A note to those who sneer at Medicare for All Wednesday, Nov 20 2019 

Some people sneer at Medicare for All because it is “unaffordable” or “unnecessary,” or some other non-reason. They sneer at Elizabeth Warren and Bernie Sanders for backing MfA.

For those people, here is an all-too-common situation:

Nextdoor Blog

Community Brings Hope to a Homeless Neighbor
November 19, 2019
Written by Shannon Toliver

When neighbors Melissa and Jenn were out shopping one day, they came across an elderly woman living in a car with two dogs. By reaching out and uniting their Pennsylvania community, they were able to change this woman’s life in a matter of hours.

Upon approaching the car to ask if she was okay, they discovered Lynn, a retired pharmacist and longtime member of their community who insisted she was fine despite spending the past two years living out of her car due to family losses and piling medical bills.

Although they did not know her, Melissa and Jenn were determined to hear Lynn’s story and help her get back on her feet.

Lynn’s life took a turn when her husband passed away suddenly at just 47-years-old, leaving her with no family beyond her two dogs.

Later, Lynn suffered a series of strokes along with breast cancer rendering her disabled and unable to work.

Lynn had to downsize to a small apartment in order to afford her medical expenses, but soon fell behind on payments and was left without a home.

While evaluating her options, Lynn found out that she did not qualify for additional assistance and could not find affordable housing. Homeless shelters were not an option as she could not bear to part with her dogs.

With no alternatives, Lynn and her two dogs moved into her car with a few remaining belongings. Once the dogs were fed and she had saved enough money, she would take a monthly shower at a local motel and drive around to avoid running into past neighbors and colleagues.

“I didn’t want to have to explain to people that I don’t have a home.

“You feel like somewhere you had to have failed. You accomplished all this but now here you are in the gutter and you don’t want people to know. You don’t want to ask for help,”

Despite her efforts to remain out of sight over the years, Lynn was running out of food and water and decided to accept Melissa and Jenn’s help. The neighbors posted her story on Nextdoor and called on their community to help.

The post gathered hundreds of supportive comments and some neighbors even shared that they, too, were once homeless. Kind neighbors brought Lynn homemade meals, pet food, and clean laundry while local businesses generously donated services such as car detailing, a haircut, and dog grooming.

Eventually, the community raised enough money to house Lynn and her dogs in a fully-furnished studio apartment that had been paid off for the next two years.

Melissa and Jenn surprised Lynn with the apartment in a heartwarming video sharing that, “It was unbelievable the way our community came together.”

Lynn was brought to tears as she thanked her neighbors.

She told ABC News, “It wouldn’t have happened without these angels. I just want people to realize that this can happen to anybody. I had a good job. I had good retirement but I got sick and health insurance only covers so much.

“I have no children. I have no family. I had nowhere to turn. Sometimes, just the kindness of strangers just makes all the difference in someone’s life.”

For the first time in years, Lynn now has a home for the holidays, supportive neighbors that stop by to drop off meals or walk the dogs, and loving friends to spend Thanksgiving with.

Stuff happens.

If this, or something like this, has not happened to you, count yourself as fortunate. Most of us live our lives in ignorant bliss, thankfully not having to contemplate a future with limited money and poor health.

In America, the richest nation in world history, this never needs to happen, but it does because the “haves” cannot empathize with the “have-nots.”

Blaming the poor for their circumstances is a convenient way to rationalize widening the income/power/wealth Gap below us.

No folks, Medicare for All is not “unaffordable.” And Social Security is not destined to be “insolvent.” And anti-poverty aids and free college are not “unsustainable.”

These are the lies, based on Gap Psychology, to justify widening the Gap. The people who spread those lies have no hearts, no compassion.

Kind neighbors helped one woman with their own money. The U.S. federal government could help millions of needy people, and use no one’s money.

The people who argue against this — the federal debt fear-mongers — should feel shame for their callous cruelty.

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.

MONETARY SOVEREIGNTY

How to lose an election by being too smart. Saturday, Nov 9 2019 

I like Elizabeth Warren.

I like her tireless energy. I like her desire to narrow the Gap between the rich and the rest. I like her compassion and her morality. I like her intelligence.

What a refreshing difference between her and the current occupant of the White House.

But it may be her high intelligence that costs her the election.

Consider these headlines:

Elizabeth Warren Wants To Pay for Medicare for All With a $9 Trillion Tax That Will Hit the Middle Class
Warren says it’s not a tax. But what else would you call a requirement that employers send money to the federal government to finance a public program?
And:
Elizabeth Warren’s Medicare for All Dilemma
And:
Elizabeth Warren’s Tax-Hike Evasion
And:
How Warren’s Medicare for All plan could impact the middle class financially
By Tami Luhby, CNN

Sen. Elizabeth Warren has promised that she won’t raise taxes on the middle class “by one penny” to finance “Medicare for All.”

The Massachusetts Democrat’s funding proposal, now key to her 2020 platform, is chock full of new levies on employers, corporations, the wealthy and financial firms.

She highlights that people would save $11 trillion that they would have spent on premiums, deductibles and co-pays over the next decade — but that benefit isn’t completely tax-free. Americans of all incomes would fork over $1.4 trillion more in taxes over 10 years.

Buried in the footnotes of the proposal is the assumption that earnings would be taxed at higher marginal income tax rates due to the full repeal of the 2017 Republican tax cuts. The proposal assumes marginal tax rates would rise by 2.3 percentage points.

Warren has two problems:

  1. She has a tax plan to solve the “How will you pay for it” non-problem, and
  2. Her tax plan is so complex and convoluted, few people can understand it, and fewer yet agree with its calculations.

So this mysterious, dark cave of data not only steals attention away from her plan’s coverage benefits, but it also inserts suspicion that she is using fiscal sleight-of-hand to hide something.

This is a bad sign for the passage of a program that actually will use zero tax dollars (because unlike state and local taxes, federal taxes do not fund anything).

The U.S. federal government uniquely is Monetarily Sovereign. It has the unlimited ability to create its own sovereign currency, the U.S. dollar.

When Warren is asked, “How will you pay for it,” her response should be:

“We’ll pay for it the same way we are paying for the GOP’s increases in military spending and tax cuts for the rich. We’ll pay for it the same way we pay for White House lawn mowing and Air Force 1, Congressional travel and meals, and Supreme Court robes:

The federal government simply will push a computer key.”

Then she can quote:

Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”

Ben Bernanke: “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.” 

St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e., unable to pay its bills. In this sense, the government is not dependent on credit markets to remain operational.”

The federal government creates dollars, ad hoc, every time it spends dollars. Unlike states, counties, cities, businesses, you, and me, the federal government needs no income.

The government creates new dollars, ad hoc, every time it spends dollars. It neither needs nor uses tax dollars, nor does it borrow.

Why does the government levy taxes? Two reasons, both having to do with control:

  1. To control the economy, it taxes what it wishes to limit, and gives tax breaks to what it wishes to encourage.
  2. To control you by making you believe dollars are scarce so you will not demand free benefits. By impoverishing taxpayers, and then doling out dollars as it sees fit, the federal government exerts powerful control over the lives of taxpayers.

Tami Luhby’s article continues:

Warren’s campaign told CNN that she only supports repealing the tax cuts for the wealthy and big corporations — not middle-class families — and doing so would have no material effect on the revenue estimate.

Tax cuts for corporations benefit the economy by leaving more growth dollars in the economy, and by helping businesses grow. Eliminating those tax cuts is anti-growth.

Warren proposes an anti-growth solution to the “How will you pay for it” non-problem.

Another provision of Warren’s plan — which calls on employers to foot a large share of the bill — could also affect the middle class in an indirect way, say some economic experts and opponents.

Under her proposal, employers would no longer pay premiums to private insurers, which on average cost them more than $14,500 annually, on average, for family coverage.

Instead, companies would write a check to the federal government for 98% of their current health insurance tab to foot nearly half bill for Medicare for All.

She calls this $8.8 trillion levy an “employer Medicare contribution.”

When employers pay premiums to private insurers, the growth dollars stay in the economy, but when employers pay taxes to the federal government, those dollars disappear from the economy.

Here, again, Warren’s plan is anti-growth.

Workers typically receive lower wages because companies factor tax free health insurance costs into their total compensation. So if employers no longer had to pay for health coverage, they would use some of the savings to boost taxable salaries.

“She has found a clever way to make middle-income people finance a portion of government health insurance without paying a direct tax,” Gleckman said. “But make no mistake, they still will be paying.”

This isn’t exactly true. Both salaries and healthcare costs are tax-deductible to corporations. So from that standpoint, the plan is a wash.

But salaries require (unnecessarily) FICA payments from employers and from employees. So employers and employees both would pay more FICA tax to the government, and this represents a net dollar loss to the economy.

Former Vice President Joe Biden, in particular, has attacked her on this point. His campaign calls this provision “a new tax of nearly $9 trillion that will fall on American workers.”

Other experts, however, counter that the employer Medicare contribution would not prompt companies to further diminish workers’ wages.

“Employers are already paying this in the form of premium contributions to employer plans,” tweeted Topher Spiro, vice president for health policy at the Center for American Progress, which supports a universal coverage model that would retain an employer-based insurance option.

“This is just redirecting the premiums to Medicare.”

Redirecting premiums from private insurers to Medicare removes growth dollars from the economy.

Warren and Sanders insist on eliminating the employer-based option. The byzantine tax maze plus the unexplained elimination of private insurance are together enough to make taxpayers throw up their hands and say, “Forget it.”

Smart people may not understand how less intelligent people “don’t get it.” Perhaps her brilliance has made Warren forget the adage, “KISS. Keep It Simple, Stupid.”

Or, perhaps she believes the populace is too stupid to understand the simple, Monetary Sovereignty truth that the federal government can pay for Medicare, without taxes and without inflation.  

Because Donald Trump is a low-IQ con-artist, he is most adept at keeping things simple — by lying in simplistic terms rather than by explaining the more complex reality.

Drain the swamp,” “Build the wall,” “Make America great again,” “Fake news” all are designed to appeal even to the intellectually impoverished.

Those who serve Trump report that he has difficulty comprehending even one complete paragraph. That being the case, he creates his communications to fit Twitter — something brief enough even he and the voters can understand.

To communicate with the voters, and win the election, Warren should attempt this bit of simplicity by saying: “We’ll eliminate FICA, and give you free, no-deductible Medicare and long-term disability.”

Or better yet:No FICA; Free Medicare”, and produce some baseball caps with the letters, “NFFM.”

Or, she can keep turning herself inside out, and look dishonest trying to “prove” she can pay for a trillion-dollar program without federal deficit spending or tax increases.

I hope her honesty will prevail.

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.

MONETARY SOVEREIGNTY

Why are the Democrats so cowardly? Tuesday, Oct 29 2019 

The Democrats have a great plan. They want to expand Medicare to cover everyone, which could be accomplished very simply by lowering the eligibility age of the current Medicare plan from 65 to 0.

The hard work already has been done. The process has been created. The government, the hospitals, and the doctors all know how to handle the paperwork. Everything is in place.

Just lower the eligibility age, cover everyone, and go.

No need for Medicaid, ACA, Medigap or Parts A, B, C, etc., etc. No deductibles. Just one simple plan for every man, woman, and child in America.

And certainly no need to tell everyone they will be forced to give up their current plans. Simply offer Medicare to everyone, and let nature take its course.

But no. The Democrats get all hung up trying to answer one simple question, “How will you pay for it?”

The correct answer, the honest answer, would be: “Federal deficit spending.”

1. Federal financing is not like state and local government financing. The federal government, unlike state and local governments, is Monetarily Sovereign. It has the unlimited ability to create its own sovereign currency, the U.S. dollar.

The federal government never can run short of dollars. It could fund any Medicare for All plan with the push of a computer key.

2. Unlike state and local government deficits, the federal deficit and federal debt are not a burden on anyone. They do not burden the federal government; they do not burden taxpayers.

Unlike state and local taxes, which fund state and local government spending, federal taxes do not fund federal spending.

3. Contrary to a popular myth, federal deficit spending does not, and never has, caused inflation. Inflation, a general increase in prices, is not caused by too much money. Inflation is caused by shortages of food and/or fuel.

Those historical photos showing people carrying paper money certificates in wheelbarrows, fail to show the actual cause of the inflation: Food and fuel shortages. The printing of those certificates was an ineffectual response to inflation, not the cause.

One of the surest cures for any inflation is government deficit spending to acquire and distribute the scarce food and fuel.

Sadly, those Democrats who know all this to be true, are too cowardly to explain it to the public. Instead, they go along with ridiculous articles like the following:

The Democratic plan for a 42% national sales tax
Rick Newman, Senior Columnist, Yahoo Finance — October 28, 2019

If you’re a Democrat who supports “Medicare for All,” pick your poison.

You can ruin your political career and immolate your party by imposing a ruinous new sales tax, a gargantuan income tax hike or a surtax on corporate income that would wreck thousands of businesses.

This is the cost of bold plans.

Or better yet, you can tell the truth about federal financing, and tell everyone who will listen that Medicare for All will be financed the same way as “Military for All,” as well as Congress, the Supreme Court, and the White House.

They all are funded by federal deficit spending.

There is no FICA tax supposedly paying for the Military, the Congress, the Supreme Court, or the White House. There is no tax supposedly paying for Congressional health care, Congressional travel, and Congressional lunches.

The reason why there is no FICA tax, or any other tax, dedicated to paying for these expenses is very simple. Federal taxes pay for nothing. Those dollars deducted from your paycheck, and those dollars you “voluntarily” send to the U.S. Treasury are not needed or used for anything.

They do not fund Medicare. They do not fund Social Security. They do not fund the military, or the Congress, or the Supreme Court, or the White House, or any other of the myriad federal initiatives.

Federal taxes are destroyed upon receipt.

Here is the A-Z Index of U.S. Government Departments and Agencies. You don’t pay for any of them. Even if all federal tax collections totaled $0, the federal government could fund all these activities.

Supporters of Medicare for All, the huge, single-payer government health plan backed by Bernie Sanders, Elizabeth Warren and several other Democratic presidential candidates, say it’s time to think big and move to a health plan that covers everyone.

Getting there is a bit tricky, however. A variety of analyses estimate that Medicare for All would require at least $3 trillion in new spending.

That’s about as much tax revenue as the government brings in now. So if paid for through new taxes, federal taxation would have to roughly double.

Right. IF (big “if”) Medicare for All was paid for through new taxes, federal taxation would have to double.

That is exactly why Medicare for All should not be paid for by taxing people.

It should be paid for via federal deficit spending, which would cost you nothing. Yes, for a Monetarily Sovereign government, lunch really can be free.

Oh, are you worried that the so-called federal “debt” would be an unsustainable “ticking time bomb”? If so, you’re in bad company, for that is exactly what phony “experts” said way back in 1940, and they’ve been saying it every year thereafter.

In 1940, the federal debt was only $40 Billion, and it was a “ticking time bomb,” according to Robert M. Hanes, president of the American Bankers Association.

Today, the federal debt exceeds $22 Trillion, a gigantic 55,000% increase, and that time bomb still is ticking. And the country still is here. And the government still is sustaining.

The Committee for a Responsible Federal Budget (CRFB) spelled out what kinds of new taxes it would take to come up with that much money.

A 42% national sales tax (known as a valued-added tax) would generate about $3 trillion in revenue. But it would destroy the consumer spending that’s the backbone of the U.S. economy.

A tax of that magnitude would be like 42% inflation, wrecking consumer budgets and the many companies that depend on them.

Other options include a 32% payroll tax split between employers and workers or a 25% income surtax on everybody.

Or, the government could cut 80% of spending on everything but health care, which would include highways, airports and the Pentagon.

Or here’s a good one: Just borrow the money and quadruple Washington’s annual deficits.

Or do none of the above, and simply create the money by federal spending, just as the federal government has been doing since 1940, the year Robert M. Hanes had his meltdown.

We’ve written about the CRFB several times before. They are mouthpieces for the very rich, who, because of Gap Psychology, do not want the middle class to receive federal benefits.

The CRFB comes up with all sorts of scare tactics to make you believe federal financing is like state and local financing or personal financing. So they print big deficit numbers and say, in effect, “Oooohh. Look at these big numbers. Aren’t they big?

The best idea might be charging every enrollee in the new program $7,500 per year, so they’d be paying directly for the coverage they’re getting.

Some people pay more than that now for health care, by purchasing insurance outright or sacrificing pay raises in exchange for employer coverage.

It would still be a nifty trick to propose that to voters.

If by “best idea,” Mr. Newman means “another bad idea,” I’d agree. So would the voters.

It’s possible that Medicare for All would cover health care for more people at a lower total cost than we spend now, meaning the average cost per person would go down.

Yes, the cost would be lower, especially if the people are asked to pay nothing for health care, and it all was provided free by the government — and especially if we eliminated the useless, harmful FICA tax, the single, worst, most regressive, pays-for-nothing tax in America.

The problem is transitioning from what we have now to whatever Medicare for all would be.

And it’s a giant problem, like crossing the Mississippi River without a bridge or a boat. The other side might look great but you’ll die before you get there.

The author, Mr. Newman, wants you to believe that having created the entire Medicare program, now simply cutting the eligibility age from 65 to 0 is an insurmountable problem.

That’s like saying that after having built from scratch, a 5,000 square foot house, changing the knob on the front door is ” . . . a giant problem, like crossing the Mississippi River without a bridge or a boat.” Pulleeze.

Warren, Sanders and others tout the virtues of this magical health care program without explaining what it would cost.

Sanders has at least suggested some possible ways to pay for it, including premiums paid by enrollees, a wealth tax on millionaires and income tax rates as high as 52%.

Warren has been cagier, saying only that under her plan “costs” would go down for middle-class families. Under pressure to explain, Warren has pledged to come up with a financing plan soon.

Now, maybe she doesn’t have to.

So again I ask, why are Warren, Sanders, and the rest of the Democrats so cowardly? When all other options lead to failure, why not simply 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.

 

Why the truth is a victim of the well-meaning. Thursday, Oct 17 2019 

No, no, no, no, no, no, no, no! NO!

Ryan Cooper, a well-meaning, national correspondent at TheWeek.com, whose work has appeared in the Washington MonthlyThe New Republic, and the Washington Post, wrote:

“. . . taxes are always a net cost by definition — something that is taken from the American citizenry and spent on government boondoggles or welfare for poor people.”

And, “. . . while Medicare-for-all would require some additional taxes on the middle class, those increases would be more than compensated for by zeroing out premiums, co-pays, and deductibles.”

And, “As economist Gabriel Zucman explains: ‘Note how Warren and Sanders actually cut taxes for the bottom 95%. That’s because they abolish mandatory private health insurance premiums, which are in effect a huge poll tax.'”

NO, Mr. Cooper, and NO, Mr. Zucman. NO. While state taxes fund state spending, and county taxes fund county spending, and city taxes fund city spending,

FEDERAL TAXES DO NOT FUND FEDERAL SPENDING.

The federal government may claim that FICA funds Social Security and Medicare. The federal government may claim that income taxes fund the military and the myriad other federal spending. But, it simply is not true.

There is zero relationship between federal spending and federal taxing. Federal taxes (unlike state and local taxes) are not “spent on” anything. They are destroyed upon receipt.

And, Medicare-for-all would not require some additional taxes. Medicare for all will be funded entirely by deficit spending, regardless of what tax schemes are implemented.

And, Warren and Sanders do not cut taxes for the bottom 95%, because they abolish mandatory private health insurance premiums. No, they will raise taxes unnecessarily, and also will cut premiums.

The tax increase and the premium decrease mathematically may or may not offset, but in either event, they have nothing to do with one another.

The federal government, being Monetarily Sovereign, creates brand new dollars every time it pays a creditor. It works like this:

When anyone — you, me, any business and any government agency — pays a creditor, it sends instructions to the creditor’s bank instructing the bank to increase the balance in the creditor’s checking account.

At that instant, brand new dollars are created. To pay for those new dollars, the checking accounts of the payors are debited.

But here is the huge difference: The checking accounts of the aforementioned you, me, any business and any government agency all are part of the money supply (mostly M1). So those checks contribute a net $0 to the money supply.

The only checking account that is not part of the money supply is the federal government’s account. So its checks add to the money supply.

Why are government checking accounts not part of the money supply? Because the federal government has the unlimited ability to add to its checking accounts any time it wishes. So whatever amounts are shown in the government’s checking accounts have no meaning.

The federal government dips into an infinite pond. There is no dollar answer to the question: “How much money does the federal government have?”

The answer is, “Infinite.”

Sadly, Mr. Cooper’s article continues:

“Bernie Sanders forthrightly admits that Medicare-for-all would require some additional taxation on the average citizen.”

Professor Kelton

gain, no. Sanders is not being “forthright.” He is being cowardly. He knows full well that additional taxes are not necessary. He had Professor Stephanie Kelton as his economic advisor, and she told him.

But, in typical politician fashion, he either didn’t understand it or more likely, was too afraid voters wouldn’t believe it.

Where does that leave us? Pretty much where we always have been, because Mr. Cooper’s article demonstrates the misinformation distributed by the public’s three main sources of knowledge: The politicians, the media, and the academics.

The politicians misinform you because they are bribed by the rich via campaign contributions and promises of future lucrative employment. The media misinform you because they are bribed via ownership and advertising dollars.

And most of the academics misinform you because they are bribed via university grants and think tank employment.

You understand this, but what of the rest of the public?

Driven by Gap Psychology (the desire to distance oneself from those “below” in any status measure), the rich want to keep the middle class from realizing that the Ten Steps to Prosperity (below) are easily provided, and without increasing taxes even one cent.

The rich wish to become ever richer, and that requires widening the Gap between them and those “below” them.

And that leads to the fourth main source of misinformation, the public itself. Having been brainwashed by the politicians, the media, and the academics, the public takes over spreading misinformation about federal financing until it becomes perceived as “common knowledge.”

It is “common knowledge” that one should live within one’s means, and that debt should be avoided, and that budgets should be balanced — except that “common knowledge” does not apply to Monetarily Sovereign governments.

Misinformation often may come from the well-meaning, but it remains misinformation, and even more harmful than misinformation from the ill-meaning.

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

Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”

Ben Bernanke: “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.”

St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e.,unable to pay its bills. In this sense, the government is not dependent on credit markets to remain operational.

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..

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

 

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