●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.
●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.
●Everything in economics devolves to motive.
Katrina vanden Heuvel is the current editor and publisher of The Nation, a magazine founded in 1865. It’s founding prospectus reads::
“The Nation will not be the organ of any party, sect, or body. It will, on the contrary, make an earnest effort to bring to the discussion of political and social questions a really critical spirit, and to wage war upon the vices of violence, exaggeration, and misrepresentation by which so much of the political writing of the day is marred.”
Here are excerpts from Ms. VandenHeuvel’s article demonstrating her “war upon . . . misrepresentation.”
It’s time to tax financial transactions
By Katrina vanden Heuvel, Published: March 5
On Friday at midnight, the sequester kicked in, triggering $85 billion in deep, dumb budget cuts that sent “nonessential personnel”— such as air traffic controllers — packing.
Not to worry, though: Wall Street’s day was pretty much like any other. Billions of dollars in profits were made off of trillions of dollars in financial transactions. And the vast majority of those transactions were conducted tax-free.
We don’t need a team of policymakers to tell us this isn’t good policy, or that it needs changing.
Comment: The budget cuts were “dumb” if you care about America, but they were smart if you want to widen the gap between the wealthiest .1% and the rest of us – which is what Congress has been bribed to want. (The bribing consists of massive political contributions, courtesy of the Supreme Court, plus promises of lucrative employment, later.)
Those budget cuts directly impacted the 99.9% while leaving the .1% relatively unscathed, thus accomplishing the gap-widening that is the real goal of the .1%.
Sens. Tom Harkin (D-Iowa) and Sheldon Whitehouse (D-R.I.), along with Rep. Pete DeFazio (D-Ore.), unveiled a bill that would place a light tax on all financial transactions — three pennies on every $100 traded.
Translation: The cure for “dumb” budget cuts, which suck dollars from the economy is taxes, which suck dollars from the economy.
The good news is that it’s a tax so small it could be mistaken for a rounding error. It’s so small, Wall Street could easily afford it and the average E-Trade investor would barely notice it.
But there’s even better news. This insignificant tax raises a significant amount of revenue — $352 billion over the next 10 years, or enough to refund about one-third of what the sequester will slash from the federal budget. It’s also enough to put many air traffic controllers back to work, Head Start teachers back in preschools, and crucial government programs back in business.
And here is where the economic ignorance kicked in. Ms. vanden Heuvel, the editor and publisher of The Nation, actually believes federal taxes pay for federal spending.
She is clueless about the difference between a Monetarily Sovereign government (which neither needs nor uses tax revenue), and a monetarily non-sovereign government (which does need, and does use, tax revenue).
Apparently, she believes monetarily non-sovereign Illinois, Chicago, Greece, you and I are financially identical to the Monetarily Sovereign U.S. government, which has the unlimited ability to pay its bills, and never needs to ask anyone for dollars.
And this is a woman who writes an economics column!! Is it any wonder the public is confused?
And after years of Wall Street excess, and at a moment when new revenues are badly needed, the time has surely come for a financial transaction tax .
When it comes to cutting the deficit, 6 in 10 Americans prefer taxing the financial industry to cutting social spending.
Imagine that! Most — 6 in 10 — Americans would rather tax Wall Street than see their Social Security benefits cut? (But who the heck are those other four Americans??)
Note there is no discussion about whether the deficit should be cut – no discussion about whether to bleed the anemic patient. That merely is assumed. The only discussion is how best to bleed the anemic patient.
After all, the tax isn’t just a good revenue raiser. It’s smart regulatory reform.
The high-frequency traders that now dominate our markets would be hardest-hit by the tax. A top economist recently concluded that their lightning speed, algorithm-driven trading drains profits from traditional investors. And analysts fear that such mass trading strategies could lead to disaster if markets behave unexpectedly.
Translation: One unnamed “top economist” concluded, without proof, that high frequency trading drains profits by . . . well, we don’t know how, so we simply will accept the word of this unnamed “top economist.”
Also, since this tax would be “insignificant” (her description), it wouldn’t eliminate high-speed trading, so what is she trying to say?
Europe, at least, seems to agree. Eleven nations, led by the conservative German government, are on track to start collecting the tax by January 2014. Expected revenues: $50 billion per year.
Er, ah, Ms. Katrina Vanden Heuvel, are you talking about monetarily non-sovereign Europe, which not only does need and use tax dollars, but which has the worlds worst record with regard to economics, and is suffering for it? Is that the Europe you’re referencing for economic wisdom?
Sequestration is a septic wound, self-inflicted by lawmakers who can’t agree on anything. Here, at last, we have a smart idea with widespread support — Americans and Europeans, populists and economists, progressives and conservatives.
After Friday’s dumb budget cuts, a little smart policymaking would be nice for a change.
Yes, sequestration is a bad idea (though not a “dumb” one, when the real motive is to widen the income gap.) It’s a bad idea because it sucks dollars from the economy, just as taxes do.
Even the editor and publisher of The Nation magazine is clueless about economics. It’s discouraging that she doesn’t understand the difference between Monetary Sovereignty and monetary non-sovereignty – a difference that provides the basis for all modern economics.
It’s even more discouraging that apparently she never has tried to learn.
And most discouraging is that she indoctrinates the American public with her ignorance.
That is how The Nation aids the .1%’s effort to enslave the nation.
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