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●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 ultimately 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.
Sen. Ted Cruz isn’t the only one who wants to gut your health care.
The Tea Partiers aren’t the only ones who want to cut government spending for your social programs.
The Republicans aren’t the only ones who have been bribed by the rich to widen the gap between the rich and the rest.
The Democrats aren’t the only ones who pretend to be friends of the downtrodden, while voting for the powerful.
No, they aren’t the only ones. The entire American populace seems to agree with them.
You have been brainwashed that government spending is “bloated,” “wasteful,” “excessive” and “needless” (to use some common terms), and should be reduced. All lies.
You repeatedly have been told the debt and deficit are “unsustainable,” “unaffordable,” “a ticking time bomb” and “will be paid by our children and grandchildren.” More lies.
So once again, let us look at what happens when government spending is cut.
The most common measure of economic growth (or shrinkage) is Gross Domestic Product:
Gross Domestic Product (GDPA) is the blue bar.
Gross Domestic Product is composed of four measures:
–Personal Consumption Expenditures (PCECA)
–Gross Private Domestic Investment (GPDI)
–Net Exports of Goods and Services (NETEXP)
–Government Consumption Expenditures & Gross Investment (GCE)
These four measures, when added together, make up the orange bar, which as you can see is identical with the blue bar.
Now, see what happens to Gross Domestic Product if we eliminate government spending (GCE):
Gross Domestic Product drops by about 20% — the difference between the orange bar and the blue bar — a monster decrease.
Let’s see what happens if we cut government spending only by half:
We suffer a 10% decrease in Gross Domestic Product. That still is a huge decrease. Consider that GDP fell 2% from 2008 to 2009. Cutting government spending in half, would cause a loss five times greater than the crash of the Great Recession.
But it gets worse. Government spending pumps dollars into the economy, which helps to grow Personal Consumption Expenditures and Gross Private Domestic Investment. A reduction in government spending will reduce private spending.
Let’s take a look at what happens if we reduce private spending by just 10%:
Gross Domestic Product falls about 19%. And that folks, is called a depression.
What happens in a depression? The richest .1% of our population does just fine, because the rest become so desperate for money, you will accept slave-labor jobs.
You become the servants of the rich, begging them for whatever handouts they wish to give you.
It’s happening even now. With unemployment high, the rich offer part-time jobs and reduced salaries, which you accept, both reluctantly and gratefully, while you do without proper health care, education, food, housing and all the other things no American should lack.
Corporations profit while the populace suffers.
The sequester, once considered outrageously so harsh, no politician would dare allow it to happen, now is the norm from which further cuts will be made.
The right wing (including Republicans and Democrats, there being no left wing in America) continues to demand ever more cuts in government spending.
They want you to believe the lies.
And the rich want slaves.
Please sir, a dollar to feed my children?
Rodger Malcolm Mitchell
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Send every American citizen an annual check for $5,000 or give every state $5,000 per capita (Click here)
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)
9. Federal ownership of all banks (Click here)
10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt
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:
1. Federal Deficits – Net Imports = Net Private Savings
2. Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports
THE RECESSION CLOCK
As the federal deficit growth lines drop, we approach recession, which will be cured only when the lines rise.