Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell
Mitchell’s laws:
•Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
•Any monetarily NON-sovereign government — be it city, county, state or nation — that runs an ongoing trade deficit, eventually will run out of money.
•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.
•Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..
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What do these Republican initiatives have in common?
House votes – again – to repeal Obamacare
Deirdre Walsh Profile
By Deirdre Walsh, Senior Congressional ProducerThe vote was 239-186, with no House Democrat supporting the measure and three House GOP freshmen opposing it.
This latest vote marked the 67th time the House has voted to entirely repeal, defund or change some provisions of President Barack Obama’s signature health care law.
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House Republicans begin impeachment against IRS Commissioner John Koskinen
It was the latest move in the battle over the targeting of tea party groups at the tax agency.
Less than a week earlier, the Justice Department issued a report finding no criminal behavior in the decision by top IRS officials to subject conservative groups to intrusive scrutiny.
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House Benghazi Hearings: Too Much Too Late
As might be expected, the “Benghazi Committee” hearings have proven not much more than a means for each party to grandstand for political points.
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Benghazi Committee Narrows In On This High-Ranking State Department Official
The House Select Committee on Benghazi is narrowing in on one high-ranking State Department official who has “magically” avoided punishment for failing to provide additional security in Benghazi before the Sept. 11, 2012, attack there, South Carolina Rep. Trey Gowdy said in an interview.
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Senator John Cornyn wants special counsel to investigate Clinton emails
The Senate’s No. 2 Republican wants Attorney General Loretta Lynch to appoint a special counsel to investigate the Clinton email controversy.
“The Attorney General has a special duty to pursue justice even when political considerations run counter to doing so.”
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Republican leaders struggle to find votes to up debt limit
Congressional Republicans say they are short of the votes for raising the debt limit and avoiding a first-ever government default. With barely a week before the deadline, there’s no plan on what to do.
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The big budget deal announced late last night is being decried as a “surrender” by conservatives who are unhappy that it boosts defense and non-defense spending, even as it insufficiently cuts Social Security and Medicare.
This is, as Philip Klein writes, a big loss for conservatives who actually want to substantially slash spending.
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The Republican 2016 Field Takes a Hard Right on Immigration
It’s no longer just Donald Trump, whose rise in the polls came after he labeled Mexican immigrants “criminals” and “rapists.”
A host of GOP candidates called this week for an end to automatic citizenship for American-born children of immigrants in the United States illegally.
Wisconsin Gov. Scott Walker, Sen. Ted Cruz of Texas and Louisiana Gov. Bobby Jindal each backed Trump’s call to end automatic citizenship. Jindal hoped no one would notice that he was born to parents in the United States on green cards.
Former Florida Gov. Jeb Bush urged tougher enforcement against “anchor babies,” an epithet for children born to parents in the country illegally and often a reason families in the country illegally are not deported.
I don’t know what you see, but what I see is a party that seems devoid of ideas, and seems to spend all its time, money and effort in political vandalism and bigotry.
Like bad boys, the Republicans seem determined to break every window of opportunity and to slash every tire on the social progress bus, and to denigrate everyone who is not a ultra-white, ultra-right-wing Christian — but never to create anything worthwhile.
I visualize one party with a history of grand vision and creation: Social Security, Medicare, Medicaid, social programs to support the poor, the elderly and the middle classes.
And I visualize the other party devoted to tiny and destructive causes: Lawsuits and attempts to dismantle anything that benefits the poor, the elderly and the middle classes, hatred for gays and foreigners and anyone “different.”
In keeping with the trend, the Republicans now have fielded the craziest group of Presidential candidates since — well, since Sarah Palin.
Currently the leading Republican is Ben Carson — Ben Carson, the medical doctor who also denies evolution(!) That says much.
The Tea Party and the House Freedom Caucus are but the tip of the right-wing iceberg. What used to be considered the lunatic fringe, now has become the center of the right.
Public Policy Polling asked Republican voters if they believe Obama was born in the United States.
Only 29% said yes Obama was born in the USA. More shockingly 40% said yes Canadian-born Cruz was born in the USA.
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Only 40 percent of GOP voters believe Islam should definitely be legal, and the other 20 percent said they weren’t sure.
When asked if a Muslim should ever be allowed to be president, 72 percent of Republicans said no, and 12 percent were unsure. Only 16 percent of GOP voters said a Muslim should be able to hold the office.
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America has succeeded in part, because of our two-party system, with each party producing ideas and plans to grow the nation. We cannot grow — we cannot even survive — if only one party wishes to build, while the other party wishes only to tear down.
We cannot grow — we cannot even survive — when small-minded bigots and mean-spirited fools rule.
Let us hope that sometime soon, sanity returns to the Republican party, before America becomes irrevocably damaged.
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 Click here
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
Recessions come after the blue line drops below zero.
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
#Monetary Sovereignty - Mitchell 
The beat goes on.
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And on and on:
Just as a reminder, Inhofe is the Republican who brought a snowball into Congress to “prove” that climate change is not happening.
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THIS WEEK IN CRAZY
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And now they are touting Ireland and Spain as examples of successful austerity.
“The Spanish and Irish economies are growing despite stingier governments. Arguably, it makes them healthier than if they had had the opportunity to try to fix their problems by printing money.”
http://www.bloombergview.com/articles/2015-07-31/two-points-for-austerity-spain-and-ireland
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Complete BS. The “improvement” is from very low levels. These two nations still have not recovered from the Great Recession:
The author fails to explain how an economy can grow while its money supply falls. It would be interesting to learn how leeches cure anemia.
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Thanks Roger, they don’t seem to mind that people are forced to leave for other countries in order to find work. This is how it should be this is normal. Then supposedly they will have real growth for those that can stay.
Is there any example of a government that does not or did not collect taxes?
I don’t know of any and the inflationists always point to governments that hyper inflated the currency. If you get by that wall then they want proof of this actually working. There’s a lot of fear associated with over spending because in our personal lives it doesn’t work 🙂
It is frustrating at times. Hard to argue beyond; the government does not need to collect taxes it simply spends money into the economy. With inflation being the only restraint. Berne Sanders hired Stephanie Kelton but nothing happening and this is where it needs to happen. Politicians and economists working in Congress. Right? I mean it can be a grassroots thing but roots have to have some direction from the top 🙂
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Widespread Monetary Sovereignty is a fairly recent phenomenon. While over the centuries, nations have gone off and on physical backing (i.e. gold and silver standards), we are in the first extended period (45 years and counting), where many of the major nations of the world are Monetarily Sovereign.
So, we’ve not had time to adapt our thinking to this “new” world. I know of no nation that yet has taken that first, tentative step of eliminating taxes.
And even I don’t think all taxes should be eliminated. Taxes have functions not associated with government spending: “Sin” taxes, taxes on the rich to narrow the Gap, money-supply and inflation-control to name a few.
The problem arises when “Taxing+Borrowing” becomes the false limit to Spending for a Monetarily Sovereign entity.
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The U.S. House passed a budget deal today. It will now go to the Senate.
The deal will cut Social Security benefits, in order to “save money” for the U.S. government (which doesn’t need to “save money,” since the U.S. government creates money by spending, and since federal tax revenue is destroyed upon receipt).
The article below explains the new cuts.
Surprisingly the article is in Forbes; a blog that is normally dedicated to widening the gap between the rich and the rest…
http://www.forbes.com/sites/kotlikoff/2015/10/28/the-house-budgets-devastating-social-security-benefit-cuts/
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Thanks Roger again for your informative commentary. I’m sitting here browsing as the Republican debate is airing. Sen. Cruz and Rubio, being far down in the polls, are attacking the “liberal press” that will not ask the questions American’s want answered, to great applause. All candidates have mentioned about the unsustainable debt the Federal Government has, and those who have responded to the Social Security question, profess that the Federal Government has been stealing from the trust fund for years and owes it to working citizens, again many say raising of the full retirement age will be progressive and must be part of the reform that must include private savings accounts. Mike Huckabee alluded to the recent debt ceiling budget bill saying,” You know the new budget steals about $240 billion dollars from Social Security”, when in actuality that amount was transferred from the S.S. Trust fund to the S.S. Disability Trust Fund, which is in need of a book entry to be compliant with the law. None of them have mentioned “kick the can down the road” yet, to my amazement! Of course Bernie Sanders is a socialist, enough said on that subject.
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@ rvette454: With respect, in previous posts, Rodger has explained that, contrary to the lies of politicians, there is no “Social Security Trust Fund.” It does not exist. It is a fiction. Likewise there is no “Federal Highway Trust Fund,” or any other U.S. government “trust fund.” All federal “trust funds” are fictions. In fact, the U.S. government has no money at all. The government CREATES money by spending. For example, each time the Social Security Administration instructs your bank to credit your personal account by $1,000 (for instance) that money is created out of thin air, simply by the act of changing the numbers in your account.
Money is not physical. It is a mental construct. A dollar is a non-physical unit of account, like points on an electronic scoreboard. If you can create points by changing the numbers on the scoreboard, then you do not need a points “trust fund.”
Naturally politicians don’t want you to realize this. Politicians want you to think that money is physical and limited, so that you grovel to them. Politicians want you to think that federal dollars are like water in a well that is about to run dry (when in reality the well is inexhaustible).
Regarding Mike Huckabee, if he says, “The new budget steals about $240 billion dollars from Social Security,” Huckabee means that 240 billion less dollars will be created for SS beneficiaries. There is no transferring of dollars between (fictitious) U.S. government “trust funds,” since there are no “trust funds.” They do not exist.
If you Google the topic of U.S. government “trust funds,” you will get countless results, all of which are vague, self-contradictory, and full of meaningless techno-babble. It’s all designed to make you confused, frustrated, and resigned to being helpless, while the rich live in luxury.
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Absolutely perfect.
Now your assignment, Ms. Harris (should you choose to accept it), is to keep contacting your local media, to tell them the facts.
This may seem like a Mission Impossible, but this message will not self-destruct if we all keep broadcasting it to everyone and every medium, until they are forced to admit it.
Good job.
By the way, here are just a few of the “trust funds” owned by the federal government. All are fake, in that they are nothing more than accounting notations, that the federal government can debit and credit at will.
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I have tried countless times, Rodger, but you know how frustrating it is. If I explain the facts online, my comments are deleted or flamed. If I explain the facts to people in person, I am ignored or rejected.
I have seen your comments on other blogs. They are always by far the best comments in the entire thread, and they are almost always ignored.
All arguments that support the Big Lie are easily debunked. Therefore the worst thing is not the rejection, but the apathy. No one cares to understand how money works, even though everyone values money.
If I had no moral conscience, I could exploit this stupidity. I could become a politician, and have people beg me for a few drops of water from the inexhaustible well. I could keep the public delirious with thirst, telling everyone that he must have even more thirst, since “I cannot give you water I don’t have.” Everyone would believe me, even though everyone could see the inexhaustible well with his own eyes. With the Big Lie, I could come from nowhere and rise to power like Paul Ryan, or Obama, and be followed by cameras and microphones down every corridor. I could revel in my superiority over the millions of people that I keep in poverty. I could be lauded as a “financial genius” and “fiscal guru.” I could be a god. Just by lying.
That said, I am extremely grateful for your blog, Rodger. It is the only place in the entire Internet where one can speak the whole truth.
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On a tangential note, is not only U.S. politicians who claim that the U.S. government is “broke,” and must have deficit reduction.
Politicians tell this same lie in most nations that have Monetary Sovereignty.
For example, former Brazilian president Luiz Inacio Lula da Silva supports Finance Minister Joaquim Levy’s call to reduce Brazil’s budget deficit. Mr. Lula is also urging the ruling Workers’ Party to increase Brazil’s fiscal austerity. Current President Dilma Rousseff has already cut public spending and social benefits as she strives to continually widen the gap between the rich and the rest.
Brazil’s economy relies on exporting raw materials to China. Now that China’s economy has slowed, Brazil is in its worst-ever recession. Former Brazilian President Lula says that because of the recession, the Brazilian government has “no alternative” but to increase its austerity (which will make Brazil’s recession even worse, and will further widen the gap).
Lula claims that, “Fiscal revenues have fallen in the recession, and there is no money to stimulate the economy.”
This is a classic case of kicking the victim (the public) while the victim is down. The truth is that the Brazilian government creates Brazilian reals by spending. Therefore the government has no need or use for tax revenues.
“The only way to recover the prestige of the Workers’ Party is to restore economic growth via austerity,” Lula said.
As you can see, the Big Lie is global.
http://www.voanews.com/content/former-brazilian-president-lula-urges-workers-party-to-back-austerity/3028265.html
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Elizabeth,
Try not to become discouraged. The public is ignorant because it has been kept in the dark. So the truth sounds alien.
But if we keep repeating it, eventually people will begin to say, “Yes, I heard that somewhere” (so it must be true).
Repetition can be our friend.
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And still the Republican idiocy continues. Rand Paul stomps his little feet and threatens to destroy the American government if he doesn’t get his way. No doubt he will be joined by other Republican idiots.
Apparently ruining America’s credit and causing a worldwide recession is O.K., so long as you can suck up to the extreme right.
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Sometimes I think people don’t grasp MS because it’s about money and money is like the US constitution; it’s not well-defined, hence supreme court decisions of 5-4. So not even the experts agree. People know the physical part that they can hold in their hand, but that’s not money. The rules surrounding money (the Enormous tax code, “Oh what a web we weave….”) won’t allow for predictability or control of the system. In short we are dealing with human behavior, not natural behavior as understood by physical science.
If MS doesn’t catch on then there’ll have to be invented a scientific basis for all costing, pricing and income that all of us will naturally be able to grasp. It’s too hard to grasp witchcraft and even harder to change thinking patterns established centuries ago assumed to be correct..
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Just now I checked some web tracking services, and saw that a blog called Zero Hedge gets millions of views per month. This means that millions of people read and believe falsehoods like this…
“The Social Security system is a giant Ponzi scheme. Young people have no chance at collecting the future benefits the government has promised to them. There are simply too many people cashing out at the top, and not enough people paying in.”
And there it is: the false delusion that finances for the U.S. government are the same as finances for non-Monetarily Sovereign entities. This is why “zero hedge” is so popular. It defends the Big Lie. Perhaps it gets support from the Koch Brothers, or from Pete Peterson.
The article was written by someone who calls himself a Chartered Financial Analyst. Further down he says this…
“The system will eventually break down. Actually, it’s already starting to happen. Recently, the government announced that there would be no Social Security benefit increase next year. That’s only happened twice before in the past 40 years.”
Wrong. The cut in benefits has nothing to do with how many people get benefits, and how many people “pay into” the system.” (Actually no one pays into the system, since FICA taxes do not pay for SS.) The cut is an entirely gratuitous decision by politicians. Its purpose is to widen the gap.
Then the writer confirms what I just said…
“The government links Social Security benefit increases to the government’s own measure of inflation. If the government says ‘no inflation,’ then there are no benefit increases. It’s like letting a student grade his own paper.”
See? By affirming that the government inflation figures are bogus, the writer admits that cuts in SS benefits (linked to inflation) are based on bogus (i.e. political) claims. So much for SS being a “Ponzi scheme” that is “breaking down.”
Next, this same “Chartered Financial Analyst” erroneously equates “inflation” with an expanded money supply, while he completely ignores the demand side of the equation…
“Governments and the financial media don’t understand what inflation is in the first place. Inflation initially meant an increase in the supply of money, and nothing else. Rising prices are not inflation. They are a consequence of inflation.”
Wrong again. The price of a good or service depends on the supply of and demand for that good or service. Prices rise if the supply goes down and / or the demand goes up. During World War II there was a danger of price inflation, because everyone had money (since everyone had a job) but consumer goods were rationed. Demand was up, but supply was down. This led to price spirals. The U.S. government’s solution was to take money out of circulation by imposing a federal withholding tax, and by encouraging everyone to buy “war bonds.” Thus, the threat of price inflation was caused by an increased money supply, plus an increased DEMAND for goods, plus a decreased supply of goods.
Millions of people falsely think that “Zero Hedge” is a “financially sophisticated” blog. But when “Zero Hedge” infers that there is too much money in circulation, and when it falsely calls SS a “Ponzi scheme,” the blog justifies austerity.
This “Zero Hedge” article alone has been read by 38,148 different people.
http://www.zerohedge.com/news/2015-10-24/another-government-ponzi-scheme-starts-crack-do-you-depend-it
I checked to see what “Zero hedge” says about the (fake) “national debt crisis.”
Sure enough, the writers are again in error. They equate MS Japan with non-MS euro-zone nations.
I could fill volumes explaining all of “Zero Hedge’s” goofs, but I will spare Rodger’s readers.
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