There are crooks and then there are Crooks. Congress falls in the later category, and lest you think I am exaggerating, let’s begin with unfunded mandates. A federal unfunded mandate is a legal requirement that the states, counties or cities provide some service or product, for which the federal government provides no reimbursement.

The purpose of an unfunded mandate is to make Congress look financially prudent, while tossing the cost into the laps of the states, counties and cities. It’s a Congressional con game.

One might think if a Monetarily Sovereign government – a government with the unlimited ability to create dollars and pay any bill of any size – if that government wanted something done, it would budget for it and pay for it. Certainly, one might not expect a Monetarily Sovereign government to force monetarily non-sovereign governments, which cannot create money, to pay for federally-desired projects. But that is exactly how Congress operates.

According to The National Conference of State Legislatures:

The Unfunded Mandates Reform Act of 1995 (UMRA) was adopted in an effort “…to curb the practice of imposing unfunded Federal mandates on States and local governments.” According to the Congressional Budget Office (CBO), UMRA defines a mandate as any provision in legislation, statute, or regulation that would impose an enforceable duty on state, local, or tribal governments or the private sector, or that would reduce or eliminate the amount of funding authorized to cover the costs of existing mandates.

Since 1995, CBO has identified eleven laws that contain intergovernmental mandates which exceed the UMRA threshold ($50 million in 1996 dollars; adjusted annually for inflation, $69 million in 2009).

Intergovernmental Mandates under UMRA that Exceed the Threshold (listed by date of enactment):

*   an increase in the minimum wage (P.L. 104-188, 1996)
*   a reduction in the federal funding to administer the Food Stamps program (P.L. 105-185, 1998);
*   a provision preempting state taxes on premiums for prescription drug coverage contained in the Medicare Prescription Drug and Modernization Act of 2003 (P.L. 108-173, 2003);
*   a preemption of state authority to tax certain Internet services and transactions (P.L. 108-435, 2004);
*   a requirement that state and local governments meet certain standards for issuing vital-statistic documents (P.L. 108-458, 2004). Driver’s license requirements were repealed and replaced with the REAL ID Act (P.L. 109-13), which under UMRA is not considered a mandate that exceeds the threshold.
*   a provision that eliminates federal matching funds for administrative expenses funded by incentive payments to states as it relates to the child support enforcement program (P.L. 109-171, 2006);
*   a requirement that all government entities, including state and local governments, withhold 3 percent on certain, non-essential government payments for property or services (P.L. 109-222, 2006);
*an increase in the minimum wage (P.L. 110-28, 2007)
*a preemption of state authority to tax certain Internet services and transactions (P.L. 110-108, 2007);
*   a requirement that public transportation agencies and rail carriers implement various security measures and vulnerability assessments, and institute training programs and background checks for certain employees (P.L. 110-53, 2007);and
*   requires commuter railroads to install train control technology (P.L. 110-432, 2008).

Congress has shifted at least $131 billion in costs to states over the past five years, according to NCSL’s Mandate Monitor

Yes, that’s $131 billion in expenses that are forced on monetarily non-sovereign governments by a Monetarily Sovereign government.

But it gets worse. The federal government collects money from the residents of states, in the form of taxes, and in the case of 14 states, returns less money to those states than it collected.

State / Fed Spending Per Dollar / State Budget Shortfall
        /       of Fed Taxes             /

Florida                      $0.97            $3.6 B
Texas                        $0.94             $13.4 B
Oregon                       $0.93              $1.8 B
Michigan                     $0.92              $1.8 B
Washington                 $0.88              $2.9 B
Wisconsin                    $0.86              $1.8 B
Massachusetts              $0.82              $1.8 B
Colorado                      $0.81              $988 M
New York                      $0.79             $9 B
California                     $0.78              $25.4 B
Delaware                       $0.77              $377 M
Illinois                           $0.75             $15 B
Minnesota                      $0.72              $3.9 B
New Hampshire             $0.71                n/a
Connecticut                     $0.69            $3.7 B
Nevada                          $0.65             $1.5 B
New Jersey                    $0.61             $10.5 B

So here we have $131 billion + in unfunded mandates, plus many billions more taken from states in the form of unreturned taxes. I call it outright theft, and for no reason. The federal government doesn’t need the money; it’s Monetarily Sovereign. It creates money.

Years ago, some parents of child movie stars stole the money their children earned, rather than putting it away for the children’s futures. Laws were passed to protect the kids. The parents were simply disgraceful, but while they were crooks, at least they had a use for the money. Congress is worse. It steals the states’ money and doesn’t even have a use for it. It destroys the money it steals.

That truly is evil.

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

==========================================================================================================================================
No nation can tax itself into prosperity, nor grow without money growth. It’s been 40 years since the U.S. became Monetary Sovereign, , and neither Congress, nor the President, nor the Fed, nor the vast majority of economists and economics bloggers, nor the preponderance of the media, nor the most famous educational institutions, nor the Nobel committee, nor the International Monetary Fund have yet acquired even the slightest notion of what that means.

Remember that the next time you’re tempted to ask a dopey teenager, “What were you thinking?” He’s liable to respond, “Pretty much what your generation was thinking when it screwed up my future.”

The world is coming to an end. This time I really mean it. Trust me with your money.

Does the following article remind you of the debt hawks telling us the federal deficit and debt are “unsustainable” and a “ticking time bomb” (their favorite words)?

NEW YORK (CNNMoney) 5/19/2011

By now, you’ve probably heard of the religious group that’s predicting the end of the world starts this weekend. Harold Camping and his devoted followers claim a massive earthquake will mark the second coming of Jesus, or so-called Judgment Day on Saturday, May 21, ushering in a five month period of catastrophes before the world comes to a complete end in October.

At the center of it all, Camping’s organization, Family Radio, is perfectly happy to take your money — and in fact, received $80 million in contributions between 2005 and 2009. Camping founded Family Radio, a nonprofit Christian radio network based in Oakland, Calif. with about 65 stations across the country, in 1958.
[. . . ]
Camping first inaccurately predicted the world would end in 1994. Even so, he has gathered even more followers — some who have given up their homes, entire life savings and their jobs because they believe the world is ending.

Anyone believing preachers, whose predictions never come true, is a dupe. We laugh at such people, or pity them. We feel the same about the people who believe those the seers who tell us the federal debt is a “ticking time bomb.”

(Hello false prophets: N.Y. Times, David Ibata, James Warren, Lexinton Herald-Leader, L.A. Times, Richmond Times, Dallas Morning News, Fortune Magazine, Bloomington Pantagraph, Ross Perot, Kansas City Star, Porter Stansberry, The Bradenton Herald, Providence Journal, NewsMax, USA Today, Reason Alert and the hundreds of others who have used that term to describe the federal deficit or debt)

Our laughter and pity also go to the dupes who believe the false prophets telling them the federal debt is “unsustainable.” (Too many to mention)

The debt-hawks have been wrong every hour of every day, every month and every year for at least the 70 years I’ve documented. That’s a ton of wrong, although dupes don’t seem to notice. The next time you’re tempted to believe a debt-hawk about the federal deficit or debt, send some money to Harold Camping – or wait, better yet, send it to me. The world is coming to an end. Believe me.

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

==========================================================================================================================================
No nation can tax itself into prosperity, nor grow without money growth. It’s been 40 years since the U.S. became Monetary Sovereign, , and neither Congress, nor the President, nor the Fed, nor the vast majority of economists and economics bloggers, nor the preponderance of the media, nor the most famous educational institutions, nor the Nobel committee, nor the International Monetary Fund have yet acquired even the slightest notion of what that means.

Remember that the next time you’re tempted to ask a dopey teenager, “What were you thinking?” He’s liable to respond, “Pretty much what your generation was thinking when it screwed up my future.”

MONETARY SOVEREIGNTY

Can increased federal deficit spending actually prevent inflation?

TIME magazine recently ran an article about inflation, which supplements what I’ve written earlier about the cause of inflation (See: The Cause of Inflation)

Think Commodity Prices Are High Now? Just Wait
Posted by ZACHARY KARABELL Monday, May 16, 2011

The just-released monthly inflation report showed that prices for most goods eased a bit. The exception of course is oil, and even though oil prices globally have declined in recent weeks, most Americans are paying ever more for gasoline even as inflation overall remains statistically tame.
[. . .]
But the real issue today is that inflation is almost entirely a product of rising raw material costs and for now, these are being born not by individuals but by companies. Many economists assume that eventually, these rising input costs will be passed on to consumers in the form of higher price tags.
[…]
The emerging world is hungry for goods, for food, cars, appliances, gadgets, homes, and clothing. And governments in Sao Paulo, Beijing, and New Delhi are authorizing vast spending on modern infrastructure. China’s is well known, but Brazil and India both have significant needs that are only now beginning to be met.

I just returned from a conference with some of the world’s leading money managers, and one theme was clear: there has been massive underinvestment in the global supply chain of industrial metals and raw materials. This is less about oil and gas than about things like copper, iron ore, palladium, titanium, zinc, rhodium, and a host of other “iums” that are the essential, irreplaceable inputs for the industrial world that we all inhabit and that billions are on their way to inhabiting. Simply put there is yawning gulf between demand and supply. . .

That means we are in for a period of rising commodity inflation, including oil and of course food as more people consumer more calories and crop yields strain to increase.
[. . .]
So unless China truly implodes or Brazil stops growing, or hundreds of millions in India and Indonesia stop believing that they have a right to the same middle class lifestyle that has characterized the West for the past century, we are at the early stages of a spike in commodity prices the likes of which we have never seen. And judging from debates in Washington over how much to spend on Planned Parenthood and how much to reduce pension of state workers, we are nowhere near prepared for this world that we are entering.

Debt-hawks endlessly cite the Weimar Republic’s hyper-inflation (which occurred 90 years ago under special economic circumstances) as an example of what growing U.S. federal deficits will cause “soon,” “some day” or “inevitably.” Factually they are wrong.

Hyper-inflation has been caused by circumstances unique to each affected nation, but always involve massive printing of money in response to existing inflation, not as the cause of, inflation. Analogy: Gasoline is necessary to make a car run, but if the car bursts into flame, you don’t keep adding gasoline. Hyperinflated nations pour gasoline on an already burning car.

Mr. Karabell writes the truth. Historically, inflation has been caused by rising production costs. In the economists’ mantra, “Inflation is too much money chasing too few goods.” The debt hawks focus on the “too much money” side, while the real cause has been too few (or really, too expensive) basic goods. Oil, whose price is manipulated, has been the main culprit, (See: INFLATION) and as a result of insufficient spending on basics, many other commodities are about to have increased involvement.

So yes, there will be inflation, “soon,” “some day” or “inevitably,” just as the debt-hawks predict, but the cause will not be federal deficit spending, as they surely will claim, but rather, oil prices and shortages of other basics.

In fact, inflation could be prevented were the U.S. to pump more money into oil exploration, other energy development, mining, plant and equipment development, R&D of all types, farming, wood and other basics. Pumping more money would include tax breaks as well as deficit spending.

To build our economy efficiently, we need increased investment in its foundations.

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

==========================================================================================================================================
No nation can tax itself into prosperity, nor grow without money growth. It’s been 40 years since the U.S. became Monetary Sovereign, , and neither Congress, nor the President, nor the Fed, nor the vast majority of economists and economics bloggers, nor the preponderance of the media, nor the most famous educational institutions, nor the Nobel committee, nor the International Monetary Fund have yet acquired even the slightest notion of what that means.

Remember that the next time you’re tempted to ask a dopey teenager, “What were you thinking?” He’s liable to respond, “Pretty much what your generation was thinking when it screwed up my future.”