It takes only two things to keep people in chains:
The ignorance of the oppressed and the treachery of their leaders.
When a right-wing, debt hawk warns about the deficit and debt being “unsustainable,” we can write it off as typical misdirection from a right-wing political group looking to justify cutting social programs, while raising taxes on the 99% (and, as always, lowering taxes on the 1%).
But when a left-winger does the same thing, all we can do is ask, “Are there any progressives at all, in our government”?
Here are writer Noah Rothman’s comments about Democrat, California, Senator Kamala Harris’s comments:
“I intend to co-sponsor the Medicare-for-all bill because it’s just the right thing to do. Taxpayers are paying huge amounts of money” for emergency-room care.
A Medicare-for-all system would generate “a return on investment for taxpayers.” This is, to be gentle, nonsense.
Rothman is correct. It is nonsense, but not for the reasons he thinks.
Yes, a Medicare-for-all system would not “generate a return on investment for taxpayers.” But the reason is that federal taxpayers do not fund federal spending and do not profit from federal savings.
Unlike state and local governments, which are monetarily non-sovereign, and do use taxpayer dollars, the federal government is Monetarily Sovereign and has no use for taxpayer dollars.
The federal government uniquely creates brand new dollars — its sovereign currency — the dollar, every time it pays a bill. No other government can do that.
The nonpartisan Urban Institute pegged the cost of a Medicare-for-all system in America at $32 trillion over ten years, requiring an average tax hike on all Americans of $24,000 annually (to say nothing of the billions in lost economic activity as Americans tighten their belts).
This is a monstrous lie, aka the “Big Lie.“
Whether the cost is $32 trillion or $320 trillion, federal taxes would not fund it. Even with $0 tax collections, the federal government creates, ad hoc, all dollars necessary to pay all its bills.
And rather than causing ‘lost economic activity,’ and American belt tightening, that $32 trillion addition to our economy would add to GDP growth. No belt tightening needed, quite the opposite.
Remember this formula: Gross Domestic Product = FEDERAL SPENDING + Non-federal Spending + Net Exports.
In short, the more the federal government deficit spends, the more GDP increases.
(Conversely, when federal deficit spending is eliminated, we have depressions):
1804-1812: U. S. Federal Debt reduced 48%. Depression began 1807.
1817-1821: U. S. Federal Debt reduced 29%. Depression began 1819.
1823-1836: U. S. Federal Debt reduced 99%. Depression began 1837.
1852-1857: U. S. Federal Debt reduced 59%. Depression began 1857.
1867-1873: U. S. Federal Debt reduced 27%. Depression began 1873.
1880-1893: U. S. Federal Debt reduced 57%. Depression began 1893.
1920-1930: U. S. Federal Debt reduced 36%. Depression began 1929.
1997-2001: U. S. Federal Debt reduced 15%. Recession began 2001.
Moreover, Federal Spending also increases Non-federal Spending by adding dollars to the private economy. If the government pays you and businesses more, you will have more to spend and businesses will have more to spend.
When Democrats pitched the public on the ACA, the “cost” estimated to taxpayers was supposedly just $848 billion over ten years after implementation, but the Congressional Budget Office insisted that the actual figure was just over $2 trillion.
That’s an incredible strain on the nation’s budget, but it pales in comparison to the galactic numbers Senator Harris and her ilk heave about recklessly.
She is playing to the cheap seats, but it’s telling that her instinct is to pitch a single-payer plan by insisting it is an attack on, not an endorsement of, profligacy.
To say the above paragraphs are 100% bullsh*t is to do a disservice to bullsh*t, which at least fertilizes growth.
- Federal spending does not cost taxpayers one dime. Being Monetarily Sovereign, the federal government does not spend taxes. The tax dollars you send to the government cease to be a part of any money-supply measure, as soon as they are received. Said another way, federal taxes are destroyed upon receipt.
- Whether or not federal spending exceeds the budget does not “strain” anything. The government pays all its bills by sending instructions to creditors’ banks, instructing the banks to increase the numbers in the creditors’ bank accounts. This creates dollars.
- Growing the economy is not “profligacy.” Increased federal deficit spending is necessary to grow the economy, and decreases in deficit spending shrink the economy.
Even in Harris’s home state, the Democratic Party’s infatuation with the idea of socialized health care was crushed against the immovable object of fiscal realities.
A peek under the hood revealed that, under all the gauzy rhetoric about access to taxpayer-funded health-care coverage representing a human right, there is no feasible way to make that a reality.
The bill could not address the hurdles associated with cost control, delivery of care, and how to finance the thing. The Assembly bill was estimated to cost the state approximately $400 billion every year, more than double California’s total annual budget.
Here, Rothman demonstrates either abject ignorance regarding the difference between Monetary Sovereignty (the federal government) vs. monetary non-sovereignty (California’s government), or he is lying.
State and local governments, being monetarily non-sovereign, do not have the unlimited ability to create their sovereign currency for the simple reason: They do not have a sovereign currency. They use the dollar, the federal government’s sovereign currency.
So state and local governments can and do run short of dollars. The federal government cannot and does not run short of dollars. Not knowing the difference is a sure sign of economic ignorance.
Is Barack Obama’s health-care reform law a triumph of progressive public policy? Or is it, as Republicans have long insisted, a poorly-conceived measure with more adverse than positive effects?
First, if we are going to be honest, it’s not Obama’s health-care reform law; it’s Republican Mitt Romney’s.
Second, it really is a poorly-conceived measure, because it makes the tacit and false assumption that it’s taxpayer funded. And because of that tacit and false assumption, ACA was developed as a Rube Goldbergian program designed to minimize the nonexistent, Federal taxpayer funding.
A very simple, federally funded, comprehensive, Medicare for every man, woman, and child in America, would cost taxpayers nothing and protect everyone. No FICA needed.
Republicans may soon have to defend a suboptimal status quo from an unpopular liberal campaign to nationalize the health-care system.
“Nationalize” is the right-wing’s code word for “socialize,” and it is wrong. The health-care system would not be “nationalized” or “socialized” by Medicare for All.
The only change would be for the federal government to take the place of health care insurance companies.
The system still would use privately run hospitals, private doctors, private nurses, privately owned drug stores, and privately owned pharmaceutical manufacturers. Everything about the system would remain private except for the insurance companies. They would disappear.
And is that a bad thing? Remember, insurance companies need to make a profit, which means charging premiums and minimizing payments to the public. It’s one of the reasons why insurance companies resist paying for expensive medications and treatments.
There are lawyers who make their living suing insurance companies to obtain health care treatments for their clients.
But the federal government does not need profits, does not need premiums and does not need to minimize payments to the public. In fact, every federal payment to the public adds to GDP.
Democrats have convinced themselves that the rising popularity of Medicare-for-all among Democrats amounts to a national wellspring of new faith in progressivism and, by extension, themselves.
They’re welcome to test that proposition at the ballot box. But, first, Democrats may want to rethink their messenger.
No, first the Democrats must have the courage to explain to the voters that:
- The federal government cannot run short of its own sovereign currency, the dollar.
- Federal spending does not cost taxpayers or their grandchildren, anything.
- The voters can have unlimited health care, provided by a privately-run health-care system.
- And by the way, it all can be done without causing inflation.
Now, what are the “good” reasons not to have comprehensive, federally funded Medicare for All?
There are none.
Rodger Malcolm Mitchell
The single most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.
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 can afford better health care than can 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 A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All) (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Economic Bonus)) 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 EVERYONE Five 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 benefitting 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 FEDERAL TAXES ON BUSINESS
Businesses are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the federal government (the later having no use for those dollars). Any tax on businesses reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all business taxes reduce 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 business 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.