–Washington Times gun-nut headline Saturday, Aug 29 2015 

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

Mitchell’s 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. .
Liberals 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 rich and poor.
•Austerity is the government’s method for widening
the Gap between rich and poor.
•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..

===================================================================================================================================================================================================================================================================================

The Washington Times, being right-wing, feels obligated to make increasingly foolish arguments for arming every man, woman and child in America.

Here is the latest such:

White House concedes new gun laws wouldn’t have stopped Va. gunman

What are we supposed to make of that headline? The White House “conceded” something that is quite true. Any current or proposed gun laws can’t stop an armed, angry fool from shooting people.

The Times headline implies that the White House first argued differently, then “conceded” the obvious. Ah, what a “concession” that was.

What next? How about, “White House concedes National Rifle Association (NRA)is paid by gun manufacturers to convince people to buy guns.”

White House press secretary Josh Earnest said it appears that a proposal championed by President Obama to require background checks on purchases at gun shows “would not have applied in this particular case.”

Law enforcement officials said gunman Vester Flanagan used a Glock handgun in Wednesday’s shooting, one of two that he bought last month. He legally bought two Glock model 19 handguns from a Virginia dealer.

Now, that headline might have read:

“White House concedes that arming everyone would not have prevented Flanagan from killing two innocent people.”
or
“White House concedes that if Flanagan could not obtain a gun he probably would not have killed.”
or
“White House concedes that guns really do kill people, and if you own a gun you have a higher probability of being killed by a gun than if you don’t own a gun.”

But, of course, the first two are obvious, and the third is statistical fact, and all three imply our gun laws are stupid at best and suicidal in effect — and that is something a right-winger has been brainwashed (by the gun manufacturers) to resist.

Gun-nuts are taken with mindless slogans, for instance the NRA’s Wayne LaPierre”s famous: “The only thing that stops a bad guy with a gun, is a good guy with a gun.”

Clearly that slogan isn’t true, because it wouldn’t have helped in the above-mentioned case or in thousands of other shootings in America. So I would like to propose a much truer slogan:

“The only thing that stops a bad guy with a gun is the same bad guy without a gun.”

Now there is a true slogan.

Yes, some might be amazed to learn that, in fact, guns actually do kill people, and the more people who have guns the more people who are killed by guns.

Surely, the White House would “concede” those statements.

(To reduce the carnage, we should pass two simple laws:

A. Any person who commits a felony while carrying a gun, shall be sentenced to a prison term of 20 years to life, in addition to the term for the felony itself.

B. Any provider of a gun that is used in a felony shall have the same criminal and civil liability as the actual perpetrator of the felony.

Those should help until someone comes up with a better idea.)

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (Click here)
9. Federal ownership of all banks (Click here and here)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)

The Ten Steps will add dollars to the economy, stimulate the economy, and narrow the income/wealth/power Gap between the rich and the rest.
——————————————————————————————————————————————

10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
1. A growing economy requires a growing supply of dollars (GDP=Federal Spending + Non-federal Spending + Net Exports)
2. All deficit spending grows the supply of dollars
3. The limit to federal deficit spending is an inflation that cannot be cured with interest rate control.
4. The limit to non-federal deficit spending is the ability to borrow.

THE RECESSION CLOCK
Monetary Sovereignty

Monetary Sovereignty

Vertical gray bars mark recessions.

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.

#MONETARYSOVEREIGNTY

–O.K., I was way, way wrong about Paul Krugman Sunday, Aug 23 2015 

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

Mitchell’s 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. .
Liberals 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 rich and poor.
•Austerity is the government’s method for widening
the Gap between rich and poor.
•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..

===================================================================================================================================================================================================================================================================================

I admit my mistakes, and back in May of 2012 I made a doozy, when I wrote the post: “Paul Krugman may be starting to get it.”

You can read that post to see why he had me fooled.

Well Krugman, the winner of, not the Nobel Prize, but rather the “Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel” (commonly known as the “Bank of Sweden Prize”), still is fooling people.

Reader “Zen” commented: It looks like Paul Krugman may just be starting to get the MS/MMT idea. “Debt Is Good”

Unfortunately, Krugman has been “just starting,” and “just starting” and “just starting” for all these years, but like the guy who promises to quit being an alcoholic tomorrow, Krugman never seems to get there.

Here are some excerpts from the article:

Rand Paul decried the irresponsibility of American fiscal policy, declaring, “The last time the United States was debt free was 1835.”

Wags quickly noted that the U.S. economy has, on the whole, done pretty well these past 180 years, suggesting that having the government owe the private sector money might not be all that bad a thing.

Actually, having the federal government pay (not just owe) the private sector is a very good thing. Adding dollars to the private sector stimulates economic growth, which is why every recession is cured by increased federal deficit spending.

Can government debt actually be a good thing?

Many economists argue that the economy needs a sufficient amount of public debt out there to function well. And how much is sufficient? Maybe more than we currently have.

That is, there’s a reasonable argument to be made that part of what ails the world economy right now is that governments aren’t deep enough in debt.

The power of the deficit scolds was always a triumph of ideology over evidence, and a growing number of genuinely serious people — most recently Narayana Kocherlakota, the departing president of the Minneapolis Fed — are making the case that we need more, not less, government debt.

Now at this point, you, like reader Zen, might think, “At long last, this guy is beginning to understand a fundamental point in economics: A growing economy requires a growing supply of money.

After all, the most common measure of economic growth is Gross Domestic Product (GDP), and the formula for GDP is:

GDP = Federal Spending + Non-federal Spending + Net Exports.

All three — Federal Spending, Non-federal Spending and Net Exports — are money measures. When they increase the money supply increases, and when they decrease, the money supply decreases.

That’s why recessions are cured by increased federal deficit spending.

But just when you think Krugman gets it, he writes:

Issuing debt is a way to pay for useful things, and we should do more of that when the price is right.

The United States suffers from obvious deficiencies in roads, rails, water systems and more; meanwhile, the federal government can borrow at historically low interest rates.

So this is a very good time to be borrowing and investing in the future, and a very bad time for what has actually happened: an unprecedented decline in public construction spending adjusted for population growth and inflation.

As grandma used to say, “Oy vey.” The man simply does not understand the differences between the federal government’s finances and private finances.

First, issuing debt does not pay for anything. The federal government, being Monetarily Sovereign, does not need to borrow its own sovereign currency — the currency it created out of thin air more than 230 year ago, and continues to create out of thin air, today.

The federal government creates dollars, ad hoc, by paying bills. It does not need to borrow the dollars it previously created, from anyone.

Second, the price of debt, (i.e. the interest paid on T-bonds) has absolutely, positively nothing to do with the federal government’s ability to pay for “roads, rails, water systems and more.” Zero. Zilch. Nada.

Even were interest rates to rise from their current near-zero to 20% or more, the federal government could continue spending as always.

Third, when Krugman says, “This is a very good time to be borrowing and investing in the future,” perhaps he is talking about you and me and private industry, but he sure as heck could not be talking about the federal government.

For the federal government, NO time either is a good or bad time to be borrowing, and EVERY time is a good time to invest in the future.

O.K., so Krugman remains clueless about federal financing, but why then does the federal government borrow (by selling T-securities)? Amazingly, Krugman supplies an answer:

According to M.I.T.’s Ricardo Caballero and others, is that the debt of stable, reliable governments provides “safe assets” that help investors manage risks, make transactions easier and avoid a destructive scramble for cash.

In this, Krugman (or more accurately, Ricardo Caballero) is correct.

That is one of the two reasons the government “borrows,” the other being that T-securities help the Fed control interest rates, which is how the Fed controls inflation.

Those are the two reasons. Remember, unlike you and me and your state and city, the federal government does not “borrow” to obtain dollars. The federal government creates dollars at will.

So Krugman was right about one function of T-securities (misnamed “borrowing”), but then he goes on to be completely at sea about the function of interest rates).

When interest rates on government debt are very low even when the economy is strong, there’s not much room to cut them when the economy is weak, making it much harder to fight recessions.

Here, he parrots the widely believed myth about low rates being stimulative and high rates being recessive (which is why the stock market tanks when the Fed says it will raise rates).

But it is a myth, and you can see why at: The low interest rate/GDP growth fallacy.

And then, after all the misstatements, misunderstandings and misinformation, Krugman finishes with something that actually is true — sort of:

In other words, the great debt panic that warped the U.S. political scene from 2010 to 2012, and still dominates economic discussion in Britain and the eurozone, was even more wrongheaded than those of us in the anti-austerity camp realized.

Not only were governments that listened to the fiscal scolds kicking the economy when it was down, prolonging the slump; not only were they slashing public investment at the very moment bond investors were practically pleading with them to spend more; they may have been setting us up for future crises.

It’s true, but only sort of, because the great debt panic didn’t end in 2012. It continues today, which is why President Obama brags about how he has reduced deficits (i.e. reduced economic growth).

But Krugman is correct about cutting deficits being wrongheaded and setting us up for future crises.

In short, the guy mixes right with wrong, so you can’t tell whether his bread is made with grain or sand.

Every time I’ve hoped he finally knows what he’s talking about, he’s dashed my hopes with large dollops of ignorance.

At long last I’m convinced: I’ve been way, way wrong about Paul Krugman.

So, reader Zen, I’m sorry to tell you. Krugman is hopeless and I’ve lost hope.

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (Click here)
9. Federal ownership of all banks (Click here and here)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)

The Ten Steps will add dollars to the economy, stimulate the economy, and narrow the income/wealth/power Gap between the rich and the rest.
——————————————————————————————————————————————

10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
1. A growing economy requires a growing supply of dollars (GDP=Federal Spending + Non-federal Spending + Net Exports)
2. All deficit spending grows the supply of dollars
3. The limit to federal deficit spending is an inflation that cannot be cured with interest rate control.
4. The limit to non-federal deficit spending is the ability to borrow.

THE RECESSION CLOCK
Monetary Sovereignty

Monetary Sovereignty

Vertical gray bars mark recessions.

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.

#MONETARYSOVEREIGNTY

–A few simple questions that never have been answered Saturday, Jul 30 2011 

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

The nonsense in Washington boils down to a few simple questions that never seem to be answered

First the background:
The federal government is the largest customer and money provider in America, spending about $3.8 trillion dollars per year on goods, services and benefits. This compares with under $12 trillion for the entire domestic business sector.

(http://www.gpoaccess.gov/usbudget/fy11/hist.html ) and (http://research.stlouisfed.org/fredgraph.png?g=1jb )

The U.S. government also is America’s largest employer, with about 4.6 million full time employees:

Military: 1,430,000 (Department of Defense, Active Duty Military Personnel Strengths by Regional Area and by Country, September 30, 2010); 700,000 defense employees worldwide (Department of Defense Civilian Personnel Management Service); 2009 Number of Full-Time Federal Employees – 2,518,101 http://www2.census.gov/govs/apes/09fedfun.pdf

The federal government employs as many people as the top nine civilian employers – Wal-Mart, McDonalds, UPS, Sears, Home Depot, Target, IBM, GM and GE — combined.

( http://nyjobsource.com/largestemployers.html )

The President, the Tea (formerly Republican) Party, the Democrats, the media, most columnists and old-line economists agree federal spending should be reduced and/or federal taxes increased. The goal: To reduce the federal deficit.

The two biggest problems facing America are the recession and the related unemployment.

Now for the simple questions:
1. What do businesses do when their biggest customer reduces purchases? Do they fire employees, reduce purchases of goods and services or both?

2. When businesses fire employees, or reduce purchases of goods and services, how does this stimulate the economy or cut unemployment?

3. What do individuals do when their salaries and/or benefit checks are reduced? Do they spend less, save less or both?

4. When individuals spend less or save less, how does this stimulate the economy or cut unemployment?

5. Considering all of the above, how does a reduction in federal spending and/or an increase in taxing (aka “deficit reduction”) solve our two biggest related problems: the economy and unemployment?

These questions never are asked, much less answered, because the politicians do not care about the answers. Their prime concern is not the working (or non-working) Americans. The politicians prime concern is who gets elected, i.e., power.

President Obama, the Tea (formerly Republican) Party and the Democrats all have the same goal, with the differences being only in the execution. And I use the word “execution” intentionally, because whoever “wins,” the American public will lose. We, our children and our grandchildren will suffer the execution of joblessness, poverty and loss of health and lifestyle. Our great American dream will be shattered — needlessly — all for the greed, ambitions and ignorance of the politicians.

While we stress about traitors at Fort Hood, we give a free pass to traitors in Congress, who intentionally do more harm to America than al Qaeda ever could.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com


==========================================================================================================================================
No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.

MONETARY SOVEREIGNTY

–The depression cometh Saturday, Jul 30 2011 

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

Historically, whenever dollars have been taken from our economy, or even when dollar growth has been reduced, the economy has gone into recession or depression. (See: Cause of recessions and depressions)

Congress and the President insist the federal deficit must be reduced. There are but two methods for reducing the deficit: Increase federal taxes and/or reduce federal spending. Both methods reduce the number of dollars in the U.S. economy.

7/29/11: Roya Wolverson, Time Magazine: “The bad news just keeps coming. The U.S. economy grew even less than expected in the second quarter, at a rate of 1.3%, down from what many economists predicted would be 1.8% or higher. The reasons for the continued lackluster performance haven’t changed. Consumers, squeezed by higher gas and other prices, are buying less of everything from electronics to meals out to new furniture.”

Recently, I posted, “Based on where Obama and the Tea/Republicans are headed, there will be a depression (not just a recession) next year. Only a miracle of realization, by both parties, can save us now. (See: Depression in 2012)

7/30/11: Alan Rappeport, Pharmaceuticals Magazine: “Merck, the US drug company, will cut as many as 13,000 jobs, or 13 per cent of its workforce, as it looks to slash costs and invest in emerging markets. The cuts, to be achieved by 2015, follow those announced last year when Merck said it would reduce its staff by 17 per cent. Merck has been looking to achieve the savings it promised when it acquired Schering Plough for $41bn in 2009.”

Congress and the President remain ignorant. They continue to call for increased taxes and/or spending cuts. The depression cometh.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com


==========================================================================================================================================
No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.

MONETARY SOVEREIGNTY

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