The end of people? Amazon vs. Costco Wednesday, Jan 11 2017 

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

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When I was young, during WWII, my mother shopped in a small grocery store in which the clerks used grabbing tools to bring down items from high shelves, then type in the prices on a cash register, count out the change and bag the items.

One clerk per customer, one at a time. Costly.

Today, you walk into a Costco having very few employees per customer, select your own items, go through a checkout that scans the items, pay with a credit card and are out.  Fast and cheap.

Back in the day, we had a coin-slot phone, and once a month, a phone company collector would show up to empty out the coins, and if we had used slugs instead of coins, he (always a “he”) would charge us for the slugs. It took a lot of collectors to collect those coins, nationwide.

Today, no coin collectors for smartphones.

These days, auto manufacturers use robots instead of Henry Ford’s employee-heavy production lines. Banks use ATMs instead of tellers. And remember all those phone operators who said, “Number, please,” and after you told her (always a “her”) she made the connection for you.

The list goes on and on. Millions upon millions of jobs, lost to progress. Yet, even with our much higher 2017 population, unemployment is not at rampant, depression-style levels. Depending on your perspective, it’s not too bad at all.

How can we have lost so many jobs, and not have huge unemployment?

The Week Magazine, December 23-30, 2016
Amazon’s cashier-less grocery store

“The most disruptive retailer since Sears Roebuck and Montgomery Ward hit the scene is noodling again on something new,” said Adam Lashinsky in Fortune.com.

Amazon’s latest bid to reinvent the way we shop is a high-tech grocery store called Amazon Go, which does away with the hassle of checkout lines and cashiers.

Instead, shoppers scan their smartphone when they enter the store, pick out what they need, and simply walk out with their groceries. All the while, sensors and cameras inside the store keep track of what customers pull off the shelves, with the items automatically charged to their Amazon account when they leave.

Right now, the shop is an experiment—there’s one 1,800-square-foot location in Seattle that’s available only to Amazon employees—but the company says it hopes to open to the public in 2017. 

“This is the shopping experience we’ve all been waiting for,” said Lance Ulanoff in Mashable.com. A few people might grouse about how technology is killing off human interactions, but what exactly is so meaningful about unloading a cartful of groceries for the cashier to wordlessly scan?

The “few people” are not “grousing” about “meaningfulness.” They are grousing about lost jobs.  No, not even jobs.   . . .

. . . They are grousing about money.

Most of us just want to get in and out of the supermarket as quickly as possible. And, the grab-and-go shopping concept is ready for prime time. It uses technologies like computer vision and sensor fusion that have already been proven to work in self-driving cars.

“But what about the jobs?” asked Justin Fox in Bloomberg.com. Nearly 3.5 million people were working as cashiers in the U.S. last year, representing about 2.3 percent of total employment. If checkout-free shopping catches on, a lot of those jobs will almost certainly be destroyed, though many new ones might also be created.

And there is the key. Technology has destroyed obsolete jobs and created better jobs. That has been happening for at least a century.

When ATM machines reduced the need for bank tellers, banks actually hired more workers because the cost savings allowed them to open more branches. “Anybody can get rid of a cashier with a robot,” said Jordan Pearson in Vice.com.

But Amazon’s raison d’être has always been data. With cashier-less shops, the retail juggernaut will be able to find out all it wants to know about your shopping habits when you’re offline, which is still how nearly everyone buys their groceries.

Amazon will use that information, as it always does, to streamline its marketing, product recommendations, and supply lines. “Amazon isn’t trying to kill cashier jobs. It’s after something bigger.”

Yes, Amazon is after data, but still, it always is trying to kill cashier jobs.

Killing cashier jobs saves Amazon money, which makes Amazon competitive. And the data Amazon wants really isn’t all that rare.

When you go into your neighborhood chain store, and you pay with your credit card, the chain knows exactly what you bought, when you bought it, and what you paid.

By analyzing that data, the chain can deduce whether you have children, how old they are, how old you are, whether you live with someone of the opposite sex and, if the chain also has a pharmacy, a great deal about your health.

Further, if the store uses loyalty cards, whatever information you gave to get that card, is added to your dossier.

Amazon isn’t going to learn much that food chain stores don’t already know (although it knows more about non-food and probably is more equipped to use that information.)

Amazon wants to learn what it doesn’t already know about you, so it can combine food information with all the other information it knows. The more it knows about you, the more directed their marketing efforts can be.

When you walk through their store, it can have a better idea about what the sensor-driven shelf tags should say to you. (“Mr. Smith, you bought bread, yesterday. Don’t forget about our peanut butter special.”)

Amazon wants to kill cashier jobs, too. And that has not hurt the economy. Greater efficiency grows an economy, for efficiency takes jobs away but gives more jobs back.

Although President Trump and the labor unions (there’s an unlikely team) rail about jobs going overseas, Amazon has killed more American jobs than any company building a plant in Mexico.

Where’s the outrage about that?

Forcing business to keep jobs here requires businesses to be less efficient. Companies don’t buy or produce overseas on a whim. They do it because it cuts costs and increases other efficiencies.

Trump and the labor unions look only at job counts, not at costs and product/service availabilities. 

But jobs are not what people want. People want money, the ownership of which allows them to lead the lives they wish to lead.

Rather than blackmailing companies to be less efficient, under the false impression that less efficiency will encourage greater employment, the government should supply people with sufficient money to allow them to buy more goods and services.

This would stimulate business, which would pay more people to produce those goods and services. In short, the government should adopt the Ten Steps to Prosperity (below), which not only would grow the economy and provide better jobs, but increase the happiness and well-being of the people.

That is, after all, the purpose of government, isn’t it?

Addendum:
Contrary to popular myth, low prices are not the secret to Amazon’s success. Convenience is.

Rather than run from store to store, trying to find the items you want, you can sit at home or work, in front of your computer, or even walk the street, smartphone in hand, and shop the world.

Yet, there is a limit to what you will buy online. You still may want to see and touch the items, and of course, if you go to the store today, you can have the item today — at no extra charge.

Amazon can’t and won’t match that, despite its doomed-to-failure drone experiment.

I have no special information, but here is my hunch about Amazon Go: Amazon doesn’t give a fig about opening a bunch of little, brick & mortar stores. Amazon wants the data and the store experience to compete with Costco.

That’s where this is headed, IMO, and Costco, Walmart, Target et al, had better be aware. Amazon is coming.

Rodger Malcolm Mitchell
Monetary Sovereignty

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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 AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) 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 EVERYONEFive 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 CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from 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 corporate 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.

MONETARY SOVEREIGNTY

As every economist knows, lowering interest rates stimulates business Wednesday, Jan 11 2017 

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

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As every economist knows, lowering interest rates stimulates business, and raising rates inhibits business. The reason is that low rates make borrowing more expensive, so businesses are reluctant to borrow for expansion. That’s why stock prices go down when the Fed raises rates.

That is what you have been told; it is a giant steaming pile of bull dung.

Stock prices do not reflect actual business growth, or actual sales, or actual profits or actual anything.

Stock prices reflect the crowd’s anticipation of future stock prices.

We’ve written about this before, in many posts, among which are:

The dumb and dumber of negative interest rates
Low interest rates: The sneak tax on you.
The low interest rate/GDP growth fallacy

Having covered the subject in some depth, I only was moved to have another go at it when I saw the following article

Economists Mystified that Negative Interest Rates Aren’t Leading Consumers to Run Out and Spend
Posted on August 9, 2016 by Yves Smith

Not only has it been remarkable to witness the casual way in which central banks have plunged into negative interest rate terrain, based on questionable models.

Now that this experiment isn’t working out so well, the response comes troubling close to, “Well, they work in theory, so we just need to do more or wait longer to see them succeed.”

The particularly distressing part, as a new Wall Street Journal article makes clear, is that the purveyors of this snake oil talked themselves into the insane belief that negative interest rates would induce consumers to run out and spend. From the story:

Two years ago, the European Central Bank cut interest rates below zero to encourage people such as Heike Hofmann, who sells fruits and vegetables in this small city, to spend more.

Policy makers in Europe and Japan have turned to negative rates for the same reason—to stimulate their lackluster economies. Yet the results have left some economists scratching their heads. Instead of opening their wallets, many consumers and businesses are squirreling away more money.

When Ms. Hofmann heard the ECB was knocking rates below zero in June 2014, she considered it “madness” and promptly cut her spending, set aside more money and bought gold.

“I now need to save more than before to have enough to retire,” says Ms. Hofmann, 54 years old.

Recent economic data show consumers are saving more in Germany and Japan, and in Denmark, Switzerland and Sweden, three non-eurozone countries with negative rates, savings are at their highest since 1995, the year the Organization for Economic Cooperation and Development started collecting data on those countries.

Companies in Europe, the Middle East, Africa and Japan also are holding on to more cash.

And there is the key: I now need to save more than before to have enough to retire,” says Ms. Hofmann.

“Well, duh,” as the kids liked to say.  If you have saved, for instance, $1 million for your retirement, and you were earning a modest 3% on those savings, that was an additional  $30,000 per year, which plus Social Security, will help your savings last longer.

But if your savings yield $0, you’re going to need to spend less, so you can make your capital last longer.

And if you, and millions of others spend less, what happens to the economy?

Right. The economy suffers.

Gross Domestic Product (GDP) is a measure of the economy, and it also is a measure of spending — private and public — plus exports. So when spending declines, GDP growth declines.

And as we have seen, time and again, when deficit spending growth declines, we have recessions and depressions.

The article then discusses that these consumers all went on a saving binge..because demographics! because central banks did a bad job of PR! Only then does it turn to the idea that the higher savings rates were caused by negative interest rates.

The higher savings rates were caused by the lower spending rates. There are only two things you can do with any given amount of money: Save/invest or spend. All else remaining equal, when one goes down, the other goes up.

Sadly, “all else” doesn’t even remain equal, for negative interest rates cause money supply growth to fall.

How could they have believed otherwise? Do these economists all have such fat pensions that they have no idea what savings are for, or alternatively, they have their wives handle money?

People save for emergencies and retirement. Economists, who are great proponents of using central bank interest rate manipulation to create a wealth effect, fail to understand that super low rates diminish the wealth of ordinary savers.

Consider what happens to investors in T-securities. When interest rates decline, the federal government pumps fewer interest dollars into the economy, which is recessionary.

It is apparently difficult for most economists to grasp that negative interest rates reduce the value of those savings to savers by lowering the income on them.

Value = Demand/Supply.  It is one of the most basic formulas in economics. One only can wonder how it is possible for economists not to understand it. When the Demand for money is reduced, the Value of money is reduced. Could it be more obvious?

Savers are loss averse and thus are very reluctant to spend principal to compensate for reduced income. Given that central banks have driven policy interest rates into negative real interest rate terrain, this isn’t an illogical reading of their situation.

Ed Kane has estimated that low interest rates were a $300 billion per year subsidy taken from consumers and given to financial firms in the form of reduced interest income.

Since interest rates on the long end of the yield curve have fallen even further, Kane’s estimate is now probably too low.

The second effect is that of inflation signaling.

Again, consumers are reacting correctly to the message central banks are sending. Negative interest rates signal deflationary tendencies and that central banks think deflation is a real risk. And what is the rational way to behave in deflation? Hang on to your cash, because goods and services will be cheaper later.

Despite what my good friends of the Modern Monetary Theory (MMT) persuasion say, low rates encourage inflation by reducing the Demand for dollars, while high rates discourage inflation by increasing the Demand for dollars.

(MMT says high rates cause inflation by increasing costs, a hypothesis that is at odds with historical fact.) The Fed successfully has fought inflation by increasing interest rates.

Inflation is a loss in the Value of money compared to the Value of goods and services.

Value = Demand/Supply
Demand = Reward/Risk

Reward = Interest

To fight inflation, increase the Demand for money, which is accomplished by increasing the Reward for owning money, and that is done by increasing Interest.

Here we have what passes for the policy logic:

Low interest rates should encourage consumers and businesses to spend by depressing returns on savings and safe assets such as government bonds. Such spending should create demand for goods, help lift sagging inflation and boost economic growth.

Earth to economists: savings and spending may look fungible to you because they are alternative uses for income but they serve very different functions.

Once people have put enough away that they have a good reserve for emergencies and enough to have a comfortable retirement, then saving and spending can be regarded as close substitutes.

But in the US, with safe income on investments running below inflation levels, and Medicare being actively crapified, a retirement-aged couple would need over $3 million in liquid assets to allow for 20-30 years of living expenses and possible medical costs. How many are in that boat?

One of the greatest, if not the greatest, fears of retirement is outliving your money.

Now perhaps this rationalization was simply central bank patter for wanting to depress the value of their currency and spur growth through more exports.

Thus, the idea that consumers might spend more was just a convenient cover for their real aim that some economists who were not clued in took seriously.

But whatever the cause, the central bank hallelujah chorus regularly claimed that negative interest rates will lead consumers to run out on a shopping spree.

The one bit of good news in this article is that the Bank of England is not persuaded, and even though the Fed has admitted it might take up the negative interest rate experiment, it remains keen to raise rates.

Mind you, it’s not clear that this skepticism is due to greater intellectual rigor. Banks have lost safe sources of earnings with zero and negative interest rates, and are increasingly pressuring central banks to increase interest rates, even though they’ll take hits during the adjustment period.

In summary, the imposition of negative interest rate is among the least intelligent of economics ideas in a litany of unintelligent ideas that beset the “science” of economics.

It is yet another example of: “If it doesn’t work, never has worked, and can’t possibly work, do it again, only more.”

(Other examples bad economics ideas are: “Reduce deficits to grow the economy,” “Cut the federal debt to make it sustainable,” “Cut Social Security to make it last longer,” “Punish the poor to make them work harder,” “Increase interest rates to slow economic growth,” and “Reward the rich for being the ‘makers.‘”)

All have been designed and promulgated by the rich to widen the Gap between the rich and the rest.

Rodger Malcolm Mitchell
Monetary Sovereignty

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THE RECESSION CLOCK

Monetary Sovereignty
Vertical gray bars mark recessions.

Recessions begin an average of 2 years after the blue line (Federal Debt Held By The Public As A Percentage Of GDP) first dips below zero.

(A common phenomenon is for the line briefly to dip below zero, then rise above zero, before falling dramatically below zero.)

There was a brief dip below zero in 2015, followed by another dip – a familiar pre-recession pattern.

Recessions are cured by a rising red line.

As the federal deficit growth lines drop, we approach recession, which will be cured only when the growth lines rise.

Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

MONETARY SOVEREIGNTY

Restore American Gory Tuesday, Jan 10 2017 

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

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We were entertained by Trump-hats reading, “Make America Great Again.”

Then incredibly creative minds came up with:

Major Gun Rights Bill Headed for Republican Congress
Posted On 09 Jan 2017

Conservative voters are counting on Donald Trump and a Republican Congress to protect the Second Amendment, but a new bill from North Carolina Rep. Richard Hudson could indicate a much more aggressive agenda for the 115th Congress.

Hudson has introduced a national reciprocity bill that would force every U.S. state to recognize concealed-carry licenses issued in other states – a law that gun-rights groups have wanted for years.

The right-wing always is hyper-concerned about states’ rights, unless the states actually use those rights. Then, as we have discovered, shooting rights are far more important than any other rights.

“Your driver’s license works in every state, so why doesn’t your concealed-carry permit?” Hudson asked in a fact sheet accompanying the bill.

Uh, well . . . could it be that the citizens of some states don’t want a bunch of lunatics carrying guns everywhere?

The purpose of the bill isn’t necessarily to change local and state laws by federal decree, but rather to prevent situations where gun owners are arrested for unintentionally violating another state’s laws.

Actually, the purpose of the bill IS to change local and state laws by federal decree. That’s the whole idea.

It has the support of the NRA, which released a statement approving of Hudson’s legislation.

What a surprise.  The NRA favors guns over states rights. The NRA favors guns over all rights.

“Law-abiding citizens should be able to exercise their fundamental right to self-defense while traveling across state lines,” said the organization’s Chris Cox. “This is an extremely important issue to our members and we thank Congressman Hudson for leading the fight to protect our rights.”

Yes, what could possibly go wrong with gun-runners . . . uh, people carrying guns across state lines — even into airplanes, for instance? Of course, that never would happen.

The bill should have no trouble passing the House, but it could run into problems in the Senate where Republicans have a much slimmer majority. Passing legislation requires 60 votes, and the GOP only has 52 seats under their control.

There are a few Democrats who could potentially be persuaded to support a bill like this, but we’ll see. The party is in fight mode right now, so it may be obstruction as far as the eye can see.

What?? A political party devoted solely to obstruction?  Whoever heard of such a thing?

Democrats would actually do themselves a big favor by supporting this bill, though. It’s a harmless law and it’s common sense.

The party could find a way to support it without dropping their gun control messaging, and it would be an olive branch to gun owners after the disastrous Obama years.

Yes, just a harmless little law. Hardly even worth discussion.

And the states still could have gun control, except they couldn’t control guns any more than the most gun-crazy of all 50 states.

Yep, other than that, the states would have complete control.

But wait, why limit it to state law.  How about a law to force every U.S. city to recognize concealed-carry licenses issued in other cities

So, if Flaming Nape, TX, passes a law requiring every citizen to carry a gun, all American cities would be bound by that law.

After all, your driver’s license works in all cities.  We don’t want gun owners arrested for unintentionally violating another city’s laws, do we?

Unfortunately, there’s no indication that Democrats are interested in pulling themselves out of the far-left bubble they’ve built for themselves, so don’t hold your breath.

Oh, that terrible “far-left bubble” — you know. It’s the “bubble” that brought America the disastrous Social Security, Medicare, Medicaid, civil rights bills, anti-poverty bills, equal education, the Voting Rights Act, aids to the arts, urban renewal, rural development, etc. — all that “far-left bubble” stuff the right-wing did its best to protect America from.

But those rights don’t compare in importance with the one BIGGEST right — the right to shoot at someone who pisses you off, kill a few innocent bystanders, and claim self-defense afterward.

That’s what the founders meant when they wrote “well-regulated militia.”

Question: What problem is this law intended to solve? Not enough guns in America? Not enough shootings in the most gun-crazy nation on earth? Not enough deaths and woundings from bullets?

Have millions more guns really protected us as the NRA promised? Have millions more people carrying guns made us safer? Does the idea even work?

So, O.K., let’s just do it.  Begin with allowing “law-abiding” people to carry a gun into Congress.

Then, if that seems to work without problems, then later we can expand it to allowing “law-abiding” defendants to carry guns into trials. (Why not? They haven’t yet been convicted of anything.)

Follow it up with allowing “law-abiding” people to carry guns into statehouses and into governors’ mansions, and “law-abiding” visitors to take guns into jails, and “law-abiding” kids to carry guns to kindergarten.

Baby steps, first — as long as they’re “law-abiding.”

Let’s keep America gory.

Rodger Malcolm Mitchell
Monetary Sovereignty

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THE LAWS

•Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.

•Any monetarily NON-sovereign government — be it city, county, state or nation — that runs an ongoing trade deficit, eventually will run out of money.

•The more federal budgets are cut and taxes increased, the weaker an economy becomes..

•No nation can tax itself into prosperity, nor grow without money growth.

•Cutting federal deficits to grow the economy is like applying leeches to cure anemia.

•A growing economy requires a growing supply of money (GDP = Federal Spending + Non-federal Spending + Net Exports)

•Deficit spending grows the supply of money

•The limit to federal deficit spending is an inflation that cannot be cured with interest rate control. The limit to non-federal deficit spending is the ability to borrow.

•Until the 99% understand the need for federal deficits, the upper 1% will rule.

•Progressives think the purpose of government is to protect the poor and powerless from the rich and powerful. Conservatives think the purpose of government is to protect the rich and powerful from the poor and powerless.

•The single most important problem in economics is the Gap between the rich and the rest.

•Austerity is the government’s method for widening the Gap between the rich and the rest.

•Until the 99% understand the need for federal deficits, the upper 1% will rule.

•Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

MONETARY SOVEREIGNTY

Er, ah . . . about that wall, what I really meant was . . . Saturday, Jan 7 2017 

Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell

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For those of you who elected Donald Trump because he promised to do something you wanted done — Good morning. Wake up. You’ve been scammed, again. And he isn’t even President, yet.

Breaking Campaign Promise, Trump Now Says U.S. Taxpayers Will Pay for Border Wall. Posted on Jan 6, 2017, By Nika Knight

President-elect Donald Trump’s transition team has signaled to Republicans in Congress that Trump would like to fund his infamous planned U.S.-Mexico border wall through the Congressional appropriations process in April, House Republican officials told CNN Thursday.

In doing so, the president-elect appears poised to break one of his core anti-immigrant campaign promises: that Trump would build a wall to “keep the Mexicans out,” and that Mexico would pay for it. (Early in his presidential campaign, he even promised to force Mexico to build the wall.)

Early Friday morning, Trump defended his move on Twitter by alleging that Mexico would pay the U.S. back for the cost of building the wall:

✔ @realDonaldTrump
The dishonest media does not report that any money spent on building the Great Wall (for sake of speed), will be paid back by Mexico later!

Mexico’s president has vociferously and repeatedly said that the country will not pay for Trump’s promised wall. “We’re not going to pay for that fucking wall,” former president Vicente Fox added last March

On Twitter, commentators were swift to poke fun at Trump’s plan:

✔ @wkamaubell
“Hello Mexico, it’s Trump. I’m ready for you to pay for that wall… Remember the wall we discussed. Hello? Hello?”

When it comes to funding the wall through taxpayer dollars, Republicans “are considering whether to tuck the border wall funding into a must-pass spending bill that must be enacted by the end of April,” Politico reported Thursday.

Congressional Republicans therefore believe that appropriating funds for the wall, expected to run into the billions, will pass easily, arguing that Democrats “would fall in line [when] faced with the choice of funding the wall or shutting down the government,” reports The Hill.

So Mexico will pay for the wall, as Trump promised, except they will pay for it “later.” Right. Later.

And the Republicans will “tuck the funding” into another bill, and force the Democrats to approve the billions of dollars needed to pay for the wall because the Democrats are adults who don’t want to shut down the government, while the Republicans are children who don’t care.  What an admission!

Aren’t these the same Republicans who claim the government can’t afford to spend on Social Security, Medicare, Medicaid, food stamps, education and other social programs? Isn’t the federal government “broke” as the previous Republican speaker of the House claimed?

Hmmm . . . In Trump’s world, there is plenty of money for a wall, but not enough for America’s poor and middle classes.

Ah, the Donald and his lies. They flow from his mouth like poop from a goose. Who are these people who still pay attention to his lies — even believe them?

He promised to show his tax returns.  That never happened.  He said he never groped women; then there was that tape of him saying he did.

And ask the students at Trump University about the Donald’s lies. They learned a lesson at that “school” — a lesson they never will forget (nor will he, after all the law suits finish).

I feel bad for all folks who were suckered into voting for him. They are the world’s patsies, the schmendricks. They are the people sending money to that Nigerian prince, who promised them millions.

They are the people who open the door to the guy who claims to have an extra truckload of asphalt, and will redo their driveway at a bargain price.

They are the people who pay a 2% annual fee on that 401K plan their company cooked up for them.  They are the dupes and doormats for the rich, buying lottery tickets they can’t really afford, then lying awake at night, dreaming about what they will do with the money.

They believe Trump’s lies, knowing in their hearts that he is lying, but hoping, hoping that somehow this time he is telling the truth.

Their disappointments will keep coming. But, to excuse their own gullibility, they will fall back on the all-purpose, “Hillary is worse,” line. “He was the lesser of two evils,” they will tell themselves, though in fact, he will prove to be the worst, ever.

You should pray for Trump’s cheated followers, while Trump and his billionaire .1% friends prey on them.

In a way, I wish the Donald would build that wall. It would be pitiful, almost laughable, as a defense against a Mexican invasion, but it would require that the federal government pump billions of stimulus dollars into the economy.

And if the public ever begins to understand Monetary Sovereignty, those could be billions of additional stimulus dollars, which would employ thousands of workers and benefit everyone — especially the rich contractors.

All things considered though, dollars invested in the Ten Steps to Prosperity (below) would accomplish more for the 99.9%.  If only the people wanted to understand.

Rodger Malcolm Mitchell
Monetary Sovereignty

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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 AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) 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 EVERYONEFive 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 CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from 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 corporate 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.

MONETARY SOVEREIGNTY

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