The real reason Putin elected Trump Saturday, Jul 21 2018 

There are many reasons why Putin might have put so much energy into electing Donald Trump as President.

Oh sure, Putin knew Trump is a vainglorious fool who would be no match for Putin in the competition between nations.

And sure, Putin was afraid of Hillary Clinton’s toughness, brains, and experience, a far more worthy opponent than the ignorant, inexperienced, feckless Trump.

But the real reason, the big one, is money, the same reason why Trump is so obsequious when in the company of Putin.  It is why Trump, after promising to reveal his tax returns, as previous Presidents had done, he invented excuses (“I’m under audit.” “The people don’t care.” ) and finally refused altogether.

Trump and his family have borrowed billions, of dollars from Putin’s Russian oligarch pals.

Following Trump’s Money Trail: Why Collusion Is Just An Illusion

The Trump Organization borrowed billions of dollars to finance its real estate operations but subsequently defaulted on many of its loans.

Nevertheless, the Trumps were inexplicably able to continue borrowing millions more from the very banks still owed money.

Around the same time, Russian entities linked to the Kremlin quietly moved $10 billion dollars from global locations into the United States using the same banks.

Government inspectors independently uncovered the suspicious Russian transactions, known as “mirror trades” (stock purchases in overseas branches and identical immediate sales in the United States).

Democratic legislators have demanded banking information for identifying links; Republicans controlling Congressional committees refuse to cooperate.

If Putin’s pals demand their money back, Trump could be in serious financial trouble — maybe broke.

ERIC TRUMP: “WE HAVE ALL THE FUNDING WE NEED OUT OF RUSSIA”

In 2008, Donald Jr. told investors in Moscow that “Russians make up a pretty disproportionate cross-section of a lot of our assets,” while Eric reportedly said in 2014 that the Trump Organization was able to expand during the financial crisis because “We don’t rely on American banks. We have all the funding we need out of Russia.”

Trump has the slimy reputation of declaring bankruptcy every time the creditors close in, and that is the last thing Putin and his cronies want.

Trump can’t “rely” on American banks because they won’t lend to him.

Here is the gist of all conversations that may have happened, over time:

Putin: “Here’s the deal, Donald. We’ll help you to become President of the United States. You not only will become rich using the U.S. Treasury as your personal piggy bank, but we’ll let you build Trump Tower Moscow and get in on a bunch of other lucrative real estate deals here in Russia. We also will treat you to some beautiful hookers.”

Trump: “Money plus women. Sounds good to me.”

Putin: “In return, you will use the billions you’ll make to repay my friends for those loans, and never go bankrupt on us. And of course, you’ll see to it that those sanctions against Russia kind of fade away.”

Trump: “I’m in. But this has to be kept secret. I’ve done lots of sh*t in business, but being revealed as a traitor . . . on second thought hey, if the money is good and the women are beautiful . . . “

Putin: “We’ll open back channels for communication, and you and I can have meetings that no one else but interpreters attends. I’ll tell you just what to do. You can toss in a couple of stern comments and act, so it’s not too obvious that I own your butt. Just don’t release your tax returns. That would scatter the grain.”

Trump: “Huh?”

Putin: “Spill the beans.”

Trump: “I promise I won’t go bankrupt on you. Have I ever lied?”

Putin: “You better not. Remember what happened to Alexander Litvinenko, Yuri Shchekochikhin, Viktor Yushchenko, and Anna Politkovskaya. And of course, there’s Sergei Skripal and his daughter. You do like your daughter, don’t you, Donald?”

Trump: “Of course, as I’ve said, in public and on many occasions, ‘My daughter is hot. She’s voluptuous. It’s O.K. to call her a piece of ass. If she wasn’t my daughter, perhaps I’d be dating her.’ Don’t hurt my daughter. Just tell me what you want me to do.”

Putin: “And if necessary, you will send me your former ambassador to Russia, Michael McFaul, so I can grill him the Russian way.”

Trump: “I’ll try.”

Putin: “And accept our annexation of Crimea.”

Trump: “Sure, why not?

Putin: “And finally, I don’t like NATO. It keeps me from getting back all those Soviet nations we used to own.

Trump: “I’ll break up NATO. It might take some time, but I’ll do it.”

Putin: “Or you will find yourself to be the innermost of a Russian matryoshka nesting doll set.”

Trump: “Yes, Vlad. May I get up, now? My knees hurt.”

And the rest is history. In total, there are many reasons why Putin would want Trump to be President, there are none favoring Clinton.

And as for Trump, the big reason is money. The man is notorious for cheating creditors, cheating employees, not giving to charity, using his charitable foundation for private use, keeping conflict-of-interest ownership and control over his properties while President, and encouraging the usage of his properties by foreign dignitaries.

Trump is all about money, money, money. He would do anything for money, including sell out his own country. And that explains everything.

Next, Mueller will explain it even better.

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

Kenahora: Why there is no “business cycle” Saturday, Jul 21 2018 

It takes only two things to keep people in chains:Related image
The ignorance of the oppressed
And the treachery of their leaders

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CYCLE: an interval of time during which a sequence of a recurring succession of events or phenomena is completed. (Merriam-Webster)Image result for sine graph

BUSINESS CYCLE: a cycle of economic activity usually consisting of recession, recovery, growth, and decline (Merriam-Webster)

The words “cycle” and “business cycle” have the appearance of inevitability about them.

We are led to believe a recession must automatically be followed by a recovery, which must lead to growth, and then the whole thing must crash down into decline and recession.

That is the cycle, and there’s nothing we can do to prevent it. All we can do is prepare for it.

Or so the theory goes:

By: John Detrixhe (John covers the future of finance for Quartz. He previously wrote about markets and trading for Bloomberg News in New York and London.) 

Despite bumper earnings, bank shares have lagged the overall market this year. The likely reason is that investors think the US, and perhaps the global economy, is getting closer to its next downturn.

That’s the common belief. Because there is a business “cycle,” growth must lead us closer to a downturn. It’s as though, in baseball, winning brings the team closer to losing. Or happiness leads you closer to sadness.

There never is a specific reason given. The notion is, the business “cycle” itself demands that success brings us closer to failure.

And that is the nonsense that passes for wisdom in economics.

It has been nine years since the last recession, almost double the average for the US economic cycle.

The bull market in US stocks is also nine years old, the second-longest run on record.

Unemployment is near historic lows following an unprecedented stretch of job gains.

One would think the good news would lead to more good news. After all, doesn’t low unemployment, together with more job growth, indicate a healthy economy?

Why should healthiness cause future sickness?

There’s an escalating trade war between the US and the rest of the world, or the fact the Federal Reserve is raising rates while other central banks keep them at historic lows.

The trade war has nothing to do with any sort of business “cycle.” It’s the arbitrary work of a fool, who believes cutting off your nose to spites China’s face.

And raising interest rates is merely an inflation preventative. Contrary to popular myth, raising interest rates does not bring on recessions.

Interest rate changes. Vertical bars are recessions

As you can see, lowering interest rates is associated with recessions, partly because reduced rates require the federal government to pump less T-security, interest money into the economy.

In a recent conference call with JPMorgan, a banking analyst said she’s getting a lot of pushback from investors because “we’re long in the tooth in the economic cycle.”

The bank’s CFO, Marianne Lake, countered that there are no signs of fragility so far, but noted that the biggest US bank by assets is preparing for the inevitable slowdown.

Indeed, finance execs have recently been citing the “credit cycle” more than at any time since the last downturn, according to a Sentieo analysis of earnings calls. 

Remarkable, isn’t it. There are “no signs of fragility,” but the biggest bank is preparing, not for growth, but rather for a slowdown.

What do businesses do to “prepare for a slowdown.” They cut spending. They reduce “unnecessary” expenses like Research & Development, Advertising and Marketing.  They defer expansion plans. They stop investing in plant and equipment. They cut employees.  They become less aggressive and instead, retreat into a protective shell.

And those are the very actions that help bring on recessions. A recession becomes “inevitable,” because it is a self-fulfilling prophesy.

In addition to the abovementioned self-fulfilling prophesy, a prime inflation cause — perhaps the prime inflation cause — is a reduction in federal deficit spending.

Changes in federal deficit spending. Vertical bars are recessions.

Gross Domestic Product (GDP) = Federal Spending + Non-federal Spending + Net Exports.

Spending cuts reduce GDP.

If the private sector and the government believe that business growth, federal deficit spending,  and raising interest rates all make a recession inevitable, they will cut spending and reduce rates.

And that indeed, will make a recession inevitable.

We often have claimed that economics comes closer to being a religion than a science. And the belief in business “cycles” — that success inevitably causes failure — is a perfect example.

According to the USC Digital Folklore Archives: “Kenahora” is a curse in Yinglish (bastardized english/yiddish) that comes from three words slurred together: the Yiddish word kein, meaning “no,” ayin, which is Hebrew for “eye,” and hara, Hebrew for “evil.”

“My mother would always say ‘don’t give a ‘kenahora’ to mean ‘don’t give us bad luck.’
“If you are driving cross country let’s say, and making great time – but stupidly decide to comment ‘Oh boy we are making great time’ – BANG – you will instantly hit traffic – bumper to bumper. It always happens!
“My mother also used to spit after saying ‘Kenahora, pu-pu-pu!’ It implied spitting on the demon to stop it.”

If phony business “cycles” concern you, especially those so-called, “inevitable” recessions, perhaps saying “Kenahora,” then spitting three times will help.

Or not.

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

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

Ten Steps To Prosperity:
1. ELIMINATE FICA

(Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.

2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE
(H.R. 676, Medicare for All )

This article addresses the questions:
*Does the economy benefit when the rich can afford better health care than can the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”

3. PROVIDE A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All)
(The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Guaranteed Income)) Or institute a reverse income tax.

This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.

4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONE
Five reasons why we should eliminate school loans

Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefitting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.

5. SALARY FOR ATTENDING SCHOOL
Salary for attending school. Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.

6. ELIMINATE FEDERAL TAXES ON BUSINESS
Businesses are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the federal government (the later having no use for those dollars). Any tax on businesses reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all business taxes reduce your personal income.

7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and business taxes would be a good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.

8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME.
(TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.

9. FEDERAL OWNERSHIP OF ALL BANKS
(Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.

10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

The Ten Steps will grow the economy, and narrow the income/wealth/power Gap between the rich and you.

MONETARY SOVEREIGNTY

As I told you, two years ago . . . Saturday, Jul 14 2018 

As I told you, two years ago . . .

. . . Here are excerpts from two posts (You can click the links to see the full flavor of what was written.)

They were not the only posts on the subject, but they are a representative sample.

September 15, 2016: What kind of President will Donald Trump be

Trump singled out as the one person he admires, Vladimir Putin, the dictator of Russia.

In true dictatorial style, Trump wishes to build an “iron curtain,” a “beautiful” Berlin wall, around America.Image result for dictator

Like dictators Stalin and Hitler, Trump wishes to rid his nation of those he considers undesirable — Muslims, Mexicans, other Latinos, gays.

Like all dictators, Trump is enamored with himself. He plasters his name on everything — buildings, airplanes, businesses. He tries hard to create a “cult of his personality” as did Stalin, Mao, and the Perons.Image result for dictator peron

The Trump Foundation even paid $20,000 of charity money, for a portrait of Trump.

Like all dictators, Trump is a thin-skinned egomaniac. Say anything negative about Trump, and you will be subject to a flurry of insulting, even threatening Emails. As President, he will do more than threaten.

Similarly, say something complimentary, and he will reciprocate. He already has said that because Putin speaks well of him, he speaks well of Putin.

Like most dictators, Trump’s primary appeal is to the less educated, the people who are more susceptible to lies, bluster, and fraud — the people who are more likely to find appeal in bigotry.

And like all dictators, Trump wishes to control the media. Why? Because once the media are under control, the people know only what the dictator wants them to know.
This is why Putin has that “80% approval rating” Trump admires. Kim Jong Un probably has 100% approval.Image result for dictator kim jong un

Dictators love to demonstrate physical invincibility. Putin, for instance, removes his shirt while riding horseback, to demonstrate his virility. And then there was Mao, swimming in the Yangze.

Image result for dictator mao

Like dictators Mao and Putin, Trump is in “perfect health.” In fact, he would be “the healthiest individual ever to the presidency.” We know this, because his doctor, Harold Bornstein jotted a quick note, dictated by Trump, telling us so.

Bottom line: Donald Trump has told us again and again, in many different ways, that he will be a dictator if we elect him.

Should we fail to listen with our own ears and fail to see with our own eyes, what Trump has made obvious, we and our children will join in the misery seen by the people of Russia, China, Argentina, Germany, Italy, Cuba, and other dictatorships.

Yes, friends, it can happen here. And when it does, we will have only ourselves to blame.

And then, two weeks later, came this post (excerpts):

Friday, September 30, 2016: Astounding similarities: Hitler in America. It’s happening now.

Of whom does the following remind you?

A host of earlier biographers have advanced theories about Hitler’s rise, and the dynamic between the man and his times.Image result for hitler

Some have focused on the social and political conditions in post-World War I Germany, which Hitler expertly exploited — a yearning for a return to German greatness; unemployment and economic distress; and longstanding ethnic prejudices and fears of “foreignization.”

“Make America great again,” anti-Muslim, build a wall.

Hitler as a politician who rose to power through demagoguery, showmanship and nativist appeals to the masses.Image result for mussolini

Hitler was often described as an egomaniac who “only loved himself” — a narcissist with a taste for self-dramatization and what Mr. Ullrich calls a “characteristic fondness for superlatives.” 

Do demagoguery, showmanship and nativist appeals sound familiar? And which egomaniacal politician describes everything about himself as “incredible.”

A former finance minister wrote that Hitler “was so thoroughly untruthful that he could no longer recognize the difference between lies and truth” and editors of one edition of “Mein Kampf” described it as a “swamp of lies, distortions, innuendoes, half-truths and real facts.”

Which politician not only lies the most of any in recent memory but repeatedly denies the incontrovertible evidence of lies?

Hitler was an effective orator and actor, adept at assuming various masks and feeding off the energy of his audiences. Although he concealed his anti-Semitism beneath a “mask of moderation” when trying to win the support of the socially liberal middle classes, he specialized in big, theatrical rallies.Image result for dictators

Which politician is a professional TV actor? Who boasts about huge rallies with thousands of cheering people? Which politician breeds hatred of minorities?

He peppered his speeches with coarse phrases and put-downs of hecklers. Even as he fomented chaos by playing to crowds’ fears and resentments, he offered himself as the visionary leader who could restore law and order.

Which politician yells “Get ’em outa here” when heckled? Which politician promises to enforce “law and order”?

Hitler increasingly presented himself in messianic terms, promising “to lead Germany to a new era of national greatness,” though he was typically vague about his actual plans.Related image

He often harked back to a golden age for the country, the better “to paint the present day in hues that were all the darker. Everywhere you looked now, there was only decline and decay.

Which politician repeatedly tells us we are losing to the Chinese, losing to the Mexicans, losing to the terrorists — losing, losing, losing — but is vague about plans (sometimes claiming they are “secret.”?)

Because the understanding of the masses “is feeble,” Hitler said, effective propaganda needed to be boiled down to a few slogans that should be “persistently repeated until the very last individual has come to grasp the idea that has been put forward.”Image result for dictator saddam

Seen any political slogans printed on hats and repeated constantly in speeches, to remind the “feeble” masses?

Hitler’s rise was not inevitable. There were numerous points at which his ascent might have been derailed.

(But) in addition to economic woes and unemployment, there was an “erosion of the political center” and a growing resentment of the elites.

(There was) the belief of Hitler supporters that the country needed “a man of iron” who could shake things up. “Why not give the National Socialists a chance?” a prominent banker said of the Nazis. “They seem pretty gutsy to me.”Image result for dictator Idi Amin

Does resentment of elites (aka “the establishment”) ring a bell? What about the need for change, to “shake things up”?

(Hitler’s) conservative coalition partners believed either that he was not serious or that they could exert a moderating influence on him.

Know of any politicians whose own party continues to try to moderate them? Was there speculation about any politicians not really being serious about running for President?Image result for putin

Hitler, it became obvious, could not be tamed.

The independent press was banned or suppressed and books deemed “un-German” were burned.

Think. Which American politician wants to sue the press for unflattering articles?

Germans believed, “It cannot happen here.”  But, as the author asks . . .Image result for trump

What persuaded millions of ordinary Germans to embrace Hitler and his doctrine of hatred?

How did this “most unlikely pretender to high state office” achieve absolute power in a once democratic country and set it on a course of monstrous horror?

It happened in Germany. Actually, it has happened in many countries. People fundamentally are the same, everywhere, and everywhere they can be led like sheep to the slaughter by Hitlerian leaders.

Yes, it can happen here. It, in fact, is happening here, right in front of our noses. Don’t believe, even for one second, that we are immune, and that dictators only happen in other countries. Those “other countries” thought the same thing.

The Republicans won’t stop Trump’s plan to be our dictator. They are too frightened, just as the good Germans were too frightened to stop Hitler.

It remains for you independents and Democrats to end this horrifying drift toward totalitarianism.

America can be saved. Your children and grandchildren can live in a free America.

But you must speak now to your Representative and Senators. And you must vote in November.

You simply must.

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

The fake trade and NATO wars Friday, Jul 13 2018 

It takes only two things to keep people in chains:Image result for carnival barker


The ignorance of the oppressed
And the treachery of their leaders

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We often have discussed the difference between ignorance and stupidity. We all are ignorant about the vast majority of facts in the universe. Being intentionally ignorant, however, is stupidity.

We discussed the ignorant trade “war” at When ego meets ignorance: Who pays for tariffs? You do, Jun 16 2018

It is a “war” in which your government shoots at the enemy and also shoots at you, and the enemy’s government does likewise.

With both government’s shooting at both sides, how does one win such a war? One doesn’t. A trade war not only is ignorant, but it is intentionally ignorant, i.e. stupid, which partly explains why Donald Trump has caused it.

But the stupidity is not his alone. Many in the media share it. Consider this article in today’s Chicago Tribune:

Reciprocity is the method to Trump’s madness

Image result for victor davis hanson

Victor Davis Hanson

By Victor Davis Hanson, a classicist and historian at the Hoover Institution at Stanford University, authorvdh@gmail.com

Critics of Donald Trump claim there is no rhyme or reason to his foreign policy. But if there is a consistency, it might be called reciprocity.

Trump tries to force other countries to treat the U.S. as it treats them. In “don’t tread on me” style, he also warns enemies that any aggressive act will be replied to in kind.

The underlying principle of Trump commercial reciprocity is that the United States is no longer powerful or wealthy enough to alone underwrite the security of the West.

It can no longer assume sole enforcement of the rules and protocols of the postwar global order.

Several bits of ignorance all packed into four short sentences:

First, the “aggressive acts” are those perpetrated by Trump. It was Trump who started the trade wars and it is Trump who has directed criticisms and threats toward NATO and specifically, toward Germany and England.

Second, the United States, unlike the euro nations, is Monetarily Sovereign. It has the infinite ability to create its sovereign currency, the U.S. dollar, to underwrite our military.

As such, it is infinitely wealthy. The euro nations are not.

In fact, the more dollars the U.S. government pumps into our military, the wealthier our nation becomes. Gross Domestic Product (GDP) is based on federal spending. The more the federal government spends, the higher goes GDP.

Third, the U.S. does not, and never has, assumed “the sole enforcement of whatever the term, “rules and protocols of the of the postwar global order” is supposed to signify.

And if we did, wouldn’t that be exactly what we want? Think about it. Would we really want someone else to “enforce the rules . . . etc.”?

This year there have been none of the usual Iranian provocations — frequent during the Obama administration — of harassing American ships in the Persian Gulf.

Apparently, the Iranians now realize that anything they do to an American ship will be replied to with overwhelming force.

Is this something that Trump supposedly has accomplished?

Aside from loudmouth bluster about “fire and fury against the North Koreans (whom Trump now loves and admires), we see no evidence of his “overwhelming force.”

Trump’s main effort against Iran has been to free them to continue making nuclear weapons. Are we supposed to believe that Trump’s ending of the Iranian deal has now frightened Iran so much, they will become placid?

Utter Trumpian idiocy.

Ditto North Korea. After lots of threats from Kim Jong Un about using his ballistic missiles against the United States, Trump warned that he would use America’s far greater arsenal to eliminate North Korea’s arsenal for good.

Yes, Trump scared Kim Jong un so much that Kim continued to manufacture nuclear weapons, ditched a meeting with US Secretary of State Mike Pompeo, and instead visited a potato farm.

Ooooh, that “overwhelming force” of Cadet Bonespurs. Another Trump failure which he will claim was a smashing success. And which his followers will believe.

More important, most NATO countries have failed to keep their promises to spend 2 percent of their gross domestic product on defense.

What the American public doesn’t understand it that it does us absolutely no good for NATO nations to spend 2% or even 10% on defense. Two reasons:

First, the U.S. likely would not spend a penny less on defense, no matter how much NATO nations spend.

Second, spending by the Monetarily Sovereign U.S. government costs American taxpayers nothing, and it stimulates economic growth.

There is not a single economic reason why America needs Europe to spend more on defense.

Why does Germany by design run up a $65 billion annual trade surplus with the United States?

Why does such a wealthy country spend only 1.2 percent of its GDP on defense?

And if Germany has entered into energy agreements with a supposedly dangerous Vladimir Putin, why does it still need to have its security subsidized by the American military?

Well, he asked three questions, so I’ll give three answers:

One — Trade Deficit: Germany runs a trade surplus (i.e. a goods and services deficit), with the U.S. because more of our consumers wish to purchase German goods than German consumers wishing to purchase U.S. goods.

Further, as we frequently have noted America, being Monetarily Sovereign, benefits from our trade deficit. We receive valuable and scarce assets, goods and services, in exchange for U.S. dollars, which the U.S. can create endlessly and at no cost.

Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”

Ben Bernanke: “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.”

St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e., unable to pay its bills.”

Thomas Edison: If the Nation can issue a dollar bond it can issue a dollar bill.  The element that makes the bond good makes the bill good also. . . . It is absurd to say our Country can issue bonds and cannot issue currency.

Those wishing for the U.S. to run a trade surplus do not understand economic reality.

Further, Germany is monetarily non-sovereign. Unlike the U.S. it does not have the unlimited ability to create its sovereign currency, simply because it has no sovereign currency.

Germany is similar to the U.S. cities, counties, and states in that it uses a currency over which it has no control.

So, to survive long-term, Germany requires the income that a trade deficit provides. By contrast,  the U.S. needs no income. It creates U.S. dollars ad hoc, by spending dollars. The U.S. government never can run short of U.S. dollars. Never.

Two — Defense: Our spending for Germany’s defense benefits us. It allows us to surround Russia with troops and weapons, and gives us better military access to Africa.

Three — Subsidized security This question is completely nonsensical. Having an energy agreement with “supposedly dangerous” (supposedly??) Russia, has nothing to do with the need for security.

Trump approaches the North American Free Trade Agreement in the same reductionist way. The 24-year-old treaty was supposed to stabilize, if not equalize, all trade, immigration and commerce between the three supposed North American allies.

There is no need to equalize trade, immigration and commerce among the three Monetarily Sovereign nations.

It never quite happened that way.

Unequal tariffs remained. Both Canada and Mexico have substantial trade surpluses with the U.S. In Mexico’s case, it enjoys a $71 billion surplus, the largest of U.S. trading partners with the exception of China.

Canada never honored its NATO security commitment. It spends only 1 percent of its GDP on defense, rightly assuming that the U.S. will continue to underwrite its security.

Not one of the above is bad for America. It is all Trump’s excuse for creating conflict. All dictators want conflict, because that cements their power.

During the lifetime of NAFTA, Mexico has encouraged millions of its citizens to enter the U.S. illegally. Mexico’s selfish immigration policy is designed to avoid internal reform, to earn some $30 billion in annual expatriate remittances, and to influence U.S. politics.

The above must have beoen written by Trump, for it has no basis in fact. There is zero evidence that Mexico is encouraging its people to leave.

This reminds us of Trump’s infamous “They’re not sending their best. They’re rapists . . .”

The immigrants are coming to make a better life for themselves and their children, just as all American’s ancestors did — just as your parents and grandparents did.

Mexico is not sending anyone. This is all a Trump fever-dream being disseminated by Hanson.

Yet after more than two decades of NAFTA, Mexico is more unstable than ever. Drug cartels run entire states. Murders are at a record high. Entire towns in southern Mexico have been denuded of their young males, who crossed the U.S. border illegally.

How does that prove Hanson’s assertion that Mexico is exporting too much to the U.S. and “sending” us criminals? Again, it sounds like a rambling Trump “attack-everyone-and-every-thing” speech.

But in 2016, red-state America rebelled at the asymmetry. The other half of the country demonized the red-staters as protectionists, nativists, isolationists, populists and nationalists.

But Trump followers are exactly that: Protectionists, nativists, isolationists, populists and nationalists — and way too many are bigots.

However, if China, Europe and other U.S. trading partners had simply followed global trading rules, there would have been no Trump pushback — and probably no Trump presidency at all.

Trump’s election had nothing to do with trading rules. It had more to do with the electoral college and gerrymandering, plus a very weak Democratic nominee,  that allowed a minority to win over a majority.

Had NATO members and NAFTA partners just kept their commitments, and had Mexico not encouraged millions of its citizens to crash the U.S. border, there would now be little tension between allies.

“Crash” the border? Did you grandparents “crash” the border. More phony language from a Trump devotee.

Again, a rich and powerful U.S. was supposed to subsidize world trade, take in more immigrants than all the nations of the world combined, protect the West, and ensure safe global communications, travel and commerce.

After 70 years, the effort had hollowed out the interior of America, creating two separate nations of coastal winners and heartland losers.

Ah yes, the divide and conquer idea. The people on the coasts (i.e. the blue New Yorkers and Californians) supposedly are rich, while the people in the middle (except for the blue Illinoisans) are impoverished — a favorite Trump theme.

And all of this is the fault of the trade deficit.

Trump’s entire foreign policy can be summed up as a demand for symmetry from all partners and allies, and tit-for-tat replies to would-be enemies.

No, Trump’s entire foreign policy can be summed up as: Buddy-up to dictators, and make war with allies.

Did Trump have to be so loud and often crude in his effort to bully America back to reciprocity?

Who knows?
But it seems impossible to imagine that globalist John McCain, internationalist Barack Obama or gentlemanly Mitt Romney would ever have called Europe, NATO, Mexico, and Canada to account, or warned Iran or North Korea that tit would be met by tat.

“Globalist”? “Internationalist”? “Gentlemanly”? Even Trump’s silly name-calling has seeped into Hanson’s language.

What do these terms signify with regard to trade deficits? Hanson has nao idea. But calling names is mandatory for a Trump follower.

Email him, and ask him why he writes such nonsense. His Email is at the top of his comments.Image result for victor davis hanson

(By the way, I looked for a photo of Hanson here, and this is what I found):

Perhaps that tells it all.

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

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

Ten Steps To Prosperity:
1. ELIMINATE FICA

(Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.

2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE
(H.R. 676, Medicare for All )

This article addresses the questions:
*Does the economy benefit when the rich can afford better health care than can the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”

3. PROVIDE A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All)
(The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Guaranteed Income)) Or institute a reverse income tax.

This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.

4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONE
Five reasons why we should eliminate school loans

Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefitting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.

5. SALARY FOR ATTENDING SCHOOL
Salary for attending school. Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.

6. ELIMINATE FEDERAL TAXES ON BUSINESS
Businesses are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the federal government (the later having no use for those dollars). Any tax on businesses reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all business taxes reduce your personal income.

7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and business taxes would be a good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.

8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME.
(TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.

9. FEDERAL OWNERSHIP OF ALL BANKS
(Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.

10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

The Ten Steps will grow the economy, and narrow the income/wealth/power Gap between the rich and you.

MONETARY SOVEREIGNTY

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