Mitchell’s laws: Reduced money growth never stimulates economic growth. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity breeds austerity and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
Have you noticed that the most angry battles sometimes concern the least significant problems? “She looked at me funny.” “He gave me the finger.” “My religion is better than yours.” “Your kids are ugly.”
In that vein, the most significant, most publicized, most hotly debated Congressional debate in recent memory, actually doesn’t matter. We have moved to the right. The Democrats are the new Republicans; the Republicans are the new fascists. But that is not the debate. The federal debt “problem” debate focuses on whether to use the Boehner plan, the Reid plan, the Gang of Six plan, the Republican, Democrat or Tea Party plan. And none of this makes much difference.
Why? The key feature of every submitted plan is deficit reduction; the rest is details. So, deficit reduction is not being debated. And it is deficit reduction that will lead to the next recession or depression, for it is deficit reduction that will reduce the growth of our economy’s money supply and our economy.
Deficit spending is the federal government’s method for adding money to the economy and for providing benefits to our children and grandchildren -– health care, retirement, roads and bridges, medical research, food and housing for the poor, scientific research, education, homeland security, food safety, retirement security, investment security and perhaps above all, employment.
The federal government is the economy’s biggest customer. When a business’s biggest customer begins to buy less, what happens to the business? That is what will happen to hundreds of thousands of businesses, and their employees, when the government begins to reduce its purchasing. Not a good thing for the unemployment problem. The federal government also is the economy’s biggest employer. What happens when the biggest employer begins to fire employees? Also, not a good thing for the unemployment problem.
Since money is the lifeblood of our economy, reducing the money supply is like applying leeches to cure anemia. The left vs right debate essentially has devolved to, “Shall I shoot you with the gun held in my left hand or held in my right hand?” The President and Congress are playing Russian roulette with our lives, and either way, you will be dead, just as any of the deficit-reduction plans will shoot the U.S. economy dead.
But no one is discussing that. Cutting the federal deficit essentially is a fait accompli, with only the method up for debate. Sadly, the result of cutting the deficit will be recession or depression. The economic pain will be distributed according to class. The wealthiest will feel almost nothing; the poorest will be devastated.
Ironically, the poorest are marching for deficit reduction, shoulder to shoulder with the rich. Why? They have been sold a bill of goods, by the media and the politicians, that they, their children and their grandchildren will benefit, when in fact, deficit reduction will increase the gap between the rich and he poor, by making the poor much poorer.
So don’t get all steamed up about who is wrong and who is right, who is a DINO (Democrat in name only) and who is a RINO (Republican in name only). Those things are meaningless. When the DINO battles the RINO, the LAWN (Lower Average Wage Nobodies) will get trampled.
Rodger Malcolm Mitchell
No nation can tax itself into prosperity, nor grow without money growth.