As you read excerpts from the following article, keep several facts in mind.
- Unlike state and local governments, the United States government uniquely is Monetarily Sovereign. It never can run short of dollars. Even if it collected zero tax dollars, the U.S. government could continue spending, forever.
- The American people are running short of money, and many are entering a starvation phase they never before had experienced.
- U.S. politicians, especially conservatives, claim that federal deficit spending (aka “money printing”) will cause inflation or will have to be paid for by our children. Neither claim is true. They both are part of what is known in economics, as “The Big Lie.”
It is a disgrace. The wealthiest government on earth, having infinite resources, is intentionally allowing its people to fall into starvation.
In the history of the United States, inflation never has been caused by federal deficit spending. Inflation always is caused by scarcity — shortages of vital products, usually food or energy (oil).
And the claim that aid given now will be paid for by our children later, not only is false, but makes no sense on the face of it.
No one pays for federal spending, not our children, not taxpayers, not anyone. All federal spending is funded exactly the same way: The federal government creates new dollars, ad hoc, every time it pays for something.
State and local governments don’t operate that way. They are not Monetarily Sovereign. They use tax dollars to pay their bills. The federal government does not.
What becomes of those federal tax dollars you send to the Internal Revenue Service or the U.S. Treasury? They are destroyed upon receipt. They cease to exist in any money measure. That is why there cannot be a definitive answer to the question, “How much money does the federal government have?” The correct answer is: It has infinite money.
And as for worries about future children paying for federal stimulus dollars, our children are paying now, by sliding into poverty.
Many children and adults will die too soon, by not being able to afford medical care or by inadequate nutrition. Many brilliant brains will be wasted by not being able to afford college.
This is today’s America, the once “golden land,” that now has been turned into “misery land.” And it all is unnecessary.
At the touch of a computer key, our federal politicians could end poverty in America. Yet, because their own bellies are full, they focus only on being re-elected, not on the welfare of the people.
The Democrats want to spend money into the economy; the Republicans refuse. It is that simple.
There is no apolitical way to sugar-coat this. It is the Republican Senate, led by Senator Mitch McConnell, that primarily is responsible for the currently growing poverty in America.
The Democrats are responsible for not explaining the facts to the American people, but at least they want to pump money into the economy. The Republicans don’t.
The blood of today’s impoverished and dying Americans is on GOP hands.
Millions of Americans are entering poverty amid pandemic as stimulus runs out
Denitsa Tsekova·Reporter, Sat, October 17, 2020
Millions of Americans have been thrown into poverty as government aid dried up in the last five months, according to a pair of studies, and those ranks will likely swell without more relief on the way.
“Poverty is rising in the United States,” Zach Parolin, a researcher at the Columbia University’s Center on Poverty and Social Policy told Yahoo Finance (video above). “More families, once again, are struggling to put food on the table, struggling to provide for their families at a time when we have the means to be able to help them out.”
Eight million more Americans fell below the poverty threshold since May, a study by Columbia University found. A similar study from the University of Chicago and Notre Dame estimated 6 million Americans entered poverty for the same period.
Without further government intervention, more Americans could follow, facing food insecurity, utility shutoffs, and even homelessness.
What a disgrace, what a cruel disgrace.
Visualize that to the left is a vast pile of wealth — money, food, medicine, education etc. — and to the right are homeless, starving people.
In between is a wall, guarded by the U.S. Congress, intentionally preventing the impoverished people from receiving aid.
That is America, today.
Poverty in the U.S. actually declined at the beginning of the coronavirus pandemic, thanks largely to two provisions in the CARES Act: stimulus checks and the extra $600 in weekly unemployment benefits.
Since then, there has been no second round of checks, and the extra unemployment benefits expired at the end of July.
“That’s just a lot of money that they’re going to have to do without,” Bruce Meyer, a University of Chicago economist, told Yahoo Money. “It means people are going to be cutting back on what they can.”
While the funding provided under the $2.2 trillion CARES Act was the largest economic stimulus package in history, its effects won’t last long enough to support those in financial hardship, especially when the job market and the economy haven’t recovered.
“Unless we see a miraculous employment recovery,” Parolin said, “it’s certain that families are going to need some extra income support to be able to pay the bills and put food on the table.”
The fading effect of the stimulus comes as House Speaker Nancy Pelosi (D-CA) and Treasury Secretary Steven Mnuchin continue talks for a bipartisan stimulus deal.
But disagreements on price tag and key provisions, lack of GOP support, and the proximity of the election all lower the prospects of a deal before the election.
The bottom line is quite clear. The Republicans, having for decades told their constituents that federal deficits are bad for the people and bad for the economy, now do not want to tell the simple truth: Federal deficit spending is necessary for economic growth.
So despite the fact that predictably, deficit spending for stimuli has been beneficial, with none of the politicians’ dire predictions realized, the GOP would rather see people starve than to admit they have been lying all along.
I hate to put this in such stark political terms, but there is no way around it: The Democrats want more stimulus; the Republicans want less. Period.
With no additional support, experts warned that the economy will slow and fewer jobs will be created. Protections for renters and borrowers also are set to expire, likely leading to another increase in poverty.
The so-called “protections for renters and borrowers” merely shifted the pain to landlords and lenders, who also are people suffering from the recession.
The solution is not to transfer pain from one group to another, but rather for the federal government to pump dollars into the pockets of all the people.
Only the federal government can spend money without feeling pain.
“Poverty is going to continue to rise,” Meyer said. “You’re going to have people having had more and more weeks out of work, and only a fraction of those lost earnings replaced. That’s going to accumulate over time.”
The financial hardships caused by this will likely mean a rise in people who can’t pay rent and utility bills, who will struggle to buy food, and who could even lose their homes.
“It’s sad to say,” Parolin said, “we can probably expect to see an increase in homelessness in the United States.”
The above article should make you furious. All this pain, all this hunger, all this tragedy in America, coming mostly from the party that promised to “Make America Great, Again,” is completely unnecessary.
Way back in April we published an article titled “The coming depression; The problem and the solution.” It began:
There is no other way to say this. We (in the U.S.) are headed for a depression because we have an incompetent and untruthful government.
Our fundamental problem is the lack of money in the private sector. The solution is for the federal government, which being Monetarily Sovereign has unlimited money, to pump dollars into the economy.
Sorry, but it isn’t any more complex than that.
Problem: Lack of money. Solution: Add money. How much money? What the economy lost due to the virus.
The economy needs at least $7 Trillion net added from the federal government. But, our Congress is spending far too little and spending way too late.
Unless Congress and the President deign to see the light, we have no way to prevent a depression.
That was April, yet Congress and the President still have not seen the light.
So you will suffer, sadly, needlessly, disgracefully. We will have a depression. The blame is directly on the shoulders of Congress and the President. You trusted them. They failed you.
Be sure to vote.
Rodger Malcolm Mitchell
Monetary Sovereignty Twitter: @rodgermitchell 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:
Ten Steps To Prosperity:
- Eliminate FICA
- Federally funded Medicare — parts A, B & D, plus long-term care — for everyone
- Social Security for all or a reverse income tax
- Free education (including post-grad) for everyone
- Salary for attending school
- Eliminate federal taxes on business
- Increase the standard income tax deduction, annually.
- Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.
- Federal ownership of all banks
- Increase federal spending on the myriad initiatives that benefit America’s 99.9%
The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.