–The Geithner legacy grows

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.
●Cutting the deficit is the government’s method for taking dollars from the middle class and giving them to the rich.
●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.
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Tim Geithner, the conservative in disguise (very poor disguise), never met a rich man he didn’t love.

In the Geithnerland, when a wealthy man or a big company has financial problems, the government should step in and not just bail them out, but reward them. Tax cuts are the best reward, but pay increases will do.

By contrast, if a poor man loses his job, his healthcare or his home, conservatives tell him it’s really his fault and he should not ask for federal help. In fact, whatever federal help he receives should be cut, because receiving Social Security, Medicare, Medicaid, food stamps, etc. is a sign the poor man is a lazy sloth and a leech on the rest of us.

Punishing the poor for being poor is a kind of “tough love” that teaches them a valuable lesson. And, rewarding the rich for being rich is good, because these people are special.

Washington Post
Report: Treasury approved excessive pay for executives at bailed-out AIG, GM and Ally

WASHINGTON — The U.S. Treasury Department disregarded its own guidelines by allowing large pay increases for executives at three firms bailed out during the financial crisis, a report released Monday says.

The Special Inspector General for the Troubled Asset Relief Program said Treasury approved all18 requests it received for executive raises at American International Group Inc., General Motors Corp. and Ally Financial Inc. Of those requests, 14 were for $100,000 or more. One raise, for the CEO of a division at AIG, was for $1 million.

Remember that these are executives who did such an inept job their companies needed to be rescued by the government.

The report says Treasury bypassed rules under the 2008 bailout that limited pay. Treasury approved raises that exceeded pay limits and in some cases failed to link compensation to performance, it notes.

If compensation had been linked to performance, these rich boobs would have been fired on the spot. Lots of poor- and middle-income people were.

The report also said Treasury officials had been warned a year ago that the department needed to reform its procedures to ensure that the pay guidelines are followed.

Hmmm . . . now let me think. Who received the warning, who supervised the entire bailout process and who had the authority to “bypass rules”? One might think it was Tim Geithner, but he probably was busy with more important projects than economic stimulus, for instance . . . uh . . .

Wait! We have a scapegoat, well-paid I hope:

Patricia Geoghegan, the Treasury official who approved the raises, said it’s unfair to call the pay excessive.

She said Treasury must strike a balance between limiting compensation and approving pay packages that are consistent with executives in similar jobs.

How many executives in “similar jobs” drove their companies to the edge of bankruptcy, then were rewarded for it?

Geoghegan called the 50th percentile “a benchmark.” She noted that some pay packages at the three companies exceeded that level in 2012. But she said more than half at AIG were at or below that level, while nearly half at GM and Ally were below it.

In Treasury-speak, a rule is just a “benchmark.” So next time you are pulled over for doing 80 in a 30 mph zone, explain to the officer that you thought the speed limit was just a benchmark, and since more than half the drivers were obeying the speed limit, you thought you could exceed it.

If that doesn’t work, and you are arrested, call Geithner for bail money. Bail is his specialty.

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:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

#MONETARY SOVEREIGNTY

–The poor are lazy, good-for-nothing leeches.

It’s the same the world over. The richest 1% convince the 99% that the poor deserve their poverty, and helping the poor only “spoils” them. The gap between the rich and the rest should be increased, because the rich are the “makers” and the poor are the “takers.”

Disdain for those below fosters greater and greater gaps, which in turn, fosters more disdain, in an unending cycle of greater control by the rich over the rest.

Here is what is happening in Japan, followed by typical American responses.

Welfare payments to be slashed ¥74 billion to root out the comfortably poor
Japan Times, Jan 28, 2013

Welfare benefits will be slashed by ¥74 billion over a three-year period starting from fiscal 2013, after a government panel found that some people are making more on the dole than the average low-income person who is not spends on living costs, it was learned Sunday.

Note the misleading language. The people are making more from welfare than the average of low income living costs. (Did you think this said welfare recipients received more than the average low income person? If so, that is what you were meant to think.)

Anyway, what is wrong with welfare exceeding average low income living costs? Isn’t that a good thing?

Finally, “comfortably poor“? Really? Is that like being stupidly happy with their poverty?

Since the standard benefit payment provides the basis for determining other levels of public assistance, such as subsidies for school expenses, reducing it may also affect low-income earners even if they are not on welfare.

The actual amount doled out per household will be slashed by a maximum of 10 percent from the current level, which is based on age, number of family members and area of residence.

Prime Minister Shinzo Abe called for the swift enactment of the budget because it “will enable us to implement economic measures in a seamless manner and tackle major challenges, such as reconstruction (from the 2011 quake and tsunami) and disaster prevention.”

Like America, Japan is Monetarily Sovereign, so has the unlimited ability to pay for reconstruction and disaster prevention, and has no need to cut welfare payments. That is basic economics, but is not the point of this post.

The point of this post is the American public’s reaction. Here are real examples from the comments section of this article:

“It is refreshing to see one government take a stand. America still is using the welfare system to enslave the poor. Then their continued support s required in order to continue to receiving welfare. They will never improve their lives from what they are today.”

The rich have convinced the 99% that welfare is slavery and poverty is freedom. George Orwell would be proud.

“Japan has a labor SHORTAGE problem. There are people collecting welfare benefits that are able to work. By cutting the welfare benefits you encourage people to re-enter the workforce. Hopefully thses people will start to climb the ladder again and work their way out of poverty. Welfare keeps people poor.”

Translation: Welfare recipients are a bunch of lazy sloths, who would rather live in poverty than work. How do I know? The rich told me so.

“In the US the desire of Obama is to increase the number of comfortably poor. No matter that, like Japan, the US is bankrupt, too.”

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“Why can’t the USA do something like this to get the life long welfare leeches off the public hand out? And don’t say raise minimum wages. Stupid! That would increase the cast of everything. Did you hear me? I said EVERYTHING you want to buy would go UP! Stupid people everywhere.”

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“No matter where in the world you live the message to the poor is the same. Get a job!!! Any job!!!”

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“The U.S. should do the same thing, the $$$ saved could then be pished away by the dems on something else.”

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“Cut off their welfare and, since they have all senses of self reliance and personal responsibility, they will soon become uncomfortably poor and right back on the dole.”

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“Japan has a 220% debt to GDP ratio. This debt to GDP ratio is one of the reasons the country is incapable of competing anymore. It is all the debt your parents rang up when times were good. Well, the payment is due and it is your responsibility.”

When our population believes the rich are inherently superior to the rest, and the poor are lazy bums who deserve their poverty, what hope is there for America, today?

And when our population insists that our Monetarily Sovereign nation is “broke,” and that our children will have to pay the debt, what hope is there for America’s future?

Rodger Malcolm Mitchell
Monetary Sovereignty

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#MONETARY SOVEREIGNTY

–The stupidifying of our children

The Next America
Analysis: How Much States Spend on Their Kids Really Does Matter

The initial difference between state education rankings and the average per-pupil spending is clear and rather obvious: States that spend more on their students tend to rank higher, and states that spend less rank lower. But if the answer were that simple, education reform would be a breeze.

Like every complex story, outliers and exceptions to the rule exist.

Children learn from their parents, their school teachers and their peers. In total, if the teaching is substandard or incorrect, the students will tend toward ignorance.

Ignorance of Monetary Sovereignty is widespread among university economics professors, who themselves were taught by professors ignorant of Monetary Sovereignty. The ignorance was handed down from teacher to student to fellow student — from generation to generation.

But, economics isn’t the only discipline where fact is ignored. Consider, for instance, biology. Here are excerpts from an article describing how vouchers have led to formalized superstition being taught in our schools.

Creationism spreading in schools, thanks to vouchers
Zack Kopplin (a 19-year-old student at Rice University, and one of the leading American voices against the teaching of creationism in schools), 01/16/2013

So far, I have documented 310 schools, in nine states and the District of Columbia that are teaching creationism, and receiving tens of millions of dollars in public money through school voucher programs. Here are a few highlights from creationist voucher schools I have identified:

Private Christian schools are rightly free to teach Christian dogma. Public schools should not. American law separates the religious world from the public world for good reason: Religion never is wrong.

Democracy is a method for debating and evaluating different opinions. In religion, there is no debate. God speaks; we obey. But how do we know what God is saying? The high priests tell us. So the reality: The high priests speak; we obey.

Those who disagree are vilified as sinners for not accepting “God’s (the priests’) word. Thus, does theocracy devolve to totalitarianism, and that is why America separates religion from politics — or tries to.

Here are more excerpts from the creationism article:

●The Beverly Institute in Jacksonville, Florida, teaches “Evidence of a Flood,” and “Evidence against Evolution,” and ”The Evolution of Man: A Mistaken Belief.”

● Christian Academy in McDonough, Georgia says,“The universe, a direct creation of God, refutes the man-made idea of evolution. Students will be called upon to see the divine order of creation and its implications on other subject areas.

●Life Christian Academy in Oklahoma City, Oklahoma says their life science class will “lead the student to recognize that God created all living things and that these living things are fearfully and wonderfully made.” Evolution is taught only in history class, where students “evaluate the theory of evolution and its flaws.” The school uses the creationist Bob Jones and CSI curriculums.

●The principal of the Claiborne Christian School, in West Monroe, Louisiana, says in a school newsletter, “Our position at CCS on the age of the Earth and other issues is that any theory that goes against God’s Word is in error.” She also claims that scientists are “sinful men” trying to explain the world “without God” so they don’t have to be “morally accountable to Him.”

●Trinity Academy, in Gary, uses the creationist A Beka curriculum and says it “presents the universe as the direct creation of God and refutes the man-made idea of evolution.”

●Rocky Bayou Christian School, in Niceville, Florida, says in its section on educational philosophy, “God mandates that children be discipled for Christ. They must be trained in the biblical world view which honors Jehovah, the sovereign Creator of the universe. It recognizes that man was created in the image of God” and says “Man is presumed to be an evolutionary being shaped by matter, energy, and chance… God commands His people not to teach their children the way of the heathen.”

●Wisconsin Lutheran High School, in Milwaukee, Wisconsin, says in its biology syllabus that it teaches, “evolutionists are ‘stuck’ because they have no god, therefore they must believe in evolution” and “young earth evidence a disaster to evolutionists.”

While we adherents of Monetary Sovereignty and MMT rail against the unnecessary money shortages endured by our schools — shortages the federal government easily could and should end — we also must acknowledge that if the money is not well managed, it may be spent for evil.

Ignorance, by teacher and parent, can overcome the intent of even the best funded school programs. Creationism is ignorance and teaching Christianity in public schools is traitorous. Adding dollars to the effort only exacerbates the harm.

So, yes our schools are underfunded. Similarly, our healthcare, retirement, anti-poverty, infrastructure and energy programs are underfunded. We always must remember, even with money, each can be perverted by those with evil intent, but that is not a reason to withhold money.

To detractors of Monetary Sovereignty, I agree that money does not solve all problems. Along with money there needs to be intelligence, honesty and effort. The shortage of money tends to worsen problems.

Too many of our children are taught creationism and mainstream economics. Unless they are particularly strong of mind, they will grow up ignorant — ignorant of subject and of the harm they do in passing this ignorance to their children and their peers.

Then they become the politicians and the judges who run our nation.

Rodger Malcolm Mitchell
Monetary Sovereignty

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#MONETARY SOVEREIGNTY

–“Framing” has brainwashed America, but Krugman will save us.

“Framing” has brainwashed America, but Krugman will save us.

Framing Conservative Arguments
by bfrederk, Daily Kos

The conservative movement is tremendously successful at generating language to define positions and ‘frame’ arguments. “Frame” is in scare quotes because framing refers to presenting one’s positions in a way that it is most likely to garner support. It is more effective political rhetoric, but it is often intellectually dishonest. When you cannot win with your actual argument, you ‘frame’ it in a certain way so that you can win.

Here is how the politicians and the media (almost all of which are owned or paid by the upper 1% income group) frame the debate about the federal budget

January 21, 2013 9:22 pm
America’s debt dilemma: A looming crisis
By Robin Harding

As the Obama administration begins its second term this week, the Financial Times explores the real fiscal choice for the US: not the short-term frenzy of cliffs, debt ceilings, deficits and sequesters, but how – or whether – to pay for an older population. The answer will decide the very nature of the US economy in the 21st century.

Down one path, the retirement contract is untouched, but tax levels have to rise by 30 per cent or more; the US would look like a mature European economy.

Down the other, taxes stay low, but barring a revolution in healthcare costs, provision for at least some retirees – current or future, rich or poor – must be slashed.

And there it is. The argument has been framed: The public is told to choose from two possibilities: Increase taxes or slash healthcare. The third possibility, increase the deficit, is not even considered, let alone debated.

But wait!! (as the TV ads say) Here comes Paul Krugman to the rescue (O.K., belatedly, but he’s getting there, sort of):

Weekend Reader: Paul Krugman’s End This Depression Now!
January 26th, 2013 Allison Brito

Allow me to offer a better option—Paul Krugman’s End This Depression Now! Originally published electronically and in hardcover last spring, it’s been brought to our attention again with its forthcoming release in paperback on January 28.

As a leading economist, New York Times columnist, distinguished Princeton professor, and 2008 Nobel laureate, Krugman’s solution to the nation’s expanding deficit is stunningly simple: Spend more, at least for now.

That’s right — while politicians are warning of excessive government spending, Krugman says that federal spending is what got us out of the Great Depression, and can quickly return us to prosperity today.

“Now is the time for the government to spend more, not less, until the private sector is ready to carry the economy forward again—yet job-destroying austerity policies have instead become the rule,” he says. Krugman’s enduring Keynesian outlook and his hopeful, progressive approach to growth are an essential contribution to a national discourse dominated by deficit “hawks.”

Yes, I’m jealous. Krugman received a Nobel for almost, but not quite (at long last) saying what my book and 900+ blog posts have been saying for 15 years (To understand economics, you must understand Monetary Sovereignty. Most economists and politicians don’t.), and the MMT folks have been saying even longer than that.

What he gets right is: The government needs to spend more, not less. And austerity, aka deficit reduction, is job destroying, economy destroying and life destroying.

Sadly, what he gets wrong is: “ . . . until the private sector is ready to carry the economy forward again . . . “ thus demonstrating he really doesn’t get it. This suggestion indicates a desire to return to austerity, once we emerge from the recession. Yikes!

Message to Professor Krugman: The federal government should deficit spend, and after that, deficit spend, and then deficit spend – until we are at a point of full employment of such scarce resources as people and energy – that is, until we face an inflation we can’t cure by raising interest rates (as we always have done).

Barring that kind of inflation, which is so far off, I hope your grandchildren live long enough to see it, the government needs to continue growing the economy with deficit spending.

Anyway, this is a good first step for Professor Krugman, whom I’m sure will tell us he “always believed that,” and in a few years, when he decides that deficit spending should continue he will tell us he “always believed that, too.”

Welcome to the party, Professor. Better late than never.

And I’m still jealous.

Rodger Malcolm Mitchell
Monetary Sovereignty

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#MONETARY SOVEREIGNTY

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