AARP tells the Big Lie

In most people’s minds, AARP is an organization that supports us old folks. Well, maybe:

60 Minutes reportedin a 1978 exposé that AARP had been established as a marketing device by Leonard Davis, founder of the Colonial Penn Group insurance companies. Until the 1980s AARP was controlled by Davis, who promoted its image as a non-profit advocate of retirees in order to sell insurance to members.

AARP severed ties with Davis in 1979 and began dropping Colonial Penn products. AARP sought competitive bids for insurance coverage and in 1981 chose Prudential Insurance Company of America to underwrite the group health plan for AARP members.

The organization was originally named the American Association of Retired Persons, but in 1999, it officially changed its name to “AARP” to reflect that its focus was no longer American retirees.

AARP no longer requires that members be retired, and there are no longer any age restrictions even for a full membership.

If AARP truly wished to support old people, or any other members, it surely would understand the way Social Security and Medicare are financed. Even more than “understand,” it would broadcast the truth to the world.

Sadly, instead of broadcasting the truth, AARP promulgates the Big Lie that Social Security and Medicare rely on trust funds, which are supported by the regressive FICA tax.

AARP, and all others who repeat the Big Lie, claim that lacking tax increases or benefit decreases, Social Security (and Medicare) cannot survive, a claim that is not made regarding other federal agencies.

Here is what AARP says:

Editor’s note: Americans may not see eye-to-eye on many things, but fully 96 percent of us agree on the importance of Social Security.

And no wonder: The program, now 86 years old, has become the bedrock of our retirement finances. Which begs the question: Why are its finances not more secure?

As a federal agency, the finances are as secure as the finances of any other federal agency, i.e. Social Security has unlimited finances subject to the whims of Congress and the President.

To answer that, AARP talked with dozens of experts about Social Security and its future viability. Here’s what we learned.

If AARP did indeed talk with “dozens of experts,” it would have learned the facts. Based on AARP’s claims, it didn’t talk with real experts, or it intentionally is lying:

“Those who tend to distrust the government seem to have less faith that Social Security will be there for them in its current form,” said Michael Baughman, a financial planner in Tryon, North Carolina. 

Social Security’s finances are unquestionably on a downward slope, and fixing them is primarily in the hands of the U.S. Congress.

If no action is taken, the moment of crisis — meaning when the program would no longer have enough money to fully pay its promised benefits — will happen in just over a decade.

That much is true: The financial future of Social Security is in the hands of Congress, but not in the way AARP wants you to believe.

The “moment of crisis” is an invented problem, the result of the myth that Social Security is funded by FICA.

It is not.

Quote from Luther Gulick, an expert on public administration and one of the founders of the American Society for Public Administration”

I raised (with Franklin D. Roosevelt), the question of the ultimate abandonment of the pay roll taxes in connection with old age security and unemployment relief in the event of another period of depression.

I suggested that it had been a mistake to levy these taxes in the 1930’s when the social security program was orgiginally adopted.

FDR said, “I guess you’re right on the economics. They are politics all the way through. We put those pay roll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits.

With those taxes in there, no damn politician can ever scrap my social security program. Those taxes aren’t a matter of economics, they’re straight politics.

FDR also mentioned the psychological effect of contributions in destroying the “relief attitude.”

FICA is the single, most regressive tax in America. Despite Roosevelt’s intentions, it has the opposite of the desired effect. FICA widens the Gap between the rich and the rest. 

Wikipedia.

The rich receive and control a massive percentage of income, wealth, and power in America, but the middle classes and the poor pay almost all of the FICA tax.

It is conceivable that self-described billionaire Donald Trump, for instance, never has paid a penny into the so-called Social Security (non-existent) “trust fund.”

In any event, all FICA dollars are destroyed upon receipt by the Treasury, so it is functionally impossible for FICA to fund Social Security, Medicare or anything else.

Like all federal taxes (and unlike state/local taxes), FICA very simply is your money flushed down a giant federal toilet, never to be seen again.

money down the drain
The tax dollars you send to the U.S. Treasury, are not used for anything. They are destroyed upon receipt.

Reid Ribble, a former Republican congressman from Wisconsin’s 8th District, says, “Republicans have never wanted to increase revenue, and just dealing with it on the benefit side is not politically feasible.”

In simple English, Republicans say they don’t want to increase FICA or decrease benefits. Democrats say the same, though for different reasons. So that produces a conundrum for those who believe in the trust fund myth.

The most likely FICA increase would be to make richer people pay more, which Republicans, being the “Party of the Rich” loathe.

Republicans wouldn’t mind a benefit decrease, but Democrats would hate that. Instead, Dems would prefer charging FICA to the rich, which is a no-go for the GOP.

Without Social Security benefits, 21.7 million more Americans would be below the poverty line, according to the Center on Budget and Policy Priorities.

Social Security does more than send eligible retirees a payment every month. It provides ongoing income to surviving spouses and their children as well.

Social Security Disability Insurance (SSDI) helps pay the monthly bills for qualified disabled workers and their families.

Although most of those whom Social Security keeps out of poverty are older adults, 6.9 million are under age 65, including 1.2 million children.

Not surprisingly, Social Security has widespread support. “It’s crystal clear that Americans of all generations value the economic stability Social Security has offered for the last 86 years — even more so as we face the health and economic challenges of a global pandemic,” says Nancy LeaMond, AARP executive vice president and chief advocacy and engagement officer.

Middle- and lower-income Americans love Social Security. The rich Americans? Not so much.

The rich would be perfectly happy if no one collected SS benefits. Eliminating all social benefits would widen the Gap between the rich and the rest.

(Without the Gap, no one would be rich, and the wider the Gap, the richer are the rich. Widening the Gap is the only way the rich become richer.)

And now, in all its glory, comes the Big Lie:

Absent any change in law, the Social Security trust funds — the financial accounts that the program draws from when annual payments to Americans are larger than annual tax collections — will be out of money in about 12 years.

At that point, the program would have only ongoing tax revenue with which to fund payments; calculations show that would cover only 78 percent of promised benefits.

The so-called Social Security “trust fund” (and Medicare “trust fund”) are not trust funds at all. They simply are balance sheet lines over which Congress and the President have total control.

The numbers in the “trust funds” arbitrarily can be changed by Congress and/or the so-called “trust funds” could be eliminated tomorrow, with Congress supporting SS the way it supports every other federal agency: By allocating funds.

Here is what the Peter G. Peterson Foundation, a right-wing group that has no love for the poor, admits about federal “trust funds.”

WHAT ARE FEDERAL TRUST FUNDS?
Sep 20, 2016, Peter G. Peterson Foundation

A federal trust fund is an accounting mechanism used by the federal government to track earmarked receipts (money designated for a specific purpose or program) and corresponding expenditures.

The largest and best-known funds finance Social Security, Medicare, highways and mass transit, and pensions for government employees.

Federal trust funds bear little resemblance to their private-sector counterparts.

In private-sector trust funds, receipts are deposited and assets are held and invested by trustees on behalf of the stated beneficiaries.

In federal trust funds, the federal government does not set aside the receipts or invest them in private assets.

Rather, the receipts are recorded as accounting credits in the trust funds, and the receipts themselves are comingled with other receipts that Treasury collects and spends.

For a more detailed view of real (not federal) trust funds, see: What Is A Trust Fund?

how a trust fund works
This is how real trust funds work. It is not how the Social Security faux “trust fund” works.

There are three parties involved in all trust funds:

The grantor: This person establishes the trust fund, donates the property (such as cash, stocks, bonds, real estate, art, a private business, or anything else of value) to it, and decides the management terms.

The beneficiary: This is the person for whom the trust fund was established.

The trustee: The trustee, which can be a single individual, an institution, or multiple trusted advisors, is responsible for making sure the trust fund maintains its duties as laid out in the trust documents and according to applicable law.

The primary difference is that a real trust fund holds money or other assets in trust. It’s not a simple checking account that accepts and doles out dollars at will.

To Congress, 2034 is a long way off. But the sooner the legislature acts, the quicker and easier it will be to bolster the trust funds’ reserves, due to simple math: Smaller revenue or benefit changes made now would accrue over time, which is a far more efficient way to secure the funds than paying for a last-minute major repair job.

Real trust funds don’t have reserves that need to be “bolstered.”  And since the Social Security “trust fund” must be “bolstered,” and the benefits can be changed at will, what is the purpose of that “trust fund”?

It’s nothing more than a line in a balance sheet.

Fully 12.4 percent of your gross income has gone to Social Security each paycheck by way of the Old-Age, Survivors, and Disability Insurance (OASDI) payroll tax.

The amount of wages subject to the payroll tax is capped and indexed annually; in 2022, a worker pays the tax on wages up to $147,000.

For a self-employed worker clearing that amount or more, that means an annual OASDI tax bill of about $18,200.,

The math goes like this: If you earn $147,000 a year, you pay $18,200 in FICA taxes, about twelve percent of your pay.

But if you earn $10,000,000 a year, you pay . . . that’s right, that same $18,200 . . . about 2 tenths of one percent of your pay.

If all your income came from sources other than salary (as does the income of most rich people, you would pay $0 FICA.

That difference demonstrates one of the ways the rich have bribed Congress to widen the Gap between the rich and the rest.

But it’s even worse than that:

After the Social Security Administration (SSA) pays beneficiaries, any tax dollars that are left over go into the trust funds, now totaling $2.91 trillion, to be tapped at a time when taxes coming into the system aren’t enough to cover ongoing benefit payments.

No “leftover” tax dollars go anywhere. The federal government does not save any tax dollars sent in, simply because it already has the unlimited ability to create infinite dollars to pay out. All tax dollars are destroyed.

When you send a tax check to the Treasury, the dollars come out of your checking account Those dollars are part of the M1 money supply measure which includes “physical currency and coin, demand deposits, travelers checks, other checkable deposits and negotiable order of withdrawal (NOW) accounts.

The instant your check is received by the Treasury, it no longer is part of M1. It ceases to exist in any money supply measure. (The federal government has an infinite supply of money, so there is no money measure of federal money.)

M1 is reduced, and effectively, your tax dollars are destroyed.

To make up for its income shortfall, the SSA this year will start drawing on the trust funds. Based on recent calculations, absent any major changes, the funds will run dry in 2034.

That’s 24 years earlier than the SSA estimated when the system was last overhauled in 1983.

There are no funds to “run dry.” Two simple computer key taps, one labeled “Assets” and one labeled “Liabilities” will instantly restore the trust fund’s balance sheets.

How did we get here? As long predicted, demographics explain a good deal: In a decade, the entirety of the boomer generation — some 70 million Americans born between 1946 and 1964 — will have hit retirement age.

As a result, the number of people receiving Social Security benefits come 2034 will be more than double the beneficiaries in 1985.

But what wasn’t known as accurately was how much longer those boomers would live. “From 1940 to 2019, life expectancies at age 65 have increased by about 6.5 years,” says Amy Kemp, chair of the Social Security Committee of the American Academy of Actuaries.

The impact: Many workers will be receiving benefits for a longer period of time. And those with higher incomes, which are generally those who receive higher benefit amounts, tend to live longer on average.

At the same time, there has been a continued decline in the nation’s birth rate; that means there are fewer younger workers to support the benefits promised to older workers.

In 1955, there were more than eight workers supporting each Social Security beneficiary. Now there are 2.7 workers per beneficiary.

All of the above is total beeswax. The question was, “How did we get here?” The answer is: By pretending that our Monetarily Sovereign government’s finances are like personal finances and that it can run short of dollars.

Contrary to the nonsense you repeatedly are told, the contributions made by young workers do not fund the benefits paid to old workers. The contributions made by young workers do not fund anything. They are destroyed.

Additionally, the country’s growing income inequality has had a negative effect on the amount of payroll taxes going into the trust funds, as wages above the payroll tax cap have grown much faster than wages under the cap.

And why is there a “cap”? Because that is the way the rich, who run America, want it. They want the Gap between the rich and the rest, to widen as much as possible.

If nothing is done, Social Security is projected to still be able to pay roughly three-quarters of promised benefits for the remainder of the century.

Or, if the government and AARP would tell the truth, they would say, “Social Security will be able to pay all promised benefits in perpetuity, whether on not it collects a penny in FICA taxes.”

So what needs to happen to secure Social Security for the long term?

Simple: Congress merely has to end FICA (which actually it has done temporarily at times), and fund SS directly, just as it does for virtually all other agencies.

There are variables that are out of the direct control of the SSA or Congress, such as the economy, wages, life expectancy, and birth rates.

But if projections hold more or less true, on paper the options are fairly simple: Congress will have to raise taxes, modify benefits or do some of both.

Both of those totally unnecessary actions will widen the Gap between the rich and the rest, effectively making the rich richer — exactly what the rich want.

Those options come down to any variation of a handful of leading approaches discussed by policymakers. Here are several, starting with ways to bring more money into the system.

Adjust the cap. This year, someone with $1 million in work income would pay the same amount of OASDI tax as someone with $147,000 in wages.

Intentionally misleading. “Work income” does not include income from rent, certain types of royalties, capital gains, and dividends. They are not subject to FICA taxes.

However, you have to pay the tax on all earned income including your salary, tips, commissions and anything else that counts as wages.

How convenient for the rich, since most (or all) of their income is derived from rent, royalties, capital gains and dividends.

Eliminating the taxable wage cap would keep the trust funds solvent until 2060, according to Social Security.

The Big Lie. The so-called “trust funds” are as solvent as Congress wants them to be. Raising or lowering the taxable wage cap would not affect “trust fund” solvency.

Also, it would have a scant effect on the rich, who get most of their income from non-wage sources.

Increase payroll tax rates. As noted, the current rate is 12.4 percent. Some propose raising that incrementally — say, by 2 percentage points, to 14.4 percent — as a way to bring additional dollars into the trust funds.

But some experts note that such tax increases would be hardest felt by those who earn lower wages or are self-employed.

But that’s the plan, isn’t it. That’s how the Gap is widened, i.e. how the rich get richer.

Broaden the base. Not all state and local employees are covered by Social Security. Some have only public pension coverage.

Bringing all newly hired state and local workers into the Social Security system would create a large new influx of cash, although it would mean more beneficiaries to pay later. 

Yes, by all means, let’s soak all those low-paid state and local workers, so that the states will be forced to raise salaries. And where will the states get the money to raise salaries? From other taxpayers, of course.

Broaden the definition of income. Certain forms of income are not subject to SSA payroll taxes, such as the value of employer-sponsored group health insurance.

Gradually eliminating such exclusions — and collecting payroll taxes on the additional income — would keep the trust funds healthy for roughly four additional years.

It would have no effect on the ability of Social Security to pay benefits, and the rich simply would find other forms of income, and continue to dodge the useless tax.

A significantly larger target, and so more politically challenging, would be to levy a Social Security tax on annual investment income, as opposed to just payroll taxes.

The other side of the coin is implementing changes that reduce benefits to certain Social Security beneficiaries.

It’s all sleight of hand to make you believe the Big Lie that federal taxes fund federal spending.

Introduce more progressivity. Typically referred to as “means testing,” this approach calls for adjusting the size of your Social Security payments based on your wages, wealth, or income.

And you don’t think the Donald Trumps of the world will find dodges to that.  He already has increased the value of his assets when asking for a loan, and decreased the value of the same assets when paying taxes.

A “wealth tax” is computationally impossible, because the values of most assets is too debatable.

Cut benefits for new recipients. Another approach would be to pay newly eligible retirees a little less per month than promised. 

Reduce the cost-of-living adjustment (COLA). Each year, the SSA usually adjusts beneficiary payments to help protect their purchasing power from inflation.

The yardstick used is the government’s Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, which takes into account the price increases for everything from apples to gasoline to rent. 

Change benefit calculations. Adjusting the complex formulas used to determine your Social Security payments could result in modestly lower benefits that could help increase the life of the trust funds. 

Up the retirement age. You can start taking Social Security, with reduced benefits, at age 62. Wait until you’re 67 (if you turn 62 in 2022) and you qualify for your full benefit. 

This last dumb idea is known as the “Work ‘Til You Drop” provision. All of the “solutions” rely on the same faulty belief, that federal taxes fund federal spending.

Some have suggested scrapping the entire program and converting it to individual account plans similar to a 401(k) retirement program, in which you contribute some or all of your current payroll taxes to a self-managed retirement account invested in stocks, bonds and other securities; you would bear the risks and rewards of your choices.

The above completely reverses the fundamental purpose of Social Security, which is to aid the middle- and low-income Americans, who can’t afford retirement, or don’t know how to manage money in their old ages.

Experts also note that such a program would mean the trust funds would be depleted sooner, putting current benefits at even greater risk.

Oh, those mythical, phony”trust funds.” We certainly don’t want to deplete what doesn’t even exist, do we?

Legislators in Congress routinely propose bills to alter Social Security, ranging from small adjustments to substantive overhauls.

In fact, so far in the 2021–2022 legislative session, dozens of members of Congress have introduced bills related to Social Security. To date, none has moved to a full vote.

But not one member of Congress has acknowledged the underlying fact that Social Security is funded by federal spending, which is infinitely available.

This lack of action isn’t surprising, given Congress’ big disagreements on Social Security reform.

To our well-bribed Congress, SS “reform” always means “more tax and less benefit,” all to widen the Gap.

The 1983 legislation negotiated between House Speaker Tip O’Neill and President Ronald Reagan that has kept the program solvent over the past four decades was a squeaker (though it ultimately won large bipartisan support).

SS is a solvent as Congress wants it to be. All Congress and the President need do is vote to add a few trillion to the budget for social purposes. No need to struggle with phony fixes.

That bill gradually raised full retirement age for beneficiaries to 67, levied taxes on Social Security payments for some beneficiaries, and increased taxes, all of which would be difficult to reach consensus on in Congress today.

Cutting benefits and increasing taxes did nothing to increase SS solvency.

Today, 12 percent of men and 15 percent of women on Social Security rely on it for 90 percent or more of their income. Even a modest reduction in benefits would hit them hard.

And 37 percent of men and 42 percent of women on Social Security get 50 percent or more of their income from the program.

And yet, not only do we hit these people with a FICA tax, but we also tax benefits. If the government really was trying to help people, this would make absolutely no sense.

But that is not what the government is bribed to do. It is bribed to make the rich richer.

With around 65 million people today receiving benefits, that means tens of millions of Americans depend heavily on the program. And already, their payments aren’t high.

The average retirement benefit from Social Security was $1,555 a month in 2021, or $18,660 a year. The average rent for a one-bedroom apartment in the U.S.? About $1,680 a month, according to Apartmentguide.com.

“When I did my research on it, probably the hardest-hit recipient of Social Security was a widow who has outlived her family savings and is now living in old age, strictly on Social Security,” Ribble says. “She’s trying to live off a $700- or $800-a-month payment.”

And the above is after the same widow was forced to pay12% of her salary on useless FICA. (Yes, 12%, not 6%, because employers take their share into consideration when calculating salary affordability.)

If history is any guide, there’s reason to hope that Congress will find a solution. Says Social Security’s Goss: “We’ve never reached the point where we depleted the reserves and had to reduce benefits.”

More false propaganda from the government. Those reserves don’t fund benefits.

In 2022, AARP will continue to urge members of Congress to shore up Social Security’s long-term finances and keep the promises made to all current and future beneficiaries.

We have fought hard against arbitrary cuts to the cost of living adjustment (COLA) and against bills like the Trust Act that target Social Security as a way to deal with budget deficits.

And we fought hard to ensure that those on Social Security would be able to get economic stimulus payments without having to file separately.

AARP also has “fought hard” to maintain the fiction that federal FICA taxes fund SS benefits.

Given that Big Lie, there can be no solution that does not include a tax increase or a benefit decrease. That’s simple arithmetic.

If you begin with the wrong premise, you cannot arrive at a correct solution.

State taxation: Twelve U.S. states now tax Social Security benefits. In 2022, AARP will work at the state level to eliminate this tax burden for more retirees and their families.

How about working at the federal level, to eliminate those tax burdens? Not paid to do that, AARP?

IN SUMMARY
Federal taxes — payroll taxes, income taxes, luxury taxes, all other federal taxes do not fund federal spending. Contrary to the Big Lie, all federal taxes are destroyed upon receipt by the federal government.

Unlike the monetarily non-sovereign state and local government, our Monetarily Sovereign federal government creates all its spending money ad hoc. It neither needs nor uses income for any purpose.

The ostensible purpose of federal taxes is to guide the economy by taxing what the government wishes to discourage and by giving tax breaks to what the government wishes to encourage. Another purpose is to assure demand for the U.S. dollar, which is necessary for paying taxes.

The real purpose of federal taxes is to make the rich richer, by widening the Gap between the rich and the rest.

To effect this result, the rich bribe the media via advertising dollars and media ownership. And the rich bribe the economists via promises of jobs at “think tanks” and via contributions to universities.

And the rich bribe the politicians via political contributions and promises of lobbying jobs.

All that bribery is expensive, but worthwhile for the rich, as the Gap has widened greatly, i.e. the rich have become richer.

[No rational person would take dollars from the economy and give them to a federal government that has the infinite ability to create dollars.]

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:

  1. Monetary Sovereignty describes money creation and destruction.
  2. 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:

  1. Eliminate FICA
  2. Federally funded Medicare — parts A, B & D, plus long-term care — for everyone
  3. Social Security for all
  4. Free education (including post-grad) for everyone
  5. Salary for attending school
  6. Eliminate federal taxes on business
  7. Increase the standard income tax deduction, annually. 
  8. Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.
  9. Federal ownership of all banks
  10. Increase federal spending on the myriad initiatives that benefit America’s 99.9% 

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

MONETARY SOVEREIGNTY

(Every spending cut demanded by conservatives is designed to widen the income/wealth/power Gap between the rich and the rest, while the few spending increases backed by the conservatives are designed to reward and protect the rich.)

Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”

Ben Bernanke: “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.”

Quote from Ben Bernanke when, as Fed chief, he was on 60 Minutes:
Scott Pelley: Is that tax money that the Fed is spending?
Ben Bernanke: It’s not tax money… We simply use the computer to mark up the size of the account.

Statement from the St. Louis Fed:
“As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e., unable to pay its bills. In this sense, the government is not dependent on credit markets to remain operational.”

Press Conference: Mario Draghi, President of the ECB, 9 January 2014
Question: I am wondering: can the ECB ever run out of money?
Mario Draghi: Technically, no. We cannot run out of money.
https://www.ecb.europa.eu/press/pressconf/2014/html/is140109.en.html

–Will the Greek people finally stop being the geese who lay golden eggs for the rich?

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.
**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.
**To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
**Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

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Will the Greek people finally stop being the geese who lay golden eggs for the rich?

Sometimes I feel we’re in an endless, time-loop, “Groundhog Day” movie, when I read articles like the following:

Greece faces last chance to stay in euro as cash runs out
Reuters: By Paul Taylor and Renee Maltezou

Greek Prime Minister Alexis Tsipras had a final chance to present credible reform proposals to an emergency euro zone summit on Tuesday to persuade skeptical creditors to reopen aid talks before his country’s banks run out of money.

With Greek lenders down to their last few days of cash and the European Central Bank tightening the noose on their funding, Tsipras must convince the bloc’s other 18 leaders, many of whom are exasperated with five years of crisis, to authorize negotiations fast on a new loan to rescue Greece.

Apparently, nothing has been learned. Still there remains the belief that Greece should have yet another “loan rescue,” so as to remain with the euro.

Still there remains the belief that Greece should present “credible reform proposals” (i.e more and more punishing austerity), so it can bleed its own people to pay the troika loan sharks.

Those “other leaders” of the block have become “exasperated” with five years of crisis, a crisis they created by inventing a financial union without a political union.

In my personally gratifying “I-told-you-so” mode, I repeatedly remind you of what I first said in a June 5, 2005 talk at the University of Missouri, KC:

“Because of the Euro, no euro nation can control its own money supply. The Euro is the worst economic idea since the recession-era, Smoot-Hawley Tariff. The economies of European nations are doomed by the euro.”

And now, it is ten years later, and still we read an article about how Greece must convince its rapacious lenders to allow it to burn in the frying pan of economic ignorance and misery.

So deeply in debt you cannot pay? Well, then borrow some more. That is the troika’s self-serving solution.

And now it is four years after I posted: There are two, and only two, long-term solutions for Greece and the other euro nations. (Thursday, Nov 3 2011), which included these lines:

In giving up the drachma, and taking on the euro, Greece voluntarily surrendered the single most valuable asset any nation can have: Its Monetary Sovereignty.

Greece now is monetarily non-sovereign. There is an absolute rule in economics: No monetarily non-sovereign government can survive long term without money coming in from outside its borders. Germany, another nation that gave up its most valuable asset, the mark, and also is monetarily non-sovereign, survives on exports.

Nevada, which also is monetarily non-sovereign, survives mostly on tourism (aka gambling). No monetarily non-sovereign can survive long-term on internal taxes or borrowing.

By contrast, Monetarily Sovereign nations do not need money coming in from outside their borders, because they create unlimited money simply by paying bills.

For Greece and the other euro nations, long term survival requires one of two, and only two, events:

1. Adopt some form of a sovereign currency, and become Monetarily Sovereign
or
2. The EU give (not lend) euros to its member nations as needed.

Event #1 requires reversing the ill-fated switch to the euro.

If Greece re-adopts the drachma, and becomes Monetarily Sovereign again, it can free itself of the appropriately despised austerity, and build its economy.

Other euro nations, especially those with a negative balance of payments, soon will follow.

Or, if Europe adopts event #2, and creates a political union, perhaps a form of “United States of Europe,” it could become the most powerful economic force in the world, surpassing even the U.S. and China.

Long term, which path will Europe follow?

Europe will follow the path the bankers and the super-rich feel will be most profitable for them.

Very little consideration will be given to the welfare of the populace, the same lack of consideration for the people that led to the creation of the euro.

Despite you have been told, the purpose of the euro never was to ease trade, nor was it to establish peace in Europe. The purpose was to give the rich bankers, the troika (European Central Bank [ECB], the European Commission [EC], and the International Monetary Fund [IMF]), absolute control over the people.

Remember, Monetary Sovereignty is the most valuable asset any nation can have. With Monetary Sovereignty, a nation can buy anything it wishes. It can buy prosperity. It can buy health, housing, education, food, convenience and pleasure for its citizenry.

By adopting the euro, each member nation handed over its most valuable asset to the small group of politicians. And oh, how the bankers loved it.

They could lend euros to nations already deeply in debt, knowing they had the financial blackjack of the troika on their side. They could suck the life out of the people, via ever-greater taxes and ever-smaller benefits — and it all was in the name of “fiscal prudence.”

If the people complained about austerity, it became a moral issue. They were “lazy takers,” who were part of a “welfare society” and who “expected the government to take care of them.”

It was a no-lose, highly profitable situation for the rich, so long as the populace didn’t get wise to the scam.

Now, that the Greek people have wised up, the rich desperately are trying to hang on to the geese who have been laying those golden eggs.

My prediction: The rich will find a way to continue the racket, just in a different form. The only way this could change is in the rare circumstance where a strong and caring leader emerges.

Do you see any such on Europe’s horizon?

Or will the geese keep on a’layin’?

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

Hitler in America. Why a bigot can win the Presidency

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

If you want to know why a bigot can win the Presidency, read this:

Trump’s model

Republican Donald Trump is an obvious and transparent racist.

Made rich by his daddy, he surrounds himself with bootlickers, telling him he’s right — and like many rich fools, he believes what they tell him.

He appeals to the worst and lowest aspects of American society — the haters and those of low morals and intelligence, who leap at the chance to blame someone, anyone, for their own deservedly low self-esteem:

Donald Trump doubles down on Mexico ‘rapists’ comments despite outrage

Trump claimed statistics show that undocumented Latino immigrants are more likely to perpetrate rape than the wider population. However, the Fusion article he referred to said 80% of women crossing the Mexican border are raped along the way, often by criminal gangs, traffickers or corrupt officials.

When CNN host Don Lemon pointed out that Trump had misread the article, the former Apprentice host said: “Well, somebody’s doing the raping, Don! I mean somebody’s doing it! Who’s doing the raping? Who’s doing the raping?

“If you look at the statistics of people coming, you look at the statistics on rape, on crime, on everything coming in illegally into this country it’s mind-boggling!”

Trump’s entire statement was: “When Mexico sends its people, they’re not sending their best . . .” [Comment: Mexico is not “sending” people. People are fleeing Mexico to come to America for a better life.]Image result for trump

“They’re sending people who have lots of problems. And they’re bringing those problems to us. They’re bringing drugs . . . “ [Comment: The vast majority of arrested undocumented immigrants (actually 95%) are not charged with bringing drugs. They are charged only with . . . that’s right: Being undocumented. That is their crime.]

“They’re bringing crime . . .” [Comment: Does Immigration Increase Crime? The results of the analysis are clear: “There’s essentially no correlation between immigrants and violent crime. Given some media depictions of immigrants as violent, or associated with human trafficking and the drug trade, this finding may come as a surprise to many. There’s a long perception that immigration increases crime, and when you look at neighborhoods where lots of immigrants live. These are typically not the best neighborhoods. These are violent places. So there’s this anecdotal association between immigrants and violent crime that just doesn’t turn out to be true in the data.”]

“They’re rapists. . . ” [There is zero data to support this. Trump twisted a report that said Mexican women are being raped on the way here — a huge jump from Mexican immigrants being rapists.]

Finally, Trump uses the standard bigot’s excuse: “I love the Mexican people; I do business with the Mexican people.”

It’s a take on the old, “Some of my best friends are black,” line.

Any moral person of normal intelligence will see Trump for what he is, a big-mouthed, egomaniacal extremist, as much a danger to America as Hitler was to Germanyand using the same tactics.

Sadly, America has its share of low-morals followers, as witness some of the comments at:

Bush says he takes Trump’s immigration remarks personallyWhen Trump announced his presidential bid last month, he criticized Mexico and immigrants who come to the U.S. illegally. “They’re bringing drugs,” he said. “They’re bringing crime. They’re rapists.”

COMMENTS BY READERS

–America is sick of the illegal alien problem and Americans are overwhelmingly against any type of amnesty for illegal aliens. Anybody that is anything short of a turnip has figured out by now Jeb Bush isn’t going to do a damn thing about illegal aliens except something that favors and coddles illegal aliens. If elected, Jeb would be a middle of the road push over…a piece of light bread soaked in water. Trump is at least old school tough and not afraid to speak out. We would be way better off with Trump.

–I work at a rural Colorado hospital and am offended every time a fence jumper delivers ANOTHER baby (aka an instant American citizen)…FREE OF CHARGE…on my dime! I am offended that ILLEGALS are allowed to qualify for housing and food assistance…ON MY DIME! These criminals refuse to assimilate and hang their Mexican flags on their porches. I would much rather see our Confederate Flag than a Mexican one. Maybe we should throw a liberal hissy fit and we, the people, ban MEXICAN FLAGS!

–This just shows that Bush has a lot more in common with the Dems than with his own party. Trump, is the only GOP nominee who has come out strongly against immigration and that is what the conservatives want to hear.

–Bush also implied he would be telling conservatives to embrace policies like amnesty and Common Core, which is reminiscent of former Utah Gov. Jon Huntsman’s all-in approach to global warming during his failed 2012 presidential campaign.

–Did anyone ever tell Bush 69% of the american people oppose illegal immigration? About 58% of Americans support deportation of all illegals. Sound pretty mainstream to me.

–How about the many American citizens who have also been killed and murdered, by illegal aliens, including our law enforcement officers; are you taking those murders personally too?

–What about the 25 American citizens who are killed each day by illegal aliens, either by traffic accidents (i.e. drunk driving, hit-and-runs, etc.), during the commission of a crime, and unlawful discharge of firearms; are you taking those personally too?

The hate and bigotry goes on and on. You find this particularly on right-wing web sites.

Why? Because the right wing has been sowing the winds of hatred since Obama became President, and now America is reaping the whirlwind.

No Republican candidate has a chance to be nominated unless he/she spews the anti-science, anti-poor, anti-black, anti-brown, anti-gay, anti-women, pro-rich platform.

Through most of my life, I actually voted Republican, but the current extremist, hateful, religionist bent of the party is too reminiscent of Hitler for my taste. It should be repugnant to every American.

If you are part of any minority in America, you should be very frightened. History is littered with Hitlers, Stalins and Maos. Most dictators have used bigotry and hatred to gain political power.

I pray American will see Trump for what he is. Or the America, of which we are so proud, will be no more. We’ll be Nazi Germany.

And don’t think it couldn’t happen here.

The Germans didn’t think it could happen to them, either.

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

–The great Iran nuclear threat lie.

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.
?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.
?To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
?Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

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

Do politicians ever stop lying? Does a flea-ridden dog ever stop scratching?

1. As we all know, Iran is a nuclear threat to (Pick one):
_____ America
_____ Israel
_____ The Middle East
_____ The eastern hemisphere
_____ All of the above

2. And, as we all know, Iran is ruled by (Pick one)
_____ Crazy, irrational religionists
_____ Smart, dangerous religionists
_____ Deceptive, duplitious religionists
_____ All of the above

3. As we all know, we can stop Iran from getting “the bomb” by (Pick one):
_____ Negotiating with them
_____ Bombing them
_____ Invading them
_____ All of the above

4. We all know these things to be true, because:
_____ Barack Obama told us
_____ John Kerry told us
_____ Bebe Netanyahu told us
_____ All of the above

If you substitute “Iraq” for “Iran” and “Bush” for “Obama,” you’ll see why this movie sounds familiar.

So where do we stand today? We have “the bomb.” So does Russia, China, India, Pakistan, the UK, France, Israel, North Korea and heaven knows who else.

Of all these, only the U.S. has actually dropped the bomb on someone.

But we are, and always will be, ruled by logical, thoughtful, peaceful governments — especially if a level-headed leader like Donald Trump, Ted Cruz, Ben Carson, Chris Christie, Mike Huckabee, Bobby Jindal, Rick Santorum, or yet another Bush becomes president.

We know we can trust them to keep us safe.

The rest of the nuclear nations also are ruled by logical, thoughtful, peaceful governments, especially North Korea. So it is vital to world peace that Iran, the only nation ruled by religious or political nuts, be prevented from having nuclear weapons.

That is why I am so relieved by this article:

Iran atomic bomb probe may be completed in 2015: IAEA

Vienna (AFP) – A long-delayed investigation into whether Iran has sought to develop nuclear weapons could be completed by the end of the year with Tehran’s help, the head of the UN atomic watchdog said Saturday.

Following his talks in Tehran earlier this week, UN watchdog chief Yukiya Amano said “progress was made on the way forward, but more work is needed.”

“With the cooperation from Iran I think we can issue a report by the end of the year on the … clarification of the issues related to possible military dimensions,” Amano told reporters before heading into talks with global powers in Vienna.

Oh, thank heavens. I wasn’t worried about Russia, China, India, Pakistan, the UK, France, Israel, North Korea bombing us or allowing terrorists to gain control over a bomb.

But I was in an absolute panic about Iran, which is why I genuflect daily in front of a John Kerry statue in my bathroom. Just knowing that Iran may not have the bomb for at least — what, five more years? — gives me hope for peace in the world.

And that is why I’m delighted that President Obama has invested so much of his attention to Iran and his anger at Israel, rather than on, for instance North Korea or China. After all, he knows where the danger to America really lies.

And speaking of lies, what about Iraq’s Weapons of Mass Destruction that cost thousands of American boys and girls their lives and limbs? Shouldn’t we attack them, too?

Oh, you mean, the previous Bush . . .

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