Twitter: @rodgermitchell; Search #monetarysovereignty
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Readers of this blog have learned that the social science known as “economics,” has been co-opted by the right wing — the rich wing — to “prove” that social spending for the non-rich should be reduced.

Politicians are bribed by the rich, via “campaign contributions” otherwise known as buying favors. The media are owned by the rich. And university professors are employed by universities and “think tanks” supported by the rich.

The right-wing Supreme Court has ruled that because money is “free speech,” rich people are entitled to more speech than are the rest of us.

So everywhere you turn, you receive misinformation, courtesy of the rich.

Then, along comes Bernie Sanders, who proposes many things the rich do not like. If you go to BERNIE SANDERSOn the Issues you will find his proposals discussed:

INCOME AND WEALTH INEQUALITY
IT’S TIME TO MAKE COLLEGE TUITION FREE AND DEBT FREE
GETTING BIG MONEY OUT OF POLITICS AND RESTORING DEMOCRACY
CREATING DECENT PAYING JOBS
A LIVING WAGE
COMBATING CLIMATE CHANGE TO SAVE THE PLANET
A FAIR AND HUMANE IMMIGRATION POLICY
RACIAL JUSTICE
FIGHTING FOR WOMEN’S RIGHTS
FIGHTING FOR LGBT EQUALITY
CARING FOR OUR VETERANS
MEDICARE FOR ALL
FIGHTING FOR DISABILITY RIGHTS
STRENGTHEN AND EXPAND SOCIAL SECURITY
FIGHTING TO LOWER PRESCRIPTION DRUG PRICES
IMPROVING THE RURAL ECONOMY
REFORMING WALL STREET
REAL FAMILY VALUES
WAR AND PEACE
WAR SHOULD BE THE LAST OPTION: WHY I SUPPORT THE IRAN DEAL
MAKING THE WEALTHY, WALL STREET, AND LARGE CORPORATIONS PAY THEIR FAIR SHARE

While I may disagree with some of the details, fundamentally every one of his proposals would make life better for those who are not among the upper 1% income/wealth/power group.

And that is why the rich, and their politician, media, and academic lackeys have leaped from their knees to preach against Bernie.

Here are a few examples:

Sanders Veers Off Into Fantasyland
FEB 21, 2016, By Noah Smith

In order for Sanders’s proposals to be feasible in the long term, they must avoid putting the U.S. fiscal deficit on an unsustainable path.

The only way that will happen is if productivity grows at a historically rapid rate and labor force participation rises to historic highs.

We’ve written about Smith, before. He’s not an economist. He’s an assistant professor of finance at Stoney Brook University.

Forget his obvious ignorance of Monetary Sovereignty, which shows that the U.S. deficit cannot be on an “unsustainable path.”

Instead see how he misses the entire point of Bernie’s proposals, which is to improve the lives of the 99%.

If you go to his article, you will see no discussion of people, poverty, sickness, veterans, fairness, climate change, or the Gap between the rich and the rest. Instead, Smith’s sole focus is on how a Monetarily Sovereign nation will pay for these things.

In short, its “Who cares about the lives of the American people; let’s worry only about how our Monetarily Sovereign government, which never can run short of dollars, will pay”.

And then, there’s this:

Progressive Economists Say Bernie Sanders’ Economic Plans Don’t Add Up
Peter Suderman|Feb. 19, 2016

Even liberal economists think Bernie Sanders’ economic plans are complete nonsense.

Sanders’ plan to replace the nation’s health care financing mechanisms with a fully government-run single-payer system have drawn particular scrutiny, with Emory University health economist Kenneth Thorpe finding that, in order to pay for the plan, Sanders would need to impose a 14.3 percent payroll tax and his income-based “premium” (which is really a tax) at 5.7 percent.

The senator’s home state of Vermont killed a long-gestating plan to pursue state-based single payer after confronting the high tax hikes that would be necessary.

We’ve written about Suderman, too. he’s a right-wing, senior editor at Reason magazine and Reason.com.

His description, not Bernie’s plan, is complete nonsense. The federal government doesn’t need to raise taxes to pay for anything, though that is the bogeyman the rich like to throw in front of us.

Suderman reveals his paid-for ignorance by conflating the Monetarily Sovereign U.S. government with the monetarily non-sovereign State of Vermont. The former can afford anything. The latter, like you and me, has to watch its pennies. Two totally different situations.

And as usual, the article focuses solely on the false narrative of a federal money shortage, and says nothing about the real point: Helping the 99% live better lives.

When President Kennedy said, “Ask not what your country can do for you — ask what you can do for your country,” he opened the door for the rich to claim that somehow, benefits to the 99% were unpatriotic, and that only the leisure class was entitled to good lives.

Kennedy was wrong. The sole purpose of government — the only reason government was invented — was to improve the lives of those live under it.

The right wing has twisted this into: The sole purpose of the people is to improve the wealth and power of the rich and the government.

So preposterous has this notion become that even your federal tax form has a checkbox for you to send the federal government an additional $3 for a phony “Presidential Election Campaign fund.”

Now, that really is nuts.

Folks, the federal government creates unlimited dollars, ad hoc, when it pays its bills. There is no “Presidential Election Campaign Fund,” nor is there a Social Security trust fund, Medicare trust fund, road building trust fund, military trust fund or any other federal fund.

A budget is not a fund.

No matter how much money you have — even if you are Bill Gates and Warren Buffett combined — you do not have what the federal government has: The infinite ability to pay bills.

Sadly, even those who defend Bernie, don’t seem to care about the human effects of his proposals:

Krugman and His Gang’s Libeling of Economist Gerald Friedman for Finding That Conventional Models Show That Sanders Plan Could Work
Posted on February 22, 2016 by Yves Smith

I’m a bit late to weigh in on the scurrilous attacks on the Sanders budget plan, and more important, on Gerald Friedman, a UMass-Amherst economics professor who modeled it in detail and gave it favorable marks. Full disclosure: I know Friedman but only casually, having met him at speaking events and conferences. I have also cross posted some of his work from Triple Crisis.

Let us be clear about the vehemence of the salvos aimed at Friedman: this isn’t just a bad case of tribalism and intellectual dishonesty. This is purveyors of a failed orthodoxy refusing to indulge any consideration of plans that would show how badly they’ve mismanaged the economy.

Had (Paul)Krugman and his fellow enforcers deigned to make a good-faith response, the key issue would be what fiscal multipliers to assume on Sanders’ ambitious spending program.

The article continues to defend Sanders on the basis of economic modeling, and once again, therein lies the problem — two problems actually:

1. Economics is a social science, and as such, its mathematical models don’t work. While astronomers can predict the exact location of Pluto 1000 years from now, and chemists can predict what will happen to sodium and chlorine when mixed a 1000 years from now, economists can’t predict mathematically what will happen a month from now.

Note the repeated surprises when federal data reveals last months employment, unemployment, GDP growth, average salary and every other report. Americas best economists repeatedly get it wrong.

And that’s based on predictions of just a couple of weeks.

So, we’re supposed to believe their mathematical models?? Gimme a break. Sure, Value = Demand/Supply, but no one knows tomorrow’s numbers, let alone next year’s.

That is the nature of a social science. All the endless discussion about whether or not Bernie’s proposals are in accord with some professor’s mathematical models is absolute (excuse me) bullshit.

The economics professors who base their reputations on mathematical modeling, make Donald Trump look honest.

2. Rather than phony concerns about unpredictable, future tax collections, GDP increases, house building, etc, the focus should be on the benefits to the people — the 99%.

Federal funding of Medicare for All absolutely, positively will help the 99%, financially, physically and emotionally. That much is certain.

Federal funding of college absolutely, positively will create a more educated public, a benefit to America.

Rather than waving the false flag of fiscal “responsibility” and benefit to the federal government, let’s raise the real flag of human benefit.

Economists, media, politicians: Please, enough with the bullshit.

Ask not what you must do for your government; ask what your government will do for you. That is the real question.

Your purpose is to improve your life and your childrens’ lives. The government’s purpose is to help you.

That’s what it’s for.

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 grow the economy, and narrow the income/wealth/power Gap between the rich and you.
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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 begin an average of 2 years after the blue line first dips below zero. A common phenomenon is for the line briefly to dip below zero, then rise above zero, before falling dramatically below zero. There was a brief dip below zero in 2015, followed by another dip – the familiar pre-recession pattern.
Recessions are cured by a rising red line.

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.

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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.
•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..

MONETARY SOVEREIGNTY