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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, and the motive is the gap.
As readers of this blog know, I believe the ACA (aka “Obamacare”) is a horrible law, as it is based on the “BIG LIE”:
— the lie that federal finances are the same as personal finances
— The lie that federal taxes pay for federal spending
— The lie that the Monetarily Sovereign U.S. government can run short of its own sovereign currency
— The lie that federal deficits inhibit economic growth and will cause hyperinflation
Rather than the convoluted Rube Goldberesque, inadequate ACA, that covers a few million additional people, while costing others more, Congress and the President should have voted to provide free, comprehensive Medicare for every man, woman and child in America (aka “single payer).
That said, ACA is a slight improvement over the previous system, in which millions of the poor had no health care insurance.
The right wing hates ACA, because:
— they want to defeat anything Obama and the Democrats have proposed
— the law benefits the poor and middle classes
— they didn’t think of it first (Oops, actually they did. It was called “Romneycare.”)
So in one of the nuttiest exhibitions of an increasingly nutty party, the Republicans in the House of Representatives voted 54 times (!) to defund ACA, all without any hope of success and without a viable alternative.
Surely, the right wing deserves a mention in the Guinness Book of Records — Insanity Section.
Today, continuing the madness, conservatives are giddy over the Halbig v. Burwell decision, which ruled that insurance subsidies could be provided only on state exchanges, not on federal exchanges. This would mean those states that did not create their own exchanges, but rather allowed the federal government to provide the exchanges, will not receive the subsidies.
Jonathan Gruber, an economics professor at the Massachusetts Institute of Technology, is widely known as one of the architects of both Romneycare and Obamacare. His models of the economic effects of the bill were frequently cited by journalists and the administration.
(Last year), Gruber made the following observation:
“What’s important to remember politically about this is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits — but your citizens still pay the taxes that support this bill.
“So you’re essentially saying [to] your citizens you’re going to pay all the taxes to help all the other states in the country. I hope that that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these exchanges.
“But, you know, once again the politics can get ugly around this.”
In short, Gruber felt it was highly unlikely that a state governor could be so cruel and stupid as intentionally to fail setting up an exchange. But, Gruber didn’t count on depravity of the red state governors, for in fact, many of them have done just that.
In the event this decision is allowed to stand, it merely will focus a spotlight on the crass politics of the ultra right-wing. It will demonstrate the moral and financial bankruptcy of conservative politicians, who deprive their own state and their own citizens of federal financing and of health care insurance, just to prevent Democrats from having a success.
If the conservatives “win,” millions of Americans will be go without affordable health care, and dozens of states will lose billions of dollars. That will be their pyrrhic “victory,” and no amount of flag-waving and quasi-religious bible thumping will erase the stain.
The Republicans remind me of Hamas, whose plan has been to have their own Gaza citizens starved, maimed and killed, so they somehow can “win” the war and maintain power. To conservatives, punishing their own people is worthwhile, if it helps defeat anything Obama.
Right-wingers should pray the decision is overturned (another court already has rendered a counter-decision), lest the entire nation, at long last, clearly see shameful conservatism in action.
All that remains for the right-wing is to nominate Michele Bachmann and Sarah Palin as Presidential running mates.
Rodger Malcolm Mitchell
Ten 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. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (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
Vertical gray bars mark recessions.
As the federal deficit growth lines drop, we approach recession, which will be cured only when the growth lines rise. Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.