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. Economic austerity causes civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
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A friend asked me, “Why doesn’t President Obama give #Occupy Wall Street a great big, public hug and kiss?”
Good question. After all, they are the antithesis of the Tea Party, which essentially has ruined the first three years of Obama’s presidency, and which was embraced by the Republicans. Tea/Republicans are an elitist organization (though many of its members don’t seem to understand that). The Teas want to cut taxes on the wealthy while reducing benefits to the poor. They hate Social Security, Medicare and Medicaid, most of which benefits go to the lower classes.
It’s no wonder that the Tea/Republicans have come out so strongly against #OWS, as witness this from Paul Krugman’s 10/9/11 column in the New York Times:
It remains to be seen whether the Occupy Wall Street protests will change America’s direction. Yet the protests have already elicited a remarkably hysterical reaction from Wall Street, the super-rich in general, and politicians and pundits who reliably serve the interests of the wealthiest hundredth of a percent.
[…]
Eric Cantor, the House majority leader, has denounced “mobs” and “the pitting of Americans against Americans.” The G.O.P. presidential candidates have weighed in, with Mitt Romney accusing the protesters of waging “class warfare,” while Herman Cain calls them “anti-American.” My favorite, however, is Senator Rand Paul, who for some reason worries that the protesters will start seizing iPads, because they believe rich people don’t deserve to have them.Michael Bloomberg, New York’s mayor and a financial-industry titan in his own right, was a bit more moderate, but still accused the protesters of trying to “take the jobs away from people working in this city,” a statement that bears no resemblance to the movement’s actual goals.
[…]
What’s going on here? The answer, surely, is that Wall Street’s Masters of the Universe realize, deep down, how morally indefensible their position is. They’re not John Galt; they’re not even Steve Jobs. They’re people who got rich by peddling complex financial schemes that, far from delivering clear benefits to the American people, helped push us into a crisis whose aftereffects continue to blight the lives of tens of millions of their fellow citizens.
So where is Obama? Since the vast majority of our voters empathize with #OWS’s mood, if not its proposals (so far, it has none. See: Nine Steps to Prosperity), you would think a vote-hungry politician like Obama would be camping out on Wall Street, in “Tent 1.” Yes that’s what you would think, if you believed he supports the regular folk. But he doesn’t.
Sorry to tell you this, liberal voters. You elected him, but doesn’t love you. He is an elitist who graduated from Columbia and Harvard law school, and was president of the Harvard Law Review. He taught at the University of Chicago. This is all elitist stuff. He bought a house for somewhere between $300K and $950K less than it was worth (depending on how you count acreage), thanks to a huge favor from his pal Tony Rezko, convicted swindler. Regular folk don’t get deals from Tony Rezko.
The Obama administration is loaded with bankers and bank-related cronies, and as you may have noticed, while the banks caused all the fraud problems, their friend, Barack Obama bailed them out — and not one banker has been arrested, much less tried and convicted of the most massive fraud, not just in U.S. history, but in world history (Try to name one bigger).
To pull the wool over voters’ eyes, he instituted the HAMP program, which punished suffering people even more, by seeming to be a solution to mortgage problems, but was a fraudulent waste of time. Just what these poor people needed: A waste of time.
Obama’s solution to the Social Security “problem” is to raise the regular folks’ qualifying age, and he goes along with the Tea/Republicans on the need to cut federal spending, most of which benefits the less fortunate. So this man has been far, far from a supporter of regular folk. He’s acted more like a charter member of the “Screw You, I’ve Got Mine” clan.
Yes, he’s a bit better than the Tea/Republicans, who at least are honest in that they make no secret of their disdain for the underclass. But really, from where does Obama get his political contributions? And what happens to those contributions if he supports #OWS? Think about it.
So, eventually, Obama may may be dragged, kicking and screaming, into support for #OWS. He can count votes. But his reluctance is telling.
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
#Monetary Sovereignty - Mitchell 
The right wing panic grows.
If you are mad at those people who are just jealous and playing the victim card, and who are anti-capitalist, and who are part of a mob that pits Americans against Americans, and who hate freedom, industry and business, vote Tea/Republican in the next election.
But if you feel you have been screwed over by the banks and Wall Street, and you feel the same anger those folks do . . . well, decide for yourself.
Rodger Malcolm Mitchell
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I thought it was Wall St that was anti capitalist, having mutated into little more than a giant skimming operation. It’s not the federal government that is ‘crowding out’ real business, it’s the FIRE sector. This would make the protests at least directed towards the right place, it’s inherent in the name of the protest, it’s Wall St and all the financial shenannigans that it represents, not productive business thats being targeted.
The reaction from the shills tends to suggest they are on target. They were quite happy with the Tea Party as it was quite a handy way to miss-direct some of the anger that many working class people must be feeling.
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I make $43,000 a year, but I don’t feel screwed over by Wall Street. I guess it’s because I’m employed and own a home I only was able to buy because the housing bubble popped.
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“. . . you would think a vote-hungry politician like Obama would be camping out on Wall Street, in ‘Tent 1.’ Yes that’s what you would think, if you believed he supports the regular folk. But he doesn’t. . . .Sorry to tell you this, liberal voters. You elected him, but doesn’t love you.”
While there is plenty to criticize in both parties, I don’t think that is a fair evaluation. My opinion is that the President of the US (by that I mean, not just Obama, any President of either party), has to be especially careful here. The President is supposed to represent all the people; I think he’s been extraordinarily cautious about criticizing the Tea Party for the same reason, even though I’d bet he dislikes everything about their philosophy (and admires what’s going on with OWS).
Expressing full support of the OWS movement at this stage will look opportunistic, partisan, and impetuous. Before OWS proves it is working in the interests of all citizens and for the betterment of the country (which I believe it is), and before it gets powerful enough to develop into a lasting force for serious positive change, it would be irresponsible for the US President to express full support. President Obama is a man who believes in propriety, and we should be happy he does because that’s what the office requires.
The rants against Obama by progressives I find especially disturbing; it always seems they criticize from a position of safety, without having to worry about the huge consequences of every single thing they say or decision they make; without having to worry about supporting something you believe in with all your heart today, but which by supporting now will cost more to the nation overall and/or later. The job of President is mega-complicated, made more so by nasty enemies just waiting to take advantage. I doubt any know-it-all critic badmouthing the President understands a fraction of the carefulness, planning and patience involved involved in achieving anything positive.
Presidents for the most part do the best they can with the tools (and shortcomings) they have; anyone of us trying to do the job would find ourselves exactly in such a situation.
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All Presidents have many problems. Some Presidents are better than others at solving those problems. In my opinion, President Obama has been worse than average.
The philosophy of compromise at all costs, is not leadership. Owning both the presidency and the Senate, yet being paralyzed by a Senate minority, demonstrates a spinelessness Americans do not admire.
Rodger Malcolm Mitchell
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How do you know anyone in the universe could do better in the same circumstances? The President is not all powerful (that’s how our government is designed), and right now ours has both the Supreme Court and congress thwarting him at best, and actively trying to destroy him at worst.
Is Obama supposed to have supernatural powers? Did he elect the hard core right wingers to office? Did he appoint a conservative Court? As a loyal American, I try to support as best I can any President in office; others seem to blame the President for the extraordinary slow rate he progresses. I see him like the steady but sure turtle, others seem to see him as a slacker. I see him limiting the damage that could have been a lot worse given how much power the other branches have, and others see that as inadequate.
I don’t know, it seems to me progressives should be behind our man, and give him all the support we can because it is the very best we’ve got (and Obama may prove to be a lot better over the long haul than many realize). A lot of great leaders work carefully, slowly, and steadily; the jack rabbits in a hurry are always the first to criticize.
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totally agree with you, les. i, too, have a problem with all the criticism of the president in general and of obama in particular.
we have a government of 3 branches, the legislative, the executive and the judicial. i personally am tired of hearing about the president “failing” to create jobs or improve the economy when it is, plain and simple, not his responsibility to do so, as head of the executive branch of government. that’s congress’ job. all the president can do is submit a bill to congress and then get on his knees and beg them to pass it.
once they pass a bill, if he likes it, he can sign it and if he doesn’t then he can veto it, but they (congress) can override his veto, so there is very little that the president can do with reference to the economy. it’s pretty much all in congress’ hands.
i, too, understand rodger’s frustration, but it appears, judging from his statements, that obama is clueless about the economy. but that’s partially the fault of the clueless people who elected him. if most of the voters are clueless, then, chances are, you’re gonna end up with a clueless politician in office.
and, as for obama getting behind the people at OWS, i also agree with les on this. who are these people? what exactly are their demands?
i think it’s way too early for him to go up there. he should just sit tight and wait to see how this thing plays out. if he gets a clear message from these people that he can support (or, more cynically, use) then it may be “useful” for him to go up there and give a speech, or better yet, not give a speech, but just show up “quietly” and mill around the crowd under darkness of night and then have photos & grainy videos taken of him talking with the protesters and then have those “leaked” over the internet.
that, i think, would go a long way to enhancing his image with his support-base as well as with the protesters.
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Les, I know others could do better, simply because President Obama does not understand Monetary Sovereignty. So rather than telling America the truth, he goes along with the myth that taxes must be raised to “pay for” federal spending.
Rather than pandering to the ignorant majority, he could have told America that federal deficits are necessary for economic growth, and the government has no difficulty whatsoever in “sustaining” the debt.
There are many people “in the universe” who understand this and would have the courage to say it. Sadly, Obama does neither. I suggest you re-think your “Bad-or-good-I-support-the-President” dogma. Some are good, some are bad, and some are truly awful.
Rodger Malcolm Mitchell
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I’m with you, Rodger, but it’ll never fly,
You ever watch Jay Leno’s segment “Jaywalking?” Most Americans can’t even identify Joe Biden by picture, so I doubt they’ll be convinced, in the face of a determined opposition with a good misinformation apparatus (a.k.a. the GOP), that federal debt is good, But maybe I’m being too cynical.
Personally, I wish Obama had a little LBJ in him too, but we have to work with what we have. I’d rather elect someone who listens to Paul Krugman for economic advice then someone who listens to Peter Schiff, even though they’re both wrong.
In my opinion, the best strategy for getting the correct economic policies in place are infiltrating academia (filling American universities with professors like the UMKC economics department faculty) and government (get the right people, like maybe Dr. Galbraith from UT-Austin, appointed to economic advisory posts or the Fed, and electing them to office, like Warren Mosler attempted).
Just like the biology teacher that won an award recently for teaching evolution without calling it evolution, and thus avoided the ire of evangelical parents, we need to get clever. Saying federal debt is good (even when we know it is) is just not a clever way to go about it. Calling it debt isn’t even good. We need to pull a Frank Luntz and start renaming everything. Get a little Orwellian. It’s not “drilling for oil”…it’s “energy exploration”…not “anti-labor” legislation….”right-to-work” legislation.
Maybe I’m wrong…
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Understanding the ideal, and being in the thick of fighting for every millimeter of progress are two different things. We have far too many armchair quarterbacks and not enough supportive team members. Just so it’s clear, I have nothing to say here about your monetary sovereignty ideas, I am only speaking to your willingness to make these kind of statements in public, “. . . you would think a vote-hungry politician like Obama would be camping out on Wall Street, in ‘Tent 1.’ Yes that’s what you would think, if you believed he supports the regular folk. But he doesn’t. . . .Sorry to tell you this, liberal voters. You elected him, but doesn’t love you.”
My attitude isn’t merely due to “bad or good” President support. I think 1) Obama is a great President, and 2) that the know-it-alls act superior when they have NO experience running a government on the world stage, a FRACTION of the understanding it takes to grasp what’s going on behind the scenes, NO knowledge of Obama’s long-term strategy, and who, when they evaluate the President, speak ONLY of what he hasn’t done and very little of all that he has managed to achieve; what they DO have is plenty of hubris along with the willingness to slander our best shot at improving the dismal state of things in our country (which, BTW, is a lot more than debt and finances).
So no thanks, I’ll not rethink my loyalty . . . I’ll leave that to geniuses who can’t seem to put forth their own ideas without vilifying our President.
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Hey guys,
I agree the President doesn’t have absolute power, but he’s not as powerless as you make out.
If he wanted to go after the crooked banksters, he would have. But he doesn’t. He like those bastards much more than the people they screwed.
If he didn’t want to cut Social Security, he would threaten to veto any such law, just as the Tea/Republicans have threatened to veto a tax increase on the rich. But in fact, he wants to cut Social Security.
The President has enormous power to do “favors” for those who are with him and to punish those who are not. And to blame his economic ignorance on ignorant voters is the worst excuse I’ve yet heard for incompetence.
You like him? Fine. You hate him? Also fine. But let’s not portray him as some poor, helpless soul, who doesn’t have the clout to get things done — if he wanted to. His obvious weakness is what has stimulated the Tea/Republicans. Like sharks, they smell weakness.
Remember Truman’s sign, “The buck stops here.” Let’s not pass Obama’s buck.
Rodger Malcolm Mitchell
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“And to blame his economic ignorance on ignorant voters is the worst excuse I’ve yet heard for incompetence.”
perhaps i wasn’t as clear there as i should have been. i was not blaming his “economic ignorance on ignorant voters.” what i was blaming on ignorant voters was the fact that an ignorant politician got elected to office in the first place.
also, one question for you, Rodger–did you come out of the womb understanding monetary sovereignty? i’m honestly curious to know exactly when was the moment you finally “got it?” was it 5 years ago, 10 years ago, 20 years ago, 30 years ago?? when was it?
every human being can’t possibly know every single thing out there there is to know. i know in my case i didn’t come to this until i read a post by “beowulf” a coupla years ago on Mish’s website that referenced you and provide a link to your site. before then i was totally unaware of the notion of monetary sovereignty or MMT or PK, or whatever. and then you and ellen hodgson brown (“the web of debt”) referenced warren mosler and that’s when it started to make sense.
i used to listen to that fool, peter schiff, and i vaguely recall once or twice he was on msnbc or somewhere debating jamie galbraith. schiff and the host kept cutting in on him, so we, the clueless public, couldn’t hear him say anything of substance. i say that to point out that 99.99% of the commentary on the economy that you hear on tv or the radio or elsewhere is same ol’ debt terrorist BS.
so, like, unless you’re lucky, like i was 2 years ago to read that post by beowulf, how do you find the truth when you deluged with so much BS on a daily basis?
i just think that given that fact, you just can’t blame someone for not knowing something that you somehow have figured out, even if they are educated and wealthy, and, in this case, President of the US of A.
resp,
yuu kim
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Kim, I wrote my first book about 15 years ago, so I probably figured it out about 20 years ago. I literally woke up one morning with a high school teacher’s words in my mind, “All money is debt.” As I began to think about those four words, I kept asking my self, “If all money is debt then . . . what?
All those questions and answers became a book, which was revised to FREE MONEY. Professor Randall Wray read FREE MONEY and asked me to speak at UMKC. It was after the speech, and at dinner with Randy, that I first discovered MMT. All that time I thought I had invented the whole concept!
In short, I got my start just by thinking, and subsequently learned from various sources.
Rodger Malcolm Mitchell
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Rodger you have been aware about Monetary Sovereignty for a while, and I think you don’t realize how hard it is for the average Joe to reject things that everybody says is true and would never question!
For example, the biggest hurdle for the average Joe is the idea that Federal taxes don’t go into the Federal government’s checking account and go back out to pay for Federal expenses.
That is a hard pill for the average Joe to swallow because they have to take your word for it, and when somebody posts that FACT on an internet discussion site, it simply gets dismissed.
Fortunately for me, I did not have to take your word nor anyone elses word for it, because I am a computer programmer who has worked on government and banking systems, so I know which accounts get debitted and which get creditted!
Unfortunately for the average Joe, they don’t have that irrefuteable proof that I do, and with everyone from the President on down LYING and saying that we need Federal taxes to pay for Federal expenses, you can’t fault that average Joe for not believing.
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You are correct.
For instance, On August 7th, Alan Greenspan told NBC’s “Meet the Press,” when answering a question about the S&P downgrade of U.S. bonds:
“This is not an issue of credit rating. The United States can pay any debt it has because we can always print money to do that. So there is zero probability of default.”
When I tell debt-hawks the U.S. has the unlimited ability to create money, and therefore neither needs nor uses tax money, they always agree. They know the U.S. can “print” unlimited dollars, and if a nation can create unlimited dollars, it has no need to ask you or me for dollars. Debt-hawks understand this.
Their sole caveat is, “Yes, the government can print unlimited money, but that would cause inflation.” (See how, at that moment, the subject changes from the government’s ability to create money, and its lack of need for taxes, to inflation.)
Then, I refer them to a graph showing zero relationship between federal deficits and inflation, and their minds shut down. It’s all too alien for narrow brains, but not for lack of facts. The facts are there for all to hear, but not if they cover their ears and keep shouting, “I can’t hear you; I can’t hear you.”
Economics isn’t the only science that has had this problem. Virtually all have, at various times.
Rodger Malcolm Mitchell
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Rodger,
Another great, to the point post. When I read comments like those above it just solidifies my belief in the ambivalence of the average American. Why must they support those whose policies assure the destruction of government which works for public purpose and democratic process. “I think Obama is a great president”, man what more must this person do before you realize he’s so far from one, a great president, that it’s incomprehensible how one could make such a statement? Have you once taken a look at the policies this man supports? What will it take for people to wake up?
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In an October 11, 2011 letter, New York Mayor Bloomberg (one of America’s wealthiest men), told the New York police commissioner Raymond Kelly to “clear the park” (of Occupy Wall Street protesters). His stated reasons were for sanitary and safety purposes.
See the letter at: http://members.beforeitsnews.com/story/1227/591/NL/Occupy_Wall_Street_Evicted.html
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More police state action in New York. That this could happen in America truly is frightening. http://www.nakedcapitalism.com/2011/10/24-people-arrested-for-trying-to-close-accounts-at-citibank.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29
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did you really expect anything different?? this has been happening in america for quite some time now! don’t you remember how the police dealt with the burgeoning union movement before WW2? or with supposed communists in the postwar years? or with the black movement in the 60s? or with the anti-war movement back in the late 60’s and early 70s? there’s nothing exceptional at all about what’s going on in nyc at the moment, not to mention the rest of the country.
and, for me, this is proof positive of how utterly evil these people are. the money that they refuse to spend to “fund” the public, they, in turn, use instead to fund the “goon squad!”
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Nope, it’s exactly what I expected. At the very top of this, and other posts, I said, “Economic austerity causes civil disorder.”
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And it’s not just New York: http://www.correntewire.com/so_how_many_times_have_banks_had_people_arrested_who_tried_to_close_their_accounts
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12 Most Absurd Laws Used To Stifle The Occupy Wall St. Movement Around The Country
Martial Law: New York police state unfolding?
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