The secret: Why Obama really, really wants to cut Social Security

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.
=====================================================================

Some of you may be amazed that a Democratic President has, for many years, been so insistent on cutting Social Security. He’s made you believe he is “giving in” for the sake of “compromise,” but in fact, he is as right-wing-ruthless as the Republicans, when it comes to cutting benefits to the middle-and lower-income groups.

It’s no compromise. He actively wants cuts. Further, this self-anointed “friend of the middle class” could hardly wait to raise FICA, the most regressive tax in American history.

So what motivates this right-winger in left-wing clothing? Here’s a clue:

Bill Clinton’s $80 Million Payday, or Why Politicians Don’t Care That Much About Reelection

On December 21, 2000, President Bill Clinton signed a bill called the Commodities Futures Modernization Act. This law ensured that derivatives could not be regulated, setting the stage for the financial crisis.

Just two months later, on February 5, 2001, Clinton received $125,000 from Morgan Stanley, in the form of a payment for a speech Clinton gave for the company in New York City. A few weeks later, Credit Suisse also hired Clinton for a speech, at a $125,000 speaking fee, also in New York.

The dirty secret of American politics is that, for most politicians, getting elected is just not that important. What matters is post-election employment.

It’s all about staying in the elite political class, which means being respected in a dense network of corporate-funded think tanks, high-powered law firms, banks, defense contractors, prestigious universities, and corporations. If you run a campaign based on populist themes, that’s a threat to your post-election employment prospects.

In 2004, Clinton got $250,000 from Citigroup and $150,000 from Deutsche Bank. Goldman paid him $300,000 for two speeches, one in Paris.

As the bubble peaked, in 2006, Clinton got $150,000 paydays each from Citigroup (twice), Lehman Brothers, the Mortgage Bankers Association, and the National Association of Realtors.

In 2007, it was Goldman again, twice, Lehman, Citigroup, and Merrill Lynch.

Those are “message” payments. They tell all politicians, “See how if you play ball now, you’ll be rewarded later.”

Today, the Democrats lie, “The deficit should be reduced,” the Republicans lie, “the deficit should be reduced,” and Obama and the media say the same thing.

But, economics says there is no reason to reduce the deficit. In fact, it should be increased. The government can pay any bill of any size, and inflation is widely predicted not to be a threat for many years.

So why do Congress, the President and the media lie, knowing their lies not only hurt America, but specifically hurt the middle- and lower-income classes?

Answer: They are paid to lie.

The upper .1% income group derives its power from the income/wealth gap between them and the 99.9%. If there were no gap, no one would be rich, and the greater the gap, the richer and more powerful the .1% is.

Even if you made $1 million a year, you wouldn’t be rich, if everyone else also made $1 million a year. But, if you made $10K a year, and everyone else made $1K, you would be fabulously wealthy.

In short, “rich” and “wealthy” are not absolute terms; they are comparative terms.

So the top .1%, wanting more power, bribe the politicians (via campaign contributions and promises of lucrative employment later) to widen the gap by cutting the deficit. And, of course, the media are owned by the rich,so they lie, too.

Because the vast majority of deficit spending benefits the 99.9%, cutting the deficit widens the gap — exactly what the rich want.

Before the past election, I urged readers to vote for Obama as the better choice between two really bad choices. My opinion was Romney would have been a greater disaster for America than Obama.

That said, Romney at least, could point to some pre-politics accomplishments. Although he hated the underclasses, he did build Bain Capital, and he successfully led the Salt Lake Olympics.

And what were Obama’s pre-politics accomplishments? He was a “community organizer” (whatever that is), and he . . . er, ah, was sort of a lawyer, briefly.

So, how did Obama rise though the ranks to attain his position, despite having few accomplishments. As a Chicago-style politician, he understood the way to success is to do the bidding of the moneyed class. He was trained to do as he was told.

I’m a life-long Chicagoan. I know how Obama came to be a state senator, a national senator and the President. Big money backed him, because he was dependable (for them) and now, he wants big money to reward him when he retires from the Presidency, by building a large Obama library in Chicago and by making him “Clinton-rich.”

That is how it’s done, and those who don’t understand these facts, continue to argue economics, when the real argument revolves around the income/wealth gap.

The words “rich” and “wealthy” are not absolute terms; they are comparative terms. Many years ago, someone making $50K per year was fabulously wealthy, because most people made less than $5K. Today, $50K is middling.

If I asked you, “Is someone making 20,000 naira per year, wealthy?” your first question would be, “How many naira does the average person earn?” Wealth is defined by the gap.

Not only does the income/wealth gap define wealth, but the wider the gap, the wealthier and more powerful the rich are. So the rich are not interested in absolute dollars; they are interested in comparative dollars. They are interested in the gap.

You can widen the gap by giving the rich more money or by taking money from the poor. Cutting Social Security widens the gap, as does cutting food stamps, cutting Medicaid and increasing FICA payments — all Obama proposals and initiatives.

For the sake of his wealthy supporters, Obama’s goal is to widen the gap, so he will be “Clinton-rich” after he leaves office.

To understand today’s sequester arguments, forget about the lie that the debt is “unsustainable” or that the government is “broke” or that the government, like you, “should live within its means.” Those claims all are misdirection from the real issue.

The real issue for politicians, left and right, is how best to curry favor with the rich. The rest is just to brainwash you, the public.

Don’t pay attention to what Obama says. He doesn’t want to “compromise.” He doesn’t want to “save” Social Security, Medicare and Medicaid. He doesn’t want to lift the middle class.

He wants to please the wealthy by widening the gap. And if you’re real generous, he’ll invite you to dinner in the White House, with him and Michelle.

How do I know? A dear friend of mine was quite generous, and recently had that very dinner. I guess his contribution was pretty good, but for a few bucks more, he might have had Obama cut food stamps.

Hmmm . . . I wonder how much it would cost to get the National School Lunch Program eliminated. Those kids are too fat, anyway.

Rodger Malcolm Mitchell
Monetary Sovereignty

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

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

Germany: “Eat our neighbors, then kill our citizens.” WWII revisited.

“I’ve been applying leeches to cure your anemia, but for some reason, the more blood I draw, the weaker you become.” Barack Obama, MD

.
In The United States of Europe: The when and the how. (Monday, Apr 30 2012), we said:

The long term survival of any monetarily non-sovereign government requires money coming in from outside its borders. Germany, for instance, survives by exporting goods and services (i.e. importing euros).

Of course, Germany has to get those euros from someplace, and unfortunately for their neighbors, that “someplace” is them. The flow of euros toward Germany sucks the life blood from France, Greece, Portugal, Spain and other nations having negative balances of payment.

Apparently, Germany is confident it will continue to bleed its neighbors, because:

German cabinet approves drastic reduction in new debt

Germany would take on no new debt, while a budget surplus of five billion euros (will) be secured in 2016.

Translation: In 2016, five billion net euros will be taken from Germany’s private sector, impoverishing the middle- and lower classes.

“With all modesty, this is a result of historic proportion,” Economics Minister Philipp Rösler told reporters in Berlin. “The lesson from the sovereign debt crisis is that solid finances are essential.”

Translation: “I’m brilliant, because I have figured out how to run a surplus in a monetarily non-sovereign nation: Tax the hell out of the little people. But when things turn sour, don’t blame me. I’ll do a ‘Sergeant Schultz’ and deny I had anything to do with it.”

Finance Minister Wolfgang Schäuble used the occasion to once again brush aside accusations from fellow eurozone countries Germany had been insisting on too much austerity in southern Europe. He argued the Germany example was proof there was no contradiction between budget consolidation and growth.

Translation: There is no contradiction if you use the other guy’s money.

The cabinet said the strong performance of the German economy and its labor market had helped to boost tax revenue and produce a solid fiscal basis for the country. But it added increased tax income had not been used to increase spending.

Translation: “The spending increase came from the money we took out of our neighbors’ treasuries. But don’t tell them that. They are too stupid to figure it out for themselves.”

Rösler’s crowing aside, the Germany is building on the flesh and blood of its neighbors and its citizens. In a brilliant campaign, reminiscent of the American .1% income group’s campaign to impoverish the U.S. middle- and lower classes, Germany has convinced the world its success is based on “budget consolidation” and “solid finances.”

A growing Gross Domestic Product requires a growing supply of money. In the case of Monetarily Sovereign nations, like the U.S., Canada, China, Australia et al, that money can be created ad hoc by their sovereign governments.

But for monetarily non-sovereign nations, which have no sovereign currency and so the total supply cannot be increased, each nation must try to steal euros from the others, in a nationalistic riot of mutual cannibalism.

When the other euro nations finally surrender to the eventuality that they either return to Monetary Sovereignty and re-adopt their own currency, or merge into a financial version of a United States of Europe, Germany will run out of blood donors.

At that point, German citizens will begin to suffer so much they will seek out a strong, ruthless leader, who will identify and persecute scapegoats, then renounce the euro, so as to finance a war.

During the chaos, the German uber-reich will feed off the dying German populace, as salaries are diverted to taxes and the focus turns to saving the government. Soon there will be but two classes: The very wealthy and the very poor. The gap will be complete.

By the way, eurozone, how’s that austerity thing working out for you?

Rodger Malcolm Mitchell
Monetary Sovereignty

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

#MONETARY SOVEREIGNTY

As I said, Congress has been bribed.

After Watering Down Financial Reform, Ex-Senator Scott Brown Joins Goldman Sachs’ Lobbying Firm
By Josh Israel on Mar 11, 2013 at 3:45 pm

During his nearly three years in the U.S. Senate, Scott Brown (R-MA) frequently came to the aid of the financial sector — watering down the Dodd-Frank bill and working to weaken it after its passage — and accepted hundreds of thousands of dollars in campaign cash from the industry.

Now, the man Forbes Magazine called one of “Wall Street’s Favorite Congressmen” will use those connections as counsel for Nixon Peabody, an international law and lobbying firm.

As I was saying, Congress has been bribed, BRIBED, via campaign contributions and promises of lucrative employment later, to widen the income/wealth gap. The right wing Supreme Court aided and abetted the crime.

Any doubts?

Rodger Malcolm Mitchell
Monetary Sovereignty

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

#MONETARY SOVEREIGNTY

Question of the day: Why is it easier to believe in worldwide ignorance than in conspiracy?

Of our leaders – the President and his many advisors, the Secretary of the Treasury and his many advisors, the Chairman of the Fed and his many advisors, the Counsel of Economic Advisers and their 400+ economic PhDs, and Congress, 535 strong – not one of these thousand-plus leaders admits to understanding Monetary Sovereignty.

Not one admits to knowing the federal government cannot run short of dollars. Instead, 100% of them falsely claims the government is “broke” and the federal deficit is “unsustainable” and the debt will be paid by our children.

Not one admits to knowing the U.S. government, being Monetarily Sovereign, is different from the monetarily non-sovereign governments of Chicago, Ohio, Greece and France.

Not one admits to understanding why personal finances are unlike federal finances. So our leaders lie, as President Obama did, when he said, “You have to live within your means, so the federal government should live within its means.”

The followers of Modern Monetary Theory (MMT) reject the notion that this is a conspiracy, perhaps because conspiracy theories, in of themselves, so often have lacked proof. MMT says this simply is an example of massive and unimaginable ignorance, which can be cured by education.

So they try to educate our leaders with ever simpler and clearer explanations – all to no avail. Somehow, strangely, our leaders just can’t seem to “get it.”

Meanwhile, the charade in Washington, DC continues, as each political party competes to destroy the American middle class, by cutting benefits.

Recently, I read an article by Chris Cook, a senior research fellow at University College London and a former director at the International Petroleum Exchange. The piece is titled, THE MYTH OF DEBT. I urge you to read it.

Here are a few excerpts:

The fiscal myth of tax and spend shared by virtually all schools of economics is that tax is first collected and then spent. This has never been the case: the reality has always been that government spending has come first and taxation later.

Taxation acts to remove money from circulation and to prevent inflation: it does not fund and never has funded public spending.

THE clearing banks have their own power to create money, for the purposes of lending. They are responsible for most new money in the modern system They, too, are the subject of a well-peddled myth, which is that deposits are first collected by banks and then spent or loaned into circulation on the basis of requiring a certain reserve level of deposits to be maintained.

In fact, there is no constraint on UK credit/money creation of reserves: the constraint on modern money creation by private banks is the capital required to cover losses on loans. Private banks first lend . . . and then fund their dated interest-bearing loans (assets) with dated interest-bearing deposits (liabilities).

Putting most money creation into the hands of organisations whose raison d’etre is to make money from lending (and more recently, from speculation) is behind much of what has gone wrong with the financial system. As with all historic bubbles, the profit motive drove excessive credit creation.

Bank lending departments were abetted by everyone from bank lobbyists persuading the authorities to allow dangerously low capital ratios to trading departments devising increasingly complex instruments for shifting loans off bank balance sheets to make more and more lending possible.

From these observations, I reach two conclusions. First, the clearing banks cannot be trusted to freely create the credit which is modern money. If money is to be created by a middleman or intermediary then it should be either the central bank or the Treasury itself.

My second conclusion is that we must revisit the concept of the national debt itself and recognise it for the national equity it is in reality. We have only saddled ourselves with this debt delusion because we have forgotten what the true relationship actually is between public spending and taxation.

Mr. Cook’s article appeared March 5th, 2013, in the Scottish newspaper, the Herald. Clearly, he understands Monetary Sovereignty. His Scotland is part of the UK, which remains Monetarily Sovereign, while much of Europe surrendered its most valuable asset, its Monetary Sovereignty, by adopting that alien currency, the euro.

Why did Mr. Cook feel compelled to write this piece? Because, the leaders of the UK, and all their economic advisers, even now, debate the best way to sacrifice their middle class, while also debating the forfeit of their Monetary Sovereignty via entry into the eurozone.

So, is this an example of worldwide ignorance or worldwide bribery and conspiracy?

Aside from their provably wrong statements, there is no evidence these thousands of economics-educated people do not understand the basics of economics. There is no evidence telling us these people do not understand the clear and obvious facts expressed in Mr. Cook’s article and in thousands of other such articles written under the MMT banner and in this very blog.

While zero evidence tells us these people are ignorant, what is the evidence for conspiracy?

Slate
The Failure of Peterson-ism
By David Weigel|Posted Monday, Dec. 10, 2012

For 20 years, a coalition of wealthy people—Pete Peterson chief among them—has spent hundreds of millions of dollars to build public support for austerity.

Hundreds of millions of dollars? Where did those dollars go? Many went into the campaign funds of politicians. Hundreds of millions will buy a great many politicians.

Then there are the Koch brothers.

According to

OpenSecrets Blog here are a few Koch political expenditures:
–Political Action Committee Spending (1989 to 2010): Koch Industries: $5,938,993
–527 Group Contributions (2001 to 2010): Koch Industries: $574,998
–Lobbying Expenditures (1998 to 2010): Koch Industries: $50,972,700

So well more than $55 million dollars were spent, most of them on “lobbying.” That too will buy you a great many politicians.

Then there is George Soros:

http://www.politico.com/news/stories/1010/43157.html Politico quotes him as saying, “Admittedly, consumption cannot be sustained indefinitely by running up the national debt …”

According to OpenSecrets blog: Individual donations to 527 organizations (2001 to 2010)
George Soros: $32.5 million

Hundreds upon hundreds of millions of dollars, given to politicians by people who claim the federal deficit and debt are, or soon will be, too large. Are these billionaires, with all their access to economic facts, also ignorant of economics?

Finally, the rich own the media, which promulgate the lie that deficits must be reduced.

So, which is more likely: Universal ignorance of economics by economics experts and the media or worldwide bribery of politicians and ownership of the media? All the evidence is on the side of bribery; no evidence supports worldwide ignorance.

What is the motive? Why do billionaires, who if anything, are experts in money, “waste” their valuable, and much beloved, dollars spreading the lie that deficits must be reduced? Because that lie will widen the wealth and income gap between the rich and the rest.

If you earned $50,000 per year, would you be rich? Yes, if everyone else earned $10,000. But no, if everyone else earned $50,000. It is the gap that makes the upper .1% rich and powerful, and the wider the gap, the richer and more powerful they are.

Without the gap, no one would be rich. That is why the rich are willing to spend millions, even billions, to widen the gap and to increase their power over the middle- and lower-classes.

Do we really believe we are so brilliant that we understand a Monetarily Sovereign government cannot run short of money, but these thousands of intelligent leaders simply cannot understand? A reporter in Scotland understands, but the leaders of the UK do not? Really?

These leaders are not stupid people. They are bribed people.

The public has been misled and brainwashed. The people do not want to learn economics, but rather wish to rely on their leaders. When the bribed leaders lie, the public believes.

So to change the world, and to save the middle- and lower classes, we who understand Monetary Sovereignty first must explain to the people how and why they have been lied to. We must not fear to explain the conspiracy and the motive.

Only when the people see the bribery and the lies, will they be willing to accept the truth.

And it is the truth that will save them from the ever growing disaster known as the “gap.”

Rodger Malcolm Mitchell
Monetary Sovereignty

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

#MONETARY SOVEREIGNTY

Share this:

Share this:

Share this:

Share this: