I titled a post written on April 14, “A picture of abject stupidity.” The centerpiece was this photo, which appeared in many publications, including the St. Lous Post Dispatch, along with this description:
While many Americans are filled with fear, Melissa Ackison says the coronavirus pandemic has filled her with anger.
The stay-at-home orders are government overreach, the conservative Ohio state Senate candidate says, and the labeling of some workers as “essential” arbitrary.
“It enrages something inside of you,” said Ackison, who was among those who protested Republican Gov. Mike DeWine’s orders at the statehouse in Columbus with her 10-year-old son. She has “no fear whatsoever” of contracting the virus, she said Thursday, dismissing it as hype.
Melissa Ackinson may or may not be stupid. But there is a strong temptation to call her stupid because:
She is a conservative politician, a follower of Donald (“I know everything”) Trump, and
She is encouraging people to stand on the edge of a cliff during an earthquake.
She may or may not be stupid or simply a conniver trying to advance herself politically on Trump’s shirttails.
But I do not believe her followers are stupid. I believe they are terrorized.
They have lost their jobs — jobs that may never return. They not only have no source of income, but they have scant savings.
They have families to feed; they have rent and mortgages to pay. They can’t even look for work, because there is none, and even if there were any jobs, the people may not even have enough money to travel to a job interview.
These are brave people, willing to risk death in order to work for money, while the politicians’ golden incomes and benefits continue — and meanwhile those same politicians dither and vacillate about an extra $250 Billion, though several more Trillions are needed to save this economy.
And all the while, columnists, who are ignorant of economics write this:
Chapman: The legislation is the start of what is likely to be a cascade of outlays to offset the terrifying collapse of the U.S. economy. Speaker Nancy Pelosi says House Democrats are considering another spending bill that could “easily” exceed $1 trillion, and the administration is not inclined to impersonate Scrooge.
Except that the additional $1 Trillion — if it ever happens, while Congress debates about $250 Billion — is far too little and much too late. At least an additional $5 Trillion is needed. So the Scrooge impersonation continues.
The drastic shift has many people on the left claiming that the previous constraints on budget policy were a fraud. If we can afford all this spending, the argument goes, why can’t we afford “Medicare for All,” the Green New Deal, free college and other ambitious initiatives?
“It’s a fascinating progressive moment because what it’s shown is that all of these issues have never been about ‘how are you going to pay for it?’ ” said Rep. Alexandria Ocasio-Cortez, D-N.Y., last month. “All of these excuses that we have been given as to why we cannot treat people humanely have suddenly gone up in smoke.”
But this is like thinking that because you laid out several thousand dollars to replace your broken furnace in the dead of winter, you can also add a whole new wing to the house.
Being forced to spend a large sum in a serious emergency, and even borrow to cover it, doesn’t mean you would be wise to give up living within your means.
That false comparison with personal finances either is abject stupidity, or unmitigated ignorance, or simply parroting the party line of the rich, or all of the above.
Meanwhile, the people are left to writhe in terror, because of an inferior Congress and a ridiculous President. They see the long lines of cars with people waiting to receive help from food pantries.
I swear, that if I had no money and no jobs, and I didn’t know how I would feed my family, I too would be standing there, banging on my Congressperson’s door.
It’s the information sources and political leaders who are the stupid ones.
Between them they easily — EASILY — could end the crisis and end the fear.
That they choose not to spend enough money — which is free to our Monetarily Soveregn government — is one of the great disgraces and tragedies of our time.
So, I will do something Donald Trump never would do. I will admit it. I was wrong. The people are not stupid. They are reasonably frightened and reasonably desperate for leadership where none is to be found.
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:
There is no other way to say this. We (in the U.S.) are headed for a depression because we have an incompetent and untruthful government.
Our fundamental problem is the lack of money in the private sector. The solution is for the federal government, which being Monetarily Sovereign has unlimited money, to pump dollars into the economy.
Sorry, but it isn’t any more complex than that.
Problem: Lack of money. Solution: Add money. How much money? What the economy lost due to the virus.
The economy needs at least $7 Trillion net added from the federal government. But, our Congress is spending far too little and spending way too late. Unless Congress and the President deign to see the light, we have no way to prevent a depression.
A week ago, Denmark’s Social Democratic government announced it would cover 75% of the wages of workers who would otherwise be laid off. I don’t think anyone expected the UK to announce, just a few days later, a policy that would cover 80% of the wages of workers who were about to be sacked.
Why are right-wing governments considering, and in some cases implementing policies they called impossible and undesirable when the left suggested them?
To put it briefly, the sight of governments bailing out not only banks but also consumers and mortgage holders isn’t a sign they have grown soft, but rather a sign of the kind of crisis we are entering.
This crisis is very different from the last, and so it demands a new range of government actions. This is likely to reshape politics and economics across the Global North for years to come.
Both Denmark and the UK are Monetarily Sovereign. They have the unlimited ability to create their own sovereign currency (the krone and the pound).
They are using this ability to try to save their economies.
America’s politicians, the media, and the economists have become so enamored of the Big Lie they have been telling, they may have come to believe it themselves.
The Big Lie is comprised of several myths:
Federal taxes and federal taxpayers fund federal spending. Wrong.
While state and local governments can, and often do unintentionally run short of dollars, the U.S. government cannot. It can create unlimited dollars.
Official Monopoly™ money
For visualization purposes, the example I often give is the Bank in the game of Monopoly™. In any Monopoly game, there usually are about four players competing for Monopoly dollars.
Additionally, there is a Bank that both gives and receives dollars.
The Monopoly™ Bank is similar to the U.S. government in that, by rule, the Monopoly Bank cannot run short of money.
Here is the rule as printed in each Monopoly Game box:
“The Bank never can ‘go broke.’ If the Bank runs out of Monopoly money, the Banker may issue as much as needed by writing on ordinary paper.”
There are times in the game when players must pay money to the Bank and other times when the Bank must pay money to the players.
If you wish to play, and find that the game box doesn’t contain enough official Monopoly money, you don’t need to “write on paper.” You can create a table like this:
Table I
The above table indicates that each player has started with 5,000 Monopoly dollars. Notice there is no column for the Bank. None is needed. The Bank has unlimited dollars.
The game begins and immediately Alice is instructed to pay the Bank 100 Monopoly dollars for taxes. The table then looks like this:
Table II
Again, since there is no column for the Bank, Alice’s 100 dollars disappear. They effectively are destroyed.
And that is exactly what happens to your U.S. tax dollars when you send them to the U.S. Treasury. Your federal tax dollars are destroyed.
Now some may object that U.S. tax dollars are not destroyed, because the U.S. government keeps a record of them on its balance sheets.
That is a false objection; we could have kept track of the Monopoly Bank’s dollars, and that would have changed nothing.
Table III
Like the U.S. federal government, the Monopoly Bank has an infinite number of dollars. If you add Alice’s 100 to the Bank’s infinite dollars, you still have infinite dollars. That is because ∞ + 100 = ∞.
In both the Monopoly Bank and Monetarily Sovereign federal government, all tax dollars are destroyed, and because all tax dollars are destroyed, it is nonsensical to talk about federal taxes or taxpayers funding anything.
The U.S. federal government does not spend tax dollars. It creates new dollars, ad hoc, each time it issues a payment. Those who complain about the poor, or any recipient, “receiving ‘my’ tax dollars,” simply are wrong.
Only the U.S. Treasury receives your federal tax dollars, and it is the Treasury that destroys them.
Why, therefore, does our federal government not eliminate the FICA and income taxes, fund Medicare for All, fund Social Security for All, fund College for All, and do what Denmark and the UK are doing: Pay people what they would have earned had they not been laid off?
Four reasons:
1. PublicIgnorance about the differences between a Monetarily Sovereign government (federal) and a monetarily non-sovereign government (state/local).
The federal government pretends federal deficits are unaffordable and unsustainable, neither of which is true. The federal government can afford anything and sustain anything.
2. Gap Psychology: The desire of those higher in the socio-economic spectrum to distance themselves from those lower, as a way to become wealthier.
3. Deficit/debt and inflation fear:
A. Negative effects of deficits/debt have been disproved many times on this web site. The federal debt has increased more than 50,000% without negative effects.
4. The economic and moral concerns about “paying people not to work.” Society already pays people not to work:
A. The military pays a pension to those with 20 years of service. Of course, as with all things military, there have been many changes and complexities added to the program, but in general, a military person can retire in his/her 40s, with about 40% of their salary.
Many (most) of then go to work after, to supplement their pension, and that probably is the key issue. Most people hope to receive raises, i.e. to make more next year than they do this year, so receiving 80% or 90% of this year’s pay usually is not a deterrent to future working.
B. The moral concerns about giving people money they didn’t earn extend only to the middle and poor classes. The rich, who receive more from the government in terms of tax advantages, are given a moral pass, as though being rich makes one more entitled.
Thus for all these reasons, Congress and the President move slowly and reluctantly to provide the economy with sufficient growth funds, and that reluctance leads to recessions, depressions, and articles like the following:
The federal government’s $349 billion program to help small businesses stay afloat during the coronavirus pandemic has run dry, leaving thousands of small business owners whose applications are pending to wait on Congress to replenish the funds.
The Small Business Administration said Thursday it is unable to accept new applications for the Paycheck Protection Program, passed by Congress as part of the $2.2 trillion CARES Act.
The SBA will not be able to issue new loan approvals if the paycheck program and the Economic Injury Disaster Loan Program, another heavily tapped funding resource for small businesses, experience a “lapse in appropriations,” officials warned.
Launched on April 3 as part of the federal coronavirus relief act, the program offers businesses with fewer than 500 employees loans of up to $10 million to cover eight weeks of payroll. The two-year loans, which are backed by the SBA, have a 1% interest rate.
Businesses do not have to pay back the portion of the loan used to cover payroll costs as long as 75% of the proceeds are used to keep paying employees during those eight weeks.
Small businesses are especially vulnerable to the economic disruption wrought by the coronavirus pandemic.
An April 3 study by MetLife and the U.S. Chamber of Commerce found that nearly one in four small businesses have temporarily shut down, and that more than half expect to be closed within weeks.
Providing payroll support — the largest expense for most small businesses — may be a crucial bridge to the end of the coronavirus shutdown and a return to something resembling business as usual.
For a government having access to infinite funds, to penny-pinch small businesses not only is economically outrageous, but callous and cruel.
Large businesses, with large lobbying staffs (and incidentally making large campaign contributions), receive instant attention, while small businesses, the heart of the American economy and the American public, are left to scramble and beg for funds.
This is the right-wing / Libertarian approach to governing.
We repeatedly have said that at least $7 Trillion in federal deficit spending would be needed this year and more next year. We may have understated the need.
Yet we see repeated hand-wringing about an infinitely wealthy government pumping “too much” free money into a needy economy.
It is beyond disgusting, yet it has a hidden purpose: To keep the populace frightened, powerless and beholden to the very rich who run America — to keep the populace desperate and willing to accept miserable work at low pay.
This is the ongoing plan of the very rich.
Will Congress and the President climb down from their golden, guaranteed federal salaries and benefits to aid their impoverished believers? Only when these believers demand it.
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:
The essence of the editorial is: Unless everyone gets a piece of the pie, no one should get any pie. We all should starve.
Here are a few excerpts:
Treasury Secretary Steven Mnuchin has struck a deal in principle to deliver billions in financial assistance to United Airlines and other carriers to protect them from coronavirus fallout.
A similar package appears to be in the works for Boeing. These exercises in corporate favoritism are a bad idea.
We’re not rooting for any company’s failure, nor for hardship to befall employees of any industry. Rather, we’re opposed to the idea of the federal government using portions of the $2 trillion coronavirus rescue package to support and protect major players in specific industries.
In other words, the Tribune is rooting for company failure and for hardship to befall employees of the airline industry.
The enemy is not the allocation of funds. The enemy is insufficient funds.
Why “major players” and “specific industries” should not be helped never is discussed. Is it that the Chicago Tribune is not one of the “major players,” and is not receiving enough help?
Would it be better for “major players” and “specific industries” (who employ millions of workers) not to receive any help?
If the point were that money given to “major players” is being taken from “minor players,” you might agree with the Tribune. But that isn’t the case, at all.
The fact is that a craven, inept, GOP Congress has not allocated enough money to deal with the pandemic and its effect on the economy. Because there is too little money, it mathematically is impossible to give some to all who need or deserve.
In giving to the airlines, Congress has elected to save what it believes to be one of the more crucial industries. You may disagree with that selection. You may mention other industries you believe are more deserving.
But when you have a “too-little, too-late” President and Congress, you are faced with the Hobson’s choice of giving to some or giving to none.
The entire country has been knocked on its heels temporarily by the pandemic. Millions of Americans have lost their jobs, been furloughed or taken pay cuts.
Small business owners, notably restaurateurs, are suffering, and some will seek access individually to emergency loans. The retail, resort, sports, arts, and energy industries are getting crushed. Again, who isn’t besides Amazon?
Yet Boeing and the airlines — and by extension, their shareholders — get singled out for dispensation?
Yes, the airlines won the lottery. Now, shall we march in the streets demanding that airlines not receive any help, and instead should go bankrupt? Will that lift the economy?
The Tribune is fighting the wrong enemy. The enemy is not the allocation of funds. The enemy is insufficient funds.
The deal in principle for Chicago-based United and other airlines, announced Tuesday, would offer up a mix of taxpayer grants and loans to help the companies keep operating and make payrolls.
Just as a reminder, there is no such thing as a “taxpayer grant.” This is part of the Tribune’s endless promulgation of the “Big Lie,”— the lie that federal taxes fund federal spending.
Unlike state and local taxes, which fund state and local government spending, federal taxes fund nothing. They are destroyed upon receipt. Even if the federal government were to stop all tax collections, it could continue spending, forever.
That is the fundamental difference between federal government (Monetarily Sovereign) financing and state/local government (monetarily non-sovereign) financing.
Also, federal loans are ridiculous on their face. The federal government never should lend. It only should give.
When the government gives, it adds growth dollars to the economy. But when it lends, it removes growth dollars from the economy, at the instant it receives repayment — and it destroys those repaid dollars.
A similar offer is under discussion for Chicago-based Boeing. President Donald Trump and members of Congress apparently want to attach conditions to the aid, including requirements that the companies hold off on layoffs.
Another significant demand: giving the government an option to take an ownership position in exchange for the financial assistance.
The first requirement is reasonable. The government is saying, in essence, “We want to save jobs, so we will give you money for you to use in payroll.”
The second requirement is hypocritical for our right-wing government because taking an ownership position is socialism.
All those GOP Congressmen, who hate any sort of federal support for Medicare because it supposedly is “socialism” (It really isn’t), now want to take an ownership position in airlines??
Is the plan for the federal government, as the owner of certain airlines, to compete with privately-owned airlines? Or put another way, shall we allow an entity having unlimited funds and no need for profits to compete with the private-sector?
Really, really bad socialist idea.
Final terms of the United aid package weren’t released as of Tuesday afternoon. Assuming the Trump administration must go forward with bailouts, extracting ownership stakes so taxpayers might benefit from the economic recovery would make these unsavory transactions fairer.
But wouldn’t you know it, Boeing and the airlines hated that idea. They’d much rather receive the money as a blank check, thank you very much.
Again, the Chicago Tribune editors demonstrate remarkable ignorance of economics, though they persist in writing about economics.
Taxpayers do not benefit from government ownership of anything.Taxpayers benefit only from tax reductions, which can be given regardless of ownership.
As to whether Americans would benefit from improved service with government ownership and management of airlines (i.e. socialism) is a subject for debate. But there is no tax benefit.
Boeing, a government defense contractor and one of two global airplane manufacturers, is the country’s largest overall exporter. Air travel is critical to the economy. No question, the aviation industry is important.
But if high status is an argument for government intervention, it is also a reason why these companies should be able to manage COVID-19 headwinds with their own bank loans and other sources of capital.
Being non-expert in airline finances, the Chicago Tribune has made the moral (not business) decision that the airlines should be able to weather the COVID-19 storm without federal assistance.
How does the Tribune come to this conclusion? Not with any financial figures. It’s just a feeling in their bones.
We’re remembering back to the dark days of the 2008 financial crisis, when Warren Buffett stepped in to protect Goldman Sachs by investing $5 billion. Both sides benefited.
That type of private transaction is available to Boeing, United and the others, assuming they are healthy enough to survive. If they aren’t, why should taxpayers save them?
Again, the Tribune demonstrates it doesn’t know what it is talking about. The Tribune claims that because Warren Buffett helped Goldman Sachs, the airlines can get the same kind of private help, no strings attached. The Tribune just knows this — somehow.
And if the airlines can’t get that kind of help, they don’t “deserve” to survive, so we should let them go bankrupt? It’s a moral thing, not an economic thing. Right?
This is what passes for “thinking” at the Chicago Tribune.
Boeing CEO David Calhoun has addressed some of these issues in television interviews, but his responses have been contradictory.
“If we need to pursue other options in private markets that are a little more unusual, we will. I don’t think we’ll get to that, but we’ll do what we have to do, and we’ll protect the long-term outlook for our shareholders.”
Indeed, this negotiation is about the shareholders. They should be rewarded for the risks they take investing in public companies, but they also should suffer the consequences for failures.
The Tribune claims it is better for shareholders to suffer because of the COVID-19 virus, than for the government to step in. Why? As punishment for . . . being shareholders?
What about the employees; should they be punished, too? And is this true for all industries? Should every industry be punished by COVID-19 for failing to anticipate the federal government’s total ineptitude in the face of a predictable, worldwide threat?
Has the Tribune just expressed the Libertarian / Tea Party belief that any federal spending is bad?
And what about smaller businesses. Should they, their owners and their employees be punished, too?
Really, what is the Tribune’s recommendation? No government action?
Competition creates stronger companies that provide more valuable products and services to customers. Competition also weeds out the weak.
Since airline deregulation in 1978, individual carriers have succeeded and failed, but the public overall has benefited from lower fares, more destinations and safer skies.
A government rescue destroys the competition proposition.
This is not a rescue from competition. Competition didn’t cause the coming depression; the government’s ineptness is causing the problem and the government needs to solve the problem.
To blame the current situation on not being able to compete is the height of ignorance.
And by the way, in addition to “lower fares, more destinations and safer skies,” competition also has given the public more crowded planes, smaller seats, no food, and ticketed flyers being bumped.
I’m old enough to remember when flying was a pleasure. Now, you have to fly a foreign airline like Emirates for that pleasant flying experience. But that’s a story for another blog post.
But hey, rather than save the economy, let’s punish the airlines. That’s the Tribune’s “plan.”
We aren’t eager to see bankruptcies. But they may be inevitable because we don’t want Washington lawmakers using taxpayer dollars to pick private-sector winners and losers. In today’s treacherous circumstances, Boeing, United and the others need to find their own ways forward.
Again, the Big Lie. No “taxpayer dollars” are being used. All federal taxpayer dollars are destroyed upon receipt, and new dollars are created, ad hoc, each time a federal creditor is paid.
Why did the airlines appear to get their way? Capitol Hill operates on a system of clout and fear, and the airline industry can leverage both. This ends up being bad for the American free-market system.
If Congress and the administration swoop in as savior, they are absolving executives of past mistakes. They are telling them they are free to take more big risks and not fret about the consequences because they’ll be backstopped by the government.
Boeing, United and the airline industry should be forced to do what millions of entrepreneurs and mom-and-pop businesses are doing: adapting to a traumatic but necessary shutdown of the economy and figuring out how to survive — without a generous rescue from taxpayers.
The above might be true if we weren’t dealing with an extraordinary situation.Before this pandemic, the airlines and every other business in America were not coming to the federal government, hat in hand.
Only when the federal government completely fumbled its response to the pandemic, have the airlines and all other companies asked for help. Isn’t that the purpose of government? To step in when it screws up, causing the entire private sector to need help?
Now the Tribune editors suggest this all is the airline’s, and all other companies’ fault for not holding back trillions in cash so they could prepare for the next worldwide tragedy and the subsequent failures by the federal government.
What a foolish way to run a business that would be. What a foolish way to run a government that would be.
With that kind of business logic, no wonder so many newspapers have gone out of business.
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:
Economists expect the U.S. to suffer its largest-ever contraction this quarter and the unemployment rate to soar to a post-Depression record, followed by a recovery that will be moderate and drawn out.
All economists? Some economists? A few economists?
The recovery may be “moderate and drawn out” only because the federal response has been moderate and drawn out.
The stock market alone lost $1.4 trillion in just one week. This doesn’t count all the other weeks this year, and it doesn’t count all the business and personal losses.
And Congress and the President think $2 trillion will prevent a depression?? Really?
Gross domestic product will plummet an annualized 25% from April through June after a smaller setback in the first quarter and the jobless rate will hit 12.6%, the highest since the 1940s, according to the median forecasts in Bloomberg’s monthly survey of 69 economists.
Therefore, the more the federal government spends, the faster will GDP grow.
Add a trillion dollars in federal spending and GDP will rise by a trillion dollars. Straight algebra.
Federal spending also stimulates non-federal (private sector) spending, which further increases GDP.
Sadly, our federal government does not acknowledge it is a Monetary Sovereign. It has the unlimited ability to create U.S. dollars at no cost.
Instead, it follows the right-wing, Tea Party / Libertarian formula of spending the least it can, under the circumstances, because of irrational fears about deficits and “big” government.
Then to exacerbate the problem, the politicians continue with petty, political arguments about precisely where each dollar is to go.
The downturn looks likely to be deemed as the first recession since 2007-2009 by U.S. business-cycle arbiter National Bureau of Economic Research. The second half of the year will see a resumption of growth, according to the survey, though economists say the deck is stacked against a snap-back.
The Fed is expected to keep interest rates near zero until the first half of 2022.
The low-interest-rate myth continues. The popular belief is that low interest rates are economically stimulative because they make borrowing cheaper.
But low interest rates have a negative side: They reduce the amount of interest the federal government pays on its Treasury Securities, i.e. the amount of interest money the government pumps into the economy. This reduction directly cuts GDP.
The blue line is the fed funds (interest) rate. The red line is GDP growth, year-to-year.
As the above graph demonstrates, high interest rates correlate with high GDP growth and low rates correlate with low GDP growth.
As interest rates trended up, through 1980, the GDP growth trended up. Then, as interest rates trended down, the GDP growth rate trended down.
The green line is federal interest payments growth, year-to-year.
The above graph is similar to the previous graph except it shows total interest paid rather than interest rates. The result essentially is the same.
On average, the more interest the federal government pays, the more GDP grows.
“Even if the economy starts to re-open in mid-May, more than 20 million Americans will have lost their job with the economy likely having contracted around 13% peak-to-trough, more than three times deeper than the global financial crisis,” James Knightley, chief international economist at ING Financial Markets, wrote with his forecast submission.
“It will be a gradual re-opening of the economy, so a return to ‘business as usual’ is many months away.
Throw in crippling financial losses and a legacy of defaults and it means we estimate U.S. economic output won’t return” to the late-2019 peak until mid-2022 at the earliest, Knightley said.
People “lose their jobs” because companies cannot afford to maintain payroll. As the companies run short of money, their people run short of money. When consumers run short of money, they buy less, so more companies run short of money, in a self-strengthening helix descending to depression.
To cut the helix, the government must give (not lend) money to businesses and to consumers.
“Crippling financial losses and a legacy of defaults” are symptoms of a lack of money.
See the commonality? The overarching problem facing the economy is a shortage of money — which the federal government could solve with sufficient deficit spending.
The U.S. federal government has a massive built-in advantage, that if used properly, would eliminate recessions and depressions. Unlike state and local governments and unlike euro-nation governments, the U.S. government is Monetarily Sovereign.
It has the unlimited ability to create U.S. dollars and to give those dollars any value it chooses.
There is no excuse for a company to fire people because it has run short of payroll dollars if the government simply will provide per-employee financial support.
There is no excuse for “crippling financial losses” if the government will pump dollars into the economy.
We are at war with our financial enemies: Recession and depression. The U.S. government has an ultimate weapon to use against these enemies: Monetary Sovereignty.
Instead, it chooses to fight with sticks and stones — little sticks and tiny stones. And it leaves the battle to the monetarily non-sovereign states, counties, and cities. The army has departed the battlefield, leaving the women and children to fight empty-handed.
The government is in a war against the enemies, recession
As a result, we will lose the war, and the American people will suffer.
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:
