Hitler talked about the Russians, the Poles, the Czechs, the English et al.

Donald Trump And Adolf Hitler

In the weeks and months to come, you will read more articles paralleling Trump and Hitler, but more importantly, paralleling the people of Germany and the people of America — the way they willingly followed the Pied Piper of hatred into hell.

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten 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. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (Click here)
9. Federal ownership of all banks (Click here and here)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)

The Ten Steps will add dollars to the economy, stimulate the economy, and narrow the income/wealth/power Gap between the rich and the rest.
——————————————————————————————————————————————

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.
1. A growing economy requires a growing supply of dollars (GDP=Federal Spending + Non-federal Spending + Net Exports)
2. All deficit spending grows the supply of dollars
3. The limit to federal deficit spending is an inflation that cannot be cured with interest rate control.
4. The limit to non-federal deficit spending is the ability to borrow.

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 growth lines rise. Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

#MONETARYSOVEREIGNTY

–Washington Times gun-nut headline Saturday, Aug 29 2015 

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

Mitchell’s laws:
•Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
•Any monetarily NON-sovereign government — be it city, county, state or nation — that runs an ongoing trade deficit, eventually will run out of money.
•The more federal budgets are cut and taxes increased, the weaker an economy becomes. .
Liberals think the purpose of government is to protect the poor and powerless from the rich and powerful. Conservatives think the purpose of government is to protect the rich and powerful from the poor and powerless.
•The single most important problem in economics is
the Gap between rich and poor.
•Austerity is the government’s method for widening
the Gap between rich and poor.
•Until the 99% understand the need for federal deficits, the upper 1% will rule.
•Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

===================================================================================================================================================================================================================================================================================

The Washington Times, being right-wing, feels obligated to make increasingly foolish arguments for arming every man, woman and child in America.

Here is the latest such:

White House concedes new gun laws wouldn’t have stopped Va. gunman

What are we supposed to make of that headline? The White House “conceded” something that is quite true. Any current or proposed gun laws can’t stop an armed, angry fool from shooting people.

The Times headline implies that the White House first argued differently, then “conceded” the obvious. Ah, what a “concession” that was.

What next? How about, “White House concedes National Rifle Association (NRA)is paid by gun manufacturers to convince people to buy guns.”

White House press secretary Josh Earnest said it appears that a proposal championed by President Obama to require background checks on purchases at gun shows “would not have applied in this particular case.”

Law enforcement officials said gunman Vester Flanagan used a Glock handgun in Wednesday’s shooting, one of two that he bought last month. He legally bought two Glock model 19 handguns from a Virginia dealer.

Now, that headline might have read:

“White House concedes that arming everyone would not have prevented Flanagan from killing two innocent people.”
or
“White House concedes that if Flanagan could not obtain a gun he probably would not have killed.”
or
“White House concedes that guns really do kill people, and if you own a gun you have a higher probability of being killed by a gun than if you don’t own a gun.”

But, of course, the first two are obvious, and the third is statistical fact, and all three imply our gun laws are stupid at best and suicidal in effect — and that is something a right-winger has been brainwashed (by the gun manufacturers) to resist.

Gun-nuts are taken with mindless slogans, for instance the NRA’s Wayne LaPierre”s famous: “The only thing that stops a bad guy with a gun, is a good guy with a gun.”

Clearly that slogan isn’t true, because it wouldn’t have helped in the above-mentioned case or in thousands of other shootings in America. So I would like to propose a much truer slogan:

“The only thing that stops a bad guy with a gun is the same bad guy without a gun.”

Now there is a true slogan.

Yes, some might be amazed to learn that, in fact, guns actually do kill people, and the more people who have guns the more people who are killed by guns.

Surely, the White House would “concede” those statements.

(To reduce the carnage, we should pass two simple laws:

A. Any person who commits a felony while carrying a gun, shall be sentenced to a prison term of 20 years to life, in addition to the term for the felony itself.

B. Any provider of a gun that is used in a felony shall have the same criminal and civil liability as the actual perpetrator of the felony.

Those should help until someone comes up with a better idea.)

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten 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. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (Click here)
9. Federal ownership of all banks (Click here and here)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)

The Ten Steps will add dollars to the economy, stimulate the economy, and narrow the income/wealth/power Gap between the rich and the rest.
——————————————————————————————————————————————

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.
1. A growing economy requires a growing supply of dollars (GDP=Federal Spending + Non-federal Spending + Net Exports)
2. All deficit spending grows the supply of dollars
3. The limit to federal deficit spending is an inflation that cannot be cured with interest rate control.
4. The limit to non-federal deficit spending is the ability to borrow.

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 growth lines rise. Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

#MONETARYSOVEREIGNTY

–Lord, save us from our friends. The left’s plans for Social Security Wednesday, Aug 26 2015 

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

Mitchell’s laws:
•Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
•Any monetarily NON-sovereign government — be it city, county, state or nation — that runs an ongoing trade deficit, eventually will run out of money.
•The more federal budgets are cut and taxes increased, the weaker an economy becomes. .
Liberals think the purpose of government is to protect the poor and powerless from the rich and powerful. Conservatives think the purpose of government is to protect the rich and powerful from the poor and powerless.
•The single most important problem in economics is
the Gap between rich and poor.
•Austerity is the government’s method for widening
the Gap between rich and poor.
•Until the 99% understand the need for federal deficits, the upper 1% will rule.
•Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

===================================================================================================================================================================================================================================================================================

The Republicans

The Republicans endlessly wish to privatize Social Security, for one reason and one reason only.

No, it’s not because private investments yield more than Social Security does. That’s the excuse given. The problem with that excuse is it merely restates a simple fact: With greater reward comes greater risk.

If you invest in stocks, you most likely will come out ahead in the long run — the long, long run. Or you could lose. In January 2008, the S&P stock average was above $1,400. By April of 2009, just 16 months later, it had fallen below $800, a drop of 40%.

Is that the kind of risk you think is appropriate for a retirement fund?

Further, if the Republicans were to privatize Social Security, the massive flow of dollars — billions upon billions of dollars — would cause a stock bubble the likes of which we never have experienced, to be followed by a bubble burst of epic proportions.

The Republicans know all this. So why do they keep suggesting privatization? To reward their dear friends, the rich bankers and investment brokers. Imagine the commissions!

The brokers salivate at the thought, and when they finish salivating, they give big campaign contributions.

The Democrats

The Democrats also understand the fallacy of privatization, so they offer other plans, not as ridiculous as the Republicans’ plan, but bad nevertheless.

O’Malley’s plan to expand Social Security draws fire from a Wall Street front

Former Maryland Gov. Martin O’Malley, one of the more overlooked candidates for the Democratic presidential nomination, emerged Friday with an encouraging endorsement of expanding Social Security to make it even more relevant to the lives of working Americans than it is today.

“The economic pressures on millions of families — from stagnant wages and high housing costs, to a lack of affordable childcare and skyrocketing college tuition — have resulted in meager, if any, retirement savings for tomorrow’s retirees.”

He’s right about that, and right that Social Security is the one pillar of retirement security that has remained strong, while employer pensions and retirees’ personal nest eggs wither.

He calls for expanding benefits and requiring wealthier Americans to shoulder their fair share of the program’s cost.

Expanding benefits is good, even necessary if SS is to have much meaning. But no one, neither the rich, nor the poor, nor the benefit recipients, needs to “shoulder any share of SS costs.

People can run short of dollars. The federal government cannot. It is Monetarily Sovereign. It creates its sovereign currency, the dollar, at will.

So why ask people to shoulder the burden, when paying for SS would be no burden at all for the federal government?

O’Malley joins Sen. Bernie Sanders (I-Vt.), and Sen. Elizabeth Warren (D-Mass.), who also are pushing to expand the program.

O’Malley’s move may increase pressure on Hillary Rodham Clinton to endorse Social Security expansion. She’s been silent on the issue.

O’Malley would impose the payroll tax on all earned income over $250,000. Because the higher figure wouldn’t be indexed to inflation, that window would narrow over time.

Sanders would impose the tax on all income, including unearned income such as capital gains, over $250,000.

Aside from guaranteeing massive pushback from those who would have to pay the new tax (i.e. those who are the big contributors to politicians), these plans are based on, and would fortify, the myth that taxes are needed to pay for Social Security.

Rather than simply telling the truth, that the federal government can spend whatever it wishes to spend, on anything it wishes to buy, the Democrats follow the same fact- twisted notion as the Republicans.

Both parties agree that SS payments are too low, and both pretend that the problem is a lack of income. The only difference is that the Republicans want stock market investors to pay for that income, and the Democrats want the people to pay it.

In short, the people pay everything and the government, which can afford anything, pays nothing. That’s every politicians’ plan.

Remember, neither the people at large, nor the people who invest in stocks, actually create any dollars.

Rising stock prices don’t create dollars. In its essence, the stock market is a gigantic Ponzi scheme, in which the same dollars simply move from hand to hand. The same is true of FICA, which also creates no dollars, but rather takes dollars from one hand, while giving dollars to another hand.

The only time dollars are created is via federal deficit spending, in which the government creates more dollars than are destroyed via taxing.

More than half of all married couples in retirement and about three-quarters of singles get 50% of their income or more from Social Security. For a fifth of married seniors and half of the unmarried, the program accounts for 90% of income.

It is sad for our wealthy nation, when half to three-quarters of retired people must credit 50% of their survival to the pittance provided by SS.

O’Malley explicitly states that he wants to give minimum-wage and lower-income workers an especially enhanced benefit and raise the special minimum Social Security benefit to 125% of the federal poverty level.

That benefit, which applies to workers with long histories of very low wages, is currently $804 a month, which is about 82% of the poverty level; O’Malley would raise it to about $1,226 a month.

Ten years ago, we recommended eliminating FICA and exactly six years ago, we published Ten Reasons to Eliminate FICA

The 10 Reasons remain relevant today, but there is an eleventh reason: The existence of FICA lends false credibility to the Big Lie — the lie that federal spending requires funding from federal taxes.

It is the Big Lie that punishes the poor and widens the Gap between the rich and the rest.

At long last, will the Democrats please stop supporting the Big Lie?

Lord, save us from our friends.

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten 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. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (Click here)
9. Federal ownership of all banks (Click here and here)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)

The Ten Steps will add dollars to the economy, stimulate the economy, and narrow the income/wealth/power Gap between the rich and the rest.
——————————————————————————————————————————————

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.
1. A growing economy requires a growing supply of dollars (GDP=Federal Spending + Non-federal Spending + Net Exports)
2. All deficit spending grows the supply of dollars
3. The limit to federal deficit spending is an inflation that cannot be cured with interest rate control.
4. The limit to non-federal deficit spending is the ability to borrow.

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 growth lines rise. Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

#MONETARYSOVEREIGNTY

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