Bold and Pitiful: The Biden budget proposal

Here are a few short excerpts from a much longer article that ran in the New York Times:

New York Times
Biden Team Preparing Up to $3 Trillion in New Spending for the Economy
Jim Tankersley

WASHINGTON — President Biden’s economic advisers are preparing to recommend spending as much as $3 trillion on a sweeping set of efforts aimed at boosting the economy, reducing carbon emissions and narrowing economic inequality.

The scope of the proposal under consideration highlights the aggressive approach the Biden administration wants to take as it tries to harness the power of the federal government to narrow economic inequality, reduce the carbon emissions that drive climate change and improve American manufacturing and high-technology industries in an escalating battle with China and other foreign competitors.

It’s bold; it’s pitiful.

No. the proposed $3 trillion isn’t pitiful. It’s bold and wonderful.

And no, the individual spending plans aren’t pitiful. They comprise the boldness this nation really needs to keep its leadership position in the world, and to help keep the world a viable place for humanity to exist.

The pitiful parts of that New York Times article are the phrases shown below in bold italics:

The plan begins beginning with a giant infrastructure plan that may be financed in part through tax increases on corporations and the rich.
Whether it can muster Republican support will depend in large part on how the bill is paid for.
Officials have discussed offsetting some or all of the infrastructure spending by raising taxes on corporations, including increasing the corporate income tax rate above the current 21 percent rate and a variety of measures to force multinational corporations to pay more tax in the United States on income they earn abroad.
Officials have weighed financing that plan through initiatives that would reduce federal spending by as much as $700 billion over a decade, like allowing Medicare to negotiate prescription drug costs with pharmaceutical companies.
The officials have discussed further offsetting the spending increases by raising taxes on high-earning individuals and households, like raising the top marginal income tax rate to 39.6 percent from 37 percent.
They have debated whether to lower the income threshold for the top marginal rate, to tax all individual income above $400,000 at 39.6 percent, in order to raise more revenue for his spending plans.
Mr. Biden’s broader economic agenda will face a more difficult road in Congress than his relief bill, which was financed entirely by federal borrowing.

If they were talking about a state or local government spending program, yes those phrases would be appropriate. Those governments are monetarily non-sovereign. They must pay for their spending through taxes and borrowing.

But the federal government, being Monetarily Sovereign, does not use tax money or borrowed money to pay for spending.

In truth, federal tax money is destroyed upon receipt, and the federal government does not borrow. That is a fundamental difference between federal finances and state/local government finances.

Dealing with each of the seven phrases, above: America The Beautiful - Inspiration316 Radio

All federal spending is financed via money creation.To pay for anything, the federal government sends instructions to creditors banks, instructing the banks to increase the balances in creditors’ checking accounts.
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When the banks do as instructed, new (M1) money is created and added to the money supply.
The bill will be paid for by the federal government’s infinite ability to create its own sovereign currency, the U.S. dollar.
Raising taxes on corporations hurts American business, just as cutting taxes on corporations stimulates business.
Federal spending adds stimulus dollars to the private sector. Attempts to reduce federal spending reduce stimulus payments.
Tax increases offset nothing, though there may be some Gap-closing benefitto taxing billionaires.
The proposal to tax incomes of $400,000 plus is counterproductive, however, because those are the people building businesses for U.S. growth. Perhaps incomes of $1 million or more should see increased taxation.
The federal government does not borrow. Having the unlimited ability to create dollars, why would it borrow? Those T-securities, sometimes referred to as “borrowing,” are nothing more than accepting deposits into T-security accounts. It’s like putting dollars into interest-paying safe deposit boxes.
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To pay off the misnamed “debt” the government simply takes the dollars out of those “boxes” and sends them back to the account owners.

Biden is hoping to do a number of great things: Advance clean energy, modernize the infrastructure with the construction of roads, bridges, rail lines, and electric vehicle charging stations., tax cuts to fight poverty, the most aggressive spending yet by the United States to reduce carbon emissions and combat climate change.

He would aid the development of other “high-growth industries of the future” like 5G telecommunications. He would spend money for rural broadband, advanced training for millions of workers and 1 million affordable and energy-efficient housing units.

His proposal includes money for improvements to the electric grid and other parts of the power sector.

Documents suggest Biden will include nearly $1 trillion in spending alone on the construction of roads, bridges, rail lines, ports, electric vehicle charging stations and

There would be investments in the caregiving economy and in skills and training needed by our workers to compete and win the global economy of the future.”

Biden’s campaign predicted that Mr. Biden’s investments would create 5 million new jobs in manufacturing and advanced industries, on top of restoring all the jobs lost last year in the Covid-19 crisis.

The second plan under discussion is focused on students, workers and people left on the sidelines of the job market. It would spend heavily on education and on programs meant to increase the participation of women in the labor force, by helping them balance work and caregiving. It includes free community college, universal pre-K education, a national paid leave program and efforts to reduce child care costs.

That plan would also make permanent two temporary provisions of Mr. Biden’s recent relief bill: expanded subsidies for low- and middle-income Americans to buy health insurance and tax credits aimed at cutting poverty, particularly for children.

Doing all of the above, which the federal government easily could fund, and could do so without causing inflation, would truly advance the lives of Americans and the other people of the world. It would demonstrate America’s leadership, and its ability and willingness to do good, not only for America but for the world.

Donald Trump spoke boldly, but actually proposed narrow, mean-spirited, harmful little things like eliminating healthcare for the poor, walling-in America, preventing Muslims from entering, fostering hatred against Mexicans and the Chinese, denying and delaying prevention of COVID, and widening the wealth/income/power Gap between the rich and the poor.

Lacking compassion for the poor, people of color, foreigners, and any who did not worship him, Trump spread hatred and bile. He supported bigotry, white supremacists, and conspiracy theorists. Then ironically, he called it all, “Make America Great, Again.”

Not since Lyndon Johnson, and Franklin Roosevelt before him, has any President proposed a plan to help America become that “America the beautiful” we of which we can be proud.

And that is why Republicans are united in opposition to biden They oppose everything Biden proposes, especially plans that really would establish the greatness of America.

The very last thing the Trumper, FoxNews, QAnon, NewsMax GOP wants is a successful Biden administration. This is the greatest fear of the Republican party.

But Biden can succeed if he has the courage to tell the American public the truth about Monetary Sovereignty.

If only. If only.

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:

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:

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

MONETARY SOVEREIGNTY

How Alabama, Florida, Georgia, Kansas, Mississippi, North Carolina, South Carolina, South Dakota, Tennessee, Texas, Wisconsin and Wyoming cheat the poor.

Actually, if you live in Alabama, Florida, Georgia, Kansas, Mississippi, North Carolina, South Carolina, South Dakota, Tennessee, Texas, Wisconsin and Wyoming, your poor fellow citizens are not the only ones being cheated.

Poor or rich, if you live in those states, you are being cheated, too. Common Issues and Barriers to Access - Accessibility at UB - University at Buffalo

Medicaid incentive fails to sway holdout states

By Geoff Mulvihill and Jeffrey Collins Associated Press

COLUMBIA, S.C. — Democrats’ nearly $2 trillion coronavirus relief package includes a big financial incentive for the states that have opted against expanding Medicaid to provide health coverage for more low-income Americans. It’s proving to be a tough sell.

Top Republican elected officials in the dozen states that have resisted expanding coverage under a key provision of former President Barack Obama’s health care law. Some have softened their opposition, but the key gatekeepers— governors or legislative leaders — indicated they have no plans to change course.

The federal government already pays 90% of the costs of expanding Medicaid coverage to more low-income adults.

If you are a political leader of any of these dozen states, all you needed to do was allow your low-income residents to receive health care.

The federal government would have been paying essentially the full cost for more than four years.

But you have refused free money from the federal government.

Thirty-six states have signed on to the expansion. Two more — Missouri and Oklahoma — are scheduled to begin their expansions in July.

Under the enticement included in the new coronavirus relief bill adopted by Congress and signed by President Joe Biden, the federal government would boost its share of costs in the regular Medicaid program, which offers coverage for the poorest Americans.

An analysis by the Kaiser Family Foundation found the additional federal money would cover 150% to 400% of the cost for the holdout states to expand Medicaid.

In Texas, the incentives would send the state about $5 billion over two years. More than 1.4 million people in the state could become eligible for coverage.

For Georgia, the estimate says it would add a net $710 million to state coffers and in Tennessee, $900 million.

But your Republican state leaders have refused the money. Why? Two reasons?

It would help low-income people, and the GOP is the Party of the Rich. It cares nothing for the poor. Remember, when it gives tax breaks, it gives them to the rich.
It is a program initiated by the Democrats. Because the GOP hates the Democrats, they refuse everything proposed by Democrats. You, a taxpayer in those dozen states, are punished by that hatred.

“It’s the literal offer you can’t refuse, but let’s see if anyone refuses it, anyway,” said Katherine Hempstead, a senior policy adviser at the nonpartisan Robert Wood Johnson Foundation.

In Mississippi, one of the nation’s poorest states, advocates say up to 300,000 people — about one-tenth of the state’s population — could become eligible for health coverage if the state adopted the expansion.

Gov. Tate Reeves, a Republican, said he’s not going for it. He opposed it, even as the Mississippi Hospital Association said it could bring up to 19,000 jobs to the state.

“My position has not changed,” he said this week. “I am opposed to expanding Medicaid in Mississippi. I am opposed to ‘Obamacare’ expansion.”

Who cares that the poor can’t afford healthcare? Not Reeves. Not the GOP.

He calls it the “Obamacare expansion,” so naturally he opposes it, no matter the benefit to Mississippi.

In three of the states — Kansas, North Carolina and Wisconsin — the Democratic governor favors expansion but can’t convince a Republican-controlled legislature.

“It’s not a big enough bribe,” said Richard Hilderbrand, the chair of the Kansas Senate health committee.

Most politicians see the political advantages in helping the disadvantaged. After all, it is the American way, to help the underdog. Healthcare is a fundamental benefit that states provide to all their citizens.

But when your mind and heart are so hardened against the Democrats and against the people who traditionally vote Democratic, even money and jobs aren’t enough to reward you for being moral.

Many Republicans remain concerned about the long-term costs of the program and are ideologically opposed to expanding government health care to working-age adults.

These are the same politicians who themselves receive free health care insurance compliments of the voters, but are “ideologically opposed” to others receiving such a benefit. (“I’ve got mine; who cares about you.”)

“I acknowledge that there are some gaps in coverage that need to be addressed, but I think they can be addressed in ways that do not require us to create a whole new level of entitlement in the state of North Carolina,” said state Senate Leader Phil Berger, a Republican

“Some gaps” is a euphemism for “poor people are screwed.” And “they can be addressed” means “I don’t have a plan and I have no intention of creating one, and every time someone comes up with a plan, I vote against it.”

It’s a similar story in Wisconsin, where the GOP-dominated Legislature and Democratic Gov. Tony Evers are at odds over the expansion. The Democrats’ coronavirus aid package doesn’t change that, Assembly Speaker Robin Vos said earlier this month.

“It’s a non-starter, and we will continue to oppose the liberal wish list item of Medicaid expansion,” he said.

“Oppose the liberal wish list” means “I will vote against anything that helps our poor Wisconsinites or is proposed by Democrats. I’m against both those things.”

Hempstead, of the Robert Wood Johnson Foundation, said Medicaid expansion is a way to address one of the biggest shortcomings in the national health care landscape: How to get coverage for a group of adults whose incomes put them below the poverty line — $12,880 for a person living alone.

In states that haven’t expanded Medicaid, there are about 2.2 million such people, the Kaiser study found. They usually don’t qualify for traditional Medicaid programs. They also do not make enough to be eligible to buy subsidized private coverage on the health insurance marketplaces established under Obama’s overhaul.

Another 1.8 million in those states who make slightly more — up to $17,774 for an individual — qualify for subsidized coverage but often can’t afford it. They could be covered through an expansion of Medicaid.

The GOP says, “Who cares about those people? Let ’em get sick and die. Let their kids get sick and die. How much money did they contribute to my political campaign?”

Studies have found that adding coverage for these lower-income people reduces charity care in hospitals, allows some to be healthy enough to work and creates additional health care industry jobs.

The financial benefits partially or totally offset the states’ share of the costs over time.

Even in the holdout states, those arguments catch the attention of some Republicans. In Alabama, Gov. Kay Ivey left open the possibility of expanding Medicaid at some point in the future, but there are no plans to do so.

“The problem has always been how to pay for it,” Ivey spokeswoman Gina Maiola said.

Excuse me, Gov. Ivey, but the federal government already has told you how to pay for it. The feds will pay for it. You can’t get away with the phony “pay for it” excuse. Voters aren’t that dumb.

The real problem is a relatively recent one. It began during the Obama administration. The GOP measures loyalty to party and Trump above loyalty to America.

Any Republican who agrees with anything said or proposed by a Democrat, no matter how beneficial and accurate that thing may be, will be labeled a “RINO” (Republican In Name Only).

The party will attempt to ostracize you. Trump will insult you and work against you in the next election. You will be called a “socialist” and a “communist.”

You only will receive respect from the GOP if you are a Trump bootlicker, who for instance, wishes to eliminate Obamacare with nothing to replace it, or to lie about the CORONA virus.

It was not always thus. There actually were times past when the two parties could pass legislation to benefit America’s less fortunate. (Hard to believe, isn’t it?)

Today, Fox News, NewsMax, and conspiracy theories run the GOP. Those folks think your patriotism is not measured by how much you care about Americans, but rather about how much you hate immigrants and Democrats, and how hard you wave a flag — especially a Confederate flag.

So you of the “dirty dozen” states that refuse federal money, continue to pay your state taxes, knowing those state tax dollars could be less if there were more federal dollars coming in.

At least you have the good feeling that comes from not lifting a finger, even when paid to do so, to help those in your state who are less fortunate than you.

We only can hope this is temporary. One day, Trump and his Trumpist stooges will be gone, and America can return to being the compassionate beacon of morality most of us want it to be.

We want a return to America the beautiful, not America the mean-spirited, selfish, uncaring, hard-hearted, bigoted . . .

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.”

Ten Steps To Prosperity:

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

MONETARY SOVEREIGNTY

Federal deficit spending causes inflation except when . . .

As “everyone” knows and claims, federal deficit spending causes inflation . . . except when it doesn’t.

As you can see from the graph below, it doesn’t.

Each place where the red and blue lines diverge indicates a lack of correlation between federal deficit spending and inflation.

**BLUE line = Federal deficit spending. RED line = inflation. Vertical gray bars = recessions.**

Lack of correlation between federal deficit spending seems to be more the rule than the exception. All inflations and hyperinflations have been caused by scarcity, usually shortages of food and/or energy.

That said, it is possible, though rare, for federal deficit spending to cause a shortage during major wars, especially a shortage of fuel. War machinery uses a great deal of oil, and inflation is highly related to oil prices.

But contrary to popular belief, federal spending to stimulate economic growth, or to reduce poverty, or to provide benefits to the underclasses, does not cause inflations.

It also does not “overheat” the economy (whatever that means), or any other similarly vague terms used by economists to make you think they know what they are talking about.

In fact, federal deficit spending not only cures recessions (as the graph shows), but it also can cure inflations, if the spending is used to purchase from abroad, then distribute to the public, the items that are in short supply.

For example, the most common cause of inflation these days is an oil shortage, which can be cured domestically by the federal government buying oil on the open market and distributing it to the private sector.

That is the purpose of the Strategic Petrolium Reserve:

According to the United States Energy Information Administration, approximately 4.1 billion barrels of oil are held in strategic reserves, of which 1.4 billion is government-controlled.

The remainder is held by private industry. In 2004 the U.S. Strategic Petroleum Reserve had the largest strategic reserve, with much of the remainder held by the other 27 members of the International Energy Agency.

Global oil consumption is in the region of 0.1 billion barrels per day. The 4.1 billion barrels reserve is equivalent to 41 days of production. The reserve is intended to be used to cover short-term supply disruptions.

Covering a 50% shortfall would deplete the reserves in 82 days.

It is those “short-term supply disruptions,” not federal deficit spending, that cause inflation.

How did the federal government obtain 1.4 billion barrels of inflation-preventing oil in its strategic reserve? Answer: Federal deficit spending.

I remind you of this because we now have, just balancing on a knife’s edge, a Democratic administration, which historically has tried to provide benefits for the lower- and middle-income groups.

The resistance to Medicare for All, Social Security for All, College for All, Basic Nutrition for All, along with improved infrastructure, usually comes from the party of the rich, the GOP.

Their excuses for not providing benefits to the “not-rich” can be summarized by three lies:

The federal government can’t afford it without tax increases. (But our Monetarily Sovereign government has the unlimited ability to create dollars, i.e “print money.” So taxes are not necessary. See here.).
The lazy poor will use benefits as an excuse not to work (except that is a proven myth, promulgated by the rich, and has no basis in fact. See here.).
Deficit spending will cause inflation. (See the above graph).

O.K., politicians, what’s your next excuse for not implementing the Ten Steps to Prosperity? (below).

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.”

Ten Steps To Prosperity:

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

MONETARY SOVEREIGNTY

How the Big Lie in economics seriously impacts your life, today and will again, tomorrow.

The Big Lie in economics is: Federal taxes fund federal spending.
The Big Lie sometimes is stated, “Our children and grandchildren will have to pay for today’s federal deficits and debt.”

The Big Lie is told, and believed, for one simple reason: Most people do not understand the differences between federal government (Monetarily Sovereign) finances and all other (monetarily non-sovereign) finances.

You, your business, your state, county, and city all are monetarily non-sovereign.

When you want to spend, you need a source of money, which for local governments mostly is taxes and borrowing.

By contrast, the federal government is Monetarily Sovereign.

When it wants to spend, it neither needs nor uses any source of money.

It creates new money by paying creditors, exactly the opposite of what you personally are accustomed to.

Although the federal government collects tax dollars, it no longer needs to.

That change occurred in August, 1971, when President Richard Nixon, in the greatest act of his Presidency, took us off a gold standard.

The purpose of that change was to remove limits on the federal government’s ability to create money. Since that date, the federal government has not used tax dollars to pay for anything.

Contrary to popular wisdom, federal taxpayers are not “on the hook” for federal deficits (which in fact are private sector surpluses) or for federal debt (which is nothing more than deposits in accounts at the Federal Reserve Bank).

You or your grandchildren do not owe the federal deficit or debt, and you never will pay for them. Period.

The sole purpose of tax dollars has been to regulate the economy, by taxing what the government wants to limit and by giving tax breaks to what the government wants to encourage. The federal government could eliminate all federal tax collections, and still continue spending, forever.

That said, please read the following excerpts from an article that appeared in the March 18, 2021 edition of the Chicago Tribune:

We don’t need Biden’s infrastructure binge
Steve Chapman, a member of the Tribune Editorial Board

Donald Trump did many bad things as president, but he deserves a smidgen of credit for what he didn’t do: go on an infrastructure spending binge.

He vowed that under him, our roads, bridges and waterways would be “the envy of the world.” He said that in 2016 and was still saying it in 2020. But his main achievement was to make “infrastructure week” a source of hilarity.

Now President Joe Biden is hoping to do what Trump didn’t do, and he has support from such divergent groups as the AFL-CIO and the U.S. Chamber of Commerce.

During his campaign, he made gaudy promises to “transform” our transportation networks, “revolutionize” railroads and urban transit, and upgrade water systems, broadband, bike lanes, home weatherization and just about anything else you could think of. Biden could make the Pledge of Allegiance an infrastructure issue.

His price tag for all this? Two trillion dollars. His plan to pay for it? Unspecified.

The two trillion dollars would be created by the federal government, then distributed as growth dollars to the private sector.

Biden would pay for it exactly the same way the federal government pays for everything: It creates dollars, ad hoc.

Specifically, to pay any bill:

The federal government creates instructions from thin air, then sends those instructions (in the form of a check or wire transfer) to the creditor’s bank, instructing the bank to increase the creditor’s checking account balance by a specified amount (“Pay to the order of _______“)

When the bank clicks a computer key to increase the numbers in the creditor’s checking account, this instantly creates brand new dollars that are added to the nation’s money supply, in a segment known as “M1.”

The bank then balances its books by clearing the instructions through the Federal Reserve, which always approves federal instructions.

By formula, increases to the nation’s money supply increase economic growth (Gross Domestic Product = Federal Spending + Non-federal Spending + Net Exports). Federal government spending increases the nation’s money supply. State and local government spending does not.

No tax dollars are involved at any point in this transaction. The whole process is paid for by newly created dollars.

The White House has indicated a preference for tax increases on the wealthy and corporations. When asked recently how she and her fellow Republicans would react to that idea, Sen. Susan Collins reportedly “burst out laughing.”

Sadly, Biden and his minions disseminate the Big Lie that federal taxes fund federal spending.

Why? The real purpose of the Big Lie is to convince you, the public, that the federal government’s ability to provide benefits to you is limited. This is to keep you from asking for free Medicare for All, free College for All, support for local governments to cut local taxes — indeed for any benefit to the not-rich.

The very rich, who run America, are motivated by “Gap Psychology,“ the desire to get richer by distancing oneself from those who have less wealth. The rich pay politicians (via political contributions and promises of jobs afterward), university economists (via lucrative jobs and contributions to universities), and the media (via ownership and advertising dollars) to disseminate the Big Lie.

We are told that our highways and bridges are falling apart from lack of investment and that upgrading them will not only create jobs but boost our economic productivity.

But the Reason Foundation, which issues a detailed report each year on the nation’s highways, found that the percentage of urban interstates rated in poor condition was lower in 2018 than a decade earlier.

Likewise with rural interstates. For other major rural highways, just 1.23% were in bad shape in 2018.

The foundation’s most recent report found that “the general quality and safety of the nation’s highways has incrementally improved as spending on state-owned roads increased by 9%, up to $151.8 billion” compared with the previous year.

The Reason Foundation is a libertarian organization that opposes virtually all government spending. Their research results tend to be slanted in that direction.

Nevertheless, even the possibility that our roads and highways may be in less bad condition, does not indicate the federal government should not improve them. Americans live longer today than they did years ago. So should the government not have paid for the CORONA virus vaccine?

And what about those jobs infrastructure work creates?

Bridges? Notes Brown University economist Matthew A. Turner in The Milken Institute Review, “There were more bridges in good condition and fewer crumbling bridges in 2017 than in 1992.” Mass transit? The average age of public transit buses has declined during that period.

As always with the Big Lie, one simple point is missed. When the states fix roads and bridges, state taxpayers must take dollars from their pockets to pay for these repairs.

When the federal government pays, it puts new dollars into the private sector.

Then we come to the faux moral excuse for the Big Lie:

Even if the United States needs more investment in particular areas, that doesn’t mean the federal government should pick up the tab. The great majority of infrastructure assets are owned by state and local governments, and it’s their constituents who would gain the most from resurfacing roads or bolstering bridges.

If they are going to reap the economic benefits of such investments, shouldn’t they be willing to pay for them?

Yes, shame on you for wanting the federal government, which has infinite money, to pay, when you, who have limited money should want to pay, that is, if you are a good person. Right?

The purpose of that kind of reasoning is to pit one part of the public against the other with a “Why should I pay for his roads?” kind of reasoning.

In fact, they seem to be unwilling. The Center on Budget and Policy Priorities reports, “State and local infrastructure spending as a share of gross domestic product is at its lowest point since the early 1980s.”

Apparently, the author believes state and local taxes are too low. After all, the only place the state governments can find the money for infrastructure repair is via taxes, so when states are “unwilling,” it merely means their taxes are too low.

But the fact that these governments don’t want to use their own money doesn’t mean they won’t be happy to use cash that falls out of the sky.

That’s the political beauty of federal infrastructure packages: The benefits are obvious to people getting new projects, but the costs are invisible.

The author doesn’t realize it, but his “falls out of the sky” intended pejorative, actually comes close to the truth. The federal government, creates dollars from nothing, as it always has — just as it created the very first dollars, when America began.

Where does the author think the first dollars came from? In the late 1770s, there existed zero dollars. Ten years later, there were millions. Where did they come from if not from “out of the sky,” i.e. created from thin air by laws (which also are created from thin air) passed by the federal government?

The timing of this push is also awkward, because the COVID-19 catastrophe creates so much uncertainty about how we will live, work and travel going forward.

“I’m not sure that at this time we want to be pouring concrete or buying equipment until we see how much of this shakes out for a year or two,” University of Chicago economist Allen Sanderson told me.

“Shakes out”? Does Sanderson believe roads will not need to be fixed? Does he believe public transportation will become obsolete? And how long is this “shake-out” period? Will we know something more next year, so don’t fix roads for a year?

Or will we have to wait a decade to learn what our long-term needs will be?

Of course, the University of Chicago economists are notorious for not understanding the differences between Monetary Sovereignty and monetary non-sovereignty, so Sanderson’s remarks, though totally wrong, are not unexpected.

Under Trump, “infrastructure week” went nowhere, time after time. But it could be that one thing worse than an infrastructure push that fails is an infrastructure push that succeeds?

No, Mr. Chapman, the one thing worse than an infrastructure push that fails is a columnist who, knowing nothing about Monetary Sovereignty, always tells his readers, “Now is not the time to spend.”

But if not now, when? Ever?

Steve Chapman blogs at http://www.chicagotribune.com/chapman.
schapman@chicagotribune.com, Twitter: @SteveChapman13

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.”

Ten Steps To Prosperity:

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

MONETARY SOVEREIGNTY

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