Reason Magazine is confused. Wrong about inflation but partly right about tariffs. And partly wrong.

Read how the right-wing “Libertarians” take opposite sides of the same issue. Here are excerpts from an online Reason (Libertarian) article:

By Refusing To End Trump’s Tariffs, Biden Is Making Inflation Worse
Trump’s tariffs are adding an estimated 0.5 percent to annual inflation.
ERIC BOEHM | Reason |12.10.2021

Tariffs do exactly one thing: raise prices.

No, tariffs do exactly two things: Yes, they raise prices, but they also take dollars from the economy.

Right now, prices don’t need any help getting higher.

Economic data released Friday by the Bureau of Labor Statistics show that year-over-year inflation hit 6.8 percent in November—the highest level recorded since 1982. Despite other indicators showing that the economy is strong, persistently high inflation is a serious problem for American households.

That includes the current resident of the White House, for whom inflation is becoming a major political headache.

There’s probably not much President Joe Biden can do to curb inflation in the short term. That ship sailed when he pushed for and signed off on a major economic stimulus bill earlier this year—one that economists warned was too large and could overheat the economy.

The “too large” phrase might make you believe Mr. Boehm believes stimulus is good, just not so much. Don’t be misled. For Libertarians all federal spending is “too large.”

Had the stimulus package been $5, Mr. Boehm would have complained it was “too large.” Why? Just because. Libertarians are anti-government everything, and would prefer that the economy sink into depression than see more federal spending.

Other factors influencing inflation, like the disconnect between supply and demand that’s largely a result of the ongoing COVID-19 pandemic, are well beyond Biden’s (or any president’s) power to change.

“The disconnect between supply and demand” are not “other factors influencing inflation” They are THE factors causing inflation, the only factors.

All inflations are caused by shortages.  Today’s inflation is caused by shortages of oil, food, computer chips, lumber, shipping (and everything else that gets shipped), and labor.

This stimulus package, like all previous stimulus packages, did not cause the oil shortage. It did not cause the food shortage. It did not cause the computer chip shortage. It did not cause the shipping shortage.

It may temporarily have caused a labor shortage by giving people an alternative to low-pay, crap jobs. Unfortunately, the unemployment compensation safety net now has been pulled out from under workers, who the employers hope will be forced to accept those jobs.

But there is one thing Biden could do to immediately provide consumers with relief. He could eliminate the tariffs imposed by former President Donald Trump.

If Boehm is claiming that the tariffs were just another, stupid Trumpian attempt to punish China by punishing American consumers, he is correct. China doesn’t pay for American import taxes. Americans do.

But what Boehm neglects to mention (or doesn’t realize) is that import tariffs take dollars from the American private sector (aka “the economy”) and give those dollars to the federal government, and that reduces the federal deficit and debt.

And as anyone familiar with Libertarians knows, those folks absolutely hate the federal deficit and debt (despite the fact that whenever the deficit and debt are reduced we have recessions and depressions).

So in the backward logic of Libertarians, deficit-reducing tariffs should be a good thing.

Those tariffs, which Biden has been stubbornly unwilling to reverse during his first year in office, are adding roughly 0.5 percent to annual inflation across the economy. 

Trump’s tariffs on washing machines, solar panels, steel, aluminum, and a host of Chinese-made goods are a “secondary but noticeable contribution” to overall inflation right now.

That’s pretty much in line with what four economists at the San Francisco Federal Reserve warned in February 2019, shortly after Trump began slapping tariffs on various goods. “Imports from China are an important part of overall U.S. imports of consumer and investment goods,” they wrote.

“Thus, tariffs on these imports are likely to have sizable effects on consumer, producer, and investment prices in this country.”

But wait. Remember Boehm’s “supply and demand” comment at the start of the article. He claimed, in effect, that increased demand is half the problem. But tariffs reduce demand. That’s the underlying purpose of tariffs.

So in Boehm’s world, reducing demand via tariffs should mitigate inflation!

And as we have said, tariffs are taxes. Deficits and debt are the difference between taxes and spending. Libertarians supposedly hate deficits and debt. Tariffs, i.e. taxes, reduce deficits and debt.

Unlike other policies that could help slow inflation, like raising interest rates, Biden could cut tariffs without having to wait for Congress or the Federal Reserve to act.

He’s right, but cutting tariffs also would increase the federal debt, which Boehm doesn’t want.

Similarly, cutting tariffs would not come with some of the negative tradeoffs that other actions might. Raising interest rates will harm the economy in other ways (for example, by making it more expensive to borrow).

Boehm is correct that Trump’s tariffs were, as usual, stupid. But he is dead wrong about raising interest rates. While raising interest rates makes borrowing more expensive, private borrowing adds stimulus dollars to the economy. Banks lend by creating dollars.

Even more importantly, higher interest rates force the federal government to pump more interest dollars into the economy, which helps grow the economy.

To quote from an article we published in 2018, “Interest rates going up. Should you be concerned?”

Rising Rates Could Further Balloon Interest Spending, Mar 21, 2018

The Federal Open Market Committee (decided) to raise the federal funds rate by 0.25 percentage points to 1.5-1.75 percent.

The federal government (is projected) to spend $6.8 trillion on interest costs over the next decade. If interest rates end up just 1 percentage point higher than projected, interest costs would increase by a further $2 trillion. If interest rates return to their pre-recession levels, costs could rise by $3.4 trillion.

Let us rephrase as follows:

The federal government (is projected) to pump $6.8 trillion interest dollars into the economy over the next decade.

Should a $6.8 trillion stimulus — which is similar in effect to a $6.8 trillion tax cut — be a cause for concern?

Contrary to popular myth, raising interest rates does not “harm the economy” as Boehm and many other economists claim. In fact, raising interest rates stimulates the economy by forcing the federal government to pump more dollars into the private sector.

Blue line is interest rates. Red line is Gross Domestic Product growth.

Higher interest rates are associated with higher GDP growth, because higher interest rates cause more money growth.

The illusion that high interest rates “harm the economy” is caused by the stock markets, which decline in anticipation of raised rates. But anticipation is based on belief, not on fact.

Adding dollars to the economy, which is what higher interest rates accomplish, stimulates economic growth.

Lifting tariffs will ease inflation and provide a tax cut to many American businesses. 

Correct. Tump’s tariffs should be lifted, just not for the reasons Boehm claims.

Again: The one and only thing that tariffs do is raise prices. That is their only function.

Again, their other function is to take dollars from the economy, give them to the federal government (which has no use for them), and reduce deficits and debt (both of which are necessary for economic growth).

Politicians might want to deploy tariffs (to raise prices) for a number of reasons: to protect domestic industries, to influence where in the world individuals choose to invest, to retaliate against what they perceive as unfair trade practices from other countries, and so on.

Tarrifs are nothing more than a spite-one’s-face-by-cutting-one’s-nose exercise. All of the above goals can be accomplished via federal tax cuts and federal spending.

If Biden is going to keep ignoring this basic bit of economic reality, then he is choosing to make inflation worse than it already is.

The basic bit of American economic reality is this:

  1. Inflation is caused by scarcity, not by federal spending. Not by “too much money,” but rather by too few goods.
  2. Cutting tariffs does not increase supply, so it does not reduce inflation.
  3. Inflation can be cured by federal spending to obtain and distribute the scarce goods.
  4. Federal deficit spending is economically stimulative, i.e cutting taxes and spending both grow the economy
  5. Interest rate increases are stimulative
  6. Tariffs are not a good solution for any economic problem

While Mr. Boehm is correct about the need to cut tariffs, he is wrong about the way to cure inflation. That cure requires increased federal deficit spending to acquire and distribute the scarce products while decreasing taxes.

A great place to begin would be to eliminate the FICA tax, which has zero positive effects, but increases business costs and drags down the economy.

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

Will the “Build Back Better” bill and “too much” federal debt cause inflation? An examination of myths.

The big argument of the day has to do with federal deficit spending. The Republicans say they don’t like it because increasing the federal “debt” causes inflation.

The Democrats agree that increased federal “debt” is inflationary, but that their proposals are “paid for” by increased taxes. So, according to the Dems. the federal debt wouldn’t increase enough to cause inflation.

In total, both parties and all their hired economists wrongly agree that federal deficit spending leads to inflation, a false belief demonstrated in the following article:

House passes Build Back Better bill after overnight delay

It’s unclear whether moderate Senators Joe Manchin and Kyrsten Sinema will agree to some of the provisions included by the House.

“The Build Back Better Act is fiscally responsible,” Mr. Biden said in a statement. “It reduces the deficit over the long-term. It’s fully paid for by making sure that the wealthiest Americans and biggest corporations begin to pay their fair share in federal taxes.

“Leading economists and independent experts on Wall Street have confirmed that it will not add to inflationary pressures. Instead, it will boost the capacity of our economy and reduce costs for millions of families.”

Janet Yellen Not Planning a Wealth Tax, but Could Do Capital Gains Tax
Yellen spreading the Big Lie that federal taxes fund federal spending and that the federal debt is too large.

The CBO said it would increase the deficit by more than $367 billion over 10 years.

But the estimate did not include the revenue that could be generated from increasing IRS enforcement, which the CBO suggested would be $207 billion.

Treasury Secretary Janet Yellen noted that the Treasury Department estimates that the crackdown on tax evaders would raise $400 billion, and her own department’s analysis “make it clear that Build Back Better is fully paid for, and in fact will reduce our nation’s debt over time by generating more than $2 trillion through reforms that ask the wealthiest Americans and large corporations to pay their fair share.”

The White House, which estimated its framework would cost $1.75 trillion, claims it would reduce the deficit over time, generating more than $2.1 trillion over 10 years.

Sounds great, doesn’t it? The spending is “fully paid for,” and increased tax collections would “reduce our nation’s debt” and “reduce the deficit.”

Thank heavens it’s all a lie, a Big Lie.

Despite all the chest-thumping by Biden and friends, the bill will be “fully paid for” simply because all federal spending is fully paid for by federal money creation, never by taxes.

The federal government uniquely is Monetarily Sovereign. Unlike state and local taxes, which do pay for state and local government spending, federal taxes pay for nothing.

That is a fundamental difference between monetarily non-sovereign state and local governments vs. the Monetarily Sovereign federal government.

State and local taxes are M1 (money supply) dollars that remain in the private sector, even after they are received by state and local governments. (The state/local governments deposit their tax dollars into private sector banks.)

By contrast, Federal taxes are M1 dollars that are removed from the economy and destroyed when they hit the Treasury, where they no longer appear in any money measure.

Anyone not understanding that fundamental truth simply doesn’t understand economics, and has no business voting on or commenting about federal spending.

(In all probability, most of the federal politicians do understand, but don’t want you to understand, lest you ask for more benefits. Rich political benefactors want the Gap between the rich and the rest to widen, an event which makes the rich richer.)

Worse yet, if in fact, the increased federal taxes equal or exceed spending (which is what the Dems claim will happen) then the removal of money from the private sector (aka “the economy”) will lead to a depression, as has happened so often n the past.i

We only can pray the Dems are lying about reducing the debt and deficit.

The other issue, perhaps the biggest issue currently, is whether increased deficits and debt will cause inflation.

This is the one the GOP harps on, because they can’t complain about deficits, as they recently gifted the rich with major deficit-causing tax decreases (which by the way, increased the deficit and debt, but didn’t cause inflation).

So what causes inflation? Is it the money supply, as so many economists claim?

Do you see any relationship between the M2 money supply and inflation?

Inflation (blue) vs. The M2 Money Supply (red)

No, there doesn’t seem to be any relationship between the M2 money supply and inflation.

But wait. Some economists claim it isn’t just the increased money supply that causes inflation, but rather increases in the velocity of money that causes inflation.

The velocity of money is the frequency at which one unit of currency is used to purchase domestically- produced goods and services within a given time period. In other words, it is the number of times one dollar is spent to buy goods and services per unit of time. (per the Federal Reserve of St. Louis)

Inflation (bright blue) vs. the velocity of M2 (pale blue).

No, there is a massive difference between the two lines. The velocity of money doesn’t seem to be a cause of inflation.

So what about federal debt? That’s one that many economists claim causes inflation.

Inflation (blue) vs. Federal Debt Held By The Public (purple)

No, the peaks and valleys are completely different. Despite the bleating by Republicans and Libertarians, there doesn’t seem to be any relationship between federal debt and inflation.

Here’s another thought. Some folks worry that the world (China especially) won’t “lend” us enough dollars. It’s a ridiculous concern, because the federal government does not borrow dollars from anyone, and further, it never can run short of dollars.

But ridiculous concerns are part of what constitutes today’s economics. So, when the federal government doesn’t sell enough “debt” (Treasury Securities) to meet legal (though not financial) requirements, the Federal Reserve jumps in with its infinite supply of dollars.

So, is there a relationship between inflation and the Federal Debt held by Federal Reserve Banks?

Inflation vs. Federal Debt held by Federal Reserve Banks

Nope. No relationship there, either.

So, what does cause inflation?

Here’s one hint:

Inflation (blue) vs. Spot Crude Oil Price (orange).

That’s more like it. Notice how the peaks and valleys of inflation generally match up with the peaks and valleys of oil prices.

Of course, the match is not perfect because oil prices, which closely are related to oil shortages, are not the sole cause of inflation.

Today’s inflation is related to the shortages not only of oil, but also of food, labor, shipping, computer chips, and other vital resources. And that gives you the answer to the question, “What causes inflation?”

Inflation always is caused by shortages of key commodities, most often food and energy, along with other supplies. Inflation never is caused by “too much money,” never by federal spending, and never by federal deficits and debt.

Not only do shortages, not money supply, always cause inflation, but inflation can be cured by federal deficit spending to cure shortages and to distribute the scarce items.

Currently, the federal government is trying to ease inflation by distributing oil from the Strategic Petroleum Reserve. This is an example of government spending, because the government previously had deficit-spent to acquire that oil.

The government can reduce the shortages of food and shipping by strategic spending to aid growers and shippers. The government can spend to bring more computer chip manufacturing to our shores.

If the government would eliminate the nonsensical, useless FICA tax, (and act that would increase the federal deficit and debt) that would effectively raise salaries and encourage more people to come to work, thus easing the labor shortage.

In summary, all the worries about federal deficit spending causing inflation are completely misplaced and in most cases, dishonest. They are nothing more than an attempt to widen the Gap between the rich and the rest.

Finally, if federal deficit spending does not cause inflation, what does federal deficit spending do?

Federal deficit spending helps prevent and cure recessions:

Gold line shows increases and decreases in federal deficit spending. Vertical gray bars indicate recessions.

When federal deficit growth declines we have a recession, which is cured by a deficit growth increase.

SUMMARY
The federal government, unlike state/local governments, cannot run short of U.S. dollars. It can pay any debt denominated in dollars, simply by creating dollars.

Though state/local government taxes fund state/local government spendinng, federal taxes do not fund federal spending. Unlike state/local tax dollars, federal tax dollars are destroyed upon receipt by the Treasury.

No evidence supports the belief that “too much” federal deficit spending causes inflation. On the contrary, federal deficit spending can prevent and cure inflations.

Additionally, federal deficit spending can prevent and cure recessions and depressions.

There is no financial reason ever to restrict federal spending. The false belief that federal finances are similar to state/local government finances and personal finances is fostered by the very rich, who strongly influence the government via bribery.

The rich wish to widen the Gap between them and the rest of the citizenry. The wider the Gap, the richer are the rich. It is the fundamental reason why the rich bribe the politicians, the media, and the economists.

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

The Pandora Box: Your taxes and your charities

The problem is this: Federal taxes are unnecessary.

They do not fund federal spending. Because the U.S. federal government (unlike state/local and euro governments) is Monetarily Sovereign, it has the unlimited ability to create its sovereign currency, the U.S. dollar. It never unintentionally can run short of dollars.

Rather than spending tax dollars, the federal government creates brand new dollars, ad hoc, every time it pays for something. Your Medicare and Social Security benefits, indeed every dollar coming out of Washington, are newly created.

What becomes of your tax dollars? They are destroyed upon receipt by the U.S. Treasury. They begin in checking accounts as part of the M1 money supply measure, and as soon as they hit the Treasury, they cease to exist in any money measure.

Not only are federal taxes not spent, but they are a terrible drag on the economy. The estimate is that this year, nearly $4 trillion will be taken from the U.S. economy by useless federal taxes.

That is a gigantic, and unnecessary, loss for the U.S. economy.

While politicians lie about you and your children owing some percentage of the federal debt (You don’t), your real debt is what you owe in federal taxes. Your federal tax dollars are lost forever.

(Perhaps ironically, your state/local taxes are recirculated into the economy, so they do wind up in someone’s pocket.)

If all federal tax collections were eliminated, the U.S. economy would be boosted by about $4 trillion, which calculates to an approximate 18% gain in annual Gross Domestic Product.

Federal taxes are the single biggest deadweight on U.S. economic growth. Nothing else comes close.

So we should get rid of those unnecessary taxes — except for two problems:

First, taxes theoretically help the federal government control certain aspects so the economy, by taxing what it wishes to discourage and giving tax breaks to what it wishes to encourage.

Second, by taking more from the rich than from the poor, federal taxes theoretically help narrow the Gap between the rich and the rest.

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.

The love of money isn’t the root of all evil. Gap Psychology — the desire to widen the Gap below and to narrow the Gap above — is the root of all evil.

Those are the theories. Here is the reality:

A growing worry for charities: Tax havens for the rich
By Haleluya Hadero , AP Business Writer

A spotlight that has been thrown on how many of the rich and powerful shield their wealth is also intensifying a fear among philanthropy experts: That the tax havens being used by the wealthy will increasingly siphon money away from charitable causes.

Wealthy Americans have long sought to use charitable contributions to reduce their tax burdens.

That is how the federal government encourages charitable giving.

(Because much charity is religiously based, it could be argued that those tax deductions are unconstitutional, but that is a separate issue,)

But the “Pandora Papers” report, issued last week by the International Consortium of Investigative Journalists, revealed how world leaders, billionaires and others have stashed trillions of dollars out of the reach of governments by using shell companies and offshore accounts, which are considered legal.

One maneuver described in the report, a “dynasty trust,” can exist in perpetuity in states like South Dakota. Using these trusts, Americans can legally shield themselves from estate and other taxes — and thereby remove a major incentive for charitable giving.

When the wealth of an American individual or couple exceeds a threshold — $11.7 million or $23.4 million, respectively — each dollar value above that level, once bequeathed, is subject to a federal estate tax of up to 40% for each generation.

But a carefully crafted dynasty trust helps succeeding generations avoid those taxes. And the longer the trusts last, the longer the user can avoid taxes and the longer he or she may lack a financial incentive to donate to a charity.

Experts note some Americans are also legally able to avoid state income taxes on revenue generated by their assets by setting up trusts in states that don’t levy income taxes. One of them is South Dakota, which also doesn’t have its own estate, capital gains or inheritance tax, thereby making it an especially attractive destination to park wealth.

Of course, that is not the only way the rich avoid paying taxes. For example:

President Trump Defends Himself Against Report He Did Not Pay Taxes For 8 Years
May 8, 2019, Heard on All Things Considered
Jim Zarroli

Trump lost so much money during the decade that he was able to completely avoid paying taxes in eight of the 10 years from 1985 to 1994, but Trump noted in a tweet this morning that big losses on paper, at least, were common in real estate at the time.

He said developers got massive write-offs that allowed them to declare a loss in most cases. It was sport, he said. It’s called tax shelter.

Tomasz Piskorski, who teaches real estate at Columbia Business School, says that was pretty much true. Real estate developers had lots of legal ways to avoid paying taxes.

Think of it. You and I paid more federal taxes than did billionaire Donald Trump.

There are dozens of ways in which the rich can avoid paying taxes — ways not available to the average taxpayer.

In fact, the U.S. tax code, rather than helping to narrow the Gap, actually widens the Gap, and not just for today’s taxpayers, but for the rich taxpayer’s children and grandchildren, into perpetuity.

That is how dynasties are built, and how relative poverty is maintained.

“There’s every reason to think that the ultimate effect of this type of wealth being put into these vehicles will also be a long-term loss in revenue for charitable organizations,” said Ray Madoff, a professor at Boston College Law School who teaches philanthropy policy and taxes. 

Tax policy, after all, consistently affects charitable giving. After the tax law changes pushed through Congress by President Donald Trump in 2017, charitable donations dropped 1.3% in 2018compared with the prior year, the Treasury Department reported. 

According to a recent study by the consulting firm CCS Fundraising, 25% of donors cited the tax deduction as a motivation for their charitable giving.

A joint study from Bank of America and the Indiana University Lilly Family School of Philanthropy found that 22% of the wealthy donors surveyed would reduce their donations if tax deductions for charitable giving were eliminated.

The same study found that 51% of wealthy donors said they sometimes contribute to charity to receive a tax benefit.

In summary, the dilemma is this:

  1. Federal taxes do not provide the federal government with spending money. Being Monetarily Sovereign, it creates all its spending money, ad hoc.
  2. Federal taxes are harmful to economic growth by removing dollars from the economy.
  3. Federal taxes, as currently written, widen the Gap between the rich and the rest.
  4. But, federal taxes help the government control the economy.
  5. For example, federal taxes encourage charitable giving.

If we want our government to encourage economic growth and to narrow the Gap between the rich and the rest, while maintaining federal control over the economy, including encouraging charitable giving, what should we do?

Because The federal government has no need for tax dollars, it should begin to:

  • Eliminate taxes on what it wishes to encourage
  • Spend on what it wishes to encourage
  • Tax only what it wishes to discourage

The first taxes that should be eliminated are FICA taxes and taxes on Social Security benefits. These taxes are the most regressive and senseless taxes in America.

The fundamental purpose of government is to improve and protect the lives of the governed. That is why people create governments.

A good government would aid the poor and middle classes before retirement and encourage retirement security. The FICA tax and taxes on Social Security benefits are in direct opposition to those goals.

A good government would provide healthcare to its governed. It would spend money on comprehensive medical insurance plans. It would not require deductibles. It would pay for education, grades K-12+.

A good government would encourage charitable giving by offering income-scaled benefits to contributors as a reverse income “tax” on money contributions to legitimate charities, with low-income contributors receiving more benefits.

A good government would eliminate tax laws and loopholes that primarily benefit the rich.

Because the rich run America via bribery, we cannot obtain a “good government” until the populace understands Monetary Sovereignty.

When the people stop believing The Big Lie that federal taxes are necessary to fund federal spending, and that federal debt should be reduced, only then will the rich no longer continue to amass greater and greater power over the rest of us.

Is this really too much to hope for?

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

Intelligence from the other side

This article ran today in the far-right, on-line magazine, Breitbart:

Common Anti-Parasite Drug May Kill Coronavirus in Under 48 Hours, Say ResearchersDurvet Ivermectin Pour On Dewormer 250mL (2-(Pack))

Researchers in Australia report that Ivermectin, an FDA-approved drug commonly used to treat parasites, appears to be effective in treating the SARS-COV-2 coronavirus (COVID-19). The drug is widely available and can be “repurposed” for this application, doctors said.

The ScienceDirect journal, Antiviral Research, published an article by a group of Australian researchers from Monash University in Melbourne reporting that Ivermectin appears to be effective at inhibiting the coronavirus that causes COVID-19.

The article states:

  • Ivermectin is an inhibitor of the COVID-19 causative virus (SARS-CoV-2) in vitro.
  • A single treatment able to effect ∼5000-fold reduction in virus at 48h in cell culture.
  • Ivermectin is FDA-approved for parasitic infections, and therefore has a potential for repurposing.
  • Ivermectin is widely available, due to its inclusion on the WHO model list of essential medicines.

“We report here that Ivermectin, an FDA-approved anti-parasitic previously shown to have broad-spectrum antiviral activity in vitro, is an inhibitor of the causative virus (SARS-CoV-2),” the researchers write. “Ivermectin, therefore, warrants further investigation for possible benefits in humans.”

The leader of the research team, Dr. Kylie Wagstaff issued a statement, saying, “Ivermectin is very widely used and seen as a safe drug. We need to figure out now whether the dosage you can use it at in humans will be effective—that’s the next step,” Newsweek magazine reported. “We found that even a single dose could essentially remove all viral RNA by 48 hours and that even at 24 hours there was a really significant reduction in it.”

“Ivermectin’s status as a drug that has already been studied and approved to treat other conditions offers a decided advantage over the development of new drugs, a long process that typically involves many years of studying safety and efficacy before being able to reach human patients,” Newsweek stated.

Dr. Leon Caly, an author of the study and a senior virus identification specialist at the Victorian Infectious Diseases Reference Laboratory, added, “As the virologist who was part of the team who were first to isolate and share SARS-CoV-2 outside of China in January 2020, I am excited about the prospect of Ivermectin being used as a potential drug against COVID-19.”

The World Health Organization approved the use of Ivermectin in humans to treat onchocerciasis in 1987. “Ivermectin is safe and can be used on a wide scale. It is also a very effective treatment and has single-handedly transformed the lives of millions of people suffering from onchocerciasis,” the WHO wrote in an article on its website. The medicine is widely available.

I have no idea how valid this is — whether it is a real breakthrough or another disappointment.

So I looked to Breitbart readers’ for intelligent “guidance.” Here are samples of their comments.

One only can admire the brilliance of those supporting our President:

  1. President Trump has been very effective in getting drugs okayed to fight WUHAN flu. Let’s pray that at least one of them will prove effective against WUHAN flu. Let’s open America for business again soon.
    TRUMP 2020!
  2. There are likely many drug cocktails that can treat this virus and the Dems will make sure every single one of them is blocked. Death, mayhem and destroying the economy is their main goal. Helping the American people through a crisis NEVER crosses their minds. They would rather let people d!e than do anything to help Trump!
  3. So far, the DemocRat efforts, have only stalled solutions and that has been part of what’s frustrating ALL of them. You are correct, in regard to the TDS, and the disregard of the devastation on either people or America as result. Their warped minds: they feel it’s okay, if it stops Trump.
  4. I won’t have to worry about this drug’s effect. Our “illustrious” Governor in Michigan will threaten doctors about prescribing it, if it shows any promises of hope.
  5. Suddenly she is now begging for the hydroxychloroquine.
  6. And now we find out that the governor of Nevada who forbid the use of hydroxychloroquine is hoarding it. Despicable Democrat governors!
  7. Don’t you just know it? Whaddah bunch of 5h!t he4d5.
  8. Hoarding it for prisoners, gots to protect that Drat voter base.
  9. She’s probably trying to get in the record that she wants the anti-malaria drug. Now that she’s caused people to die by preventing doctors in her state from prescribing HydroxyChoroquine! I hope the families of people she caused to die sue her butt off!
  10. She certainly didn’t handle the crisis well, but forward thinkers like our President will do what’s best for Americans, and that brings with it hope, which is key.
  11. The British NHS have banned the use of this drug because it is not on the approved list, so people are just left to die even though the drugs that would save them are sitting on the shelf.
  12. The UK has one size fits all socialized medicine. If it’s not in the budget and you need it, or you’re deemed to be too old, TOUGH LUCK. If you are deemed eligible, you might die while waiting in long lines.
  13. Yeah!!! They’re blockeads. They can’t figure out they’re mortal like you, like me.
  14. Sovereign immunity drastically curtails any meaningful monetary judgement.
  15. Michigan motto: ‘We will crush Hope.’
  16. Dont forget Obama originally brought Michigan HOPE… the economy never recovered until Trump.
  17. He brought HOPE alright – Hell On Planet Earth.
  18. Just what we need, mentally ill leftist sociopath Nancy Pelosi as president (God forbid). She’s 3rd in line of succession as Speaker of the House.
  19. You have to wonder what drugs Nasty Nancy and Chuck you Schumer are taking to stay alive past their normal shelf lives ? And continuing to damage America with their Anti Border wall Rhetoric ! How many murders of Americans are they responsible for by Criminal Illegals freely flowing through Americas unprotected lower border ?
  20. Many people are STILL waiting for obama’s citizenship to be investigated. There now is doubt as to whether obama is a U.S. citizen at all, much less a natural born citizen.
  21. Sure he is a citizen, That is why his college records are sealed. He applied to prestigious colleges and universities as a FOREIGN student, from Indonesia, where US entrance acceptance requirements are much slacker for foreigners. How else to explain a pot smoking student with poor grades getting accepted into ivy league schools and, WHO, exactly paid for his college? He was broke. Obama was a sham through and through and the worse president America has ever had.
  22. NO ONE, not even the professors, remember Barry Soetoro aka Barack Hussein 0bama at Columbia University. At the time, there were few black students, so he would have stood out. If he applied as a foreign student, which he likely did, it means he LIED about it (student loan and college application fraud) OR he actually WAS a foreign student, and was ineligible to be president. Either way, he committed felonies. There is very strong evidence that Barry committed social security fraud by using someone else’s SS# (a story in itself), and selective service registration fraud.
  23. Still wondering where, oh where did the missing Immigration records go in Hawaii – the ONLY records missing, in the ENTIRE history of the immigration entry records – appears to be the two weeks Obozo’s Commie Mommy flew into Hawaii – Did she have a US born son with her, OR . . .
  24. Barry Soetoro aka Barack Hussein 0bama was not a natural born citizen for 2 reasons: 1) BOTH parents have to have been US citizens at the time of birth. Only his mother was, not his alleged father (although his real father may have been communist Frank Marshall Davis). 2) Barry was required to have Indonesian citizenship under Indonesian law when he attended school there at a madrassa. Another citizenship automatically negates natural born citizenship status since it creates a divided loyalty. He may automatically have given-up his US citizenship when he became an Indonesian citizen. There is no evidence that he ever was repatriated when he returned to the United States. Barry Soetoro aka Barack Hussei 0bama is a TOTAL FRAUD.

Let us remember that these are the well-informed, logical responses to an article about Ivermectin, a hoped-for treatment of COVID-19.

Lest you believe these comments are an aberration, I can assure you they are quite typical of what you will see on any right-wing web site — Breitbart, Fox News et al. The tone has been normalized by our leader’s tweets.

It is comforting to know that these are America’s voters, the people who gave us Donald J. Trump.

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. Provide a monthly economic bonus to every man, woman and child in America (similar to 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