–The two great American con jobs of the 21st century

Mitchell’s laws:
●The more federal budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor, which leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
●To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
●The penalty for ignorance is slavery.
●Everything in economics devolves to motive.
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I enjoyed movies like “The Sting” and “Paper Moon,” because I like seeing a good con job being played out, even fictionally. But, I’m especially fascinated with the two real con jobs in America today.

Unlike an armed robbery, where the robber demands money at gunpoint, the essence of a con job is that the victim plays the leading roll. In a good con job, it is the victim who demands to give money or other valuable to the con artist. The con artist levers some basic human emotion – greed, fear, hate, etc. – to make the victim work against his/her own best interests.

In a really good con job, the victim becomes so emotionally involved, brainwashed even, he will fight with friends and relatives who try to tell him he is being conned.

I am reminded of a former employee of mine, whose sister was roped in by the classic Nigerian con. She refused to listen to people who told her she was being cheated – not just refused to listen, but angrily refused to listen to facts. (Angrily refusing to accept facts is a classic con victim symptom.)

Eventually, she stopped talking with friends and family, while she continued to send her last few dollars overseas, waiting for the big payoff that never came. Her family hasn’t healed. To this day, she maintains she was right, and if only the family had not interfered, the money would have arrived.

One of the two great cons in America is the “gun con.” The 2nd Amendment specifically mentions “a well regulated militia,” which the gun con has translated to: “Any fool who wants to own a gun of any kind.” This is a “militia”? This is “well regulated”?

The fact is that most gun owners do not belong to any kind of militia, and certainly not to a well regulated militia, unless you consider the “Insane Bloods” gang to be part of a militia and to be well regulated.

The 2nd Amendment requires the most convoluted interpretation to be the basis of today’s gun laws. Gun rights enthusiasts angrily denounce that simple fact.

Another part of the gun con is the mantra that widespread gun ownership is necessary to protect citizens from government tyranny. You and your friends and your semi-automatic rifles are going to defend yourselves against the planes, ships, bombs, aircraft carriers, drones and manpower of the United States Army.

Good luck with that.

Here are excerpts from article in today’s Chicago Tribune:

How to get those politicians to listen
By Charles M. Madigan, May 8, 2013

Palin addressed the National Rifle Association convention in Houston a few days ago and rolled out all her applause lines, “lamestream media” being the one that has always been most puzzling to me. Almost every time we hear her say it, it’s on “lamestream” media.

She accused Democrats of “exploiting tragedy” in the call for tighter gun laws. All of this part of a “politics of emotion,” she said. Of course they loved her and cheered and clapped.

Supported by a gun industry behind the scenes and some other groups that are even louder, the NRA, has managed to frighten enough U.S. senators to prevent background checks from becoming a part of federal gun law.

And there it is, the identification of the con artists (Every con begins with a con artist): The gun industry.

The NRA’s argument: If we just had more guns, many of these heartbreaking murders would not happen because someone would plug the perp before he or she had a chance to pull that trigger 15 or 16 or 30 times.

Here’s the problem with that thought. If you want to look at a place where there are plenty of firearms already, look at the most troubled neighborhoods on Chicago’s South and West sides. This is proof that packing heat does nothing to cool down murderous crime.

Here’s another fact, the con victims angrily ignore: A gun in a home increases the chances of a murder or a suicide. And that doesn’t include the thousands of gun accidents.

Gun ownership making you safer is part of the con.

Look at the facts. Those of us who support background checks were defeated by not very many people and a bunch of frightened senators.

All you have to do is say no to an interest group that makes a lot more noise and tosses around a lot more money than its membership warrants. The NRA can be stopped. But not by people who care more about their own seats in Washington than the lives of the victims of gun violence.”

The gun con is a big money con, devoted to making the suckers send their dollars to the big gun and ammo manufacturers – those close relatives of the infamous, military/industrial complex.

Gun owners, you have been conned. You have been frightened and brainwashed on behalf of the rich. You get angry if someone calls the facts to your attention. But isn’t that exactly how a con works?

And then, there’s the other big con in America: The debt/deficit con. The rich have spent billions to convince Americans that federal spending for middle- and lower classes is bad for – you guessed it – the middle- and lower classes.

If you show the facts (i.e., the government cannot run short of dollars, the rich benefit from recessions and unemployment) to typical members of the middle- and lower-classes, they get angry, and babble about the Weimar Republic and Zimbabwe – two economic non-sequiturs (Neither has any economic relevance to America).

The middle- and lower classes have been brainwashed by misinformation (the government is “broke,” “your children will pay the debt”) to the point where facts and the truth are questioned and self-sacrifice is the answer.

So there you have it: The two great con-jobs of the 21st century: The gun con and the debt/deficit con. The rich profit from them; the victims angrily demand them.

You would be safer and richer if you simply sent dollars to Nigeria.

Rodger Malcolm Mitchell
Monetary Sovereignty

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Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Medicare — parts A, B & D — for everyone
3. Send every American citizen an annual check for $5,000 or give every state $5,000 per capita (Click here)
4. Long-term nursing care for everyone
5. Free education (including post-grad) for everyone
6. Salary for attending school (Click here)
7. Eliminate corporate taxes
8. Increase the standard income tax deduction annually
9. Increase federal spending on the myriad initiatives that benefit America’s 99%

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
Two key equations in economics:
1. Federal Deficits – Net Imports = Net Private Savings
2. Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

#MONETARY SOVEREIGNTY

Two gun stories. Which will you tell your friends?

Washington Post
A clear case of self-defense rallies supporters of gun rights

In LOGANVILLE, Ga. — Melinda Herman was at home, working upstairs in her office, when she saw a man coming to her front door. Her 9-year-old twins were off from school that day. Don’t answer it, she yelled downstairs, as the doorbell rang several times. From her window, Herman watched the man return to his silver SUV. Instead of leaving, he pulled out a crowbar and turned back for the front door with the decorative wreath.

By the time Herman called her husband at work to say an intruder was in the house, she had rushed both children into an upstairs bedroom and locked two doors behind her. She also had retrieved a .38 from the gun safe. The only place left to hide was a crawl space that led to the attic, and that’s where Herman crouched, with her son and daughter beside her and a revolver in her hand.

Walton County sheriff’s deputies barreled toward the subdivision off Sharon Church Road, but the intruder reached the crawl space first. When he opened the door, Herman fired six times.

Melinda Herman became an instant hero to gun owners facing new restrictions on firearms. While the intruder lay in a hospital, clinging to life, the National Rifle Association tweeted about GA MOM.

Here in Walton County, people went out and bought guns.

Does that convince you? Or does this:

Yahoo News
5-year-old shoots 2-year-old sister in Kentucky
By Travis Loller and Dylan Lovan | Associated Press – Wed, May 1, 2013

BURKESVILLE, Ky. — In southern Kentucky, where children get their first guns even before they start first grade, Stephanie Sparks paid little attention as her 5-year-old son, Kristian, played with the rifle he was given last year. Then, as she stepped onto the front porch while cleaning the kitchen, “she heard the gun go off,” a coroner said.

In a horrific accident Tuesday that shocked a rural area far removed from the national debate over gun control, the boy had killed his 2-year-old sister, Caroline, with a single shot to the chest.

In this case, the rifle was made by a company that sells guns specifically for children — “My first rifle” is the slogan — in colors ranging from plain brown to hot pink to orange to royal blue to multi-color swirls.

My guess: You consider one of these articles to be a “perfect example.” The other is a “rare occurrence.”

Which will you tell your friends?

Rodger Malcolm Mitchell
Monetary Sovereignty

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#MONETARY SOVEREIGNTY

–GDP formula: Why China can’t change the design of the U.S. flag

We’ve discussed this before, but since the problem continues to exist, the discussion must continue.

The U.S. federal government is Monetarily Sovereign. The U.S. dollar arbitrarily was created by federal law, and the government has the legal right to do anything it wishes with its arbitrary creation.

In past years, the government had decided to link the dollar to gold. President Nixon, speaking for the government, simply unlinked it. Done.

The U.S. government has the power to pay any invoice denominated in dollars. If you were to send a $999 trillion invoice to the federal government, the Treasury could pay it in an instant. No taxes; no borrowing; no problem. The government is sovereign over its own creation.

Want to pay off China? Again, no problem. Simply debit China’s T-security account at the Federal Reserve Bank and credit China’s checking account, also at the FRB. Easy. No new money needed.

Oh, are you worried about inflation (despite today’s rampant unemployment and a strong deflationary tendency)? Our Monetarily Sovereign government has all the curative tools it needs.

Inflation is a decrease in the value of a currency relative to the value of goods and services. The value of a dollar is based on supply and demand. To cure inflation, the government can reduce the supply (the debt hawk solution, which causes recessions and depressions) or increase the demand.

The demand for the dollar is based on risk (i.e. inflation) and reward. The reward for owning the dollar is interest. So, to cure inflation, the government increases interest rates, the very solution the Fed successfully has used for many years.

The historical proof of the Fed’s success: Inflation has not been caused by federal deficit spending:

See the lack of correlation between federal deficit spending (as shown by annual debt changes) and inflation. That is just one of many facts the debt hawks refuse to acknowledge.

The U.S. dollar is an arbitrary, legal creation of the U.S. government. The government can create, destroy, inflate or deflate dollars — at will. If U.S. laws need to be changed, the government changes those laws, also arbitrarily.

So the lie that somehow the government can run short of the dollars it legally creates, or have difficulty paying its debts, or be in any sort of financial stress, is ludicrous. Dollars are what the government wishes them to be, both in quantity and in value.

It’s our government’s dollar, and our government can do whatever it damn well feels like doing. Our government can make the dollar strong or make it weak, and make as many or as few as wanted, whenever wanted. It’s our government’s dollar.

The debt hawks can’t bring themselves to understand this. They think the dollar somehow is separate from the U.S. government.

For the silly debt hawks, the evidence of Greece isn’t enough to prove austerity is an economic disaster. Nor is the evidence of Italy. Nor of Ireland. Nor of Portugal. Nor of the entire eurozone. Nor of fact and logic.

The Petersons, Kochs et al pretend the U.S. is not sovereign over the dollar. They want the gap between the rich and the rest to widen, and lying about the dollar is their plan.

They brainwash the public into believing our government can’t control its own creations. It’s like saying the federal government can’t control the design of the U.S. flag or the notes to the Star Spangled Banner.

And then there are those who use platitudes to substitute for facts, so they say, “There’s no such thing as a free lunch” and “Neither a borrower nor a lender, be,” and other brilliant reasoning. And, the fact that by definition, austerity (aka deficit/debt reduction) removes money from an economy, doesn’t seem to give pause.

Let’s try simple algebra. Gross Domestic Product is the most commonly used measure of the economy. GDP is composed of four spending measures, plus net imports:

GDP = Personal Spending and Investment + Government Spending and Investment – Net Imports.

Look at the following graph:

The orange bar demonstrates the total of those four spending measures and imports. The purple bar is GDP. They are identical, of course.

What happens to the orange bar if we remove government Spending and investment? Look at following graph:

The difference between the orange bar and the purple bar represents what is lost by eliminating federal spending.

But even that doesn’t tell the whole story. What happens to Personal Consumption and Personal Investment if federal spending merely is reduced and/or taxes increased — i.e., what does austerity do to people’s finances?

Think of what will happen to Personal Spending and Investment if Social Security is reduced. If Medicare is reduced. If Medicaid is reduced. If the myriad aids to poverty, R&D and aids to education are reduced.

What happens to Personal Spending and Investment if federal employment is reduced? Unemployment insurance reduced? And what do FICA taxes do to Personal Spending and Investment? Any numrical answer would be speculative, but let’s see what happens if we reduce spending by a meagre 10%

That modest 10% spending reduction knocks more than $1 trillion dollars from GDP, an economic disaster.

Bottom line: Reductions in federal spending reduce Gross Domestic Product, partly because federal spending itself is a major factor in the GDP formula, and partly because federal spending cuts reduce the other major factor, private spending.

The U.S. dollar, the American flag and the national anthem are creations of the federal government. They exist and have value only because the government says so. The government can make any changes in its creations it wishes.

The U.S. government cannot run short of dollars, nor can it run short of stars for the flag, nor can it run short of musical notes for the anthem. China et al cannot force us into bankruptcy any more than they could change the design of our flag or alter the notes of our national anthem.

There is no pseudo-logic, no lie, no slogan that can change these simple facts. Those who claim otherwise are ignorant or liars.

Rodger Malcolm Mitchell
Monetary Sovereignty

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No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

#MONETARY SOVEREIGNTY

–Barack Obama and the Chicago way

Last year, Rod Blagojevich, the Chicago boy, who became governor of Illinois, was sent to prison for 14 years. He tried to sell a Senate seat. Selling is the Chicago way.

Also last year, the Chicago Sun Times published an article titled, “Alderman: ‘you almost have to be a priest to be in public service’,” by Fran Spielman, City Hall Reporter, August 9, 2012. The lead read, “It’s hard to imagine anyone comparing Chicago aldermen to priests, considering the steady drumbeat of corruption that has sent 31 present and former aldermen to prison since the 1970’s.”

Wisecracks about priests and prison aside, 31 aldermen selling their influence is just a small example of the Chicago way.

And then, there was the boss crook, Mayor Richard M. Daley, who sold the Chicago Skyway toll road to his pals. Then he sold Chicago’s parking meters to other pals. Needless to say, tolls and parking costs rose hugely — paid by the poor citizens.

Daley was trying to sell Midway Airport when the criticism reached new heights, so he quit office, and accepted lucrative jobs from his pals. Daley, and his father before him, was a master of the Chicago way.

And now comes Chicagoan Barack Obama and Chicagoan Penny Pritzker:

Penny Pritzker is pick as commerce secretary
Longtime Barack Obama backer may face tough questions about her business dealings

Chicago business executive Penny Pritzker was introduced Thursday as Obama’s nominee to lead the Commerce Department.

Pritzker, a member of Chicago’s wealthiest family, was an early supporter of Obama’s. With a personal fortune estimated at $1.85 billion, Pritzker is listed by Forbes magazine among the 300 wealthiest Americans.

She played an influential role in Obama’s rise from Illinois state senator to the nation’s 44th president, serving as Obama’s national finance chair in his first campaign for the White House and co-chair of his re-election bid.

Her friendship with the president gives her a unique ability as part of the economic team,” said Chicagoan Bill Daley, commerce secretary under Bill Clinton and White House chief of staff to Obama.

There’s that “Daley” name again, this time belonging to Mayor Richard Daley’s brother, another Chicagoan.

The Pritzker family has had multiple disputes with the Internal Revenue Service about its overseas tax shelters. Pritzker is likely to be asked about the 2001 failure of Superior Bank, based in Hinsdale, where Pritzker was chairman from 1991 to 1994.

The bank gave loans to people who couldn’t afford to repay them and then sold portions of the notes to investors — a strategy similar to one that contributed to the near-collapse of the nation’s economy less than a decade later.

Chairman of a failed bank that created worthless mortgages, then bundled them into worthless securities and sold these worthless securities to investors: That, plus giving Obama hundreds of thousands of campaign dollars, makes good Chicago credentials for commerce secretary.

The U.S. Chamber of Commerce, on Thursday welcomed Pritzker, whose personal network, business credentials and family name have served Obama well.

The U.S. Chamber of Commerce is a huge cheerleader for austerity, i.e. for widening the gap between the rich and the rest.

She has few to no allies within organized labor. Hyatt has long battled the Unite Here union in Los Angeles, Chicago and elsewhere. And Pritzker has been harshly criticized by the Chicago Teachers Union. A union official said she “has a long and storied history as an anti-labor and anti-worker kind of boss.”

Anyone know any pro-union rich people?

Mayor Rahm Emanuel called Pritzker a “champion for our students and our city” who has shown “incredible commitment and leadership in her every business, civic and philanthropic endeavor.”

Remember Rahm Emanuel, Obama’s former chief of staff? Yep, he too is a Chicagoan. He went to New Trier High School in Chicago’s most affluent suburban area, called “the North Shore.” (Disclosure: He was my son-in-law’s classmate.)

According to Wikipedia:

Emanuel was named to the Board of Directors of Freddie Mac by President Clinton in 2000. He earned at least $320,000 during his time there, including later stock sales.

During Emmanuel’s time on the board, Freddie Mac was plagued with scandals involving campaign contributions and accounting irregularities. The Obama Administration rejected a request under the Freedom of Information Act to review Freddie Mac board minutes and correspondence during Emanuel’s time as a director.

Put them all together — Blagojevich (Senate seat), Daley (toll road, parking meters), aldermen (selling influence), Pritzker (failed bank, selling worthless securities), Emanuel (money scandals) — and you have a pattern of greed, we in Chicago refer to as the “Chicago way.”

So when I tell my academic friends, “Barack Obama has been bribed by the upper .1% to gut Social Security, gut Medicaid, gut Medicare, gut aid to the poor” — when I say he has been bribed to support austerity, which has destroyed the lives of ordinary people all over the world — when I accuse him of being bribed to widen the gap between the rich and the rest — when I say these things and people tell me “there is no proof,” I only can shake my head in wonderment at their naivety.

Here is my prediction: You can write it down, and if I’m wrong, you can throw it in my face: The insanely wealthy Pritzker family will lead the way in collecting (i.e putting the arm on rich folks) for a giant Barack Obama Library in Chicago.

The Pritzkers also will “encourage” charitable and other groups to book the Obamas for speeches at monstrous fees.

And their daughters will receive high-paying jobs from rich “friends” of the Pritzkers.

Chicago may have a reputation as a rough, tough town, but we know how to say, “Thank you.”

Rodger Malcolm Mitchell
Monetary Sovereignty

====================================================================================================================================================

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

#MONETARY SOVEREIGNTY

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