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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.
Our police state loves wars and crises, especially wars that never can be won and crises that never can be resolved.
Wars and crises provide the upper .1% power group with the excuses to take away the liberties of the lower 99.9%, thus legitimizing the widening of the power gap.
Consider the war on terror. There always will be at least one terrorist or potential terrorist out there, at least one person who either hates the United States or hates the President or hates Congess or hates the government or simply is nuts.
And even if my some miraculous means, we were able to eliminate all those haters and nuts, just the possibility that a new one might be born, is sufficient to maintain the never-ending war on terrorism. This eternal war justifies the excesses of the NSA, FBI, CIA et al, not to mention local police excesses, “stop-and-frisk,” airport security and assorted other intrusions into your privacy — none of which pester the upper .1%.
The war on drugs is another endless war that provides the .1% with excuses to harass, prosecute and incarcerate vast numbers of the 99.9%, while giving a free pass to the .1%.
Which brings us to the real subject of this post: The so-called, endless “debt crisis.”
What exactly is the “debt crisis”? No one knows, though you will see and hear that phrase every day, liberally sprinkled throughout the news and commentary.
Look through today’s paper or this week’s magazine, and whenever you see the phrase “debt crisis,” note to yourself that the author either is economically ignorant or a liar on behalf of the .1%. It is a defining phrase.
But what is the “debt crisis”? For the extreme liars, it means any debt (i.e. outstanding Treasury Security) is too much. So if the total federal “debt” were $1, the extreme liars would consider that we still are in a “debt crisis.”
I even have seen statements that the U.S. federal government should run a surplus, so there would be “enough funds for future spending,” as though the government’s finance were like yours and mine.
For the ignorant and the less-extreme liars, “debt crisis” means today’s federal debt, whatever that debt might be. This blog contains several posts regarding our so-called “unsustainable debt” (the prelude to the “debt crisis”) showing how examples of this phrase began in 1940 or earlier — almost 75 years ago!
Today, the “debt” still is “unsustainable,” still in “crisis,” and the upper .1% still is doing everything possible to increase the power gap.
The reason: Enough never is enough. Although the GINI ratio (a measure of the gap between the rich and the rest) continues to grow, no gap ever will sufficient for the rich. They want to beat the 99.9% down, down, ever down.
And they do it by convincing every level of the 99.9% that those residing in levels below them are slackers and takers.
Think of it: The vast majority of ultra-conservative voters are part of the lower 99.9%, voting against their own well-being. What a remarkable brainwashing job, the .1% have done.
Of course, there is no “debt crisis,” a manufactured “crisis” that could end tomorrow with the simple expedient of not issuing any more T-securities. Even the existing T-securities could be made to disappear, by the other simple expedient of debiting T-security accounts and crediting checking accounts. That could be done tomorrow, without creating any new money.
There are, in fact, just two debt crises, and neither has anything to do with federal debt. One is the crisis of consumer debt, forced on the ignorant, who have been made to believe it is better for a Monetarily Sovereign government to run a surplus than for the economy to run a surplus. (“The government needs my dollars more than I do.”)
The other debt crisis is the shameful, unnecessary student debt crisis, about which I will post in the future.
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. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (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.