Are you “Gap dumb”?

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 the rest..
•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..


Why would the middle classes agree to reduce such benefits as unemployment insurance, Social Security, Medicare, Medicaid, food stamps and other aids to the poor?

Many of those benefits aid the middle classes, yet they repeatedly vote to reduce them. They vote against their own interests, doing exactly what the rich want them to do. Why?

The Gap is the difference between the “haves” and the “have-nots,” the difference between the rich and the rest, the difference between the powerful and the powerless.

The income Gap has been growing for the past 45 years, partly because both political parties have convinced the voting public that benefit restriction is necessary:

monetary sovereignty
(The Gini ratio shows a Gap difference, with “0.000” meaning everyone has the same income and “1.000” meaning one person has all the income)

Although we speak of “the” Gap, there are, in fact, many Gaps. Not only is there a Wealth Gap, an Income Gap and a Power Gap, but there are Gaps between all levels.

For example, there is an Income Gap between the upper .1% income group and the 1% income group, and Gaps between every income group below.

There are Power Gaps between the President of the U.S. and any individual Congressperson, and the lay people below them.

There are salary Gaps, even among various employees in the same companies.

While every Gap has its own characteristics, a generalization can be made about all Gaps:

The occupants of each level wish to narrow the Gaps above themselves and to widen the Gaps below themselves.

The following article demonstrates this generality at play:

The $70,000 Minimum Wage Experiment Reveals A Dark Truth
Sam Becker, December 25, 2015

Earlier this year, a small Seattle-based payment processing company made headlines when its 31-year-old CEO made a rather jarring change to the company’s pay structure: Gravity Payments would pay all employees, at a bare minimum, $70,000 annually.

It was met with a variety of reactions, ranging from those who said CEO Dan Price was establishing himself as a working-class hero to those who thought he was actively destroying the fabric of society as we know it.

Price had read a study that said the optimal level of happiness can be achieved with an income at around $70,000, and decided that he was in a position to make a difference. So he acted on it — by cutting his own salary by 90%.

Now, with several months having passed, we’re beginning to see the fallout.

The company has lost a handful of clients, but it’s signed on even more — so many more that it’s had to go on a hiring spree.

The other unintended side effect of Price’s minimum wage policy has come from within the company.

According to reports, Gravity Payments lost two of their rock star employees, both who evidently thought it was unfair that other employees were getting big pay bumps, while not necessarily contributing as much to the company’s success.

Essentially, it rubbed them the wrong way that a receptionist was getting a huge raise, while not working harder than they were. They felt that the value of their skills had been diminished.

Said another way, the higher paid employees did not like the fact that the Income Gap between them and those below them had been narrowed. They looked upon the lower levels as being “inferior,” and did not want “inferior” people coming closer, physically, financially or in prestige.

This is comparable to the way the rich feel about the non-rich. “Keep your distance. If you come closer it diminishes our own status.”

We’re seeing similar sentiments pop up all over the country as calls for $15 minimum wages for fast food workers and others start to gain momentum. Basically, people don’t feel like someone who simply cooks fries, serves drinks, or parks cars should be paid that much.

The Gravity Payments employees who quit didn’t see their pay go down, or see a negative externality as a result of their coworkers’ wages going up. Yet, they were unhappy that their coworkers were better off.

It speaks to a certain psychological element that we see in many aspects of society — lots of people are only happy with success when it means that others around them are worse-off. It’s the view that the world is a zero-sum game, and that instead of everyone being better off, we need to have some losers.

The very rich — the .1% — make use of that psychology, by convincing the populace that those below them do not deserve help. Thus, the poor are portrayed by the rich as “lazy undeserving takers,” who if they receive welfare, would simply loll about and refuse to work.

Nevermind that the poor lead comparatively miserable lives, and few if any would prefer receiving welfare than receiving earned salaries. And nevermind that the working poor — the gardeners, car valets, house cleaners, waiters, fast food employees, factory workers, etc. — work harder and receive less for their efforts than do the rich.

The belief is widespread that the wealthy have earned their largess, while the poor have earned their misery. It is a belief disseminated by the rich and the people who have been bribed by the rich: The media, the politicians and the university economists.

Thus brainwashed, each level tends to vote against its own best interests, so long as those below are hurt more.

It also is a strange quirk of human psychology that the “good deed” of giving to charities benefitting those below seems satisfying, while allowing the government to do the same creates resentment.

NOTE to those who object to the government helping the poor and middle classes: Just know you are doing the dirty work of the rich at your own detriment.

That’s just “Gap dumb.”

Rodger Malcolm Mitchell
Monetary Sovereignty

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.


Recessions come only after the blue line drops below zero.

Monetary Sovereignty

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.



4 thoughts on “Are you “Gap dumb”?

  1. Rodger, that article you quoted is not clear about something…

    “According to reports, Gravity Payments lost two of their rock star employees, both who evidently thought it was unfair that other employees were getting big pay bumps, while not necessarily contributing as much to the company’s success.”

    Where are these “reports”? And what is a “rock star employee”?

    If I worked harder than the company receptionist, and if I brought in the sales that the company (including the receptionist) vitally depended on, then yes, I would expect to be paid more than the receptionist.

    The article says, “It rubbed them the wrong way that a receptionist was getting a huge raise, while not working harder than they were.”

    Which means the receptionist was working AS hard as the “rock star employees.”

    The article could be clearer.


    Regarding “Gap dumb,” yes, this is endemic to society.

    From the article… “People don’t feel like someone who simply cooks fries, serves drinks, or parks cars should be paid that much. It diminishes their own wages as a result, and drives down their purchasing power as businesses adjust prices to absorb the increased labor costs.”

    Because average people only think about themselves, they see life as a zero sum game. They think the definition of “winning” is to increase other people’s losing. They think they have not gotten ahead that unless they have knocked other people down. They measure their success not only by what we have attained, but also by other people’s failures. They cannot see that they will prosper if everyone prospers. For example, if fast food workers were paid $15.00 or more, then other businesses (e.g. Wal-Mart) would eventually have to increase their wages to keep employees from resigning to go work at fast food places.

    As you note, rich people foment and exploit Gap stupidity (i.e. they promote and exploit resentment between the peasants). It’s as though we are in a vast dungeon with a small exit door. If the small exit door is opened, then everyone will eventually be able to escape. However everyone cannot escape at once. Since I resent anyone who escapes before I do, I and my fellow prisoners pull back anyone who tries to leave. Therefore none of us escape, even though the exit is always open.

    Applying this to the real world, if someone suggests that college should be free, then people who are struggling with student loan debt will object. “I have to pay, so everyone should have to pay!” These people cannot see that if college is made free, then people who are still paying will be able to highlight the injustice, and demand debt relief.

    The rich understand all this. They regard average people as rats. And indeed, average people tend to behave like rats.

    Meanwhile among the rich, if one of them tries to buck the trend, and treats his subordinates decently, other rich people will attack him (or her).


    There’s another element involved in all this, which is that average people defend the rich so that average people can pretend that they are not average.

    For example, Chipotle Mexican Grill has 1,900 locations nationwide. I’ve never eaten there, but I understand that Chipotle is the best fast food Mexican place in terms of food quality. The best by far. Chipotle has been exploding in size, threatening giants like Taco Bell, which has 9,600 locations, and whose food is garbage (and getting worse all the time). Taco Bell is now owned by Yum! Brands, which has more than 41,000 restaurants around the world in over 125 countries.

    Although Chipotle has no more problems with foodborne illnesses than does any other large restaurant chain, any hint of problems at Chipotle is exaggerated in the corporate media outlets, which are sympathetic to the giants. If there is a problem, then the media will interview an executive with Yum! Brands who will gloat, and will indulge in “Schadenfreude.”

    The thing is, average readers will also gloat! Never mind that Chipotle gives them far more value for their money. The peasants simply enjoy gloating like the rich. They may even avoid Chipotle.

    By defending the rich, the peasants imagine that they are not peasants, thereby guaranteeing that they will always remain peasants.


    Here are some illustrations connected with the Gap…


    1. The motive is this: “Rich” and “poor” are not absolute terms; they are comparative terms.

      If you earned $1,000 per year, you might be considered “poor.” But what if every other person on earth earned $10 per year. In that case, you are “rich.”

      So, there are two ways to be rich: Earn more or make sure everyone else earns less.

      The resentment toward federal benefits to the poor is based on the desire to be richer than as many people as possible — or, at least, to feel richer.

      The person who lives in a slum, but has a 60″ TV set is an aristocrat among his peers. Those who don’t have the 60″ set feel envy.

      The problem arises when, in pushing down those below, one pushes himself down. And that is what happens with deficit reduction.


      New 2015 Wealth Data Reveal U.S. Inequality at Its Ugliest



    An article in…

    “Government spending is a huge economic burden. Contrary to what Keynesian members of the political class tell us, government has no resources. The dollars that politicians so generously lavish on us were first taken from us. Our taxes are high because government spending is at record levels. The money isn’t conjured out of nowhere.”

    From there it gets worse, and worse, and WORSE!

    Quantcast says that gets 12.2 million views per month, or an average of 406,000 views per day. That’s a lot of people swallowing a lot of excrement.

    Imagine what life would be like if nearly half a million people a day were told the TRUTH.


    1. John Tamny is a well-paid propagandist for the rich. His knowledge of economics is equal to my knowledge of quantum chromodynamics.

      I don’t write about quantum chromodynamics and he shouldn’t write about economics.

      And no one should believe us if we did.


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