Mitchell’s laws:
●The more budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity starves the economy to feed the government, and leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
●To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
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Sorry for insulting whores, who work hard for their money, but how do you know when a politician is lying? Aside from “When he’s moving his lips,” he will use certain buzz words that tip you off.
In the post, “No, it’s not your imagination. The upper 1% really are screwing you more,” we listed ten ironic “suggestions” for how the upper income 1% can continue to increase the income gap.
Here are those suggestions, together with examples of how they are being followed. The purpose is to show you the context in which politicians use their buzz words to destroy the 99%. Listen for them the next time you hear a politician open his/her mouth:
1. Raise taxes via a national sales tax or VAT. Poorer people devote a greater percentage of their income on consumption.
April 6, 2010: Speaking at a New York Historical Society event, Obama adviser Volcker said a VAT is “not as toxic an idea” as it has been in the past and concluded: “If at the end of the day we need to raise taxes, we should raise taxes.” (Newsmax)
2. To “save” Social Security, tell the 99% it’s “insolvent”, so you must reduce benefits and continue to increase the SS starting age. Also, continue to tax SS benefits, as these benefits are most important to lower income people. Maintain or even increase the FICA tax. This tax directly punishes lower salaried people.
(Mitt) proposes that Social Security should be adjusted in a couple of commonsense ways that will put it on the path of solvency and ensure that it is preserved for future generations.
First, for future generations of seniors, Mitt believes that the retirement age should be slowly increased to account for increases in longevity.
Second, for future generations of seniors, Mitt believes that benefits should continue to grow but that the growth rate should be lower for those with higher incomes.
3. To “save” Medicare, tell the 99% it’s insolvent, so you must reduce payments to doctors and hospitals. That way, more of the best doctors will opt for “boutique” practices that only the 1% can afford. Don’t pay for expensive procedures (that only the rich can manage). Continue to tax medical expenses based on percentage of income. (Poor people get no benefit at all.)
The Obama administration’s own Medicare actuary, Richard Foster, has explained that the Obamacare Medicare cuts could make unprofitable 15 percent of hospitals serving Medicare patients. “It is doubtful that many [hospitals and other health care providers] will be able to improve their own productivity to the degree” necessary to accommodate the cuts, Foster has written. “Thus, providers for whom Medicare constitutes a substantial portion of their business could find it difficult to remain profitable, and, absent legislative intervention, might end their participation in the program (possibly jeopardizing care for beneficiaries.
4. Cut federal salaries and benefits to “save taxpayers’ money.” Federal agencies employ the 99%. Military equipment production companies hire the 99%. Cut postal and other government employment. Cut domestic spending, as the vast majority of domestic spending benefits the 99%.
As the chief architect of the House Republicans fiscal 2013 budget proposal, (Paul) Ryan proposed extending the current federal pay freeze through 2015, cutting the size of the federal workforce by 10 percent through attrition and increasing employee contributions to retirement plans. Ryan says this would save taxpayers approximately $386 billion over 10 years.
Note: Federal taxpayers do not pay for federal spending.
5. “Broaden the income tax base” (code words for increasing the number of lower income people forced to pay taxes). Continue the Alternative Minimum Tax (AMT); it catches more of the 99% every year, and the 1% know how to avoid it.
The Romney plan would reduce individual marginal income tax rates across the board by 20%, while keeping current low tax rates on dividends and capital gains. In addition, he would broaden the tax base to ensure that tax reform is revenue-neutral.
6. Cut federal spending to “stop spending money we don’t have” and to reduce “big government.” The reason: Most federal spending creates jobs for the 99%. Especially cut food stamps, unemployment compensation, Medicaid, aid to education, job training and all other federal aid programs. The upper 1% don’t use them.
“We need to stop spending money we don’t have,” said Paul Ryan at the Iowa State Fair on Monday. “President Obama has given us four years of trillion dollar-plus deficits. He is making matters worse, and he is spending our children into a diminished future.”
7. Cut financial assistance to the states, Medicaid, food stamps and farmers. Virtually everything the states do benefits the 99%, and since the states are monetarily non-sovereign, they have nowhere to get money except by taxing their own people. The rich know how to avoid this.
The House Agriculture Committee on Thursday unveiled its approach for a long-term farm and food bill that would reduce spending by $3.5 billion a year, almost half of that coming from cuts in the federal food stamp program.
8. Continue to spread the myth that the U.S. government — a government having the unlimited ability to create dollars — is, or soon will be insolvent, like Greece, and that federal taxes pay for federal spending. These false ideas confuse the 99% and give you a good excuse to cut anything that benefits them. Continue the federal debt limit exercise. Pretend federal finances are the same as personal finances.
“Washington isn’t broken — it’s broke.” By EDWIN FEULNER and SEN. JIM DEMINT
“The United States is becoming too much like Greece and could easily end up in the same place.” By Peter Morici, June 15, 2012 FoxNews.com
9. Continue to allow banks to trade for their own accounts, and always bail them out when their investments go sour. Never accuse any banker of criminal activity. Banks are special.
Republican congressmen vented Wednesday that a signature aspect of President Barack Obama’s financial reform has become too costly and complex to enforce. The so-called “Volcker Rule”— named after former Federal Reserve Chairman Paul Volcker — would restrict banks from trading for their own accounts, a move intended to prevent them from making risky bets with deposits insured by the government.
At a joint House Financial Services subcommittee hearing, Rep. Spencer Bachus (R-Ala.) attacked the rule as being a “self-inflicted wound” for the entire economy, warning that Wall Street jobs could migrate abroad to Canada after the rule starts to go into effect in July.
10. Nominate more arch conservatives to the Supreme Court. Scalia, Alito and Thomas are good models, who have turned the Court into a right wing political organization. The “Citizens United” decision was an excellent step forward. This assures that the agenda favoring the 1% over the 99%, will have the reinforcement of Supreme Court decision.
New York Times: The Supreme Court examined the Arizona immigration law in minute detail, but when it came to revisiting the damage caused by its own handiwork in the 2010 Citizens United case, it couldn’t be bothered. In a single dismissive paragraph on Monday, the court’s conservative majority refused to allow Montana or any other state to impose limits on corporate election spending and wouldn’t even entertain arguments on the subject.
It is not as if those five justices could have missed the $300 million in outside spending that deluged the 2010 Congressional elections or the reports showing that more than $1 billion will be spent by outside groups on Republican candidates this year, overwhelming the competition.
They might also have seen that many of the biggest donations are secret, given to tax-free advocacy groups in defiance even of the admonition in Citizens United that independent contributions should be disclosed.
The court’s five conservative justices struck down a Montana law that prohibited corporate spending in elections — a law passed in 1912 not out of some theoretical concern about money corrupting elections but to put an end to actual influence-buying by copper barons.
But the frustration of the dissenters, led by Justice Stephen Breyer, was clear. He said grave doubt had been cast on the majority’s belief, expressed in Citizens United, that independent expenditures do not give rise to corruption or even give the appearance of corruption. But he said the majority had made it plain that it hasn’t the slightest interest in reconsidering or altering its decision.
While the real anti-99% dirty work is done by Republicans, Democrats cannot claim complete innocence. They consistently have failed to disseminate the truth, namely that the federal government easily can support all social programs, without taxes and without borrowing.
Yes, it takes courage to argue against popular wisdom, especially when courting voters. But, think back, Mr. & Ms. politician. Why the heck did you run for office, originally? Do you remember when you hoped to do good for America? Do you feel pride, now that you’ve become a crass, meaningless party servant, who “goes along to get along”?
Is political power really worth becoming a lying whore?
Rodger Malcolm Mitchell
Monetary Sovereignty
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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. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports
#MONETARY SOVEREIGNTY
#Monetary Sovereignty - Mitchell 
GREAT ARTICLE !!
But you blew it at the end…..”Is political power really worth becoming a lying whore?”
Isn’t that the question the 1% ask those in office, “Isn’t it great being ….?”
P.S. Please tell me you read ”
http://archive.org/stream/roleofmoney032861mbp/roleofmoney032861mbp_djvu.txt
THE
ROLE OF MONEY
WHAT IT SHOULD BE,
CONTRASTED WITH WHAT IT HAS BECOME
By
FREDERICK SODDY
M.A. (Oxon) ; LL.D. (Glasgow) ; F.R.S. ; Nobel Laureate
in Chemistry, 1921 ; Author of ” Science and Life ” ; ” Wealth,
Virtual Wealth , and Debt ” ; ” Money versus Man ” ; etc.
Printed in 1926,1933 It has to answers to all items above.You have to read it .
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Nope. Summarize it so I’ll know whether I want to read it.
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Frederick Soddy is always worth reading.
Of course, government also destroys money by taxing. The government can also redistribute income and wealth by taxing and spending.
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Clonal Antibody , “The government can also redistribute income and wealth by taxing and spending.”
Could you imagine if that same government were to be the only way and means for the issuance of its sovereign currency (That being “money” based by all the goods and services of the country) and were to charge interest on that money as a means to controll its quality and quantity as well as its DISTRIBUTION ? And if it did this for the betterment of mankind-instead of as at present those doing this (for profit banks)for the servitude of mankind. Tax money,not people.
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Frederick Soddy
From Wikipedia, the free encyclopedia…..
“…In four books written from 1921 to 1934, Soddy carried on a “quixotic campaign for a radical restructuring of global monetary relationships”, offering a perspective on economics rooted in physics—the laws of thermodynamics, in particular—and was “roundly dismissed as a crank”. While most of his proposals – “to abandon the gold standard, let international exchange rates float, use federal surpluses and deficits as macroeconomic policy tools that could counter cyclical trends, and establish bureaus of economic statistics (including a consumer price index) in order to facilitate this effort” – are now conventional practice, his critique of fractional-reserve banking still “remains outside the bounds of conventional wisdom”. Soddy wrote that financial debts grew exponentially at compound interest but the real economy was based on exhaustible stocks of fossil fuels. Energy obtained from the fossil fuels could not be used again. This criticism of economic growth is echoed by his intellectual heirs in the now emergent field of ecological economics.
Justaluckyfool asks “…while most of his proposal are now conventional practice…”, why is he ignored? Is the world really flat, or does the Sun revolve around the world, or are banks solvent ? ?
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“Thursday (first week of August, 2012), the Commerce Department reported that the deficit on international trade in goods and services was $42.9 billion in June.
Imported oil and subsidized imports from China account for nearly the entire trade gap and pose the most significant barriers to robust growth and jobs creation.
The economic recovery began five months after Barack Obama took office, and GDP growth has averaged 2.2 percent. In October 2009, unemployment peaked at 10 percent, but has fallen to 8.3 percent — almost entirely because fewer Americans are seeking work.
Ronald Reagan inherited a similarly troubled economy with unemployment cresting at 10.8 early in his presidency. When he sought reelection, the economy was growing at 6.3 percent, unemployment was 7.3 percent and a rising percentage of Americans were seeking work.
Nowadays, economists agree the U.S. economy suffers from too little demand. Consumers are spending and taking on debt, but too many dollars go abroad to pay for Middle East oil and Chinese goods that do not return to buy U.S. exports. Businesses remain pessimistic and don’t hire.
Mr. Reagan encouraged the development of natural resources and endured much criticism from environmentalists and academics. Whereas Mr. Obama has talked repeatedly about developing the full range of energy resources, but has bent to their pressure and imposed counterproductive limits on oil production in the Gulf, off the Pacific and Atlantic Coasts, and Alaska. Merely replacing domestic oil with imports does little to improve air quality or curb CO2 emissions.
These policies are premised on faulty assumptions about the immediate potential of electric cars and unconventional energy sources, and in combination, those make the United States much more dependent than necessary on imported oil.
Oil imports could be cut by two-thirds by boosting U.S. oil production to 10 million barrels a day, and immediately implementing more feasible solutions like the aggressive use of natural gas in fleet vehicles and more fuel efficient internal combustion engines.
To keep Chinese products artificially inexpensive on US store shelves, Beijing undervalues the yuan by 40 percent. It pirates US technology, subsidizes exports and imposes high tariffs on imports.
Mr. Reagan was a forceful advocate for US economic interests with the preeminent rivals of his day, like Japan. Whereas Mr. Obama, like President George W. Bush, has sought to alter Chinese policies through endless negotiations.
Beijing offers token gestures, knowing President Obama will not take the strong actions, advocated by economists across the ideological and political spectrum, to force China to abandon its mercantilist policies. It successfully cultivates political support for the Bush-Obama policy of appeasement among large U.S. multinationals and banks doing business and profiting from mercantilism in the Middle Kingdom.
Cutting the trade deficit in half, through domestic energy development and conservation, and forcing China’s hand on currency manipulation and other protectionist practices would increase GDP by about $500 billion a year and create at least 5 million jobs.
Longer term, large trade deficits shift resources from manufacturing and service activities that compete in global markets to domestically focused industries. The former undertake much more R&D and investments in human capital.
Cutting the trade deficit in half would raise U.S. economic growth by one to two percentage points. But for the trade deficits of the Bush and Obama years, US GDP would be 10 to 20 percent greater than it is today, per capita income as much as five to ten thousand dollars higher, and unemployment not much of a problem.”
-Peter Morici (is an economist and professor at the Smith School of Business, University of Maryland)
Is this guy in dreamland, or just a typical old school economics shill?
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Just a,
“Soddy wrote that financial debts grew exponentially at compound interest. . .”
Oh, really? This persistent hypothesis doesn’t square with the facts.
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RMM, What is it that you call “mis direction”?
Why do you use a chart that states -NONFINANCIAL- sectors ?
Also I would take issue with you taking one proposal, regardless of correct or not, to use to discredit ten or twenty propoasals.
Is he correct that banks are insolvent, loaning money that they don’t have ? If all depositors were to claim their “money” would they be able to pay them? I don’t think so .
And is this statement false, quote from Michael Hudson,””…. The Mathematics of Compound Interest
A syndicate of less than one hundred American capitalists, if allowed to collect interest on their capital at a low rate and re-invest for 150 years or less, would at the end of that time own the earth and all real and personal property thereon. This is a simple mathematical proposition, capable of exact demonstration, and any one who doubts the truth of this statement may set all doubts at rest by computing compound interest on one and one-half billions of dollars for one hundred and fifty years, at five per cent per annum.”
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Rodger,
The chart you just showed shows exactly what Soddy said – Debt grows at a compounded rate. I do not see any negative rate of growth there.
Showed differently
or on a log scale
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What is that compounded rate?
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The two graphs that may not have embedded in my reply
http://research.stlouisfed.org/fredgraph.png?g=9CO
and
http://research.stlouisfed.org/fredgraph.png?g=9CP
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Right. Debt (aka, the money supply) grows every year. Thank goodness. The year the debt (money supply) doesn’t grow, we’ll enter a depression. That is the whole point of this blog and the whole point of Monetary Sovereignty.
Neither justa nor Soddy seems to understand that debt = money. They are living in the monetarily non-sovereign, gold standard days.
Why do you want the money supply not to grow?
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RMM, “Right. Debt (aka, the money supply) grows every year. Thank goodness. The year the debt (money supply) doesn’t grow, we’ll enter a depression. That is the whole point of this blog and the whole point of Monetary Sovereignty.”
Neither justa nor Soddy seems to understand that debt = money. They are living in the monetarily non-sovereign, gold standard days.
Why do you want the money supply not to grow?”
YES,yes,RMM…….but the growth is “profit for the banks” and that is the point ! Why give the private banks over time “all the wealth of the nation”
Justaluckyfool would rather it be given to the nation as revenue for re distribution. Could we say, ” Misdirection is used by the “lying whores” for the “Misdirection of money “/debt.
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That is exactly what Soddy is saying. You are reacting – as you have not read Soddy. He is separating Private Debt from Public Debt. Public Debt is the Money issued by a Sovereign Nation. Public Debt does NOT have to be paid back, while Private Debt Does – non payment means the ruin of one or the other party to the debt. This is what Soddy is saying — and that is almost exactly what you are saying. Only Soddy wrote this almost a hundred years ago – when the world was still on a “Gold Standard” and he was advocating for a fiat currency.
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Actually, clonal
I’m reacting to the thrust of the comments. Federal debt grows nearly every year. So what?
As you say, I have discussed the differences between federal and private debt, on many occasions. (https://rodgermmitchell.wordpress.com/2010/06/14/is-federal-money-better-than-other-money/), but lately this blog has been inundated (most of which I don’t post) with ignorant comments about “debt-free money” and the dangers of growing debt.
I already have read books written by people, who agree with me. Don’t need more. I’m more likely to read the books by people who disagree, so long as the books don’t advocate:
1.Perpetual motion machines
2. Anti-evolution
3. Debt-free money
4. Austerity
Is there an argument of substance here, or are we just doing a semantic dance?
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