Tag: federal debt

–I have been erased!

The debt hawks are to economics as the creationists are to biology. Those, who do not understand Monetary Sovereignty, do not understand economics. If you understand the following, simple statement, you are ahead of most economists, politicians and media writers in America: Our government, being Monetarily Sovereign, has the unlimited ability to create the dollars to pay its bills.
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I have been erased! Not just banned, but erased! Yes, it’s true. I have been erased by Barry Ritholtz. Here is the Email I just received from him:


Buh Bye

From: The Big Picture thebigpicture@optionline.net
To: rmmadvertising@yahoo.com
Date: May 15, 2011

WE ARE OFFICIALLY DONE

YOU ARE ERASED

My erasure apparently came as a result of an article Barry wrote titled, “When should you fire your fund manager?” My response was, “When he repeatedly demonstrates he doesn’t understand the difference between Monetary Sovereignty and monetary non-sovereignty.”

Think of it. Here is a man who has promoted himself into world fame, but if my “erasure” means what I assume it does, he seemingly cannot tolerate differences from his opinions. On many occasions I have challenged him to debate his philosophy (whatever that may be) vs Monetary Sovereignty, and he never has taken me up on it. And now, he has, in effect, done the childish act of clamping his hands over his his ears, stamping his feet and screaming “I can’t hear you. I can’t hear you.”

To give you an idea of Barry’s thinking, this is the paragraph he puts at the top of every article in his blog:

”Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.”

Hmmm. Detect any irony, there? Anyway, by contrast, one always can come to my blog, and feel free to disagree with me. We’ll have a nice discussion, and perhaps we each will learn something. I have learned a great deal from my blog readers. Could it be that Barry is not interested in that kind of learning?

Hey Barry, you always can come to my blog and tell me I’m wrong and why. Perhaps we’ll have that nice debate you’ve managed to miss. And by the way, Barry, you aren’t the first to ban (or as you say, “erase”) me. Years ago, I was banned by the Concord Coalition, that notorious debt-hawk group. So you’re in good company.

As for my “erasure,” I feel honored.

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


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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

–Does this report from the Committee for a Responsible Federal Budget make you angry? Does it make you afraid? It should.

The debt hawks are to economics as the creationists are to biology. Those, who do not understand Monetary Sovereignty, do not understand economics. If you understand the following, simple statement, you are ahead of most economists, politicians and media writers in America: Our government, being Monetarily Sovereign, has the unlimited ability to create the dollars to pay its bills.

Does this report from the Committee for a Responsible Federal Budget make you angry? Does it make you afraid? It should.

Analysis of the 2011 Social Security Trustees Report, May 13, 2011

Today, the Social Security Trustees released their 2011 report on the financial status of both Social Security and Medicare. The reports make clear that both programs are on unsustainable paths, and reforms will be necessary to make them solvent. This analysis focuses on the financial status of Social Security.

The latest Trustees report shows Social Security’s position has deteriorated since last year. The Trustees estimate that the 75-year actuarial imbalance has now increased to 0.8 percent of GDP (2.22 percent of taxable payroll) compared to 0.7 percent of GDP (1.92 percent of taxable payroll) in last year’s report. Over the coming decade, the Trustees project cash-flow deficits of about $490 billion (including $131 billion in 2021 alone), compared to about $380 billion in last year’s report.

The Trustees now estimate that the program will exhaust its dedicated trust funds (one for old-age and the other for disability) in 2036, a year earlier than the 2037 date projected in last year’s report. At that time, absent changes in law, all current and future beneficiaries would experience an immediate 23 percent cut in benefits.

Even more pressing is the state of the Disability Insurance trust fund, which (if not allowed to borrow from the rest of Social Security) will run out of money by 2018, only seven years from now.

According to the Trustees, making Social Security sustainably solvent would take savings equal to 0.8 percent of GDP (2.22 percent of payroll) over 75 years and 1.5 percent (4.24 percent of payroll) in the 75th year.

Well, did that make you angry or afraid? It should have, because it is based on a lie – a government lie – and having the federal government lie makes all of us especially angry and afraid.

The lie, very simply is the implication federal spending relies on federal taxes. Social Security and Medicare are federal programs. FICA taxes paid to the government are less than benefits paid. Based on this, the Trustees say these federal programs will “run out of money.” A lie.

Were it true, the entire federal government already has “run out of money,” because federal taxes, with very few exceptions, have been less than federal spending, every year in our nation’s history. So beginning in 1776, America has been on what the Committee for a Responsible Federal Budget would call an “unsustainable” path and insolvent. Yet here we are, 235 years later, still “unsustainable,” still “insolvent” and still the most powerful nation on earth. Amazing, isn’t it?

Well, it would be amazing if you didn’t understand the federal government creates the dollars you use. It would be amazing if you believed federal taxes pay for federal spending and FICA pays for Social Security and Medicare. They don’t.

The U.S. is Monetarily Sovereign. If all federal taxes, including FICA, were reduced to $0 or increased to $100 trillion, neither event would affect by even one dollar, the solvency of any federal agency, including Social Security and Medicare. There is no functional relationship between federal taxes and federal spending. The federal government always pays its bills, regardless of taxes collected.

(The situation is different for states, counties and cities, which are not Monetarily Sovereignty, , so they do use tax money to pay their bills. The situation also is different for Greece, Ireland et al, which also are not Monetarily Sovereign. And the situation is different for you and me. We too, are not Monetarily Sovereign. For reasons I cannot explain, the federal government, the media, and even most economists, do not know the difference between Monetarily Sovereign and monetarily non-sovereign, and therein lies the problem.)

So yes, be afraid. Be very, very afraid, especially with both the Democrats and the Tea (formerly Republican) Parties believing our federal social programs must be cut. Your future and the futures of your children and grandchildren are in the hands of people who do not know what they are doing.

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


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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

–Psychologist wanted.

The debt hawks are to economics as the creationists are to biology. Those, who do not understand Monetary Sovereignty, do not understand economics. If you understand the following, simple statement, you are ahead of most economists, politicians and media writers in America: Our government, being Monetarily Sovereign, has the unlimited ability to create the dollars to pay its bills.
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Although economics can be mind-spinningly complex, the essence of economics is rather simple, in that it boils down to a few facts, about which there can be no argument:

Fact 1. The U.S. federal government is different from you and me. It alone has the unlimited ability to create (“print”) dollars. If it wished to do so, the government could create a billion trillion dollars tomorrow, merely by pressing a computer key. It has had that power since 1971, the end of the gold standard, and that power is called Monetary Sovereignty.

Fact 2. Given such power, the federal government has the unlimited ability to spend dollars, and does not need to tax or borrow in order to spend. Were taxes and borrowing to fall to $0 or rise to $100 trillion, neither would affect by even one penny, the federal government’s ability to create and spend dollars and to “sustain” any size debt. In federal terms, taxes and borrowing do not fund spending.

Fact 3. Therefore, the only limitation on federal spending is not taxes or borrowing, but uncontrollable inflation.

I know of no economist, no columnist, no politician who disagrees with the above. Yet virtually all of them seem to agree that the federal debt and deficits are “unsustainable,” and should be reduced, despite the fact our massive deficits have brought us nowhere near uncontrollable inflation. (Only recently, we were worried about deflation.)

Logically, that makes no sense. How can a debt or deficit be a problem, if the government can create unlimited money and inflation is not a threat? It’s as though one part of the brain was not communicating with the other part. The psychologists call it “cognitive dissonance,” and since they have a name for it, perhaps they have an explanation, too.

So if you are a psychologist, and/or understand cognitive dissonance, I ask you; Why do otherwise intelligent people hold two, mutually exclusive ideas about our economy?

Some have speculated it’s merely the confusion between personal finances (which are not Monetarily Sovereign) and federal finances. But economists should not be confused about so simple a concept. Even the dullest economist should understand the difference between a personal bank account and the federal government’s money creation. There must be something more than mere confusion.

Perhaps, we hard-wired to believe the “no-free-lunch” idea that you can’t get something for noting. But can it really be so difficult to see that the federal government can “print” dollars?

I just don’t understand it. No one debates the underlying facts, which seem obvious and straightforward. The federal government can create infinite dollars, limited only by inflation, which we are nowhere near. Everyone agrees. Yet, after that there is a huge disconnect, leading to notions about needing tax increases and debt ceilings and the deficit being unsustainable. It’s beyond logic.

So because it is beyond logic, I am asking for assistance from psychologists to explain why the logical and obvious are invisible to people, who acknowledge the facts while simultaneously being blind to them.

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

–Who are these people who continually have been wrong, and never right, for 70+ years? Do you believe them now?

The debt hawks are to economics as the creationists are to biology. Those, who do not understand Monetary Sovereignty, do not understand economics. If you understand the following, simple statement, you are ahead of most economists, politicians and media writers in America: Our government, being Monetarily Sovereign, has the unlimited ability to create the dollars to pay its bills.
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Sorry to send you back to something I wrote 13 months ago: UNSUSTAINABLE DEBT. But with the debt ceiling vote upon us, that post is just so darn timely and appropriate, I couldn’t resist. Anyway, I’ve added to it, since I first wrote it, so some is new.

Be sure also to check out the links regarding “ticking time bomb.” They are good for a laugh.

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