Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell
•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 the rest.r.
•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..
The Gap is the difference between the rich/powerful and the rest of us.
Without the Gap, no one would be rich (we all would be the same), and the wider the Gap, the richer the rich are. That is one result of the Gap: To separate the rich from the rest.
But, the Gap has another purpose: To give the rich control over the rest of us, and here is where Marco Rubio’s plan comes in:
Rubio’s College-Cost Plan Deserves a Chance
15 DEC 2, 2015, By Paula Dwyer (Paula Dwyer writes editorials on economics, finance and politics. She was previously London bureau chief for Businessweek and Washington economics editor for the New York Times.)
Marco Rubio has taken a lot of heat for endorsing what some have derided as indentured servitude for college students.
Intriguingly, the plan the Republican presidential candidate is backing is indentured servitude, though strictly voluntary, as he keeps pointing out.
It’s also one of the more promising solutions to the U.S. student-debt predicament.
Never mind that indentured servitude during the 17th and 18th century also was largely voluntary. It was oppressive and intolerable then; it would be oppressive and intolerable now.
[Indentured servitude was a labor system where people paid for their passage to the New World by working for an employer for a certain number of years. It was widely employed in the 18th century in the British colonies in North America and elsewhere.
It was especially used as a way for the poor in Britain and the German states to get passage to the American colonies.
They would work for a fixed number of years, then be free to work on their own. The employer purchased the indenture from the sea captain who brought the people over; he did so because he needed labor.
About half of the white immigrants to the American colonies in the 17th and 18th centuries were indentured.]
When people are desperate, they often will “volunteer” to do desperate things.
The rich count on that. Workers in the infamous garment industry sweatshops were largely “voluntary.”
The new method, called income sharing, typically involves a “loan” from investors to students.
Instead of paying the money back with interest, students contract to pay their investors a set percentage of income for a fixed number of years after graduation.
The concept dates to 1955, when economist Milton Friedman concluded it made no sense to require new graduates to make fixed loan payments when earnings are so low.
Instead, he suggested, why not make equity investments in human beings?
Investors could finance college students by buying a share in their earnings prospects.
Successful graduates, some of whom would pay back more than the initial investment, would compensate for the unsuccessful ones.
It all sounds so neat and cozy. Poor kids would take out these loans. (Rich kids won’t need Rubio’s loans)
Those poor kids, who need every penny they earn would, for years and years, give some percentage of their earnings to rich people.
What a concept!
But it gets even better:
Investors are more likely to offer generous repayment terms to students who choose fields in great demand, and who select colleges with a high rate of return on their degrees.
Said another way, “Investors are more likely to offer onerous repayment terms to students who choose fields or colleges the investors don’t like.”
The rich investors would gain control over:
1. The subjects students study.
2. The colleges the students attend.
3. The subjects those colleges offer.
4. The percentage of salary the students must pay.
5. The number of years the students must pay.
If you prove to be a good, little indentured
slave er, ah, servant, you might even get a break on those terms — or not. That would depend on what your rich master wants.
Forget about studying in less remunerative areas like teaching, agriculture, physics, mathematics, geology and other sciences (How much do those guys make, anyway?) And for sure, don’t work for charities or other “do-gooder” enterprizes. We’d have to make you work for us, for the rest of your life.
We rich want you poor people to study banking, investing and other business courses, so you can work for our companies. That’s where the real dollars are and that is where we’ll make the most money.
The college-debt problem is worse than we thought, recent data show. Outstanding balances now exceed $1.2 trillion, four times the amount of 12 years ago.
One in six borrowers is delinquent or in default.
Low-income borrowers, especially those attending historically black institutions, two-year community colleges and for-profit universities, hold much of the outstanding debt — and are behind 70 percent of the defaults.
The poorer you are, the more difficult it is for you to pay off your loan. Knowing that, what will an investor do?
Right. He will not make the loan or he will demand a high percentage from poorer people’s salaries, i.e those “repayment terms” mentioned earlier.
Bottom line: Rich investors want to own the rest of us. They want to get in on the thievery, while restoring the indentured servant system that traps the poor into never-ending servitude.
So they came up with this corollary to Bush’s attempt to privatize Social Security — a program to enrich Wall Street and create debt servants.
Of course, the whole thing is a gigantic, right-wing scam — completely unnecessary and economically damaging.
If elementary school students don’t pay for school. And high school students don’t pay for school. Why should college students pay for school?
And if monetarily non-sovereign cities can pay for elementary school, and monetarily non-sovereign counties and states can pay for high school, why can’t the Monetarily Sovereign federal government pay for college?
We could eliminate the disgraceful trillion dollar weight on the poor and middle classes with one simple law — a law similar to the one that makes elementary and high school free:
Suggest that, and listen to the rich squeal.
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 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.
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. Recessions come after the blue line drops below zero and when deficit growth declines.
As the federal deficit growth lines drop, we approach recessions, each of which has been cured only when the growth lines rose.
Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.