Mitchell’s laws: The more budgets are cut and taxes inceased, the weaker an economy becomes. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity = poverty and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
==========================================================================================================================================

This is the world according to Rick Santorum. This is what appeals to he pious right.

“Not all folks are gifted in the same way. Some people have incredible gifts with their hands. Some people have incredible gifts and … want to work out there making things. President Obama once said he wants everybody in America to go to college. What a snob. There are good decent men and women who go out and work hard every day and put their skills to test that aren’t taught by some liberal college professor trying to indoctrinate them. Oh, I understand why he wants you to go to college. He wants to remake you in his image. I want to create jobs so people can remake their children into their image, not his.”

“Satan has his sights on the United States of America. This is a spiritual war. And the Father of Lies has his sights on what you would think the Father of Lies would have his sights on: a good, decent, powerful, influential country – the United States of America. If you were Satan, who would you attack in this day and age? There is no one else to go after other than the United States and that has been the case now for almost 200 years, once America’s preeminence was sown by our great Founding Fathers.”

“If the Supreme Court says that you have the right to consensual (gay) sex within your home, then you have the right to bigamy, you have the right to polygamy, you have the right to incest, you have the right to adultery. You have the right to anything.”

“He’s making the world a much more dangerous place as he continues to pull America back and allow those who seek to do harm to freedom, those who seek to oppress — yes, evil forces around the world.”
[For bringing home soldiers from overseas]

‘In the Netherlands people wear a different bracelet if you’re elderly and the bracelet is ‘do not euthanize me.’ Because they have voluntary euthanasia in the Netherlands, but half the people who are euthanized every year, and it’s 10 percent of all deaths for the Netherlands, half of those people are euthanized involuntarily at hospitals because they are older and sick. And so elderly people in the Netherlands don’t go to the hospital, they go to another country, because they are afraid, because of budget purposes, that they will not come out of that hospital if they go in with sickness.”
[100% invented from thin air, on all points]

“One of the things I will talk about, that no president has talked about before, is I think the dangers of contraception in this country. Many of the Christian faith have said, well, that’s OK; contraception is OK. It’s not OK. It’s a license to do things in a sexual realm that is counter to how things are supposed to be.”

“I have nothing, absolutely nothing against anyone who’s homosexual. If that’s their orientation, then I accept that. And I have no problem with someone who has other orientations.”

“We all know that this country was founded on a Judeo-Christian ethic but the Judeo-Christian ethic was a Protestant Judeo-Christan ethic, sure the Catholics had some influence, but this was a Protestant country and the Protestant ethic, mainstream, mainline Protestantism, and of course we look at the shape of mainline Protestantism in this country and it is a shambles, it s gone from the world of Christianity as I see it.”

“I don’t believe in an America where the separation of church and state is absolute. The idea that the church can have no influence or no involvement in the operation of the state is absolutely antithetical to the objectives and vision of our country”

“The president’s agenda is not about you. It’s not about your quality of life. It’s not about your job. It’s about some phony ideal, some phony theology. Oh, not a theology based on the Bible, a different theology, but no less a theology.”

“A third of all the young people in America are not in America today because of abortion, because one in three pregnancies end in abortion.”

“I find it almost remarkable for a black man to say ‘now we are going to decide who are people and who are not people’.”
[Referring to President Obama and his pro-choice beliefs]

“They are forcing them to pay for something that costs just a few dollars. Is that what insurance is for? The foundational idea that we have the government tell you that you have to pay for everything as a business. Things that are not really things you need insurance for, and still forcing on something that is not a critical economic need, when you have an economic distress, where you would need insurance. But forcing them even more to do it for minor expenses.”
[Describing how cheap hospital care for pregnancies is.]

“They are taking faith and crushing it. Why? Why? When you marginalize faith in America, when you remove the pillar of God-given rights, then what’s left is the French Revolution. What’s left is the government that gives you right, what’s left are no unalienable rights, what’s left is a government that will tell you who you are, what you’ll do and when you’ll do it. What’s left in France became the guillotine. Ladies and gentlemen, we’re a long way from that, but if we do and follow the path of President Obama and his overt hostility to faith in America, then we are headed down that road.”

“I don’t want to make black people’s lives better by giving them somebody else’s money; I want to give them the opportunity to go out and earn the money.” (“I’ve looked at that quote, in fact I looked at the video. In fact, I’m pretty confident I didn’t say black. I started to say is a word and then sort of changed and it sort of — blah — mumbled it and sort of changed my thought.”)

“They talk about income inequality. I’m for income inequality.”

“I mean the fact is that some of this information that we have found out that led to Usama bin Laden actually came from these enhanced interrogation techniques.”

“Isn’t that the ultimate homeland security, standing up and defending marriage?”

“The idea is that the state doesn’t have rights to limit individuals’ wants and passions. I disagree with that. I think we absolutely have rights because there are consequences to letting people live out whatever wants or passions they desire.”
[Limited government??]

“The men and women who signed that declaration wrote the final phrase, ‘We pledge to each other our lives, our fortune, and our sacred honor.”
[No women signed the Declaration of Independence]

“What we should be teaching are the problems and holes and I think there are legitimate problems and holes in the theory of evolution. And what we need to do is to present those fairly from a scientific point of view. And we should lay out areas in which the evidence supports evolution and the areas in the evidence that does not.”

I award Rick Santorum 1 clown, and I award the people who voted for him, 4 clowns. As long as he doesn’t run short of clownish statements, and the pious right doesn’t run short of clownish candidates, I won’t run short of clowns to award.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com

==========================================================================================================================================
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 exports

#MONETARY SOVEREIGNTY

Mitchell’s laws: The more budgets are cut and taxes inceased, the weaker an economy becomes. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity = poverty and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
==========================================================================================================================================

What are the parallels among rivers, roads and the economy?
.

Rivers:

The fastest river water is at the middle. Water nearer the shores is impeded by friction, and ironically, if the center water moves fast enough, eddies will form at the edges, where the water actually moves backward.

If you add the forward motion of every water molecule, you get the total output of the river. Because eddies have a lower forward speed (or even a backward speed), they reduce total river output. These eddies are “turbulence,” in which the water mixes as it flows, rather than flowing in straight lines.

Increasing the speed of the center water causes more eddies, wherever faster water touches slower water – so that increased pressure on the river to move faster is met by more and more turbulence, more resistance, and a less-than-proportional increase in river speed.

Given any level of pressure, a river will flow fastest if turbulence is reduced and every molecule of water moves in the same direction at the same speed. When there are speed gaps among water molecules, the slower water will drag down the speed of the faster water. All else being equal, the smaller the speed gap, the faster the river will move.
.

Roads:

I began thinking about this recently on a long driving trip from Boca Raton, FL to Chicago. I spent several hours on four-lane roads (two in each direction), and frequently I saw this sign – I’m sure you’ve seen it too: “Speed limit: Autos 65, Trucks 60.”

On crowded highways, traffic moves faster and safer if everyone stays in their lanes rather than repeatedly changing lanes to get into or out of the faster lane (aka “turbulence”). Lane changes force drivers in the ‘changed-to” lane to slow, while changing drivers lane may first slow, then speed up, then drop into average speed, and this continual changing of speed causes bunches and gaps which overall, reduce the average forward speed.

(Visualize, for instance, a 60-yard dash, where runners edge in and out of lanes. Their average speed will be lower than if they had stayed in their lanes.)

But by law, truck drivers are required to go 5mph slower than cars. They are required to cause turbulence. The average-speed car will try to pass the average-speed truck, by moving from the right lane into the left lane, then moving back to the right when an even faster car comes up behind. (That’s the other law, which explicitly says, “Slower traffic to the right.”)

Then, some trucks try to pass other trucks (this takes forever), cars going slowly in the fast lane and cars continually weaving to find the open lane. By forcing trucks to go slower than cars, the law encourages traffic jams – bunching, weaving, speeding and slowing – where no one averages the speed limits, either for cars or for trucks.

So, the worst possible scenario is for some vehicles to be mandated to go slower than other vehicles, while sharing lanes. The slower vehicles drag down the speed of the faster vehicles, which in turn, even drags down the speed of the slower vehicles.

All vehicles – cars, trucks, busses –should be encouraged to run at the same speed. The smaller the gap in speed, the faster will be the average speed.
.

The Economy:

For the economy to grow most quickly (assuming that is a goal), all economic “drivers” should move in the same direction and at similar speeds, without the eddies and vortexes that work counter to economic growth.

We all share the same “road.” When faster drivers interact with slower drivers, friction and turbulence reduce average economic growth speed. And the greater the speed differences among “drivers,” the less growth will result. In economics, this is the income “gap.”

All those who benefit from economic growth (and who does not), will benefit more from a more laminar economic growth and a lower income gap.

Gross Domestic Product, the usual measure of economic growth, requires spending. Increase spending within an economy and GDP increases. On average, a rich person spends more than does a poor person. Per capita, rich people contribute more to economic growth. The center of the river moves more water than do the shores.

While rich people grow the economy by spending more, poor people slow economic growth by spending less, like eddies in a river or trucks causing traffic jams.

To increase the average flow of a river, we should not reduce the flow of the fastest water, but rather should increase the flow of the slowest, reducing the speed gap between fastest and slowest. This will reduce turbulence and eddies.

To increase the average speed of a road, we should not reduce the top speed, but rather should increase the speed of the slowest moving vehicles, reducing the speed gap between fastest and slowest. This will reduce turbulence, lane changing and traffic jams.

To increase GDP growth, we should not tax or otherwise impede the rich, but rather should increase the growth of the poor, reducing the wealth gap between the richest and the poorest. This will reduce turbulence and non-productivity.

In all cases, the average speed can be increased by two, concurrent strategies:

1. Maintain or even moderately increase the top speed while
2. Dramatically increasing the slower speed.

The “speed” gap must be reduced, not by slowing the fastest, but by speeding the slowest.

In a river this might mean removing turbulence-causing boulders from the bed and weeds from the shore. In a road this might mean increasing the speed of trucks to reduce the turbulence of lane changing.

In an economy, the turbulence of the wealth gap can be decreased by lifting the poor, but not through private charity, which like changing lanes, diverts private investment from growth to rescue. Instead, the federal government should rescue the poor, i.e. remove boulders and weeds from the riverbank and allow trucks the same speed limit as cars.

At “Closing the gap between rich an poor” I discussed tax approaches for reducing turbulence in economic growth, with this example:

What if the federal government offered to support every state, county and city on a per-capita basis, if these governments voluntarily would forego collection of all local sales and income taxes?

Consider Chicagoans. They pay taxes to Chicago, to Cook County and to Illinois. Here are the taxes residents pay just to the state of Illinois:

Aircraft Use Tax, Automobile Renting Occupation & Use Taxes, Bingo Tax & License Fees, Business Income Tax, Charitable Games Tax & License Fees, Chicago Home Rule Municipal Soft Drink Retailers’ Occupation Tax, Cigarette & Cigarette Use Taxes, Coin-Operated Amusement Device Tax, County Motor Fuel Tax, Dry Cleaning License Tax & Fee, Electricity Distribution & Invested Capital Taxes, Electricity Excise Tax, Energy Assistance & Renewable Energy Charges, Environmental Impact Fee & Underground Storage, Gas Tax, Gas Use Tax, Hotel Operators’ Occupation Taxes, Individual Income Tax, Liquor Gallonage Tax, Manufacturer’s Purchase Credit (MPC), Metropolitan Pier and Exposition Authority (MPEA) Food & Beverage Tax, Motor Fuel Taxes, Oil & Gas Production Assessment, Personal Property Replacement Tax, Property Tax Information, Pull Tabs & Jar Games Tax & License Fees, Qualified Solid Waste Energy Facility Payments, Real Estate Transfer Tax, Sales & Use Taxes, Sales of Aircraft & Watercraft by Lessors, Tax Increment Financing (TIF), Telecommunications Tax, Telecommunications Infrastructure Maintenance Fees, Tire User Fee, Tobacco Products Tax, Use Tax for Individual Taxpayers, Vehicle Use Tax, Watercraft Use Tax, Withholding (Payroll) Tax

At #OWS is an angry baby, I put forth nine steps for growing the economy:

1. Eliminate FICA (Click here)
2. Provide free Medicare — parts A, B & D — for everyone, from cradle to grave.
3. Send every American citizen an annual check for $5,000 or give every state $5,000 per capita (Click here)
4. Provide long-term nursing care insurance for everyone
5. Provide free education (including post-grad) for everyone
6. Provide a salary for everyone attending school (Click here)
7. Eliminate corporate income taxes
8. Increase the standard income tax deduction annually
9. Increase federal spending on the myriad initiatives that benefit America

Rather than the left’s counter-productive desire to increase taxes on the rich, and the rights counter-productive desire to reduce the deficit and federal spending, our leaders should discuss ways to lift the economy by lifting the poor to reduce the wealth gap and its associated friction and turbulence.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com

==========================================================================================================================================
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 exports

#MONETARY SOVEREIGNTY

Mitchell’s laws: The more budgets are cut and taxes inceased, the weaker an economy becomes. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity = poverty and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
==========================================================================================================================================

Lower taxes won’t help you save or invest.

If you believe that statement, then you are in perfect agreement with the author of the following article and with Warren Buffett.

Time Magazine: Why Lower Corporate Taxes Won’t Create More Jobs
By Rana Foroohar, February 23, 2012

Yesterday, President Obama announced a long-awaited proposal to cut corporate taxes in America, which U.S. businesses complain are much too high by international standards. What’s being missed in all this is that the corporate tax debate and the jobs debate are two separate things. Here’s why.

America has the second highest corporate tax rate in the rich world. But most American businesses don’t pay it. The President is suggesting that the corporate tax rate drop from 35% to 28%. But as my colleague Fareed Zakaria wrote a few months back in Time, few of the biggest U.S. businesses are paying that rate right now; indeed, most are paying much less – 115 of the companies in the S & P 500 paid less than 20% in tax over the last five years. And 39 firms paid less than 10%.

True. If you cut the tax rate from the rate no one is paying to the rate everyone is paying, you haven’t really cut taxes at all. That’s clear, though misleading, as to “no one” and “everyone,” since clearly some businesses must be paying the highest rate (probably small businesses), and would benefit from a lower rate.

But here’s where Ms. Foroohar’s logic gets even screwier:

Fundamentally, lower taxes aren’t the reason that businesses choose to invest, or not, in a certain country. As Warren Buffett told me when I interviewed him late last year, “The idea that American business is at a big disadvantage against the rest of the world because of corporate taxes is baloney in my view. In the 50s and 60s, corporate taxes were 52%, and we were making all kinds of [job] gains.”

True enough. In fact, you can see more and more evidence for the fact that business doesn’t locate in a particular country just because it’s cheaper to do so.

Please, Mr. Buffett. Get real. The 50’s and 60’s did not have the ease of import/export we have now. China, India, South America et al weren’t massive exporters to the U.S., nor was plant relocation as easy and common. We weren’t Monetary Sovereign. We were gearing up for the cold war, the Korean war and the Vietnam war. The euro didn’t exist. In fact, virtually nothing was the same as now. So is this is your best example — a massively different world from fifty years ago?

Consider the recently released Harvard Business School study looking at insourcing and outsourcing decisions among 10,000 alumnae who are running American businesses. The key reason for outsourcing wasn’t labor cost, but a combination of cost, proximity to market, and (most importantly) better worker skill sets abroad. In order for America to create jobs at home, we need to do the heavy lifting to reform education and develop workers who can do the sort of jobs businesses need them to do.

Notice the phrasing, “ . . . a combination of cost, . . . “ Since taxes are part of costs, taxes do affect outsourcing. So let’s not hear any nonsensical conclusion that tax costs are meaningless to business decisions. Tax costs aren’t the only reason to outsource, but they surely are part if the reason.

Additionally, unemployment is not caused only by outsourcing.

Anyway, it gets even screwier:

As Buffett says, nobody ever stopped investing because of high taxes.

Really? Taxes reduce the amount of money a company has available for investing and spending. If a company pays 20%, 10% or even 1% of its profits to the government, that’s 20%, 10% or even 1% it can’t spend to grow its business. Period.

The notion that lower corporate taxes (or better yet, the elimination of corporate taxes) won’t help grow the economy, and thus create more jobs, is so silly on the face of it, one wonders why such mental gymnastics or pure mendacity are brought to bear. What’s the Foroohar/Buffett motive for ignorance?

How much effect President Obama’s plan will have, can be debated, but there can be no debate about the fact that reducing business taxes will help businesses, help the economy and reduce unemployment.

Ms. Foroohar and Mr. Buffet each are awarded a dunce cap, from my unending, sovereign supply, for their statements in direct conflict with common sense and arithmetic.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com

==========================================================================================================================================
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 exports

#MONETARY SOVEREIGNTY