The debt hawks are to economics as the creationists are to biology.
I strongly recommend this one-page piece: Randall Wray
Rodger Malcolm Mitchell
http://www.rodgermitchell.com
No nation can tax itself into prosperity
Tag: debt hawk
–Politics vs. people
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.
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Today’s headline: “Fears grow as millions lose jobless benefits”
Body copy: Senate Republican leader, Mitch McConnell of Kentucky, said: “The fastest-growing parts of this Democrat economy aren’t jobs — they’re the crushing burden of the national debt and the size of the federal government.”
The “crushing burden” is not national debt, which crushes no one. The crushing burden is the false belief the national debt is a crushing burden.
As a result of this false belief, millions will lose jobless benefits, taxes will be increased, Medicare doctors will receive less than they should, Social Security payments will begin later, Medicaid payments will be cut, defense spending will be reduced, federal funding of K-12 education and school breakfast programs will be cut, mass transit funding will be cut and federal assistance to the states will be reduced — all because of a myth with no factual support.
So you, dear reader, will suffer a significantly degraded life style, all because the debt hawks say the federal debt is a crushing burden and the debt causes inflation, neither of which is supported by any data.
Go to any debt hawk web site and ask them for data proving the U.S. federal debt is unsustainable or causes inflation. If they answer you at all (unlikely), they merely will give you statistics regarding the size of the debt, but no evidence it has a negative effect on America.
Here are a couple debt hawk sites you can visit:
Concord Coalition
The Cato Insitute
The Heritage Foundation
The Manhattan Institute
The Hoover Institution
Go ahead. Contact any of them. Despite impressive doctoral credentials, and oodles of statistics, they have no evidence to back their claims. Why? No such evidence exists, though massive evidence shows the misnamed “debt” (should be called “net money created”) is necessary for economic growth.
Rodger Malcolm Mitchell
http://www.rodgermitchell.com
No nation can tax itself into prosperity
–Why the slow recovery?
The debt hawks are to economics as the creationists are to biology.
Recessions and recoveries ultimately are associated with money, and more specifically with money growth. In general, less money growth = less economic growth. (That actually is something of a tautology, since economic growth is measured in money.)
There are several definitions of money, most differing on the basis of liquidity, the ease of converting to currency. The most liquid form is called M1, which consists of currency and checking account deposits.
The government no longer measures the less liquid forms, M3, L and the most inclusive form: Debt of Domestic Non-Financial Sectors. And for many reasons, the supplies of the various money forms do not move together. For instance, there are periods when M1 goes up or down more than M2, even though M1 is part of M2.
I found an interesting pattern relative to recessions. In the following graph, you see a strong tendency for one form of money, Federal Debt Held by the Public, to grow more slowly before recessions, then grow quickly during recessions, then resume growing more slowly after recessions.
M1 exhibits a similar, though less consistent pattern, and M2 is less consistent yet. One consistency is: Following every recession, at least one of the money forms grows at an increasing rate — every recession except the most recent one:
Here, despite (or because of) worries about deficits, every measured form of money has shown a sharp decline in growth rate. Perhaps this overall decline in money growth is responsible for the slowness of the recovery — yet another bit of evidence that debt fear has hurt our economy, and increased federal spending is desperately needed.
Rodger Malcolm Mitchell
http://www.rodgermitchell.com
No nation can tax itself into prosperity
–How President Obama’s National bipartisan Commission on Fiscal Responsibility and Reform could destroy America
The debt hawks are to economics as the creationists are to biology.
Parade Magazine, in its 7/4/10 “Intelligence Report”, printed an interview by Steven Beschloss and Janet Kinosian titled, “Can These Men Fix the Deficit?” The men are Erskine Bowles, a former White House chief of staff, and Alan Simpson, a former Republican Senate whip. Today, Messrs. Bowles and Simpson are co-chairs of President Obama’s National bipartisan Commission on Fiscal Responsibility and Reform.
Here, with my comments, are what they said:
BOWLES: “If we don’t solve the (federal) debt problem, we will be paying $1 trillion in interest in 2020. That’s money we can’t spend on Social Security, Medicare, education, infrastructure or innovation to make sure America is competitive in a global economy.”
RMM: “Of course, he’s dead wrong. America is a monetarily sovereign nation. Future spending is restricted neither by past spending, by debt, by deficits nor by tax collections. That $1 trillion in interest will function as an economic stimulus. This is classic cognitive inconsistency. Mr. Bowles believes the government cannot do what he sees with his own eyes, the government actually doing, i.e spending trillions on stimulus plans, despite debt that has grown more than 1,500% in only 30 years. In addition to cognitive inconsistency, he suffers from anthropomorphic economic disease – the mistaken belief that the government’s finances are like yours and mine.
BOWLES: “We’re looking at how we can reduce discretionary spending – things like education, transportation, the military, homeland security – and mandatory spending which includes Social Security, Medicare and Medicaid. We also need to raise revenue.”
RMM: He believes that cutting back on education, transportation, the military, homeland security, Social Security, Medicare and Medicaid, while raising taxes, will “make sure America is competitive in a global economy.” The notion would be laughable if it weren’t so dangerous.
SIMPSON: “We’re not going to cut Social Security – we’re going to stabilize it. None of the ideas that have been presented will affect anyone over the age of 58.”
RMM: “Stabilize” is political double talk for, “We are going to cut Social Security for everyone 58 and younger.”
SIMPSON: “As it is, it (Social Security) can’t sustain itself.”
RMM: Ah, the old (and false) “unsustainable” claim.
BOWLES: “We’re going to work our hearts out succeed.”
RMM: In their world, “Fiscal Responsibility and Reform” are code words for austerity, which always causes recessions and depressions. Heaven help us from those who have power, yet cannot learn.
Rodger Malcolm Mitchell
http://www.rodgermitchell.com
No nation can tax itself into prosperity
#Monetary Sovereignty - Mitchell 