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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.
Readers of this blog know that our politicians, media and mainstream economists have been bribed by the ultra-rich to widen the gap between the rich and the rest.
The politicians are bribed by the ultra-rich via campaign contributions and promises of lucrative employment for themselves and their families (the Bill Clinton syndrome)
The media are owned by the ultra-rich. (The FOX syndrome)
The mainstream economists are employed by universities that have been bribed, and/or they are employed by the so-called “think tanks” (the CATO syndrome) which are funded by the ultra-rich.
Very briefly, they all are bribed to brainwash millions of Americans with The Big Lie — the myth that federal spending is too high, unsustainable and must be reduced.
Because the vast majority of federal spending benefits the vast majority of Americans, i.e. the millions of non-rich, reductions in federal spending widen the gap.
When House Speaker said, “Let’s be honest. We’re broke,” he was expressing The Big Lie.
When one of the brainwashed millions tells me that federal spending is unsustainable, here is the inevitable scenario:
Brainwashed: “Social Security benefits (or Medicare benefits, or any other federal spending) must be decreased.”
RMM: “Do you think the federal government can run short of dollars?”
Brainwashed: “No, they always can print dollars, but that will cause hyper-inflation. Remember Weimar Republic (or Zimbabwe, or Argentina)”
Despite 200 years of wars, recessions, depressions, stagflations, inflations and bubbles, the U.S. never has had a hyper-inflation, and today we are nowhere near hyper- inflation. Instead, we are near deflation and recession.
Harlan Green, Editor and Publisher
Deflation is the Danger
Posted: 09/14/2013 12:14 pm
Deflation is the danger to economic growth at present, not inflation. For inflation is a sign of economic growth, yet prices have barely risen if one looks at the major inflation indexes, like the CPI or Personal Consumption price index.
The so-called PCE price index is the main inflation indicator liked by the Federal Reserve, and it is running far below the Fed’s preferred target of 2 to 2.5 percent.
. . . the emphasis on holding down inflation . . . resulted in 2 decades of low inflation that was called the “Great Moderation”–has meant slower economic growth and less productive investment, as well as two further recessions in the last decade, including the Great Recession.
We have not had an inflationary environment since the 1970s, and that was ‘cured’ by then Fed Chairman Paul Volcker with his double-digit interest rates.
So now what can brainwashed parrots for the ultra-rich to say? They acknowledge that the federal government has the unlimited ability to (erroneously called) “print” dollars. The government never can run short of dollars to pay its bills.
Our current problems are slow growth, unemployment and a widening gap between the rich and the rest.
The non-rich need increased, not decreased, federal deficit spending for Social Security, Medicare, Medicaid, poverty aids, education, the infrastructure, pure food, clean water and the myriad other benefits of federal deficit spending.
And our primary danger is deflation, not inflation.
So with low inflation, verging on deflation, what’s the excuse now?
Rodger Malcolm Mitchell
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded 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) Or institute a reverse income tax.
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. Federal deficit growth is absolutely, positively necessary for economic growth. Period.