–Widen THE GAP? See how Australia plans to do it.

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

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 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,
and the motive is the gap.


THE GAP actually is a series of income/wealth gaps between the very rich, the rich, the not-so-rich and down the line to the very poor.

Every income/wealth group wants the gaps below them to widen and the gaps above them to narrow. For the very rich, all gaps are below them, so general gap widening is the goal.

The GAP is what makes the rich rich, for without the GAP no one would be rich, and the wider the GAP, the richer they are. So it is the GAP, not just income, that is of primary importance to the very rich.

It is the very rich who run this and all nations, by bribing politicians (via campaign contributions and promises of lucrative employment later), “bribing” the media (via ownership) and bribing economists and other thought leaders (via contributions to universities and “think” tanks).

The ever-widening GAP is the single most serious problem in all of economics.

Monetary sovereignty

The rich have a simple plan for widening THE GAP: Claim that the central government cannot afford to provide benefits to the lower income groups, so these benefits must be reduced, reduced, reduced. This is known as the BIG LIE.

Here is one example of how Australia puts the BIG LIE into practice.

Australia Considers Cuts to Rein in Second-Smallest Debt
By Benjamin Purvis and Candice Zachariahs May 1, 2014

Australia may sell assets and cut welfare spending to rein in a debt burden that is already the second-smallest among developed nations.

Australia is Monetarily Sovereign. It has the unlimited ability to create its own sovereign currency. So there is no debt “burden.”

Nevertheless, this mythical “burden,” despite being the “second smallest among developed nations,” provides sufficient excuse to continue widening THE GAP.

Australia will sell government assets to rich people at low prices. And, of course, Australia will continue to cut spending that benefits the poor — a perfect one-two punch that will reward the rich and punish the rest.

Australian Treasurer Joe Hockey will deliver his first budget on May 13 — Recommending savings of as much as A$70 billion ($65 billion) a year within a decade. The independent body, led by former Business Council of Australia President Tony Shepherd, wants the government to commit to achieving surpluses over the economic cycle.

former Business Council of Australia President Tony Shepherd, wants the government to commit to achieving surpluses over the economic cycle.

Translation: The Australian government not only will take money from the poor, but will take so much money out of the economy that an inevitable recession will cause massive unemployment and hardship. The rich then will be able to pay less to a larger selection of unemployed, desperate servants.

The government should sell off rail and postal assets, cut family welfare payments and make changes to age pensions and unemployment benefits, the report advised.

The Treasurer announced today that the government would raise the eligibility age for the state pension to 70 by 2035. It now stands at 65 and is scheduled to increase to 67 by 2023.

“The age pension expenditure today is currently more than what we spend on defense,” Hockey said at an event in Melbourne. “This is about the long-term sustainability of our system.”

Translation: The rich will buy rail and postal assets at a steep discount, then immediately raise prices. Not-rich families will pay more and receive less. (Chicago’s latest Mayor Daley was particularly adept at this scam.)

“Sustainability” is the magic word of the BIG LIE, since it pretends that somehow a Monetarily Sovereign government can run short of its sovereign currency.

Hockey said while he was not planning to implement an austerity budget, the fiscal strategy would be prudent and underpin the productive capacity of the economy.

See, it’s like this. Cutting benefits is not austerity. It is . . . er, uh . . . “prudence.” And by some mathematical magic (don’t ask how), reducing the nation’s money supply (i.e. running a surplus) will “underpin” (?) the economy’s productive capacity.

As everyone knows, to cure anemia you must apply leeches and bleed the patient. Right?

The Treasurer announced today that the government would raise the eligibility age for the state pension to 70 by 2035. It now stands at 65 and is scheduled to increase to 67 by 2023.

Translation: Eventually, the not-rich will be told to work until they drop. The ultimate goal is zero pension and zero welfare spending. That would make for a perfect slave class.

As long as the people are ignorant enough to believe the bribed government’s BIG LIE, the rich will continue to push the people down, down, down.

. . . Until the populace realizes what is being done to them, turns back and cries, “Let there be guillotines.”

Rodger Malcolm Mitchell
Monetary Sovereignty

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

Monetary Sovereignty Monetary Sovereignty

Vertical gray bars mark recessions.

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.


9 thoughts on “–Widen THE GAP? See how Australia plans to do it.

  1. Did you hear about Vermont being the 1st state to pass a resolution to amend the constitution to fix the problem with our campaign financing ? The Wolf-PAC has been doing much work on this front. Would you give me your opinion on the effort and strategy?

    Sent from my iPad



  2. Sorry Roger.

    I am currently in Europe. I can’t recall which museum I saw this in, or reference a source. However, here is the depressing reality. During the French Revolution, just six percent of the executions were exacted on the nobility and aristocracy. More than 40 % were of the common people. In other words, the revolution turned on itself. (Not that the guillotine was a solution.)

    I am too disheartened to draw any conclusion, but if history is any guide…


    1. Thanks Vincent,

      I don’t know the numbers, but there always are far, far more not-rich people than very rich people.

      So, assuming your numbers are correct, while the not-rich took a hit, the very rich must have lost nearly everyone.

      That said, the not-rich have a long history of self-mutilation. You can see it happening today, where the not-rich vote for austerity.


  3. I’ve been ringing the bell for months about Australia.

    “Austerity is coming! Austerity is coming!”

    I saw it coming a year ago when Tony Abbot vowed that if he became prime minister, he would impose austerity. Indeed, Abbot wrote four books explaining his diabolical plans. Since he assumed office seven months ago, he has led Australia in a mad rush to catch up with the rest of the world in imposing austerity, in order to widen the gap.

    Abbot calls Australia’s minimum wage of $16.88 per hour “outrageous.” He cannot slash it directly, since it would cause the peasants to squeal, so he will do it via austerity. He will wipe out jobs via mass privatization.

    Abbot is also a climate change denier, which is understandable, since (as we all know) “climate change” is an atheistic Communist conspiracy to funnel all monies to brown people.

    Oh…and thank you Rodger for noting that austerity is no longer called austerity. It’s called “structural adjustment,” or “fiscal responsibility,” or “enhanced sustainability.” Or in Australia’s case, “prudence.” Since the public hates leeches, the public will no longer get leeches. Instead, the public will get “health aids” (i.e. more leeches).

    Meanwhile, the more the Big Lie causes the peasants to suffer, the more the peasants defend the Big Lie.

    It’s like putting a million people in a concentration camp and cutting off their food and water. The more you starve the prisoners, the more the prisoners blame, attack, and eat each other. The first ones attacked are those who say, “Let us unite and help each other to escape!”


  4. Million-Dollar Home Sales Thrive While Low End Stumbles

    Million-dollar homes in the U.S. are selling at double their historical average while middle-class property demand stumbles, showing that the housing recovery is mirroring America’s wealth divide.

    Purchases costing $1 million or more rose 7.8 percent in March from a year earlier, according to data released last week by the National Association of Realtors. Transactions for $250,000 or less, which represent almost two-thirds of the market, plunged 12 percent in the period as house hunters found few available homes in that price range.

    THE GAP continues to grow.

    Luxury-home sales are climbing as an improving economy and stocks that have almost tripled from 2009 lows bolster confidence among affluent buyers. At the same time, slow wage growth, tight credit standards and escalating prices are putting homeownership out of reach for many Americans.

    The growth of the federal deficit continues to decline.

    And then there’s:

    San Francisco’s Google Buses Attacked in Lawsuit

    A growing number of private coaches with blackened windows, upholstered seats and Wi-Fi that shuttle employees of Google, Apple Inc. (AAPL) and Facebook Inc. to Silicon Valley have fueled a debate about inequality in a city where software engineers just out of college can expect to make more than $100,000-a-year. Their drivers and other residents who make half that amount are paying $2-a-ride on public buses and struggling to keep up with fast-rising rents.

    With the highest rents in the country and rental evictions at a seven-year peak, the rising presence of company-funded buses in densely populated neighborhoods has led to protests and occasional violence in a city known for tolerance.

    Thus begins a revolution. Have the rich gone too far?


    1. I suspect that the American middle class (which existed from 1945 to 1975) was a fluke. I suspect that nothing like it had ever existed before in the world, and it may never exist again.

      Perhaps this is the way of nature. Perhaps we just have to live with it. All social mammals exhibit a dominance hierarchy. Chimps, dogs, dolphins, hippos, lions, zebras, whatever…they all have a pecking order, with “alpha males” and so on. Some non-mammalian species exhibit it too, if they live in groups or herds.

      The question with humans is this…

      Are the 1% the brightest and strongest? Or are they sociopaths that simply got lucky?

      Perhaps it depends on the person. Bill Gates contributed to a wave that led to every house having a computer, but hedge fund managers contribute nothing. They are useless “takers” that drag down society. Yet they are at the top, because they are rich.


  5. Does it not appear as though a country that can keep spending closer to tax revenues (Australia) has a lower coefficient than the ones that don’t (US). See these 2 charts. The gini coefficient rose as the debt increased and decreased as the debt decreased. I think that although it may look like Australia is removing “help” from the poor, the effect of the policy will have an opposite impact and will in fact help the poor. My 2 cents.


    1. The GAP has many causes. Deficit spending that directly benefits the poor, can narrow the gap. Deficit spending that directly benefits the rich, can widen the gap.

      Tax laws can narrow or widen the GAP.

      Criminal and civil laws can narrow or widen the GAP.

      National mores can narrow or widen the GAP.

      Politics can narrow or widen the GAP.


  6. To put it short: The United States is not a True Republic, but actually and Oligarchy

    A republic can be an oligarchy. There are different types of republics. In America the oligarchy (based on the privileges of wealth and the servants conformity to religion) rules through the institutions of society. The form of government does not change that. What is Constitutional is up to debate and is ultimately decided by human judges by their ideological alliances.

    I’d like to point out something that should have been obvious to everyone (and to me, too) long ago: our government isn’t what it used to be. I’m not saying it needs to be fixed, I’m saying that it’s not all what the Founders set in place-it’s not the same government. The law no longer serves its original purpose, that of protecting individual rights to life, liberty, and property. It is used more often now as a weapon. Those in power are not working for liberty and justice. They see us as servants (human resource), to be beaten into submission by any and all means expedient, with little or no regard to the Constitution.


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