●The more federal 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.
●Cutting the deficit is the government’s method for taking dollars from the middle class and giving them to the rich.
●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.
●The penalty for ignorance is slavery.
The Florida Sun Sentinel is a nice little paper that periodically publishes some news. It’s editorials generally are of the safe “Crime is not a good thing” variety. But occasionally, the editors must feel the need to attack a big problem, and the result is the following mess:
Now, avert “fiscal abyss
Of all the reaction to Washington’s last-minute compromise for averting the “fiscal cliff,” the most clarifying message comes from China, our biggest foreign creditor.
The United States, said China’s Xingu news agency, must deal with a budget deficit that threatens not just a “fiscal cliff,” but a “fiscal abyss.”
“In a democracy like the United States, tax increases and spending cuts — the exact dose of medicine needed to cure its chronic debt disease — have long proved hugely unpopular among voters. So the politicians have chosen to kick the can down the road again and again. But as we all know, the can will never disappear. Sometime and somewhere, you might trip over it and fall hard on the ground, or in the U.S. case, into an abyss you can never come out of.”
How “clarifying.” Tax increases and spending cuts, to remove dollars from our economy (i.e. applying leeches to cure anemia), are just what our recession-wracked economy needs. How do we know? Our dear friends, the Chinese, say so. And, as we all know, they have our best interests at heart.
China’s reaction is important because it has become our major foreign banker, our dealer, and at some point, it could turn off the tap.
For those of you who have not yet become familiar with Monetary Sovereignty, “turn off the tap” is a meaningless, actually ludicrous, phrase when applied to the U.S. government. China is neither our banker nor our dealer.
China merely is a depositor in its T-security account at the Federal Reserve Bank. What would happen if China “turned off the tap,” i.e stopped depositing? Absolutely nothing.
The U.S., now being Monetarily Sovereign, would continue to create its sovereign currency exactly the same as it has since August 15, 1971, when it went off the gold standard. The U.S. never, ever can run short of the dollars it has the unlimited ability to create.
And what would happen if China wanted its dollars back? The Federal Reserve Bank would transfer China’s dollars from its T-security account to its checking account, also at the Federal Reserve Bank. Visualize you transferring dollars from your savings account to your checking account. Is this a problem?
Note to Sun Sentinal: Federal finances are not like personal finances. Learn the difference before you write further nonsense.
The ignorance continues:
And what will happen to the United States when the banks refuse to loan us any more money? Must we face an abyss to act?
How does one address the abject ignorance of the above comment? Banks do not lend the federal government anything. The federal government, having the infinite ability to create its sovereign currency, does not need to ask banks or China or anyone else for its sovereign currency.
Many of us took a measure of relief in Congress having passed a New Year’s Day compromise bill to avert dramatic spending cuts and tax hikes, a “fiscal cliff” combination that economists said would have shocked our tattered economy back into recession.
What Congress did was slightly raise taxes on the rich and dramatically raise taxes on the middle class (FICA), neither of which tax increases takes us further from the fiscal cliff. We, in fact, have moved much closer to economic disaster.
Most notably, the compromise will raise taxes on families that make more than $450,000 a year, which seems fair in this era of growing income inequality.
The Sun Sentinel editors conveniently omit the huge tax increase on the not-rich. That is the tax increase that will widen the gap (more like a gulf) between the .1% and the 99.9% – exactly what the .1% wants.
What happened to the promised two-for-one spending-cuts-to-tax-hikes once promised by the Democrats?
President Obama says there’s more to be done on spending cuts, but where are the specifics? If the cuts proposed for the Pentagon and other government programs were too severe, where, exactly, will we pare back?
Yes, spending cuts are exactly what our money-starved economy needs. — to completely collapse. And let’s not be so coy about “where, exactly will we pare back?” We all know where: Social Security and Medicare, that’s where. Those are the programs that support the middle class. Spending cuts will further widen the gap / gulf between the middle and the top.
In averting the cliff, it appears the Democrats won the battle, but lost the war for the hearts and minds of average Americans, who are keenly aware of the threat our national debt poses to our national security.
“. . . threat to our national security”? Huh? Deposits in T-security accounts at the Federal Reserve Bank constitute threats to our national security?
I’ll tell you what constitutes a threat to our national security: Misleading editorials in newspapers.
The budget war is not over. In February, the new Congress will convene to decide on spending cuts. And in March, it will decide whether to increase the federal borrowing limit.
Cut spending and limit deposits in T-security accounts – could it get any worse? Yes, it could. Read the next paragraph:
Let us vigorously address the spending choices we face now. Do we continue unemployment compensation indefinitely? Do we adjust cost-of-living raises for Social Security recipients? Do we change pension plans for government employees? Do we end certain tax credits? Do we raise the age of eligibility for Medicare? Do we pare back Pentagon spending?
With the possible (?) exception of ending “certain” tax credits, all of the above “solutions” involve cuts to middle- and lower-class net income. In short, the Sun Sentinel is acting as yet another paid shill for the rich.
My suggestion: Everyone write to the Sun Sentinel editors, explaining to them, the basic facts of Monetary Sovereignty. A little paper like the Sun Sentinel, that only receives a handful of letters each day, might be responsive.
If even one newspaper’s editors began to write the truth, who knows what wonderful things could happen.
Or we can just surrender, and let our economy be dragged down by the .1%
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
5 thoughts on “–Florida Sun Sentinel clearly expresses the ignorance of the day”
Spot on. Although I would add that the military industrial complex is draining the economy of the best and brightest minds that could be used elsewhere for the provision of other more necessary things – i.e. education, renewable energy, improving infrastructure, R&D, etc.. In reference to our discussion on another article – this is another example of the “crowding out” effect.
The editorial appeared in Xinhua News, the official propaganda outlet of the Chinese government. (The “Xingu News Agency” does not exist.)
Author Ming Jinwei is a Xinhua reporter who writes from Hong Kong, a city that partially remains under City of London financial hegemony.
The Western corporate media have eagerly reprinted Mr. Jinwei’s garbage, in total alignment with Tea Party liars (e.g. AP, AFP, Reuters, etc, plus many independent outlets).
The question is why Xinhua ran this trash in the first place.
Mr. Jinwei’s original is even worse than the Sun Sentinel’s treatment of it. Its absurdities are extreme…
Perhaps Wall Street and Western bankers require Xinhua English to spout such garbage as a condition of Xinhua’s tenancy in New York. In 2010 Xinhua moved into a new office on the top floor of the 44-story skyscraper at 1540 Broadway in Time Square, Manhattan.
Perhaps big corporate sponsors require Xinhua to tow the anti-labor, pro-austerity line as a condition for the contuinued purchase of advertising with Xinhua. (Xinhua publishes in eight languages, and has offices around the world, plus over a hundred afiliate agencies.)
I don’t know. In any case, we see that the lies about Monetary Sovereignty are global, just as the false belief that the sun orbited the earth was once global.
And now the Western media has a new buzzword: the “fiscal abyss.”
China’s economy continues to be export-oriented. One would think that China would prefer that U.S. politicians not impoverish U.S. consumers by worsening the U.S. depression.
Your preaching to the quire , I understand perfectly, america is under a spell of ignorance,misdirection, misinformation, propaganda( yet still cant figure out who really understands, and whom just wants a perpetuation of a rigged game they benefit from), since most Americans are ignorant of how their monetary system actually functions , the mechanics if you will, how do you enlighten when those being oppressed are too hectic to take a step back and ponder, while those benefiting from the false premises certainly dont see a reason to educate and confront. I want to write a book about this, comparing it to other misconceptions and propagandized misinformation, like the pharmacutical industry’s profit motive and revolving door innapropriatness with regulators, the disgusting agriculture subsidy thats the furthest thing from free market capitalism, factory farming and free range baloney picturing happy cows and chickens tortured before slaughter and the unhealthy results for consumers whobelieve they need this mayhem for optimal health and are doing their small part in correcting horrific conditions, Marine parks that cruelly keep dolphins confined for strictly profitable reasons yet rationalizing educational benefits to the uninformed public whom they fleece, and many other misaligned public perceptions from reality. Though i count the propaganda around monetary sovereignty(or non if u buy into the reasons for austerity and tax increases) as the largest most harmful of the lies people accept as they go about their day indifferent to the implications of their ignorance, or numbness to reality , as the willfully continue voting against their own interests and supporting the very policies that create disparities of wealth in the first place. Please help me figure out how to possibly capitalize on this insanity, people go on talk circuits espousing all the lies and getting paid well to do it, this is insane, i have no branding, or substantiation to profligate my thoughts, you have done a great job blogging, yet little headway towards changing hearts and minds of the uninitiated. How do you keep your sanity, patience, acceptance of economic hardship in a world gone mad. I know no one, have almost no network of family and friends, and the people i do know could care less any way, they have accepted their lot in society, and figure to get as much as they can within whatever system is available uninterested in ethical considerations or truths.PLEASE ADVISE, i do respect your attempt at getting the message out, please tell me how to market a book that publishers will probably shunn, no name, and no reason to upset their apple cart,or so i tell myself. To: email@example.com Sent: Thu, January 3, 2013 10:28:56 AM Subject: [New post] –Florida Sun Sentinel clearly expresses the ignorance of the day
WordPress.com Rodger Malcolm Mitchell posted: “Mitchell’s laws: ●The more federal 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. ●Cutting the deficit is “
How do you keep from going stark-raving mad when articles like that Sun-Sentinel one keep on popping up, and when nearly every legislator in Washington says the word “Greece” nearly every day? I can hardly stand to watch the news or read the paper anymore.
Yes it’s madness. It’s like realizing that the religion you honored all your life is a garbage cult. Or growing up cherishing war and patriotic songs, but realizing one day that the military only exists to serve the rich and enslave the poor.
Mass stupidity is caused by widespread selfishness. It’s why there is so much suffering in the world. It’s why millions of people kill each other in wars, all in obedience the the 1% and politicians.
The public loves politicians who say the public must suffer more. Some people love Republicans who proclaim that,”We are broke, and you must starve.”
Other people love Democrats who proclaim that, “We are broke, and you must pay higher taxes.”
Meanwhile the MMT people ignore all moral issues. It’s one of their many failings.