It takes only two things to keep people in chains:
The ignorance of the oppressed
and the treachery of their leaders.
Perhaps I have a strange sense of humor, but I cannot help but laugh at the repeated “time bomb” references to our federal misnamed “debt.” (It’s not the kind of debt people think of. It actually is the total of deposits in T-security accounts.)
Years ago, we published the article, “Federal Debt: A ‘ticking time bomb‘“. It showed that in the 71 years from 1940 through 2011, the federal “debt” (deposits) repeatedly was called a “ticking time bomb” by the media, the politicians, the economists, and members of the public who believed what the experts said.
In 1940, the federal “debt” was $40 Billion dollars. If you click the above link you will see that because of the “time bomb,” horrible things were just about to happen.
Any minute now. Look out! Duck, the sky is falling. Here it comes!
By 2011, the “debt” (deposits) had grown to $10 Trillion, at which time we were in the midst of huge economic growth, fueled by massive deficit spending, growth that continues today.
During that period, we published “From ‘ticking time bomb’ to ‘looming collapse,” an article that quoted the experts claiming the federal debt (deposits) continued to be a threat to America well into 2017. By then, the so-called “debt” had grown to $15 trillion.
That’s a 50% growth in just six years, and still no explosion. The sky remained intact and America’s prosperity continued (though the Gap between the rich and poor also grew — that’s another story.)
If the first 71 years of wrong predictions were amusing, the next six were absolutely hilarious. Sadly, the black comedy has not ended.
Just today, one of my favorite TV commentators, Rachel Maddow, broadcast a piece titled, “Paul Ryan legacy gives lie to Beltway’s deficit hawk mythology.”
“Rachel Maddow shows how the Beltway media spun up an elaborate myth about Paul Ryan as a budget hawk focused on reducing spending and debt.
Ryan announced his retirement two days after the CBO announced a record deficit resulting from the budget Ryan oversaw.”
Rachel criticized Ryan, who devoted his entire career, his entire raison d’etre as the Speaker of the House, for announcing his retirement with the claim that he had succeeded in what he wanted to do.
She rightfully scoffed at the notion of success by failure, but what she failed to mention is that by failing to keep his promises, Ryan helped America grow.
If you go to the above link, and watch Rachel’s show, you’ll see she doesn’t understand that deficit spending is stimulative.
Money growth is absolutely, positively necessary for economic growth, and federal deficit spending, which is reflected in the so-called federal “debt,” provides money growth.
Yes, it was a case of ignorance succeeding, and Ryan probably still doesn’t understand it, but federal deficit spending has grown the economy, and cuts to federal spending have cut economic growth.
And today, even my beloved Rachel has joined the chorus of ignorance — or humor, depending on your perspective.
I can understand the boobs of Fox and Friends not getting it. When Sean Hannity is one of your top personalities, you know you have problems.
But Rachel? My Rachel Maddow? Oh Rachel, say it isn’t so.
Rodger Malcolm Mitchell
Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell
The 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.
3 thoughts on “The debt “bomb” and Rachel Maddow. Not you too? Say it isn’t so”
And then there’s this steaming pile of BS:
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It could well be that Ryan finally got it, by reading a book about monetary sovereignty and the sectoral balances, realized what a great fool he had been all these years and how much damage he had done and wanted to bail before it became common knowledge. Or wanted to bail because he saw the error of his ways and that politically he had painted himself into a corner. He had no stomach to keep up the lies.
One only can hope you are correct.