–Watch America, our once great nation, decline – as we cut pieces from ourselves, snip by snip by snip.

Reduced money growth cannot increase economic growth. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
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Nations die from within, their governments, either from ignorance or corruption, slowly cutting away the factors and institutions that made their nations great.

On August 15, 1971, the United States of America went off the gold standard to become “Monetarily Sovereign.” In that fateful instant, our federal government acquired the unlimited ability to create dollars. It no longer could be forced into bankruptcy, except by Congress. America had gained the ability to pay any bill of any size, instantly. No debt was unsustainable.

There are more than 1,000 federal government agencies. Because they are agencies of the government, they too cannot be forced into bankruptcy. Congress, the White House, the Supreme Court, the branches of the military – all are federal agencies. None can go bankrupt. They have the full support of the U.S. government and its unlimited money-creation power.

For reasons clouded in political history, a tiny handful of the 1,000+ U.S. agencies cannot count on unlimited support from the federal government. Among these are Social Security, Medicare and the United States Post Office.

Ostensibly, the first two are supported by the FICA tax, while the USPO is supported by stamp sales. In economic fact though, the budgets of Social Security and Medicare are limited, not supported, by the FICA tax, and the budget of the USPO is limited, not supported, by stamp sales. In a Monetarily Sovereign nation, no form of income, whether taxes or fees, supports government spending.

The measure of a nation is the well-being of its citizens. All three of the above-named agencies are vital to the health and welfare of the United States. The USPO is so important, it specifically is authorized in the Constitution. Notwithstanding the Internet, fax machines and cell phones, America requires postal service, and any lessening of this service lessens America.

The benefits of Social Security, Medicare and the Post Office all are necessary to America’s greatness. Any reduction in the services provided by these three agencies represents a step backward for America.

Today, a Congress and President, ignoring factual economics, debate how once again, they will snip pieces from Medicare and Social Security, diminishing us. And then there was this article from the 8/12/11 Washington Post:

The Postal Service has reduced its workforce by 212,000 positions in the past 10 years and recently announced it is considering the closing of 3,700 post offices. It also has asked Congress to allow it to deliver mail five days a week instead of six and to change a requirement that it pre-fund retiree health benefits.

The USPS said it needs to reduce its workforce by 120,000 career positions by 2015, from a total of about 563,400, on top of the 100,000 it expects by attrition. Some of the 120,000 could come through buyouts and other programs, but a significant number would probably result from layoffs if Congress allows the agency to circumvent union contracts.

At a time when unemployment is one of our most serious problems, the USPO will lose 212,000 jobs in just the next three years. Even more telling are the phrases,” . . .closing of 3,700 post offices. . . “ and “ . . . deliver mail five days a week instead of six . . .”

In what seems now the distant past, mail was delivered twice a day, six days a week. Later, this service was reduced to once a day (snip) and soon just five days a week (snip). And the availability of local post offices will be reduced by another 3,700 (snip). And all too often, in what essentially is a tax increase, the price of postage rises, becoming less and less affordable (snip).

Today, we have a Congressional committee deciding how to cut Medicare benefits once again (snip) and how to reduce Social Security benefits once again (snip).

Slowly America is being cut away, our greatness being gutted by leaders who have neither the wits to understand what they are doing, nor the patriotism to care.

Is Congress like the apocryphal carpenter who shakes his head in puzzlement, “The more I cut the shorter it gets”? Or perhaps more like populist François Duvalier, who destroyed Haiti with the Tonton Macoutes militia and voodoo?

Whatever the analogy, there is no question America is diminishing at the hands of Congress and the President. That will be their legacy. And it all is so unnecessary. In a great nation, Medicare should be enlarged, not cut. In a great nation, Social Security should be expanded, not reduced. In a great nation, the Post Office should provide more services, not fewer.

Our federal government can and should enable the growth of America, not its dissolution. Instead it forms a committee to reduce our money supply, like using leeches to cure anemia. Right before our eyes, our beloved nation is dying the death of a thousand cuts, disappearing at the hands of those elected to protect us. And we are dying with it.

Snip.

Snip.

Snip.

Snip


Rodger Malcolm Mitchell
http://www.rodgermitchell.com


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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. The key equation in economics: Federal Deficits – Net Imports = Net Private Savings

MONETARY SOVEREIGNTY

15 thoughts on “–Watch America, our once great nation, decline – as we cut pieces from ourselves, snip by snip by snip.

  1. “capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone” John Maynard Keynes

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  2. Today economic planning and execution by our national leaders since the 2008 meltdown has been based om John Maynard Keynes economics. How has that worked out?

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  3. TARP, Stimlus, QE1 &2. Your the economist and your asking me? Or is this a gotcha question? Look around and see what is working and what is not. Yes, you will have to use objective reasoning to come to a truthful answer.

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  4. “O.K., so you don’t understand Keynes.” If there wasn’t any government intervention, things would not have been good in the early days of the 2008 collapse. However, those whom made it possible would have been gone (BOA, Citi, Chase, Wells, AIG just to name 5). Country Wide got rolled into BOA and their chief looter is free today because of his relationship with Dodd and Frank. As time pasted and things improved (and they would have improved) not everyone would see better days. Capitolism only rewards those whom produce, so no doubt some would suffer. That is not saying that those haves would purposely hurt they have nots, it is objective fact that not everyone wants to produce. Free money, or the subjective belief that free money will solve lack of willingness to work for his keep are those whom would suffer the most. And I will deserving so. Once people understand that A is A (or for those who don’t want to think) you can’t have your cake and eat it to.

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    1. Glaaaghhh. Ack. John G – you seem to think what you say makes sense. But it doesn’t really. What MMT/Monetary Sovereignty – and yes, Keynes was all about was making sense. Addition. Subtraction. Accounting. Definitions. Calling a spade a spade. Understanding things that are so simple that they repel the mind. Saying trivial things. Which are obvious, once you understand them, once a pioneer has managed to say them, has managed to explain that this piece of common knowledge, this thing that everyone knows, is the key to a difficult puzzle. Which is what all really great science is about. Modern math and science are much simpler at heart than what came before. They usually aren’t presented that way, for a century or so, but they still are.

      Yes, Free money, Keynes, etc can be misused to benefit the Bad Guys. That is partly what happened in 2008. A monetary economy without government intervention is a contradiction in terms. The point is whether it should be run according to principles that 99.99% of the people adhere to and 0.01% pay lip service to, or whether it should service the predatory urges of 0.01% who are professional con men. AN excessive amount of the “government intervention” benefited the 0.01%, but part was for the other 99.99%.

      If you understand economics, you understand that capitalist systems, or more generally monetary economies, will, without what is miscalled “government intervention” , have involuntary unemployment. Monetary economies will force people to not work, as inevitably as Stalin’s USSR might randomly designate every tenth person as “an enemy of the people” and send them to SIberia. Sane governments must provide people with jobs, because the monetary economy they create forced people to be unemployed. Nothing at all to do with people who “don’t want to produce”. Just simple arithmetic applied to normal and reasonable human desires summed over whole economies.

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  5. Please tell me one produce the government ever made / produced? Can any government make a pencil? I mean specifically make a pencil on their own and Not bring in the private sector to do it for them or help them do it. If the government can create jobs and they do, what happens when all the products they use is no longer made by the private business. Can you tell me how those governmemt organizations will provide for them self? BTW: America is now a full functional socialist state. Just looks here and it should become clear -> http://blog.riseofreason.com/socialist-platform-of-1928/111/

    Well, maybe not for some…

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    1. It’s a simple matter of mathematics to show that an economy that can produce what everybody needs without requiring all of the labour available in the economy will fall to an equilibrium lower than that and not produce what everybody needs. That is the paradox of productivity.

      The currency issuer has to top up the system for it to stay stable at maximum output.

      We’ve already tried the infinite private credit solution and seen where that ends up.

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    2. John, sure, if you define things the way you want to, no government ever produced a pencil, or anything else. It has to hire people = private sector to make the pencils. All though you have got to work harder on ideological definitions to cover the cases of government slaves and pencil-making government-owned robots. And no person ever made a pencil. It was his right hand that did it.

      But if one uses ordinary definitions, governments, businesses, people can make pencils. If you look at history, you will see that money came from states and governments. And then came market economies. Not the other way around. If you look at economies, you will see that the creation and destruction of government money is an essential feature. All that Rodger & other thinking economists say is that the government shouldn’t starve the private sector of the one thing it really needs – money.

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  6. i never said government should make pencils. they do have killing down to a science though. it is the “peoples govenment” no? looks to me like alot of the people are being left behind. mitt said corporations are people, if only i could afford an army of lobbyist working on my behalf, maybe they would represent my interest as well. oh wait, isnt that what elections are for? sounds more like corporate fascism to me,if this was the “evil”socialism, maybe we would have single payer or medicare for all.

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