Buy stocks. If the following Chicago Tribune/ Associated Press article proves to be correct, America’s economic boom will continue for at least another decade.
Here are some excerpts and translations:
US on track for first $1T budget deficit since 2012
By Martin Crutsinger Associated Press
WASHINGTON — The U.S. budget deficit through the first four months of this budget year is up 19% from the same period a year ago, putting the country on track to record its first $1 trillion deficit since 2012.
Translation: . . . putting the economy on track to receive 1 trillion growth dollars from the government this year.
The Treasury Department said Wednesday in its monthly budget report that the deficit from October through January was $389.2 billion, up $78.9 billion from the same period last year.
Translation: The Treasury Department said Wednesday in its monthly budget report that it sent 389.2 billion growth dollars into the economy from October through January, up $78.9 billion from the same period last year.
The deficit reflected government spending that has grown 10.3% this budget year while revenue was up only 6.1%.
For January, the deficit totaled $32.6 billion, compared to a surplus a year ago of $8.68 billion.
Translation: The deficit reflected government stimulus to the economy has grown 10.3% this budget year while taking dollars out of the economy was up only 6.1%.
For January, 32.6 billion growth dollars were added to the economy, compared to a year ago when $8.68 billion were removed from the economy.
President Donald Trump sent Congress a new budget blueprint Monday that projects the deficit will top $1 trillion this year but then will decline over the next decade.
But the Congressional Budget Office is projecting that the deficit will top $1 trillion this year and remain above $1 trillion over the next decade.
Translation: President Donald Trump sent Congress a new budget blueprint Monday that projects sending more than 1 trillion growth dollars into the economy this year, but then would send less over the next decade.
However, the Congressional Budget Office is projecting that 1 trillion growth dollars will be sent into the economy this year and more than 1 trillion growth dollars will be sent in every year over the next decade.
The deficit for the 2019 budget year, which ended Sept. 30, was $984.4 billion, up 26% from the 2018 imbalance.
Translation: Growth dollars added to the economy for the 2019 budget year, which ended Sept. 30, totaled $984.4 billion, up 26% from the 2018 lesser surplus.
The rising deficits reflect the effect of the $1.5 trillion tax cut Trump pushed through Congress in 2017 and increased spending for military and domestic programs that the president has accepted as part of a budget deal with Democrats.
Translation: The rising economic stimuli reflect the effect of the $1.5 trillion tax cut for the rich Trump pushed through Congress in 2017 and increased spending for military and domestic programs that the president has accepted as part of a budget deal with Democrats.
In his new budget plan for the 2021 fiscal year that starts Oct. 1, Trump is proposing spending $4.8 trillion, but would seek to hold down deficits by cutting domestic programs like food stamps and Medicaid.
In his new budget plan for the 2021 fiscal year that starts Oct. 1, Trump is proposing adding 4.8 trillion growth dollars to the economy, but would seek to punish the poor and the economy, by unnecessarily cutting domestic programs like food stamps and Medicaid.
Trump’s plan projects that if Congress goes along with his spending cuts, which is unlikely, the budget would return to balance in 15 years.
Translation: Trump’s plan projects that if Congress goes along with his spending cuts, which is unlikely, the government will take more than a trillion dollars out of the economy, and destroy those dollars, preventing any hope for economic growth, and assuring a depression that would make the 1929 depression look like a garden party.
Through the first four months of this budget year, government spending has totaled a record $1.57 trillion, up 10.3% from the same period last year.
Revenue also set a record for the first four months of a budget year, increasing by 6.1% to $1.18 trillion.
The government first ran $1 trillion deficits from 2009 through 2012 as revenue fell during the worst recession since the 1930s.
Translation: Through the first four months of this budget year, government growth dollars added to the economy have totaled a record $1.57 trillion, up 10.3% from the same period last year.
Unfortunately, the growth dollars removed from the economy also set a record for the first four months of a budget year, increasing by 6.1% to $1.18 trillion.
The government pumped $1 trillion into the economy annually from 2009 through 2012, which helped the economy recover from the worst recession since the 1930s.
We can end this post by showing you excerpts from a truly ignorant article that appeared in Reason.com:
To Revive the Economy, Cut Federal Spending
Obama and Boehner are both big spenders. That’s the problem.
NICK GILLESPIE AND VERONIQUE DE RUGY, 1.1.2013
The Republican opposition, led by House Speaker John Boehner of Ohio, has signaled that the Republicans could stomach generating as much as $800 billion in new revenue over the next decade.
Such a large difference obscures a more fundamental agreement: Neither side is interested in addressing the central role federal spending plays in creating persistent deficits and, more important, damping economic growth.
The deficit for fiscal 2012, which ended on Sept. 30, came in at about $1.1 trillion, marking the fourth consecutive year that the nation has posted a trillion-dollar-plus spending gap.
It’s fun to look back in time to see what people, who are completely ignorant of Monetary Sovereignty, said.
We’ve done that when we repeatedly published those “The Deficit is a Ticking Time Bomb” articles since 1940. (The bomb still is ticking).
And now we have the Reason.com’s daily serving of abject ignorance. You’ll note that the article makes dire predictions about the economy unless the government stops adding dollars to the economy.
(Thankfully, it didn’t stop; the dollar additions cured the Great Recession, and after the article was published, the economy continued to grow because of more dollar additions.)
Yet even today, if you go to Reason.com, you’ll find those folks have learned nothing. They still publish the same blather about the danger of deficits.
And here’s the real knee-slapper:
The article quotes economists Carmen M. Reinhart, Vincent R. Reinhart, and Kenneth Rogoff who famously were discredited, partly because they didn’t take into account the differences between a Monetarily Sovereign nation and a monetarily non-sovereign nation. And these are “economists.”
They said that periods of “debt overhang” – when accumulated gross debt exceeds 90 percent of a country’s total economic activity for five or more consecutive years—reduce annual economic growth by more than one percentage point for decades.
Oh REALLY? Look at this graph:
Every year since 2010 (lots more than ten years), the federal debt has exceeded that magic 90% number, and the economy . . . oops . . . well, look for yourself:
Is Reason.com chastened by the facts? No, facts be damned. They have the “We know what we know and don’t bother us with facts” attitude.
And that is how the public is kept ignorant.
And that also is why we will not have a recession in the foreseeable future unless some politician can convince his/her peers that taking money out of an economy is a clever way to grow the economy. (Sort of like spilling water out of a bucket is a clever way to fill the bucket.)
So long as we keep running trillion-dollar deficits, and the deficits keep growing, my advice will be to buy stock.
Rodger Malcolm Mitchell
Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell
THE SOLE PURPOSE OF GOVERNMENT IS TO IMPROVE AND PROTECT THE LIVES OF THE PEOPLE.
The most important problems in economics involve:
- Monetary Sovereignty describes money creation and destruction.
- Gap Psychology describes the common desire to distance oneself from those “below” in any socio-economic ranking, and to come nearer those “above.” The socio-economic distance is referred to as “The Gap.”
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 Monetary Sovereignty and The Ten Steps To Prosperity can grow the economy and narrow the Gaps:
Ten Steps To Prosperity:
3. Provide a monthly economic bonus to every man, woman and child in America (similar to social security for all)
The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.