●The more budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor, which 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.
I told this true story about a year ago, and it’s worth repeating now, because of an article I just read:
I can remember an incident from the time I was five years old. I was at a family picnic. My uncle had built a bonfire for warmth, and my parents, uncles and aunts threw branches and leaves into it, which made the fire flare up in a big roar.
We kids loved it, but were not allowed to throw things into the fire, because it was considered dangerous. I recall whining about this, so after a time, my father said, “O.K., you can throw sand into the fire.” Thrilled, I picked up a handful of sand and threw it in, but the fire didn’t grow. So I threw another handful and another, but instead of flaring up, the fire grew smaller.
Finally, much to my dismay, the fire went out, and all the fun went out with it. I thought I was building the fire, but I was putting it out. And on the drive home, when I realized what I had done, I felt so sad. My father had lied. I had misunderstood the difference between wood and sand. That’s what I remember. That feeling of sadness and betrayal and ignorance.
That story again came to mind when I read this is the article, in the November 7th, Florida Sun Sentinal.
Nationwide strike in Greece protests new austerity plan
By Anthee Carassava
Shopkeepers rolled down shutters, transport screeched to a halt and state agencies were closed Tuesday as millions of Greeks walked off their jobs to protest the toughest measure yet unveiled by the government in its bid to slash the nation’s deficit and jump-start the stalled economy.
But three years of piled-on austerity and five years of recession have unleashed a wave of public unrest.
The new measures include futher pay cuts, tax hikes and an increase in the average retirement age. The plan would also sack thousands of public employees and slash severance payments in a society where unemployment has hit 25 percent.
Samaras’ government says the measures are necessary to bring down Greece’s deficit and squeeze out a primary budget surplus.
It’s a lie that putting sand on a fire will stimulate that fire, and it’s an equal lie that cutting federal deficits will stimulate the economy. As a five-year-old, I had misunderstood the differences between wood and sand. Today, the American and Greek adults misunderstand the differences between Monetary Sovereignty and monetary non-sovereignty.
So they pour sand on their fire.
Please remember my little sand-on-the-fire story, as you read and hear lies about the U.S. having to cut federal spending and President Obama’s “grand bargain” of deficit cuts. The purpose of those lies is to widen the gap between the rich and the rest.
The poor and middle will suffer first, but even if you’re rich, eventually you’ll suffer as America’s fire slowly winks out.
Rodger Malcolm Mitchell
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Medicare — parts A, B & D — for everyone
3. Send every American citizen an annual check for $5,000 or give every state $5,000 per capita (Click here)
4. Long-term nursing care for everyone
5. Free education (including post-grad) for everyone
6. Salary for attending school (Click here)
7. Eliminate corporate taxes
8. Increase the standard income tax deduction annually
9. Increase federal spending on the myriad initiatives that benefit America’s 99%
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