“That guy is another Trump”

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

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By any reasonable measure, Donald Trump is among the worst, if not the worst Presidential candidate in American history.

He is a mean-spirited and vindictive bigot and a compulsively endless liar.  He is anti-black, anti-brown, anti-immigrant, anti-gay, anti-science, anti-women, anti-fact and anti-truth.

He is a hate-monger, a fear-monger, and a rumor-monger. He lacks morality and judgment.

He is inexperienced in, and ignorant of, both international and domestic matters, but is so egocentric he seems not to recognize his ignorance — a most dangerous combination.

He claims personal superiority in all areas, from war knowledge superior to that of trained generals, to tax knowledge superior to that of all previous Presidents, to physical fitness superior all previous candidates, to athletic ability superior to everyone living in New York, to superior business ability — despite ample evidence he actually is inferior in all these  areas.

Yet despite his obvious failings, he has a massive and passionate following.

One hint to this seeming anomaly might be found in an article from the November 2016, issue of Scientific American Magazine. Here are a few excerpts:

Why Political Pessimism Trumps Optimism
The psychology of political pessimism
By Michael Shermer

“If you had to choose a moment in time to be born, any time in human history, and you didn’t know ahead of time what nationality you were or what gender or what your economic status might be,” what time would you choose? Paleolithic? Neolithic? Ancient Greece or Rome? Medieval times? Elizabethan England? Colonial America? The 1950s?

“You’d choose today,” answered the man who posed this question in an April 2016 speech, President Barack Obama.

We are fortunate to be living in the most peaceful, most prosperous, most progressive era in human history,” he opined, adding that “it’s been decades since the last war between major powers.

More people live in democracies. We’re wealthier and healthier and better educated, with a global economy that has lifted up more than a billion people from extreme poverty.”

If these facts are true—and they are —then why the doom and gloom heaped on us by politicians and pundits on both sides of the political aisle?

First, news media outlets are far more likely to report bad news than good. Another day in Turkey without a coup goes unreported, but just try and take over a country without the world’s media covering it.

Second, as psychologist Roy F. Baumeister explained, “bad emotions, bad parents, and bad feedback have more impact than good ones, and bad information is processed more thoroughly than good.

Bad impressions and bad stereotypes are quicker to form and more resistant to disconfirmation than good ones.” Why?

One answer, I suggest, is in the psychology of loss aversion, in which, on average, losses hurt twice as much as gains feel good.

To get someone to take a gamble, the potential payoff must be about twice the potential loss. Why? Because of the endowment effect, which is the tendency to value what we own more than what we do not own.

Why is our psychology wired this way? Evolution. According to Harvard University psychologist Steven Pinker, in our evolutionary past there was an asymmetry of payoffs in which the fitness cost of overreacting to a threat was less than the fitness cost of underreacting.

The world was more dangerous in our evolutionary past, so it paid to be risk-averse and highly sensitive to threats.

All of which helps to explain much political pessimism.

That is part of it — pessimism is stronger than optimism, and is widely considered to be wiser. The optimist often thought naive and innocent, while the pessimist is wrongly believed to be a realist.

A second factor is what we described in earlier posts, and what the philosopher, Eric Hoffer, calls the “true believers.” These are people who passionately follow a leader or a faith. Religious fundamentalists and group fanatics are true believers.

One of the characteristics of a true believer is certainty despite contrary fact, especially the certainty that the past was good, the present is bad, but the Leader can make the future good again.

When Donald Trump says, “Political correctness is killing us;” “Free trade is killing us;” “Globalization is killing us;” “China is killing us;” “Mexico is killing us;” he is speaking to true believers, who long for a mythical future and a beautiful past that never really existed.

Trump’s slogan, “Make America great, again,” is a paean to that belief.

Despite Obama’s optimism and factual statement of how things are better today, many people have things worse, or think they do, or are afraid they will in the future.

Trump speaks to those of the middle and low income/wealth/power groups, who have seen the Gap widen between them and the rich, and they are resentful and need someone to blame. 

True believers need a devil to blame, generally someone from a competing ideology (a different religion or nationality). Trump’s Mexicans, Muslims, gays, Chinese, etc. fit perfectly (though ironically, the real devils are the American rich who, like Trump, create and benefit from policies that widen the Gap).

Third, there is a characteristic commonly known as “charisma,” a hard to define quality that many people find attractive and convincing.  Barach Obama and Bill Clinton have it in the eyes of many. Hillary Clinton seems to lack it. Donald Trump has it.

If we combine general need of threat avoidance, the specific needs of true believers, plus charisma,  we have a leader. If we add to the mix, a frightening lack of job qualifications and morality, we have Donald Trump.

It is quite likely that, no matter the election outcome, Donald Trump’s name will live on as the epithet: “That guy is another Trump.”

Rodger Malcolm Mitchell
Monetary Sovereignty

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the rich and the rest.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

Ten Steps To Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE (H.R. 676, Medicare for All )
This article addresses the questions:
*Does the economy benefit when the rich afford better health care than the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be a good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME. (TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

The Ten Steps will grow the economy, and narrow the income/wealth/power Gap between the rich and you.

MONETARY SOVEREIGNTY

9 thoughts on ““That guy is another Trump”

  1. OFF TOPIC

    Eighty percent of the securities credit ratings market is controlled by Moody’s, plus Standard & Poor’s.

    The remaining 20% is controlled by Fitch.

    All three companies accept bribes to fraudulently rate securities in the way that bribe payers want.

    In Feb 2015, Standard & Poor’s agreed to pay a $1.375 billion fine for having defrauded investors by issuing falsely inflated ratings. (But of course no one went to jail.)

    The US Justice Department is now preparing to sue Moody’s for fraud, along with Fitch.

    In one case, Fitch fraudulently rated collateralized debt obligations issued by Credit Suisse Group as “AAA,” resulting in investor losses of $340.7 million.

    The entire world knows that these three companies are utterly corrupt. Nonetheless, every time these companies fraudulently downgrade the creditworthiness of sovereign securities (such as U.S. T-securities or U.K. “gilts”) it becomes a news item.

    Moody’s now says it will downgrade British “gilts” if the U.K. leaves the E.U.

    http://www.cbsnews.com/news/moodys-says-u-k-s-brexit-could-result-in-ratings-drop/

    Most investors ignore such nonsense, since they understand the concept of monetary sovereignty. However the corporate media outlets report the nonsense anyway, in order to make average people think that governments with monetary sovereignty (which create their domestic spending money out of thin air) are the same as private citizens (which must balance their income with their expenses).

    Average people WANT to believe this lie, even when top officials tell them it is a lie (such as Greenspan or Bernanke). Trump himself said it’s a lie, but his followers don’t care.

    Below, a Wall Street Journal article admits that the U.K. government can never run out of pounds sterling.

    Articles like these make no difference. Average people cling to the lie no matter what. Amazing, isn’t it?

    http://blogs.wsj.com/moneybeat/2016/10/31/message-from-the-gilt-market-the-u-k-can-never-run-out-of-pounds/

    Suppose the U.S. President gave a nationally televised address in which he clearly admitted that dollars are infinite, and that Social Security can never become “insolvent.”

    At least 80% of the people out there would reject this fact. They wouldn’t even hear it.

    That is why we have poverty and inequality.

    People with wealth and power know that the lower classes reject the truth, even when the wealthy and powerful clearly explain the truth to them.

    Like

    1. Why do people reject the facts?

      Because people only hear what they want to hear.

      What do people want to hear? It depends on where they are on the ladder of wealth and power.

      Rich people tend to want to hear the truth.

      Poor people tend to want lies and fairy tales. Poor people use fables (e.g. religion) as an opiate to cope with their misery. They are addicted to their opiate, and they will defend it with their lives. They are frightened by the truth, since it threatens their delusion. They regard their delusions as “common sense” and “objective fact.”

      In some cases we cling to lies because they give us special privileges over others.

      Like

      1. “Rich people believe they are innately superior to poorer people.” ~ RMM

        >> And poor people insist on acting inferior. Rich people look down and the poor and say, “They wouldn’t know what to do with equality if they had it.”

        Since the poor vastly outnumber the rich, the poor can only be enslaved because they agree (at least subconsciously) that they should be slaves.

        ++++++++++++++++++++++++++++++++++++++++

        “Then again, all people tend to believe they are innately superior to poorer people.” ~ RMM

        >> Exactly. Most people at all levels want to narrow the gap above them, and widen the gap below them. Of the two motivations, the latter is stronger. This is another reason why we have poverty and inequality.

        My overall point is that the rich are not the only ones to blame.

        Like

  2. Venezuela is Monetarily Sovereign. Its currency is the bolivar. So why this?

    Cash-strapped Venezuela has a big payment due today by Patrick Gillespie @CNNMoneyInvest

    Venezuela owes more money than it has in the bank.

    Including a big bond payment due on Wednesday, Venezuela owes about $11 billion in bond payments between now and the end of next year. Besides that, it also owes billions more to China, foreign oil companies and many others.

    And it’s losing money fast. As of Monday, Venezuela only had $10.9 billion at its central bank, mostly held in gold bars, along with some assets held at the International Monetary Fund and some cash. At the beginning of last year, Venezuela had $24 billion in the bank.

    The IMF forecasts inflation in Venezuela to skyrocket 500% this year and 1,660% next year. It’s caused food prices to rise so high that people can’t afford whatever food is available in markets and stores.

    Venezuela is expected to avoid a default on Wednesday and pay $1.2 billion to bondholders. It recently caught a big break when some of its bondholders, who accepted a “swap” and agreed to push back payments to a later date. The state-run oil giant, PDVSA, had warned it might default if investors didn’t accept the swap.

    Venezuela does in fact have a strong record of making payments — at the expense of its people.

    It has prioritized paying bondholders over paying for food to feed its people. Food imports to Venezuela were down about 50% in the first half of 2016 compared to the same time a year ago.

    See that word “inflation”? No one wants bolivars. Everyone wants to be paid in dollars, euros, pounds, or at worst, another important currency.

    So though Venezuela has the unlimited ability to create bolivars, it probably owes dollars, and no one wants to exchange dollars for bolivars.

    So the people will suffer, as always. The rich will do just fine, as always

    Why so much inflation? Economic mismanagement and political criminality — common among countries that rely on oil.

    Like

  3. Re your last comment we can add the pernicious influence of the USA. They are producing food to glut levels. Just this year 35 million gallons of milk was poured away. Venezuela used to be self sufficient in its food production. Then came NAFTA and the cheap US assisted food it produced undercut Venezuela’s own crops. So they started buying it and their own farming was abandoned, paying for it out of oil exports. Now that has evaporated they cannot afford to buy food and they don’t have the agricultural industry to fall back on. So next step, borrow ,in Dollars, the money they need and then fail to repay it and then the banks come in and strip the country of its natural capital. Naturally none of tho poor see any of the loan money. And again naturally the country will become a third world natin, just what the PTB like to see.

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  4. Good.

    So Venezuela, a monetary sovereign, cant fool logic?

    How can that be i thought your plan was fool proof. Nobody wants bolivares because venezuela does exactly what you are proposing, they “give” things for free.

    Except that no one wants to produce anything any longer. The last thing left is to hand over their oil for real money.

    You ms recommendation is pure bs.

    Like

    1. Liberalism did not kill the bolivar. Criminality did. Everyone wants dollars.

      But if you don’t want liberalism, vote against Social Security, Medicare, Medicaid, aids to education, and reductions in personal and corporate taxes.

      I assume you are very rich to want those things.

      Like

  5. What does this say about Trump? What does this say about Trump followers?

    Obama Meets 12-Year-Old With Cerebral Palsy Who Was Kicked Out Of Trump Rally

    One day after he was removed from a Donald Trump rally, a 12-year-old boy who has cerebral palsy met with the president.

    J.J. Holmes and his mother, Alison, stopped by a Saturday Trump event in Tampa to protest the Republican nominee’s treatment of the disabled.

    “The crowd started chanting ‘U-S-A’ and pushing his wheelchair,” Alison Holmes told the Washington Post. “We were put out by security. Mr. Trump kept saying, ‘Get them out.’ “

    Like

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