Mitchell’s laws: The more budgets are cut and taxes inceased, the weaker an economy becomes. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity = poverty and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
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He came close, oh, so close:

Europe’s “Going in the Wrong Direction,” Forbes Says: “The Worst of Both Worlds”
By Aaron Task | Daily Ticker (Scottrade)

The EU has probably bought itself “several more months,” thanks to the Greek restructuring and the “radical measures” adopted by the European Central Bank, says Steve Forbes, chairman of Forbes Media. “You can keep kicking” the can down the road, “but crises emerge.”

In sum, Forbes fears European policymakers have failed to take the “right” lessons from the Greek tragedy.

Right now “you have the worst of both words” in Greece, he says. “The economy is going into the tank without the pro-growth reforms to get it back again.”

At this point I became so excited. Steve Forbes was about to win the race to be the first media leader who understands the fundamentals of Monetary Sovereignty.

Forbes prescription for Greece — and Europe’s other so-called PIIGS — is familiar to anyone who’s followed his work over the years: less regulation, labor reform and a “radically reformed tax structure,” featuring (of course) a flat tax. (See: “Everyone Is Making a Bungle of Things”: Steve Forbes’ Rx to Fix Greece)

The type of tax is much less important than the amount of tax. If his flat tax would collect fewer euros than the current tax, that would help the private sector. But of course, Greece still is monetarily non-sovereign, which needs to be corrected.

“They’re going in the wrong direction” in Europe, he says, citing new tax increases in Spain and Portugal and Greece’s failure to really reform its bloated public sector.

Right. Tax increases are anti-stimulus. Austerity is anti-stimulus.

“They need remedial education,” Forbes says of EU policymakers. “They’re all tied to defunct notion of Keynesianism that government spending somehow stimulates the economy — that easy money stimulates the economy. No it does not.”

Forbes compares European policymakers to medieval doctors who tried to “bleed the patient to cure the patient. So they killed the patient.”

OMG, the guy almost has it. Then he misunderstands his own analogy. Steve, think it out. Your analogy is this: Taking blood out of the sick patient is bad; taking money out of the sick economy is bad. If a patient has anemia, you have to add blood via a transfusion, i.e. add euros via a money transfusion.

Steve, think very slowly, now. If, as you correctly say, tax increases are bad, why are they bad? Because they remove money from the private sector. Anything that removes money from the private sector hurts the private sector. Hurting the private sector hurts the economy. Similarly, adding money benefits the private sector. This isn’t quantum chromodynamics.

What a shame. The guy was almost there. But his pre-Monetary Sovereignty education in economics, prevented him from taking that last step. He has no idea what happened on August 15, 1971, and how it changed economics 180 degrees. He’s still saying the same stuff he would have said in 1970 and before.

Perhaps in another year or two . . . ? Dare we hope?

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

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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. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption + Net exports

#MONETARY SOVEREIGNTY

Mitchell’s laws: The more budgets are cut and taxes inceased, the weaker an economy becomes. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity = poverty and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
==========================================================================================================================================

More than any other single factor, Saudi Arabia arbitrarily determines oil prices, which strongly affect gasoline prices.

The President of the United States is not the king of Saudi Arabia. So as powerful as the Presidency is, Obama has minimal-to-zero control over oil or gasoline prices.

Yet . . .

Washington Post
Gas prices sink Obama’s ratings on economy, bring parity to race for White House
By Dan Balz and Jon Cohen, Published: March 11

Disapproval of President Obama’s handling of the economy is heading higher — alongside gasoline prices — as a record number of Americans now give the president “strongly” negative reviews on the 2012 presidential campaign’s most important issue, according to a new Washington Post-ABC News poll.

Increasingly pessimistic views of Obama’s performance on the economy — and on the federal budget deficit — come despite a steadily brightening employment picture and other signs of economic improvement, and they highlight the political sensitivity of rising gas prices.

Nearly two-thirds of Americans say they disapprove of the way the president is handling the situation at the pump, where rising prices have already hit hard. Just 26 percent approve of his work on the issue, his lowest rating in the poll. Most Americans say higher prices are already taking a toll on family finances, and nearly half say they think that prices will continue to rise, and stay high.

Friday’s employment report showed a gain of 227,000 jobs in the past month, continuing an upward trend and offering the White House something positive to point to. Still, the survey — conducted Wednesday through Saturday — finds 59 percent of Americans giving Obama negative ratings on the economy, up from early last month.

Voters think of the President (any President) as “daddy,” and when something goes wrong, they expect daddy to fix it. I suspect that the price of oil this election year will depend in large part on whom the Saudis want as U.S. President. If they prefer Obama, oil prices will drop before November.

Interestingly, the poll shows the Democrats with huge leads over the Republicans in:

“Better represents your own personal values”
“Is more concerned with the needs of people like you”
“Cares more about issues that are especially important to women”

Never use the word “voters” and the word “logic” in the same sentence. We’re into a strange, puzzling, fun eight months.

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. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption + Net exports

#MONETARY SOVEREIGNTY

Mitchell’s laws: The more budgets are cut and taxes inceased, the weaker an economy becomes. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity = poverty and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
==========================================================================================================================================

Some things never change.

Back then:

From Wikipedia, the free encyclopedia

The Kansas evolution hearings were a series of hearings held in Topeka, Kansas, United States May 5 to May 12, 2005 by the Kansas State Board of Education and its State Board Science Hearing Committee to change how evolution and the origin of life would be taught in the state’s public high school science classes.

The hearings were arranged by the Board of Education with the intent of introducing intelligent design into science classes via the Teach the Controversy method.

The hearings raised the issues of creation and evolution in public education and were attended by all the major participants in the intelligent design movement but were ultimately boycotted by the scientific community over concern of lending credibility to the claim, made by proponents of intelligent design, that evolution is purportedly the subject of wide dispute within the scientific and science education communities.

The Discovery Institute, hub of the intelligent design movement, played a central role in starting the hearings by promoting its Critical Analysis of Evolution lesson plan which the Kansas State Board of Education eventually adopted over objections of the State Board Science Hearing Committee, and campaigning on behalf of conservative Republican candidates for the Board.

And recently:

Rick Santorum: “I had an amendment, it’s a great story, I had this language, because what’s taught in our school system as a result of liberal academia, is <evolution is an incontrovertible fact. There is no suspicion of it. It is decided science that cannot be questioned. There cannot be any doubts about it. If you have any questions or doubts, it’s trying to inject religion into the science classroom. So it is above reproach.

I obviously don’t feel that way. I think there are a lot of problems with the theory of evolution, and do believe that it is used to promote to a worldview that is anti-theist, that is atheist.”

And now:

Washington Post: By Felicia Sonmez and Brady Dennis, Published: March 10

Former senator Rick Santorum (Pa.) cruised to a victory in the Kansas caucuses with 51 percent of the vote, sweeping all but one of the state’s 105 counties, the Associated Press reported, and bolstering his argument that he, and not former House speaker Gingrich, is the conservative alternative to Mitt Romney.

Readers of this post also might enjoy: “Kansas Outlaws Practice of Evolution”

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. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption + Net exports

#MONETARY SOVEREIGNTY

Mitchell’s laws: The more budgets are cut and taxes inceased, the weaker an economy becomes. To survive long term, a monetarily non-sovereign government must have a positive trade balance. Austerity = poverty and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
==========================================================================================================================================

In economics, self-deception seems to be the rule. That thing called “debt” really isn’t the same “debt” you and I know — at least not for Monetarily Sovereign countries. And “unsustainable” doesn’t exactly mean something that can’t be sustained. And while taxpayers pay taxes with “taxpayers’ money,” the federal government doesn’t pay its bills with “taxpayers’ money,” as the media claim.

Now comes monetarily non-sovereign Greece, with its own package of self-delusion.

Yahoo Finance
Greece secures biggest debt cut in history
Greece secures high participation in critical bond swap, staving off imminent bankruptcy
By Elena Becatoros, Associated Press | Associated Press

ATHENS, Greece (AP) — Greece has cleared a major hurdle in its race to avoid bankruptcy by persuading the vast majority of its private creditors to sign up to the biggest national debt writedown in history, paving the way for a second massive bailout.

If you and I were to declare bankruptcy, we would write off our debts. Greece avoids bankruptcy by writing down its debts. See the difference?

Following weeks of intense discussions, the Greek government said Friday that 83.5 percent of private investors holding its government bonds were participating in a bond swap. Of the investors holding the euro177 billion ($234 billion) in bonds governed by Greek law, 85.8 percent joined.

“We have achieved an exceptional success … and I believe everyone will soon realize that this is the only way to keep the country on its feet and give it a second historic chance that it needs,” Finance Minister Evangelos Venizelos told Parliament.

“A window of opportunity is opening” with the success of the deal to reduce the country’s euro368 billion debt by euro105 billion, or about 50 percentage points of gross domestic product, he said.

The public sector screws the private sector out of 105 billion euros ($138 billion), and this is considered an “exceptional success” and a “window of opportunity.”

The bond swap is a radical attempt to pull Greece out of its debt spiral and put its shrinking economy back on the path to recovery. The hope is that by slashing debt, the country can gradually return to growth and eventually repay the remaining money it owes.

How will eliminating past debt create future growth? The underlying problem remains. To survive long term, all monetarily non-sovereign nations require money coming in from outside their borders. This is an absolute rule.

But Greece runs trade deficits. Money flows out, not in.

If, in the future, Greece continues to suffer trade deficits, euros will continue to cross its borders in the wrong direction, further impoverishing the Greek people. What will change this longstanding problem? Certainly not future defaults, bankruptcies and loans.

The investors will exchange their bonds with new ones worth 53.5 percent less in face value and easier repayment terms for Greece. A total of euro206 billion ($273 billion) of Greece’s debt is in private hands. The swap will effectively shift the bulk of the remaining debt into public hands — mainly eurozone countries contributing to Greece’s bailouts.

If the exchange had failed, Greece would have risked defaulting on its debts in two weeks, when it faced a large bond redemption.

Got it? Greece didn’t “default.” It exchanged bonds. Remember that, so you can tell your bank you would like to exchange your $100K mortgage for a $50K mortgage — to prevent default on the $100K mortgage.

A successful bond swap is also a key condition for Greece to receive a euro130 billion ($172 billion) package of rescue loans from other eurozone countries and the International Monetary Fund.

Lending to borrowers, who have bad credit, caused the most recent recession — and the banks (rightly) were criticized for it. Now the IMF and EU do it, and everyone dances in self-congratulatory glee.

Service of loans from other euro nations will require sending euros out of Greece. Where will Greece find those euros to send across its borders?

Word picture: You’re in the middle of the desert. You have no water. Someone gives you a sip of water and says, “One hour from now, give me back the water, plus extra as interest.” But you’re still in the middle of the desert. Problem solved??

“After quite a rollercoaster ride, it looks like Greece has finally done it … allowing Europe to avoid what could have been a disorderly default in which the costs do not bear thinking about,” said Simon Furlong, a trader at Spreadex.

Rather than a disorderly default, we had an orderly default. Now, it’s time to start thinking about the costs.

IMF head Christine Lagarde also welcomed the debt writedown agreement. “This is an important step that will dramatically reduce Greece’s medium-term financing needs and contribute to debt sustainability,” she said.

On the streets of Athens, however, many remained skeptical about the deal and pessimistic about the future. Panayiotis Theodoropoulos said the writedown was good “for them.”
“For us? Nothing. Everyone looks out for themselves. In a while the people will be living on the streets,” he said.

Mr. Theodoropoulos is far wiser than Ms. Lagarde. He’s right; she’s wrong. My heart goes out to the people of Greece, who are mere pawns in a chess game between the foolish and the greedy.

The debt crisis, sparked by years of overspending and waste, has left Greece relying on funds from international bailout loans since May 2010. Austerity measures including repeated salary and pension cuts and tax hikes imposed in return have led to record unemployment with more than 1 million people out of work, a fifth of the labor force.

The debt crises was caused by Greece’s unforgivably bad decision to surrender the single most valuable asset any nation has: Monetary Sovereignty. Austerity measures, by simple mathematics, always must cause unemployment and economic misery.

The bond swap accomplishes two things:

1. It delays the time of recovery, extending the austerity and suffering of the Greek people
2. It sets a precedent for other monetarily non-sovereign nations to screw the private sector and extend the misery if their citizens.

And this is the EU’s and the IMF’s “exceptional success.”

I said it in 2005; I say it today. “The economies of the European nations are doomed by the euro” (and by the world’s financial leaders).

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. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption + Net exports

#MONETARY SOVEREIGNTY