–The vote: Can Greece’s financial calamity be prevented?

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Mitchell’s laws:
**Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
**The more federal budgets are cut and taxes increased, the weaker an economy becomes. .
**Liberals think the purpose of government is to protect the poor and powerless from the rich and powerful. Conservatives think the purpose of government is to protect the rich and powerful from the poor and powerless.
**The single most important problem in economics is the gap between rich and poor.
**Austerity is the government’s method for widening the gap between rich and poor.
**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.
**Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

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As I write this, the Greek people prepare to go to the polls. They will vote “yes” or “no” — on what? They have no idea.

Nor do I.

Ostensibly, it could be a vote on whether to remain a euro nation. Or maybe not. No one is quite sure.

Most writers belief Greece should remain. For example:

Greece Should Vote Yes and Europe Should Be Ashamed
Bloomberg By Clive Crook

The vote doesn’t change the calculations that the respective sides will have to make about long-term consequences. It will still be in both sides’ interests to come to an agreement.

Some European officials are ready to see Greece default and exit the euro system. If Greeks vote no, that view may gain ground and the chance of Grexit certainly goes up.

If the voters say yes, there’s a better chance that the EU and the ECB will offer help to stave off both default and Grexit. At least in the short-term, yes is the better path to less economic pain.

By submitting to the EU, Greece might incline the creditors to be generous in victory. Europe might finally concede what Tsipras has long been demanding and what has always made sense from the creditors’ own point of view — to bundle debt relief and a milder profile of fiscal consolidation into a third bailout program.

“Less economic pain”? “Creditors generous in victory”? Puleeze!

Visualize that you are deeply in debt to a criminal syndicate. You already have given them every cent you have, but it’s not enough to pay your debt. So they come to you with a new deal.

They will lend you the money to pay your past debt, but only if you give them your house and car and all your future earnings. This will require that you and your family starve in a cardboard box on the street.

It also will insure that they can continue bleeding you forever. You never will emerge from debt.

That is the deal the troika has offered, and always will offer, to the Greeks.

But you have an alternative. You can tap into a source of money that will allow you to pay off all the debt. No longer will your family be bled dry. No longer will they be forced to live in a cardboard box on the street.

Which do you prefer? The syndicate “bleed forever” deal or the pay-off-all-debt deal?

The source of money for Greece is called Monetary Sovereignty. Greece can revert to the drachma, a currency they would have the unlimited ability to create.

They should announce that they will pay all debts in drachmas and collect all taxes in drachmas.

Some believe Greece’s return to Monetary Sovereignty will be a financial calamity for Greece and the world.

Nonsense.

The European Unit of Account (EUA), a basket of currencies, was introduced in 1975. The European Currency Unit (ECU), also a basket of currencies, replaced the EUA, 1 for 1, on March 1979.

Then, on January 1, 1999, the euro replaced the ECU, 1 for 1.

In the past 40 years alone, there has been a great deal of currency shuffling by the European nations, and none of these changeovers caused financial calamity.

Seventeen nations have surrendered their own sovereign currencies, to adopt the euro. No financial calamity in that changeover.

Some European nations did not adopt the euro, but still remain part of the European union. No financial calamity in that lack of changeover.

Greece itself, did not adopt the euro until the euro was two years old. No financial calamity in that changeover.

But now, we are expected to believe Greece’s “unadopting” of the euro would cause a financial calamity.

Here is what would be a calamity: Greece’s continuing to bleed its citizens forever, to pay the rapacious lenders of the troika.

Those lenders don’t want to lose their cash cow, so they spread the financial calamity nonsense.

What was done, can be undone, and the sooner the better for the Greek people.

Rodger Malcolm Mitchell
Monetary Sovereignty

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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. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (Click here)
9. Federal ownership of all banks (Click here and here)
10. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)

The Ten Steps will add dollars to the economy, stimulate the economy, and narrow the income/wealth/power Gap between the rich and the rest.
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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.
1. A growing economy requires a growing supply of dollars (GDP=Federal Spending + Non-federal Spending + Net Exports)
2. All deficit spending grows the supply of dollars
3. The limit to federal deficit spending is an inflation that cannot be cured with interest rate control.
4. The limit to non-federal deficit spending is the ability to borrow.

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.

#MONETARYSOVEREIGNTY