–Does raising the minimum wage really benefit low-wage workers? Wednesday, Sep 17 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.
===================================================================================

There are many arguments, pro and con, regarding an increase in the minimum wage — so many arguments that ’till now, I’ve been reluctant to engage.

Those in favor of raising the minimum wage believe: It’s only logical. If you raise the minimum wage, the Gap between the rich and the rest will narrow; fewer people will require poverty aids, people will spend more, and the entire economy will benefit.

Those opposed to raising the minimum wage believe: It’s only logical. If you raise the minimum wage, employers will be encouraged to find ways to reduce the number of low-wage jobs. These tend to be low-skill jobs, the easiest jobs to replace with automation or by combining multiple jobs. So, raising the minimum wage will cause more unemployment.

There may be no convincing answer — at least no answer that can convince both sides — but here is some interesting data:

????????????????????????

Bottom line: Employment decreases may result from many factors, but raising the minimum wage does not seem to be one of them. On balance the states that raised the minimum wage had a higher employment increase than those that did not.

That said, raising the minimum wage may not be the best way to help the lowest-paid group.

Employment decreases generally are associated with a bad economy. But, raising the minimum wage adds no dollars to the economy, so does little to stimulate economic growth.

monetary sovereignty

The best way to help the low-wage worker is to institute the “10 Steps to Prosperity.”

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)

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

#MONETARYSOVEREIGNTY

–Who owns Palestine? The phony crisis. Monday, Sep 15 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.
===================================================================================

I long have considered the upset over Israeli settlements in the West Bank, “on Palestinian land,” to be a media-manufactured, pseudo-crisis, for three reasons:

1. There are no “Palestinians” other than people who have lived in Palestine, a definition that includes Arabs and non-Arabs, Jews, Christians, Muslims and representatives from just about every national, religious and social group in the world.

2. There is no “Palestine”, at least there is no agreed-upon border for anything called “Palestine.” It’s an unspecified, amorphous area containing the city of Jerusalem.

3. National borders change frequently, mostly as a result of wars, the determinant of the “correct borders” generally being the winners of those wars. With the exception of Israel’s voluntary gift of Gaza, made with the naive belief that “land-for-peace” would be honored, seldom in history, has a victor donated the acquired land back.

Here are two maps of “Palestine,” the first from http://www.bible.ca and the second a map of “Palestine,” as illustrated by worldatlas.com

Palestin biblical mapPalestine world atlas

They are substantially different, of course, and leave open the question, “Who has had the right to draw those borders and who owns the land.” The historical answer: “The victorious occupant.”

Similarly, look at European maps, that appeared in the NewScientist article, “End of nations: Is there an alternative to countries?”” (03 September 2014 by Debora MacKenzie)

Europe nations 1800Europe nations 1900

Europe nations 1920Europe nations 2000

Again, they are substantially different, and again the questions, “Who has had the right to determine which is the ‘correct’ map, and what makes it ‘correct’?” And again, the answer to both questions historically has been, “the victorious occupant.”

As we review some excerpts from the excellent NewScientist article (I urge you to buy it and read it), remember the above questions and answers.

Before the late 18th century there were no real nation states, says John Breuilly of the London School of Economics. If you travelled across Europe, no one asked for your passport at borders; neither passports nor borders as we know them existed. People had ethnic and cultural identities, but these didn’t really define the political entity they lived in.

A conquered city or region could be subsumed into an empire regardless of its inhabitants’ “national” identity. Ancient empires are coloured on modern maps as if they had firm borders, but they didn’t.

In 1776 and 1789, revolutions in the US and France created the first nation states, defined by the national identity of their citizens rather than the bloodlines of their rulers. According to one landmark history of the period, says Breuilly, “in 1800 almost nobody in France thought of themselves as French. By 1900 they all did.”

According to Brian Slattery of York University in Toronto, Canada, nation states still thrive on a widely held belief that “the world is naturally made of distinct, homogeneous national or tribal groups which occupy separate portions of the globe, and claim most people’s primary allegiance”.

But anthropological research does not bear that out, he says. Even in tribal societies, ethnic and cultural pluralism has always been widespread. Multilingualism is common, cultures shade into each other, and language and cultural groups are not congruent.

Claims to Palestine generally are based on historical occupancy of claimants’ ethnic ancestors, over the centuries.

Yet. . . there is no good definition of an ethnic group. Many people’s ethnicities are mixed and change with the political weather: the numbers who claimed to be German in the Czech Sudetenland territory annexed by Hitler changed dramatically before and after the war.

Russian claims to Russian-speakers in eastern Ukraine now may be equally flimsy.

When Russia, the world’s largest nation, with millions of acres of empty land, annexed Crimea, the world reacted with barely concealed boredom. Yet when Israel, one of the world smallest nations builds a tiny settlement, the world is convulsed in seeming outrage.

Media-encouraged street protests, posing for television, with the obligatory police response, magically appear around the world. Meaningless suits (Decisions can be vetoed by any member of the UN Security Council) are filed in the World Court with claims of crimes against humanity .

One may debate the reasons why, but Israel, the only Mid-Eastern, democratic nation allowing freedom of religion is, and always has been, “different.”

That debate would have to include reasons why, despite massive financial and physical aid, and a significant population, Gaza has remained an impoverished war-territory, autocratically governed, and with its sole goal, destroying its neighbor.

Perhaps it is no wonder, then, that the nation-state model fails so often: since 1960 there have been more than 180 civil wars worldwide. Such conflicts are often blamed on ethnic or sectarian tensions.

It often is mentioned that while many thousands of Muslims live productive lives in Israel, no Jews live productive lives in Gaza. But . . .

It turns out that while ethnicity and language are important, what really matters is bureaucracy. This is clear in the varying fates of the independent states that emerged as Europe’s overseas empires fell apart after the second world war.

According to the mythology of nationalism, all they needed was a territory, a flag, a national government and UN recognition. In fact what they really needed was complex bureaucracy.

My Chicago-area village of only 25,000 residents has eleven primary Departments. Just one of those departments, Community Development, includes: Director of Community Development, Assistant Director of Community Development, Business Development Planner, Zoning Review Planner, Planner, Enforcement Officer, Building Inspectors, Code Enforcement Officer and Permit Clerk.

The other ten Departments are equally complex. They function to serve the myriad needs of the citizenry. Hamas and Fatah seem to care little about serving their citizenry, with Hamas preferring to use citizens as human shields.

Gaza has been riven by armed political conflict. Per Wikipedia: “From 2006-2007 more than 600 Palestinians were killed in fighting between Hamas and Fatah. A series of violent acts killed 54 Palestinians, while hundreds have claimed they were tortured. 349 Palestinians were killed in fighting between factions in 2007. 160 Palestinians killed each other in June alone.”

No street marches protested these killings.

Bottom line: Nations are a relatively new phenomenon, which unlike tribes and empires, require complex bureaucracies, not only in a central capitol, but throughout the territory. Gaza lacks these.

No ethnic group has the exclusive right to the name, “Palestinians,” and there is no specific land area known as “Palestine.”

While million of words have been written and spoken and shouted about the conflict, no one knows who Palestinians are and where Palestine is. Like discussions of religion — and fundamentally this is a discussion of religion — the fewer the facts the more fervent the belief.

The only real crisis is one of flying rockets and soaring hatred — encouraged by the media.

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)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (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 growth lines rise. Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

#MONETARYSOVEREIGNTY

The dishonest basis for an unwinnable war, and our children are sent to die Sunday, Sep 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.
===================================================================================

It’s all lies: The dishonest basis for an unwinnable war: ISIS version.

ISIS is Islam. Do not be deceived by lies. ISIS is cruel in its methods and extreme in its beliefs, but at its core, it is Islam.

Many Muslims feel that Christianity is evil, amoral and blasphemous, and most importantly, that Christianity wishes to defeat and ultimately eliminate Islam.

For thirteen hundred years it has been thus.

Christianity proselytizes. That is a fundamental. Christianity sends missionaries over the world, missionaries whose raison d’etre it is to convert people from “inferior” or “ignorant” faith.

Is it any wonder that Islam resents this? Is it any wonder that so many Muslims reject what it sees as the attempted Christianization (aka “Westernization”) of its women, of its children, of its mores?

We all are led by the extreme versions of what is in our hearts. So when America’s extreme right wing declares that “America is a Christian nation,” many moderate Christians may object as a matter of law, but in their hearts and souls, this indeed is a Christian nation — or should be.

Eliminate the beheadings, and ISIS is the Crusades — or perhaps, more accurately, ISIS is the Crusades, including the beheadings. But, ISIS is an internecine war, Muslim against Muslim, and that should make all the difference.

President Barack Obama, leader of the Christian world, righteously declares a different phase in a thirteen hundred year war. Now we shall attempt yet another Crusade. We shall exterminate ISIS (an impossible task) and we shall enlist Muslim nations to assist us (even less likely than “impossible”)?

Think: Despite centuries of religious wars, what religion, even what sect, has been exterminated? Consider the Inquisition. Consider the Holocaust. Consider the massive cruelty, hatred, incredible time and effort devoted to exterminating one tiny religion. What has been the result?

And now we wish to exterminate ISIS??

Will we succeed just as our endless wars against al Qaeda, recreational drugs, alcohol and crime succeeded?

And Barack Obama, leader of the Christian world, says he wishes to enlist Muslim nations to help exterminate ISIS. And this, he tells us, is for moral reasons. ISIS is evil, and it is our given mission and right to eliminate evil.

All morality. All righteousness. All lies.

The only assistance the Christian world will receive from the Muslim world, will come from Islamic dictators, afraid ISIS will infringe on their personal dictatorial power. And even then, the assistance will be tentative and grudging.

Soon, more American children will be mutilated, suffer and die in another endless, useless war. It is necessary that they die to prove the evils of Islam. All religious wars must have martyrs as symbols of the other side’s depravity.

And for what? Does ISIS threaten secular America? Is this band of thousands likely to overturn the mightiest war machine the world ever has known?

Or does ISIS threaten Christian America?

Number of Muslims in the U.S. doubles since 9/11
Mormonism grows 45% and spreads across nation

Data released Tuesday from the 2010 U.S. Religion Census shows Islam was the fastest growing religion in America in the last 10 years, with 2.6 million living in the U.S. today, up from 1 million in 2000.

Mormonism too saw remarkable growth, with a 45% increase in adherents. It added nearly 2 million members since 2000, bringing their number in the U.S. to 6.1 million.

In the Midwest and parts of the South there are now more Muslims than Jews for the first time.

Is this what America fears: 2.6 million Muslims, up 1.6 million in ten years, in our nation of 316 million people?

And if so, will the war on ISIS help slow the growth of Islam in America — or increase it? What exactly does America want? What would victory look like?

ISIS has killed a handful of Americans; now soon thousands more Americans will die in the futile attempt to eliminate ISIS. What would victory look like?

More and more young Americans are being swept into radical Islam as a result of Christian America’s attempt to crush ISIS. What would victory look like?

Who wants this unwinnable war? Who benefits from this unwinnable war?

Yes, the military manufacturers, the makers of tanks, guns, ships, planes, rockets and boots.

Yes, the military itself, for nothing creates big budgets and fast promotions like war.

Yes, the politicians, who long have known there is no better way to be elected than to act tough in the face of an enemy, real or imagined.

And yes, the religious leaders, who righteously call for peace, while using war as a recruitment tool for “us versus them.”

What is our alternative?

Do nothing. Isis’s war is intramural, Muslim against Muslim.

It is not America against any other nation, unless we make it so. As a nation, we have no national enemies in the Mideast and, but for Israel, we have no national friends. So what would victory look like?

In this religious war, whom shall we support and whom shall we make our enemy? Shia? Sunni? Quranist? Sufist?

Which Islamic denomination shall we fight in Iraq and which in Iran? With which do we hope to ally in Syria? In Turkey? In Egypt? Whom shall we invite to hate us most?

Do we really believe that bombing and killing one denomination in one geographic area, will endear us that denomination in a different geographic area — or to a different denomination? Or, is bombing and shooting to be our method of proselytization?

Might it not be better to step back and say to all Islamic nations:

“If, as a nation, you come to America in peace, America will welcome you in pease, as we welcome all amicable nations. If you are a friend to America, we will support you. But, if you attack America, America will defend itself.

Where Islam is at war with itself, we will not intervene. Such war is Islam’s to pacify. America will provide food, but not guns. America will provide medicines, but not soldiers. America will not try to convert you nor to change your peaceful ways.

We respect your freedom to choose your path.”

If not this, what else exactly do we want? What exactly would victory look like?

We no longer need Mideast oil, so that has ceased to be the tacit excuse. We cannot remake the world in our image. So what do we want?

The endless war is composed of lies, all lies, nothing but lies. And upon these lies our children are sent to die.

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)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (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 growth lines rise. Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

#MONETARYSOVEREIGNTY

The only cure for the village in a box Saturday, Sep 13 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.
===================================================================================

If you don’t already understand the differences between Monetary Sovereignty and monetary non-sovereignty, please click the above link before continuing.

Last year, we published “Why Detroit and Jonathan Tobin both are bankrupt.” A few key sentences from that post are:

Detroit et al are not sovereign over the dollar. Greece is not sovereign over the euro. In essence, the dollar and the euro are “alien” currencies, used courtesy of the Monetarily Sovereign U.S. government and the Monetarily Sovereign European Union.

It is an absolute rule of economics that a monetarily non-sovereign entity cannot survive long-term without money coming in from outside its borders. You and I are monetarily non-sovereign. To survive long term, we must have income. We could not survive by paying taxes to ourselves.

Similarly, no city, county or state in America can survive long term by taxing itself. Nor can Greece.

What happens when a monetarily non-sovereign entity has insufficient money coming in from outside? It must borrow. And if the situation persists, it must borrow again. And again. And again. And one day, when it no longer can borrow, it goes bankrupt or defaults on its loans.

This is true even if the entity is bare-bones frugal. Even if you were to live in a tent and eat garbage, you, being monetarily non-sovereign, eventually would run out of money, unless you had an income.

In this regard, the Chicago Tribune published an interesting 9/8/14 article by Reihan Salam, titled: “How the suburbs trap the poor.”

The suburbs have long been a welcome refuge for families looking for a safe, affordable place to live.

But for many Americans, the suburbs have become a trap. Towns too small or too starved of sales tax revenue to sustain their local governments stay afloat by having local law enforcement go trawling for trumped-up traffic violations, the fines for which can be cripplingly expensive, and which only grow more onerous as low-income residents fail to pay them.

Before we can understand what makes some suburbs so miserable, we first have to understand what makes others succeed. The most successful suburban neighborhoods fall into two categories. First, there are the dense and walkable ones that, like the most successful urban neighborhoods, have town centers that give local residents easy access to retail and employment opportunities.

These neighborhoods generally include a mix of single-family homes and apartment buildings, which allows for different kinds of families and adults at different stages of life to share in the same local amenities.

The problem with these urban suburbs is that there are so few of them, and this scarcity fuels the same kind of gentrification that is driving poor people out of successful cities.

The other model for success can be found in sprawling suburban neighborhoods dominated by households with either the time or the resources to maintain single-family homes and to engage in civic life.

As a general rule, the neighborhoods in this latter category don’t allow for apartment buildings or town homes on small lots. They implement stringent local land-use regulations that keep them exclusive, and they attract families that tenaciously defend the character of their neighborhoods.

Last year, Slate contributor Matt Feeney argued that Detroit, his hometown, had declined so dramatically because it was “a virtual monoculture, residentially speaking a city of detached, owner-occupied, single-family homes.

Since the initial rise of the suburbs, families have changed. The most dramatic change has been the steep increase in one-person households, from 7.8 percent of all households in 1940 to 26.7 percent as of 2010.

To summarize Mr. Salan’s thesis, Detroit and indeed many cities and especially suburbs, struggle because they are loaded with single-family, owner-occupied homes. These homes take up land and city services. Their owners can’t afford the upkeep, the taxes and the risk of property depreciation. In the event poorer people move into the neighborhood, the resident home-owners, fearing home depreciation, rush out, only to be replaced by additional poor people.

As poor owners replace wealthier owners, property prices fall; then tax collections fall; then suburban services fall in a downward helix to poverty. And all this could be prevented if the suburb or city had more of multi-story, affordable rentals, requiring less service per person and less risk of property devaluation to chase people away.

The problem, according to Mr. Salam, is Detroit’s mono-culture of single family homes.

There may be some logic to this, but it ignores the fundamental problem: A monetarily non-sovereign entity cannot survive long term without money coming in from outside its borders.

Visualize Village “A.” It is entirely self-contained, being surrounded by a high wall. Nothing comes in; nothing goes out. Every dollar spent remains in the village, so total dollars do not change. If the total population remains static, then the average dollars per person remains static.

Only if the Gap between the rich and the rest shrinks or grows, will the economy of Village “A” become unstable. Otherwise, nothing changes.

Now visualize Village “B.” It has the same wall as Village “A,” but this wall has a door, which allows for imports but not exports. So goods and services flow in, while dollars flow out. Eventually, Village “B” runs out of dollars and goes bankrupt.

Clearly, it makes no difference whether or not Village “B” contains single-family housing, high-rise apartments or pup tents all in a row. And, no matter how much taxing or benefit cutting the village does, a monetarily non-sovereign village that has a negative balance of payments, will run out of money. To survive long-term, a monetarily non-sovereign entity must have more money coming in across its borders than going out.

From where can the village acquire enough dollars to balance or exceed its outflow? One source would be neighboring villages. For instance, some people who receive a paycheck in Chicago, live in the suburbs, so among these people there is a net flow of dollars from Chicago to its suburbs.

That helps the monetarily non-sovereign suburbs, but punishes the monetarily non-sovereign Chicago. The dollar-shortage has not been solved; it merely has been moved from one village to another.

In any closed system, where the total supply of dollars neither grows nor shrinks, the overall net balance of payments = $0. If the system is comprised of states, counties, cities, businesses and people (all of whom are monetarily non-sovereign), on average half will gain dollars and half will lose dollars, and the losers will be threatened with bankruptcy.

Chicago might be able to obtain dollars from Cook County, which in turn might be able to obtain dollars from Illinois, but what then?

A tax increase temporarily may help Illinois, but it would impoverish Illinois tax payers, who in turn, will pay less taxes, eventually impoverishing the Illinois government. For long term survival, additional net dollars are needed.

From where will these additional dollars come? Fortunately, our federal government is Monetarily Sovereign. It alone has the unlimited ability to create its sovereign currency.

When the states, counties, cities, businesses and people run short of dollars, the federal government has the unlimited ability to replenish the shortfall via deficit spending.

Monetarily Sovereign government deficit spending is the only long-term method by which dollars are created. Were it not for federal deficit spending, the supply of dollars would remain static. Net importing and population growth would reduce the number of dollars per person.

Yes, banks create dollars by lending. In fact, banks create most of the dollars. But these all are temporary dollars. When the loans are repaid, those bank dollars disappear. The only permanent dollars result from federal deficit spending.

Bottom line: A Monetarily non-sovereign government may look for short term solutions to its dollar shortage. It can borrow. It can do as Mr. Salam suggests and build more high rise rental apartments along with fewer stand-alone, single-family homes. It can raise taxes and cut spending. It can try to increase exports and reduce imports.

But all this accomplishes is to move the same dollars from one monetarily non-sovereign entity to another, which over time results in, on average, half being short of dollars.

If the states are to help support their counties, and the counties are to help support their cities, and the cities are to help support their suburbs — all of which is necessary to prevent the impoverishment of these governments and their residents — the U.S. federal government must deficit spend. It is basic arithmetic.

This not true only for the U.S. The same concept is true for the euro nations and indeed for every nation. The euro nations, for instance, have tried to deny that 1 – 1 = 0, by instituting a wide variety of “Band Aid” solutions to their monetary non-sovereignty. Most of the solutions involve loans, the repayment of which is impossible, together with higher taxes and lower social benefits, this impoverishing the citizenry.

The one entity capable of permanently increasing each nation’s euro supply, is the Monetarily Sovereign European Union. But it refuses, perhaps for fear the populace will learn that all these years of back-breaking austerity were unnecessary.

Similarly, the U.S. state & local U.S. governments force austerity by repeatedly raising taxes and cutting services, while the federal government does the same.

The only solution to a money shortage is to create money. There are no clever “work-arounds.” Monetarily Sovereign governments must create the money to feed their monetarily non-sovereign citizens.

Governments excuse austerity with the bogeyman of hyperinflation. It is the BIG LIE.

The trapped people, emaciated and dying of starvation, are refused food for fear of morbid obesity.

Cruelly, the governments will not send food into the box.

Rodger Malcolm Mitchell
Monetary Sovereignty

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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)

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

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

#MONETARYSOVEREIGNTY

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