Wanted: A leader.

Recently, I’ve been watching the television documentary, “The Last Dance.” It is the story of the Chicago Bulls basketball team during two three-year periods in which they were a great team — perhaps the greatest ever — with the great leadership of Michael Jordan and Phil Jackson.Bulls Jordan 1984

When these two men were forced out by a greedy, and jealous management, the team which they had rescued from mediocrity, returned to mediocrity, from which it still has not escaped and perhaps never will.

We, in the Chicago area, felt great, chest-puffing pride in having that team as part of us, though we ourselves had accomplished nothing. We were just floating in the current of greatness created by Jordan and Jackson.

Similarly, all mighty nations are composed of weak, or at best, ordinary followers of a mighty leader.

Great leaders lead a nation to greatness. Courageous leaders give us courage. Moral leaders give us morals.

George Washington led us to freedom from Great Britain. James Madison and Alexander Hamilton were among those who gave us the Constitution.

Abraham Lincoln led us to end the moral blight of slavery. Franklin Roosevelt led us to WWII victory, and gave us Social Security. Lyndon Johnson gave us Medicare and Medicaid.

Though leaders all have human foibles, their leadership directs us to be what we are: Wood chips floating with the current.

A few of America’s leaders have been great. Most mediocre. Some terrible.

When America is admired, it is only because we have had enough great leaders to direct the current admirably, not because we, as people, were born admirable.

As humans, we all are born equal, every city, every nation. 

Today, we lack great or even mediocre leadership. The “accomplishments,” (if one can call them that) of our current leadership are to build a useless barrier between the U.S. and Mexico, to foment hatred of minorities, foreigners, and non-Christians, to normalize the illegal, the immoral, and the mean-spirited, and to widen the income-wealth-power Gap between the rich and the rest.

At times in our past, we have been admired — now we may be feared perhaps, but we no longer are admired. Our leadership combines all the worst characteristics of humanity, and so, that is who we are: A psychopathically weak nation.

Yes, we have many rich people and a powerful military, but history will not remember this generation or this decade as great.

Millions of us are poorly educated. Millions have poor healthcare. Millions live in poverty, hunger, and misery. Millions are treated poorly by our laws.

We have the power to overcome those outrages, but we have chosen not to lift even a finger in support.

We were great in WWII when we defeated the fascists and rescued the East from a marauding Japan. It cost us many lives and much money. But we were great.

We were great after WWII when we helped to reconstruct our allies and our enemies (What nation ever does that?)

And now, when misery and poverty and bigotry and sickness agonize so many Americans, our leaders tell us to turn away. They tell us to blame the victims. They divide us into “me” (not even “we”) and “them.”

So we do not provide health care for all, though we easily could.

And we do not provide education for all, though we easily could.

And we do not provide good housing for all, though we easily could.

And we do not provide financial support for all, though we easily could.

As a Monetarily Sovereign nation, we could do all these things without taking a single tax penny from any American. Instead, out of ignorance and meanness, we levy regressive taxes we neither need nor use — taxes that punish the poor and reward the rich.

And no great leader, recently has emerged, to speak and act against these travesties.

As just one, microscopic example in a sea of examples, I give you this Email recently received:

News from Senator Bernie Sanders
Student Debt Relief During COVID-19
Millions of Americans’ economic security is being threatened due to this crisis.

During this difficult time no one should have to worry about going into default or making additional sacrifices to make their student loan payments.

The federal emergency relief bill (the CARES Act) suspends payments and interest accrual for federal student loans through September 30th.

I’ve called on the Department of Education to cancel monthly student loan payments for the duration of the national emergency, and to cancel $10,000 in student loan debt for all federal student loan borrowers.

While I’m proud the CARES Act provides much needed relief for federal student loan borrowers, we must do more for the millions of Americans with private student loan payments.

We must cancel all student loan payments and halt interest accrual for the duration of this crisis.

As we work to address the debt crisis and immediate needs of American families during this pandemic, I will also continue to fight to make college accessible and affordable, and to cancel all student loan debt in the United States.

Cancel student loan debt “for the duration“? Cancel just $10,000 permanently? Apparently, Senator Sanders timidly subscribes to the realpolitik notion that “Congress would never” do what is right, so he asks for something meager: “For the duration.”

But in doing so, he actually helps perpetuate the notion that the federal government “can’t afford” such “giveaways.”

If he were a great leader, he would propose a law that reads something like this:

Whereas the United States government is Monetarily Sovereign and so cannot run short of its own sovereign currency, the U.S. dollar, and

Whereas, the United States benefits from an educated populace, and

Whereas, there are millions of intelligent people, who otherwise would contribute to America’s greatness, but are unable to afford the education that would make this possible,

Therefore, be it enacted by the Senate and House of Representatives of the United States of America that every American student of every college or university in the world, shall receive from the federal government a tax-free stipend to equal the tuition, supplies, room, and board paid by that student, and additionally a tax-free stipend as salary for being a student.

In short, it would formalize Steps #4 and #5 of the Ten Steps to Prosperity (below)

It’s not difficult. It’s quite straightforward. It requires money, of which the federal government has infinite.

And all it requires is a leader who is not afraid to tell the truth.

Rodger Malcolm Mitchell
Monetary Sovereignty
Twitter: @rodgermitchell
Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell



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.


Libertarians attack Warren, so she must be good.

Background: The Cato Institute is an American libertarian think tank, founded as the Charles Koch Foundation.

It supports lowering or abolishing most taxes, opposition to the Federal Reserve system, the privatization of numerous government agencies and programs including Social Security, the Affordable Care Act, and the United States Postal Service, along with adhering to a non-interventionist foreign policy.

Reason is an American libertarian monthly magazine published by the Reason Foundation. Peter Suderman works for Reason.


Libertarianism tends toward anarchy; seemingly any level of government ownership or control, no matter how small, is considered too large by libertarians.

The following article perfectly illustrates the libertarian worldview:

Elizabeth Warren’s Plans Don’t Add Up

The Warren worldview of ill-founded economic pessimism is both bloodless and moralizing.


At the heart of Elizabeth Warren’s campaign for president—and of her entire career as a politician and public intellectual, are two simple ideas.

The first is that the economy is fundamentally broken. She declared that “millions and millions of American families are also struggling to survive in a system that has been rigged by the wealthy and the well-connected” and in which she insisted that the only response was to fight for “big structural change.”

She inveighed against corporate profits and monopolistic businesses and corrupt lawmakers who have “made this country work much better for those who can make giant contributions, made it work better for those who hire armies of lobbyists and lawyers, and not made it work for the people.

It was present in the 2007 essay that imagined what would eventually become the Consumer Financial Protection Bureau, a federal agency premised on the notion that American families were being “steered into overpriced credit products, risky subprime mortgages, and misleading insurance plans'”

She proposed an array of economic policies, from a $15 minimum wage to enforcing restrictions on certain bank loans, that she argued could stave off the crisis.

(She issued a) slew of white papers and policy proposals that have poured forth from Warren’s campaign as if she were running a think tank rather than a presidential bid.

Image result for poverty in america
It’s her own fault. Don’t ask for government help.

Apparently, libertarian Suderman doesn’t believe that “millions of American families are also struggling to survive in a system that has been rigged by the wealthy and the well-connected” and “this country works much better for those who can make giant contributions, and for those who hire armies of lobbyists and lawyers.”

He is living in a libertarian dream world.

He doesn’t like that Warren has proposed a $15 minimum wage, up from the current federal minimum of $7.25 hour — barely survivable for a single person, and poverty-level for supporting a family.

Libertarian Suderman doesn’t like that Warren wants to restrict the terrible bank loans that contributed to the “Great Recession of 2008.”

Suderman doesn’t like that Warren has issued “white papers and policy proposals,” rather than merely promising generalities and American greatness.

In the space of just a few months this year, Warren released plans for everything from ending drilling on public lands to breaking up Facebook and Amazon.

She wants to spend $500 billion on affordable housing and trillions more to cancel most student debt, make public college tuition free, and offer subsidies for childcare.

And she has proposed paying for these costly programs with wealth taxes designed not only to offset the price tag of new government spending but to help reduce economic inequality by shrinking large stores of wealth.

To Suderman, ending drilling on public lands, providing affordable housing, canceling student debt, and offering free college tuitions — i.e. ideas to narrow the Gap between the rich and the rest — are terrible.

He is right about one thing: “Paying for” her ideas with a wealth tax is unnecessary and unworkable. It is unnecessary because the federal government, being uniquely Monetarily Sovereign, it creates dollars at will. So, your federal taxes do not fund federal spending. 

Unworkable, because “wealth” is far too easy for the truly wealthy to hide.

Warren’s penchant for wonky policy detail has defined her candidacy: “Elizabeth Warren has a plan for that” has become a rallying cry and a slogan, one her fans have plastered across an array of T-shirts and campaign signs.

Warren has happily embraced this persona, joking with crowds that her focus on the details of federal agencies would turn them all into nerds.

Heaven forbid that a candidate supplies plans and details. To Suderman, it would be far better to offer bland Trump-like generalities, like “Repeal and replace ACA”” and “Build the wall” than to provide specific, people-friendly details.

Warren wants the federal government to be the American economy’s hall monitor, telling individuals and companies what they can and can’t sell or buy and making some of the nation’s most successful businesses answer to her demands.

Being the economy’s “hall monitor,” i.e. preventing miscreants from stealing, is exactly what the federal government should do.

And oh, horrors, telling the nation’s most successful businesses what dishonesty not to commit, is unthinkable to Suderman, who seems to believe that “liberty” means allowing big business to do whatever it pleases.

It seems to be working. During the first six months of 2019, this strategy vaulted Warren into the top tier of Democratic primary contenders, helping her raise more than $19 million during the year’s second quarter and placing her among the top three or four candidates in the party’s crowded field.

Focus groups and political reporting have consistently found that Democratic voters are warming not only to the substance of Warren’s ideas but to the very fact that she has them.

Well yes. Having ideas and detailing them, not only is good politics, but it is good governance. Would that more politicians did it.

Although she has received kudos for the volume and specificity of her plans, Warren has a history of pushing misleading research and cherry-picked data designed to support politicized conclusions.

Warren first rose to prominence as the co-author of a pioneering study of consumer bankruptcy, which was published in book form in 1989 under the title As We Forgive Our Debtors: Bankruptcy and Consumer Credit in America.

Warren and her co-authors based the book on a trove of court data from about 1,500 bankruptcy cases in Pennsylvania, Illinois, and Texas during 1981.

The book relied on real-world case studies. Warren statistically analyzed a trove of unique data. She was telling a story to make an argument about politics and policy.

The story was that rapacious credit card companies, rather than consumer overspending, were primarily responsible for a run-up in consumer debt and the resulting sense that household budgets had grown more precarious.

The book’s authors saw bankruptcy in broadly sympathetic terms, as a financial safety net for struggling families. In the years that followed, Warren would go on to become one of the nation’s most prominent advocates of making bankruptcy easier, more lenient, and more accessible.

But that story had some notable problems. Among others, it was based on cases from 1981, a recession year when consumers would have looked worse off than usual. It was released years later, after a significant reform to the bankruptcy code in 1984 rendered its picture of American bankruptcy somewhat out of date.

Here, Suderman criticizes the currency of Warren’s bankruptcy research, none of which has anything to do with the currency of her above-mentioned economic recommendations.

It’s as though Suderman would hate her ideas for child-rearing because her book on auto repair is out of date. In short, Suderman’s criticism is inane and utter nonsense.

And note the words, “rather than consumer overspending.” They illustrate the libertarian belief that poor people are responsible for their own misfortune.

Warren drew on her bankruptcy research to argue that the middle class had been given a raw deal.

The number of households filing for bankruptcy had shot up dramatically, she said, and it wasn’t because they were spending too much.

Instead, the increasingly high cost of housing, driven heavily by competition for access to good schools, and the pile-up of medical debt were driving families into dire straits.

It is the high cost of living, not just housing, has driven families into dire straights.

Again, Suderman wants to “prove” Warren is completely wrong, by trying to nit-pick a point of data, when her overall conclusion (that the Gap between rich and poor has widened, and many families are in financial trouble and need protection) is correct.

These effects were compounded by the movement of women into the workforce.

Where stay-at-home wives had once served as a safety net—the earners of last resort should a breadwinner husband lose his job—the rise of the working mother had increased financial risk for two-earner families.

The book’s findings were marked by controversy and unanswered questions about the soundness of her methodology. In particular, Warren’s notion that housing prices have been pushed upward by school competition doesn’t fully stand up to scrutiny.

Although research has found that school quality does impact housing prices, the effect is fairly modest. A 2006 study in the Quarterly Journal of Economics found a 2.5 percent increase in home prices for every 5 percent increase in test scores.

And in what way does the so-called “fairly modest” difference in home prices negate Warren’s position on student debt, mortgage supervision, family bankruptcy, the minimum wage, and the prevention of financial cheating by large companies?

It doesn’t, but Suderman tries to make his point by fixating on minutia to distract you from the main point, that middle-class families are struggling, and the very purpose of government is to improve the lives of its citizens.

And then there’s the role of taxes. In the book’s hypothetical comparison budgets, Warren presents taxes as a percentage of household income—24 percent in the 1970s, 33 percent in the 2000s—which the book describes as a 35 percent change.

Yet as George Mason University law professor and consumer finance scholar Todd Zywicki has noted, the choice to render taxes only as a percentage of income has the effect of masking the total dollar value.

Using Warren’s own figures, Zywicki calculated that the tax increase—owing partly to the hypothetical family hitting a new tax bracket and partly to the imposition of additional state, local, and property taxes over time—was by far the largest factor affecting the modern family’s budget.

Warren’s numbers, in other words, showed that families had been strapped not by increased spending on homes or health insurance but by a bigger tax bill.

Yes, taxes on the middle classes are too high. So, how does that eliminate the need to follow Warren’s proposals? Again, it doesn’t. It’s just another Suderman diversion.

Zywicki is among Warren’s most outspoken critics, and he has made this case—that Warren’s data do not show what she claims they do about the plight of the middle class—on multiple occasions over the span of more than a decade.

What Suderman fails to mention is that Zywicki is a senior fellow, paid by the Cato Institute, that aforementioned libertarian think tank, which spends its time and money trying to prove that government not only is unnecessary but a hindrance to America.

Zywick is not exactly an impartial commenter.

Warren co-authored a Health Affairs study purporting to show that at least 46 percent of the nation’s bankruptcies were a result of medical bills, a figure she subsequently updated to 62 percent.

Her research claimed that medically induced bankruptcies had increased a shocking 23-fold since 1981.

President Barack Obama warned that sky-high medical costs had forced many Americans to “live every day just one accident or illness away from bankruptcy.”

One wonders, what is the fundamental point Suderman is trying to demonstrate? That sky-high medical costs are not a serious financial problem for millions of Americans?

The response by Warren and her co-authors was revealing. In one sense, they were engaged in a conventional academic dispute about interpreting bankruptcy data. But what they were really fighting about—what was really at stake—was public policy.

Warren clearly believed that the value of her research was in the story it told and the way that story informed and influenced the real world of politics and public affairs.

Yes, that exactly is the point. What does it matter whether housing prices, or school costs, or medical costs are most responsible for bankruptcies or other forms of financial distress?

The point that Suderman doesn’t want you to understand is that these are problems the federal government can and should address. It has the means, if only it had the will.

Sadly, the Sudermans of the world would rather quibble about differences in data than to solve the clear and obvious problems that plague us.

Yes, some things are more troublesome than others, but that does not mean we should stall. while people suffer, debating how much more troublesome school costs are than medical costs.

But perhaps, stalling is what Suderman wants.

In the aftermath of the 2007–08 financial crisis, Congress, then controlled by Democrats, passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, which was billed as a direct response to the economic meltdown and an attempt to make sure it never happened again.

A centerpiece of the bill was the creation of a new federal agency, the Consumer Financial Protection Bureau (CFPB), which was modeled on Warren’s original proposal.

The bureau, as imagined by Warren, was premised on the notion that consumers did not and in some cases could not understand the financial services they relied on, and that only an army of unusually powerful government bureaucrats could save them from blundering into the tricks and traps set by lenders.

And that is absolutely correct. Left to their own designs, the banks created the most convoluted, complex financial products, that no one, not even Suderman, could understand, then sold them to the public, with disastrous results.

The CFPB’s mission, meanwhile, was far more expansive than its origin story might imply. From payday lenders to cash advance services, many of the financial products it was given the power to regulate had little or nothing to do with the financial crisis.

Suderman’s senseless point seems to be that if a financial scam had nothing to do with the Great Recession, it should be ignored.

The CFPB was the culmination of decades of research and advocacy on Warren’s part. She had imagined it, fought for its creation, and then, from her perch in the administration, ushered it into being.

And yet there was a kind of victory as well, in the simple fact of the CFPB’s creation. Warren would not be its leader—that role would eventually go to former Ohio Attorney General Richard Cordroy, who was given a recess appointment that caused its own controversy—but she had willed it into being and would continue to provide spiritual guidance.

She did not achieve her political ambitions, but on the policy question, she had triumphed.

In the years that followed, something strange happened: Warren, the icon of progressivism whose political brand had proven too toxic to move through the CFPB nomination process, became the object of a strange new respect from the right.

Apparently, being respected by some right-wingers is a curse for Suderman.

Under President Donald Trump, in July, The American Conservative, long a bastion of immigration-skeptical conservative nationalism, ran an essay extolling Warren’s economics, particularly her plans for a new bureaucracy dedicated to “defending good-paying American jobs,” and saying that in some respects, “Warren may be a bigger economic nationalist than even Trump himself.”

A paragraph of utter nonsense, but what else can one expect in political discourse?

Nor is Warren’s popularity limited to small opinion journals.

In June, Fox News’ Tucker Carlson, among the most-watched hosts on cable news and an influence on the Trump administration, opened his show with an extended monologue praising Warren’s domestic jobs plan and its elevation of “economic patriotism,” which calls for, in the senator’s words, “aggressive new government policies to support American workers.”

“Many of Warren’s policy prescriptions make obvious sense,” Carlson said. “She sounds like Donald Trump at his best.” Later, at a conference in July, he praised The Two-Income Trap as “one of the best books I’ve ever read on economics.”

Suderman’s position is if a right-winger likes any of her recommendations that is prima facie evidence she is not a progressive. It’s wrong and a bit goofy, but it’s Suderman.

But then, the quick reversal:

It is hard to imagine the Republican Party ever embracing Elizabeth Warren. Trump frequently mocks her claims of Native American heritage, and the congressional GOP continues to view her with deep hostility. She’ll never be an ally to the party.

But in some increasingly influential corners of the right, her ideas and her outlook are winning.

The rest of Suderman’s long article is a rehash of his “unaffordability” claim about her proposals, and his dislike of the detail with which she presents them.

But “unaffordability” is a false claim concerning federal spending, and quibbling about the details rather than solving the big-picture problems solves nothing.

Government is created by the governed to improve their lives. That is the purpose of government.

Peter Suderman is a classic libertarian, a hater of government. As a libertarian, he wastes more than 6,000 words denying the obvious — that for many people, good schooling, good housing, good food, and good medical care are unaffordable and that the banking industry has cheated millions of innocent people.

Suderman denies that many families are driven into bankruptcy by trying to pay for the abovementioned schooling, housing, food, and medical care, or eschewing bankruptcy, they must forego these life necessities.

Suderman also hints at the libertarian’s “bootstraps” theory, in which the victim is blamed for not earning enough, or being frugal enough, or smart enough to pay for their own needs.

To libertarians, “liberty” means freedom from government help. People should pull themselves up by their bootstraps, rather than depending on the government.

Then he applies the libertarian, “Catch 22” objection to deny people those bootstraps by implying that the $15 minimum wage is a bad idea. “Gotcha!”

In the real world, our “bootstraps” consist of things like a good education, good health, good housing, and money — all of which the federal government can and should provide — and all of which libertarian Suderman would not provide.

Why does libertarian Suderman deny the obvious?

Because to admit it would require him to offer solutions, and those solutions inevitably require federal spending — an anathema to libertarians.

Warren’s proposals are fact-driven and logical, which Suderman dismisses as “bloodless.” Her proposals also benefit the poor and middle classes, which Suderman dismisses as “moralizing.”

Suderman and the libertarians live in a harsh mythical world, where there is no allowance for poverty, people are expected to be born with all they need to succeed, and it only is laziness that prevents them from realizing their dreams.

Asking for help from the government supposedly is a moral and financial imposition on the rest of us who, of course, are self-sufficient.

It is the ultimate expression of Gap Psychology, in which people wish to widen the income/wealth/power Gap below them.

Ten Steps to Prosperity: Step 4: Free education for everyone

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


It takes only two things to keep people in chains: The ignorance of the oppressed and the treachery of their leaders.


Let’s begin with several facts:

  1. Educating our young people is important to the future of America.
  2. For that reason, free elementary education has been provided by every state and every town in America.
  3. Since WWII, America’s  need for college-educated young people has grown, in a more sophisticated, more competitive world. College educated students no longer are a luxury for America; they are a necessity.
  4. Many of America’s bright students are unable to afford a college education, especially not in better colleges.
  5. The U.S. federal government is Monetarily Sovereign, meaning it creates dollars at will. It never can run short of dollars. The federal government has the unlimited ability to pay for anything.
  6. The federal government’s responsibility is to advance the interests of the United States.
  7. Putting America’s young people into debt, a debt so suffocating it cannot even be discharged in bankruptcy, does not advance the interests of the United States.

An article titled, “The Fed’s Financial Accounts: What Is Uncle Sam’s Largest Asset?” by Doug Short, 12/9/16, includes the following graph.

The single largest asset on the Federal government’s balance sheet is Student Loans — the amount students owe to the federal government.

And the following graph — Federal government; consumer credit, student loans; asset, Level — came from the St. Louis Fed:


Here we see the massive increase in student indebtedness to the federal government, especially in just the past six years.

Quoting from the 2013 post titled, “Five reasons why we should eliminate school loans”:

Senator Elizabeth Warren and the New York Times have talked about student loans. The Times said:

Student Debt Slows Growth as Young Spend Less
By ANNIE LOWREY, Published: May 10, 2013

The anemic economy has left millions of younger working Americans struggling to get ahead. The added millstone of student loan debt, which recently exceeded $1 trillion in total, is making it even harder for many of them, delaying purchases of things like homes, cars and other big-ticket items and acting as a drag on growth, economists said.

Rather than stimulating America’s economic growth, college educations funded by loans actually “act as a drag on growth.”

Senator Warren said:

“Right now, a big bank can get a loan through the Federal Reserve discount window at a rate of about 0.75%,”

“But this summer, a student who is trying to get a loan to go to college will pay almost 7%. In other words, the federal government is going to charge students interest rates that are nine times higher than the rates for the biggest banks — the same banks that destroyed millions of jobs and nearly broke this economy.”

The federal government not only lends money to students — money it should give without asking for its return — but it charges students interest. And these are not low rates.

See the site: “Student Loan Hero”:

This image has an empty alt attribute; its file name is average-student-loan-rates.png

Impoverishing loans must be paid back with high interest rates.

If you wanted a plan to discourage college while also discouraging economic growth, this is it.

“Some may say that we can’t afford this proposal. I would remind them that the federal government currently makes 36 cents in profit on every dollar it lends to students. Add up all of those profits and you’ll find that student loans will bring in $34 billion next year.”

She’s beating the drum, but with the wrong stick.

The federal government making a profit on students is ridiculous.

Being Monetarily Sovereign, the government neither needs nor uses profits. All dollars sent to the federal government disappear from the money supply. In other words, they are destroyed upon receipt. Federal profits are a net loss to the economy.

Senator Warren complains about interest rates when she should complain about the loans themselves.

The big debate in Congress is how much interest to charge students. And there are several complex, convoluted plans afoot. But, the federal government never can run short of dollars. It never needs to ask anyone for dollars — not you, not me, not China, not our students.

It is the U.S. states that are monetarily non-sovereign, so can and do run short of dollars. Nevertheless, they spend billions to support schools, grades K through 12.

So college attendance — which benefits all of America — has become a widespread hardship.

If the monetarily non-sovereign states can support grades K-12, surely our Monetarily Sovereign government can and should support grades 13+.

We already have a model plan.  It’s called “Medicare.” Although there are differences between healthcare and education, we can learn from the parallels.

There are more than five thousand public and private hospitals in the United States. Each is unique in terms of geography, reputation, specialties, size, tuition, staff, etc.

Coincidentally, there are almost five thousand public and private colleges in the United states. Each is unique in terms of geography, reputation, specialties, size, costs, staff, etc.

Medicare has determined procedures for compensating the great variety of hospitals and healthcare personnel. Similar procedures could be used for compensating the great variety of colleges and educational personnel.

We could call the program “College-aid” or something similar.

Tuition, books & materials, tutoring, housing, and a meal stipend all would be covered according to limits set by “College-aid” — similar to the way Medicare pays.

Regarding college:

  1. College education helps America to be economically competitive.
  2. Federal deficit spending costs taxpayers nothing, and grows the economy.
  3. College loans discourage college attendance and damage the ability of college students to create new businesses.
  4. The federal government should institute a “College-aid” program, similar in methods to the Medicare program.


The above focuses on college financing. K-12 financing has its own difficulties. Like college, which largely is financed by monetarily non-sovereign students and parents, K-12 is largely financed by monetarily non-sovereign state and local communities.

As with college education, and healthcare, the richer receive the best and the poorer receive the worst. But the biggest difference, regarding K-12, is not just the money spent on schools, but also the school and family environments.

Consider two high schools in Illinois, New Trier Township High School, and Dunbar High School, Chicago.

New Trier High School  straddles two upscale suburbs of Chicago. The following is from their website:

“New Trier offers a rigorous college preparatory curriculum and routinely ranks among Illinois’ very top schools for academic achievement.

“For the Class of 2014, New Trier’s mean composite score on the ACT was 27.4, the highest in Illinois for an open enrollment public school. Approximately 98 percent of the Class of 2014 enrolled in college.

“New Trier offers numerous opportunities for learning and involvement outside of the classroom in activities, athletics, fine/performing arts, and social service.

“Its 35 interscholastic athletic teams have won more athletic state championships than any high school in Illinois interscholastic history.

“New Trier also offers more than 150 student clubs, many with a service component. A comprehensive Student Services program serves students’ social and emotional growth in a variety of ways, from social work and special education services to student support groups and tutoring.

“Service Learning is also an important part of the New Trier experience, and students are asked to participate in service projects throughout their four years at the school.

Dumbar High School is located in Chicago. Its student population is 99% “low income.” It has a very modest website, but from what we can glean on the Internet, Dunbar’s mean composite score on the ACT was 14.4

Aside from the huge ACT difference, we see another difference: New Trier spends an average of $24K per student, while Dunbar spends an average of $10K.

The figures may not be directly comparable, because Dunbar doesn’t break out Operational spending from Educational spending, but two facts are clear: New Trier spends more and has better results; Dunbar spends less and has worse results.

And this is where the arguments begin. Is there a cause/effect relationship between school spending and results? There is plenty of research on both sides, but two things are clear:

  1. Learning environment counts. Lack of heating or air conditioning, lack of books, computers and other materials, lack of non-academics like music, art, and gym all mitigate against the average overall learning experience.
  2. Clubs and other social programs produce a more well-rounded learning experience.

While “throwing money at the problem,” won’t always produce better results — there are too many other variables in play — “starving the beast” is almost guaranteed to produce worse results.

So, where there may be doubt about how much per-pupil spending is best, one may wish to err on the higher side especially if money is free. 

And, that is the point.

Grades K-12 are funded by the public, either through state and local taxes or through direct tuitions. And unlike the federal government, the public has limited funds.

All states are financially challenged in that they are monetarily non-sovereign. Unlike federal taxpayers (who do not pay for federal spending), state and local taxpayers do pay for state and local government spending.

State and local taxpayers pay for one of the largest expenses each state has: K-12 education.

As a result of taxpayer resistance, many K-12 schools, especially schools in low-income areas, are insufficiently funded, some lacking even the most basic educational assets.

The federal government should fund grades K-12 and remove that financial burden from the states and cities, and from their taxpayers. The federal government also should fund grades 13+, and remove that financial burden from parents and students.

Because the U.S. federal government is Monetarily Sovereign, it neither has, nor can have, a financial “burden.” It creates dollars, ad hoc, by paying bills.

No defense can be made of a system in which the financially challenged are required to pay for a service the financially unchallenged should support.

Rodger Malcolm Mitchell
Monetary Sovereignty


The single most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.

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 The Ten Steps To Prosperity can narrow the Gaps:

Ten Steps To Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
This article addresses the questions:
*Does the economy benefit when the rich can afford better health care than can the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All) (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Guaranteed Income)) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONE (See also: Five reasons why we should eliminate school loans)
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefitting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be a good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

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