I. End federal taxes through V. Free retirement income
MS$=∞ is one of the most important equations in economics. When the information sources acknowledge it, and the public understands it, we could have, in America:
- The end of federal taxes collected ostensibly for funding (Collect federal taxes only to control the economy and to assure demand for the U.S. dollar.)
- The end of poverty by instituting a more generous Social Security for everyone in America, regardless of age.
- Free, no-deductible healthcare for every man, woman, and child regardless of prior health.
- Free K-16+ education, including professional (medical, legal, etc.) for all who want it.
- Free and generous retirement income
- Modern and maintained infrastructure — free roads, utilities, buildings, and mass transit.
- Responsive and helpful government services.
- The prevention/cure for recessions, depressions, and inflation.
- The research and development of AI and other inventions to protect and improve the lives of the people.
- The end of the state and local governments’ need for taxes to fund spending
The equation means: A monetarily sovereign has unlimited access to its own currency.
The U.S. government is Monetarily Sovereign, so it cannot unwillingly run short of U.S. dollars. The fundamental purpose of a government is to improve and protect people’s lives.
The U.S. government operates financially unlike any state, county, city, village, business, or individual. It has the unique power to create U.S. dollars simply by pressing computer keys. It also makes all the laws governing dollar creation and can produce as much money as it wants, whenever it chooses, and distribute it to whomever it decides.
The U.S. government, or any of its agencies, can never unwillingly run out of dollars. If Social Security needed an extra trillion, the government could create it before nightfall. If Medicaid required an additional two trillion, it could be provided at no cost to anyone.
If the military requested five trillion more, Congress could approve it with a simple vote. Even if Senators, Representatives, and Supreme Court Justices wanted their salaries tripled, the government could make it happen with ease. Nothing—absolutely nothing—is unaffordable for the U.S. government.
None of the above is speculation. These are the absolute facts of money, all of which are merely legal numbers on balance sheets that the U.S. federal government owns and controls.
What Would You Do If You Were in Charge of the Government and Understood MS$=∞?
Your list might be different from mine, but here is what I would do:
I. End taxes collected ostensibly for funding.
The federal government has no use for outside income. It actually creates dollars by spending dollars.
The only taxes might be “sin” taxes on cigarettes, alcohol, gambling, illegal drugs, and other products and activities the government wished to discourage or to narrow the Gap between the very rich and the rest. FICA, income taxes, capital gains taxes, and inheritance taxes, except on the very rich, would be eliminated.
This would enrich the working class, aid businesses, and add billions of dollars to Gross Domestic Product.
Taxes on business profits would be eliminated to encourage business growth, while anti-trust laws would be enforced to prevent monopolistic behavior.
Charities would benefit from a “reverse tax” to encourage charitable giving.
II. A more generous Social Security for everyone. The poor are a drag on the nation, not because they are lazy or unwilling. Quite the opposite. Most work hard just to survive.
They face a tough reality, with less time and opportunity to be educated or productive. Often stuck doing menial tasks that machines could handle, they miss out on using the most valuable asset any human has: their mind.
They’re less likely to get an education, become scientists or creatives, or make a positive impact on the world. Instead, poverty and desperation increase the chances of them turning to crime, leading to wasted days in jail that cost both society and them precious time and talent. This cycle often continues, passing poverty down to the next generation.
The Social Security benefit should not be based on income, wealth, age, marital status or any other demographic. Every living American should receive the same monthly benefit. That would eliminated the need for a complex, costly, inefficient, difficult-to-manage program like our tax code has become.
It would reduce crime and the need for the subsistence charities that cater to the very poor.
III. Free, comprehensive, no-deductible healthcare for every person, regardless of prior health, should be a priority. To fulfill its mission to “improve and protect people’s lives,” the government should ensure that everyone has access to top-quality healthcare. This means doctors of all specialties, hospitals, nursing homes for long-term care, nurses, medicines, and equipment should be readily available and free, fully funded by the government.
Achieving this will require substantial financial investment to guarantee accessibility. Private hospitals should receive federal funding, and doctors should be supported by the government, similar to how concierge doctors are supported by patients today.
The “comprehensive, no-deductible” promise ensures no one delays seeking medical care due to financial concerns.
IV. Free K-16+ education, including professional (medical, legal, etc.) for all who want it. Currently, the states, counties, and cities offer free K-12 education, Because they are Monetarily non-Sovereign, financing always becomes an issue.
Thus, too many public schools are understaffed, and the students are underserved. Expensive private schools can exist only because free public schools provide inferior education in an inferior environment. Generous federal funding of public schools could cure the disparity as well as relieving local taxpayers of the financial burden.
Teachers, other staff, school buildings, transportation, books and equipment all should be federally funded.
V. Free and generous retirement income. By the “official” poverty measure seniors appear to have the lowest poverty rate:
- Children (<18): 16.3%;
- Working-age adults (18–64): 11.7%;
- Seniors (65+) 10.9%.
However, the “official” measure ignores medical costs, housing costs, and geographic price differences — all of which disproportionately affect seniors.
The more realistic Supplemental Poverty Measure (SPM, 2024) includes out‑of‑pocket medical expenses, housing costs, and regional price differences, which hit senior harder than any other group. Here we see that seniors are the highest‑poverty age group:
- Children (<18)≈ 12–13%
- Working‑Age Adults (18–64)≈ 8–9%
- Seniors (65+)≈ 14–15%
Social Security is the single largest anti‑poverty program for older Americans. Without it, senior poverty would be about 37–38%, That means current Social Security, as modest as it is, still lifts roughly 17 million seniors above the poverty line. This is the largest anti‑poverty effect of any federal program.
And what was the poverty line in 2024, the time of the above data? These are national base thresholds for a two‑adult household, adjusted by housing status:
- Renters: ~$34,000
- Owners with mortgage: ~$36,000
- Owners without mortgage: ~$28,000
So, even with SS, 14-15% of seniors fell below the poverty line. Without SS, 38-40% of seniors would live in poverty.
The question is: Should the government’s goal be to lift people above the poverty line, or should the goal be higher? The poverty line is basically a bare‑bones survival threshold, not a measure of a decent or secure life. Economists, social scientists, and policy analysts use several higher‑level standards to capture a measure of whether people can live well, not merely avoid destitution.
We suggest creating a Decent Life Index. It would measure a household has enough stable resources to meet basic needs, maintain security and resilience, and participate meaningfully in society.
It combines basic needs, economic security, and relative position (the Gap — distance between income/wealth/power –metrics).
A. BASIC NEEDS includes:
- Housing: safe, stable, non‑overcrowded, <30–35% of income
- Food: reliable, non‑hungry, nutritionally adequate
- Healthcare: access without catastrophic cost risk
- Transportation: reliable access to work, services, social life
- Childcare (if relevant): affordable, safe
- Technology: basic connectivity (phone, internet)
Score: 0: Below basic‑needs threshold (poverty/ALICE‑below), 1: Meets basic needs, no margin, 2: Meets needs with modest margin
B. ECONOMIC SECURITY/RESILIENCE includes:
- Emergency buffer: savings or access to support covering ≥3 months of expenses
- Income stability: no large (>25%) involuntary drops in income over last 2–3 years
- Debt burden: manageable; no chronic delinquency
- Risk exposure: not one medical bill or car repair away from crisis
Score: 0: Highly fragile (one shock → crisis), 1: Some resilience (can absorb small shocks) 2: Strong resilience (can absorb major shocks)
C. GAP POSITION (relative income/wealth/power distribution:)
- Income position: share of median income (e.g., <50%, 50–100%, >100%)
- Wealth position: net assets vs. debt
- Autonomy: ability to refuse exploitative work/housing; bargaining power
Score: 0: Deeply subordinated (low income, no assets, high dependence), 1: Moderate position (some bargaining power, some assets), 2: Strong position (high autonomy, assets, low dependence)
Combining A, B, and C. into a single index
- 0–1: Precarious (below decent life; often People above poverty but still unable to afford childcare, transportation, housing and healthcare)
- 2–3: Barely decent (meeting basics, fragile)
- 4–5: Secure decent life
- 6: Comfortable / empowered
This provides a graded picture, not a binary “poor/not poor.” (Poverty line: “Are you starving or homeless?” DLI: “Can you live a stable, decent, autonomous life?”)
With the Gap lens we can see where do they stand relative to those at the top? The current median SS monthly benefit is $2,000 per month. Comparisons:
- With Current Social Security [median $2,000 per month]: DLI ≈ 3 (Barely decent life);
- With SS median at $5,000 per month: DLI ≈ 6 (Comfortable/empowered; SPM poverty ≈ 0–2%)
Now consider this America:
- Every man, woman, and child gets $5,000/month = $60,000/year. (No other cash or in‑kind aid (no SNAP, housing vouchers, tax credits, etc.)
- Free, comprehensive Medicare for All. Out‑of‑pocket medical costs ≈ $0.
If every American received $5,000/month per person + free comprehensive Medicare for All + no other aid, poverty situation is essentially eliminated.
There would be no need for specialized programs like SNAP, housing vouchers, tax credits and the bureaucratic costs, complications, delays, and unfairness associated with all bureaucracies.
It would be simple: Medicare for All + $5,000 a month for all, and poverty would disappear. Crime would drop significantly
The income/wealth/power Gap would still exist at the top (ownership, capital, political power), but material poverty and basic‑needs deprivation would be gone.
The Fundamental Change: Today a large fraction of Americans live at “precarious” to “barely decent.” A huge cognitive load goes to survival problems like rent, food, medical bills, debt.
With $5,000/month + Medicare for All, Almost everyone jumps to a comfortable, secure, decent life, and survival becomes solved, so attention can move to meaning, contribution, and preference. Not only does that have a personal positive effect, but it affects the entire economy.
Property crimes, like theft, burglary, robbery, and many frauds are heavily driven by economic desperation. With everyone at $60k/year + free healthcare, the economic motive collapses for most. Expect sharp declines in property crime and survival-driven offenses. Some violent crime also is tied to poverty, stress, and unstable environments.
Overall, crime shifts from “survival-driven” to “pathology-driven.” Total crime likely drops substantially and the composition changes.
As to K-12 education, kids show up better fed, better rested, less traumatized by economic chaos. Parents will have more time and mental flexibility to monitor their children. Schools no longer will function as emergency food and crisis management centers. We can expect higher achievement and a lower dropout rate with better behavior.
For higher education (college and beyond) cost becomes less of a barrier; more people can pursue college, trades, or creative paths. Student debt becomes less necessary or less burdensome. Overall, education becomes less about “escaping poverty” and more about “developing capability.” Expect longevity and physical/mental health to improve.
Medicare for All can provide preventive care, chronic disease management, mental health care. No one skips treatment due to cost. There would be massive reductions in untreated conditions, late-stage diagnoses, and medical bankruptcy. Expect stress reduction
Financial stress is one of the biggest health killers. Removing survival anxiety improves sleep, mental health, and physical health. We should expect higher life expectancy, less suffering. lower suicide rates and overall better mental health.
GDP and economic activity would increase. There would be a huge increase in demand and supply. Businesses would thrive. More entrepreneurs would take risks by starting businesses, creating, experimenting—without fear of destitution. There would be more innovation, more small firms, more local projects.
People would no longer be forced into exploitative jobs just to survive. Low-quality, low-respect work would either improve in pay and conditions or be automated, shifting bargaining power toward workers.
GDP would rise, and more importantly, there would be less meaningless work and more productive activity. Society in America would see fewer conflicts over money, fewer evictions, and fewer desperate moves, with more time and emotional energy for relationships.
People would have the time, energy, and will to engage in local politics, volunteering, and organizing. While poverty would be essentially eliminated, the income, wealth, and power gap would still exist. Ownership, capital income, and political power would remain concentrated, but as the floor rises dramatically, the distance between “top” and “bottom” would shrink in lived experience.
Most Americans would move up, with those at the bottom progressing relatively more. The gap would become less about survival and more about influence, luxury, and control. America would become a nation where no one is forced to trade dignity for survival, and the central human question would shift from “How do I survive?” to “What do I do with my life?”
As for the Social Security for All cost, figure $5,000/month for all x 335,000,000 people x $60,000 ≈$20.1
trillion per year. So, assume a cost of about $20 trillion per year in gross payments.
Free comprehensive Medicare for All. Estimated at $6 trillion per year. This covers: Current Medicare, Medicaid, private insurance, employer insurance, out‑of‑pocket, VA, CHIP, and state/local programs.
America’s total medical + SS cost would be about $26 trillion per year, and our Monetarily Sovereign government would pay it all vs. about $3 trillion that the government now pays—an additional $23 trillion in federal spending under the proposed plan.
Because the federal government is Monetarily Sovereign, and MS$=∞ , t can pay for anything simply by pressing computer keys. So, affordability is not a question. One question is inflation, another is sloth (Who will do the work?) both of which will be discussed in the next Chapter.
The last suggestion was V. Free and generous retirement income. Next:
VI. Modern and maintained infrastructure — free roads, utilities, buildings, and mass transit. We will discuss this, plus additional suggestions, and two main objections (inflation and sloth) in a subsequent post.
Rodger Malcolm Mitchell
#Monetary Sovereignty - Mitchell 