Nancy and Mitch can’t agree on how much gold to pump into the economy.
Pelosi: “The economy is crashing.”
McConnell: “And The People are suffering.”
P: “And dying.”
M: “And we’re running out of time to prevent a severe recession.”
P: “Or more likely a depression.”
M: “Even worse than the Great Depression of 1929.”
P: “But we can’t agree on how much money we should pump into the economy.”
M: “I want to pump in one gold bar. We can’t afford more than one.”
P: “And I want to pump in two gold bars.”
M: “But I want to give at least 1 gold bar to business.”
P: “And I want to give at least 2 gold bars to the people.”
M: “We don’t know what to do.”
P: “So we’ll just keep arguing.
M: “And arguing.”
The People: “Why not pump in 4 gold bars? Then you Mitch, can give more than 1 gold bar to business, and you Nancy can give more than 2 gold bars to The People, and the economy will recover faster, and everyone will be happy.”
P & M (together): “Not everyone.”
The People: “Who won’t be happy?”
“Infinite but unsustainable”
P & M (together): “The rich. They say we can’t afford to give so much gold to The People. They say giving 4 gold bars would be ‘unsustainable.’ And it would be giving The People too much. They wouldn’t know what to do with all that gold, like we rich folks do.”
P: “And it would be ‘profligate.’ The people probably would just use the gold for food, clothing, housing, and education rather than hiding it in overseas tax shelters, like we do.”
M: “And the Libertarians agree that all government gold is socialism.”
The People: “But, look around you. The government has infinite gold. It never can run short. Why not enrich the economy?”
P: No, sorry. We’ll have to keep arguing and arguing, to keep The People down.
M: “If ever we do anything, it will be too little and too late.”
P: “And make it look like we really, really are trying.
M & P (together): “And hey, while we argue, you and I still are getting paid. And isn’t that the whole point?”
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 U.S. federal government isMonetarily Sovereign. It has the infinite ability to create its own sovereign currency, the U.S. dollar. It never can run short of dollars. Never.
If it wished, the U.S. government could, at the press of a computer key, create $100 trillion dollars.
“Why are we arguing about how much water is needed? Keep on pumping.”
Money supply never is a problem for the government, but it is a huge problem for the economy. What does that tell you?
Very simply, it says that during times of economic stress, the federal government should give the economy enough money to cure the stress.
Think of that clear truth as you read excerpts from the following article:
Both sides want to give businesses a lifeline amid shutdowns that threaten to plunge the economy into a deep recession.
Democrats want tough provisions to prevent corporations that receive federal bailouts from later engaging in stock buybacks that enrich their executives.
Yes, stock buybacks enrich shareholders, most of whom are Mr. and Mrs. Average Americans. So why be concerned about a handful of executives getting rich?
The economy is burning, and the fireboat officers are quibbling about water. Pump money into the economy — $7 trillion would be a good start, and forget about micromanaging the dollar flow.
Senate Majority Leader Mitch McConnell, R-Ky., said his bill already includes Democrats’ demands for conditions on loans and other aide to major businesses.
Democrats have called for provisions that would temporarily block evictions and foreclosures as families struggle with lost income.
Rather than waiting to produce a complex, convoluted series of regulations, simply give people and businesses the money to replace lost income.
The federal government has infinite money; stop quibbling.
They also want additional funding for food stamps and an expansion of unemployment benefits.
absolutely. Why not provide additional funding for food stamps and unemployment benefits. This won’t make the poor rich, but it may make life bearable.
Democrats and Republicans are also wrangling over how much money should go to hospitals and health providers to help them deal with the crisis.
Why wrangle? Pour in the money. There is no penalty for giving “too much.” When it comes to hospitals and health providers, there is no “too much.”
For God’s sake, politicians, stop pretending like the dollars are coming out of your own pockets.
No one pays for federal dollars.No taxes will be necessary. The government creates dollars from thin air; it does not need taxes.
Congress, stop wasting time. Just pump the money into the economy and put out the fire.
About $7 trillion this year, should do it, but if more is need to fund favorite projects, pump in more.
Dollars circulate through the economy; a rising tide lifts all boats.
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:
OK, you already know that Trump emasculated the Departments that were created to deal with widespread illnesses and specifically pandemics.
A perfect world — for the very rich.
And you already know that Trump and his flunkies at FOX “News” downplayed the risk, called it a “hoax,” and virtually urged people to keep doing exactly what they had been doing.
And you already know that we are months behind in creating protective, analytical, and treatment equipment to protect currently healthy people and to identify and cure sick people.
And, you already know that hospital space and personnel are insufficient.
But did you know, the government, in a “mountain labored and produced a mouse” act that is the very definition of “too-little, too-late, produced this?
WASHINGTON (Reuters) – The coronavirus economic relief bill being finalized by the U.S. Congress will include a one-time $3,000 payment for families and allow the Federal Reserve to leverage up to $4 trillion of liquidity to support the nation’s economy, U.S. Treasury Secretary Steven Mnuchin said on Sunday.
Mnuchin, speaking on the “Fox News Sunday” television program, said the additional liquidity measures would allow the U.S. central bank to help a broad base of businesses to get through next 90 to 120 days.
Trump administration officials hoped to finalize the legislation on Sunday and see a vote on Monday, Mnuchin said, adding that further steps could be taken if the crisis did not abate in 10 to 12 weeks.
There are 83.5 million families in America. Even if every single family received the full $3,000, that would total only $250 billion. And not every family will receive that amount.
Before anyone knew anything about the coronavirus, the federal government already was budgeted to spend $4.6 Trillion in 2020. The abovementioned $250 Billion “stimulus” comes to a paltry 6% increase in federal spending!
A 6% increase to fight the greatest threat to our economy since the depression of 1929! And, as stated before, even that amount won’t be spent.
Are these people crazy or just plan uncaring? No, it’s more than that. It’s a deliberate attempt to enslave the lower and middle classes.
Mnuchin said the U.S. economy would clearly take a hit from the health crisis, but should rebound once the new coronavirus has been contained.
And when will that happen? No one knows. It could take many months or years. And meanwhile, all but the rich will suffer. (Or is that the plan?)
“We need to get the money into the economy now. If we do that, we think we can stabilize the economy,” he said.
You can’t stabilize our economy with a lousy $250 Billion. The U.S. Gross Domestic Product is over $21 Trillion.
Congress people, do you really believe you will stabilize a ripped-apart, $21 Trillion economy with an additional $250 Billion, a 1% “stimulus”?
Here is what we’re dealing with today (and it only will get worse):
Nearly one in four Americans, or 80 million people, were under orders to close up shop and stay home as just five states, New York, California, Illinois, Connecticut and New Jersey instituted statewide lockdowns to try to contain the rapid spread of the highly contagious respiratory illness.
Mnuchin downplayed a question about a possible recession, calling it a “technical question” that was not “terribly relevant” in the current situation since the government was effectively shutting down large parts of the economy to slow the virus.”
As soon as we can get the medical situation under control, we’re going to reopen it.”
And how much will GDP have fallen by then? Ten percent? Twenty percent? Fifty percent?
No one knows, but it surely won’t be only 1%.
And what about the lasting damage. Simply “reopening” the economy won’t result in an instant cure. Some businesses will never re-open. Some people never will recover.
Lives will be lost, forever. Life plans will disappear. The kids who were planning on college won’t make it. New doctors won’t be educated. Start-up businesses never will open. The chaos will be long-lasting.
I urge you who are reading this to pick up your torches and pitchforks and march on Washington, march on your Senators’ office and homes, march so they know you mean it.
The U.S. federal government easily can and should invest at least $5 Trillion to $7 Trillion in the economy, NOW. Get the money out there.
Despite the lies you have been told, it would cost you, as a taxpayer, nothing. The federal government can do it without collecting a single penny in taxes.
The whole disgusting plan is part of the program by the very rich who run America, to make you captives, willing to slave for them at pennies an hour.
Why do you think miserly Social Security slowly has been taken away as qualifying ages rise?
Why do you think the unnecessary and regressive FICA tax is levied, and now they lie that the fake Social Security “Trust Fund” is running short of money?
Why do you think they don’t want you to have Medicare for All, and tag it with the false epithet, “socialist”?
Why do you think the single biggest asset on the government’s books is student debt, when the government easily could pay for all tuitions, and without collecting any taxes?
Why do you think that of all private debts, only student debt has not qualified for bankruptcy dismissal?
Why do you think all those tax loopholes and avoidance schemes are designed to benefit the rich?
Why do you think a guy like Warren Buffet pays a lower percentage of his income in taxes than does his secretary, and a guy like Donald Trump pays no taxes?
Why do you think the poor are criticized for accepting federal benefits (“lazy takers”) while the rich receive billions in special benefits, and that is considered being “smart”?
Don’t let those bastards get away with destroying your life and your children’s futures. (“Please sir, I’ll take any job. I’m desperate.”)
These are not accidents. These are not bugs. They are features.
Now, during an election year, is the time to protest, loudly, angrily. Get out your torches and pitchforks. March for yourselves and for your children.
Mass protests work. Mass protests ended the Vietnam war and a Presidency. Politicians are afraid of protests.
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 Chicago Tribune has a very special department. It should be called “The Department of the Big Lie,” but strangely it is called “The Editorial Page.”
This department is populated by such luminaries as:
Par Ridder, General Manager
Colin McMahon, Editor-in-Chief
John P. McCormick, Editorial Page Editor
Margaret Holt, Standards Editor
Christine W. Taylor, Managing Editor
along with directors of Content:
Jonathon Berlin, Amy Carr, Phil Jurik, Amanda Kaschube, Todd Pamagopoulos, George Papajohn, and Mary Ellen Podmolik
Considering that the Tribune Department of the Big Lie employs these twelve experts, and perhaps many others, who devote their lives and expertise in crafting their Big Lies, the Department should have honed its skills to a fine point.
And so it has, for some of their “best” editorials are replete with Big Lies — direct statements, hints, and untrue inferences — as today’s post will demonstrate.
Before we begin the demonstration, we should tell you exactly what the Big Lie is:
The Big Lie is the false claim that federal taxpayers fund federal government spending.
While state and local taxpayers do fund state and local government spending, federal taxpayers dollars do not fund federal spending.
“Use as little water as possible.”
The difference comes from the fact that the federal government is Monetarily Sovereign, while state and local governments are not.
Way back in the 1780s, the U.S. federal government created the U.S. dollar from thin air. It did it by passing arbitrary laws from thin air.
These laws arbitrarily provided for the number of dollars and for the value of each dollar.
While the details of these laws have arbitrarily (note the repeated use of the word, “arbitrary”) been changed over the years, the fundamentals remain the same.
The federal government still arbitrarily creates dollars and their value.
As distinguished financial leaders have told us:
Fed Chairman Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.” Fed Chairman Ben Bernanke: “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishesat essentially no cost.” Famous Wealth Manager Warren Buffet: “Those who regularly preach doom because of government budget deficits (as I regularly did myself for many years) might note that our country’s national debt has increased roughly 400 fold during the last of my 77-year periods. That’s 40,000%!” [Today it’s over 50,000%]
By contrast, your state and local governments are monetarily non-sovereign. They did not create the U.S. dollar. They only use it. They cannot, as Federal Reserve Chairman said, “produce as many dollars as (they) wish at essentially no cost.”
Now think about this very closely: If the federal government cannot become insolvent, and can produce as many dollars as it wishes, what is the purpose of federal taxes? Obviously, not to pay for spending.
The primary purposes are:
1. To control the economy by rewarding activities the federal government wishes to encourage and by punishing the activities the government wishes to discourage, and
2. To make the populace believe the government’s ability to spend is limited by taxes, so that the people will not ask for more benefits.
President Franklin D. Roosevelt
This has been well-known for many years. As President Franklin D. Roosevelt said, with regard to Social Security (FICA) taxes,
“With those taxes in there, no damn politician can ever scrap my social security program. Those taxes aren’t a matter of economics,they’re straight politics.”
And it is in political Purpose #2 that the Tribune’s Department of the Big Lie plies its trade. Here are the promised examples from the editorial of 3/33/2020. We begin with the title:
Immediately, we see the disdain for federal spending exhibited by the Department of The Big Lie. The clear inference of the word “reflex” and the repetition of the word “spend” is that this is spending profligate and somehow foolish.
The facts are that federal spending is necessary to grow the economy, and massive federal spending is necessary to prevent today’s economy from falling into a depression.
Further, to date, Congress has not shown the proclivity to spend enough. In these perilous times, the deficit spending for the Ten Steps to Prosperity, which would stop a depression before it starts, requires at least $7 trillion, probably more.
The article says:
The federal government has the power to commit near limitless amounts of taxpayer money to replace every missing paycheck, protect every nervous employer and save every buckling business.
To go big, as President Donald Trump vows. To spread cash around. To make payrolls. To save airlines.
And there’s the first outright statement of The Big Lie, for while the state and local governments do spend taxpayer money, the federal government does not.
You will be saddened (outraged?) to learn that those federal tax dollars you sweat and strain to earn, then sweat and strain to calculate, then are obliged to pay under penalty of law —those dollars are destroyed upon receipt by the U.S. Treasury.
Instead, the government creates brand new dollars, every time it pays a bill.The process: When your dollars reach the Treasury, they disappear from all measures of the U.S. money supply. In that sense, dollars held by the government cease to exist.
It thus, is nonsensical to ask, “How many dollars does the federal government have?” It “has” infinite dollars.
To pay a creditor, the federal government sends instructions (in the form of a check or bank wire) to the creditor’s bank, instructing the bank to increase the balance in the creditor’s checking account. The moment the bank follows those instructions, new dollars are created and added to the money supply (M1).
The federal government can issue such instructions endlessly, whereas the state and local governments are limited by the dollars held in their own bank accounts.
There’s panic selling on Wall Street and panic promising in Washington, where Congress is compiling a $1 trillion-plus emergency fiscal stimulus package.
How much exactly and to benefit whom? As The Associated Press notes ominously: All the pressure is for the package to keep growing.
The growth of the “package” is “ominous” only for those who wish to convey the false notion that federal debts, i.e. debts of a government that has the unlimited ability to pay its debts, are “ominous.”
The caution we express is about the secondary coronavirus effect: the rush by politicians to throw money at this crisis in hopes of making all negative and unanticipated consequences go away.
It’s business as usual for government to spend other people’s money aggressively. When in doubt, spend. When not in doubt, spend. When in crisis, spend more.
That’s the only way to look at the White House plan to fight the virus by, yes, writing checks to most Americans.
Note the load of pejorative words: “Rush,” “throw money at,” and “business as usual.” Finally, we are treated to a sentence that contains the word “spend” three times.
If the crisis were a fire, and the politicians were firefighters, would the Tribune’s Department of The Big Lie criticize them for rushing to throw water on the fire, as “business as usual”?
How much of your money, taxpayers, is Washington willing to hand out? Treasury Secretary Steve Mnuchin suggests a family of four would receive $3,000 a month, as both assistance and stimulus for the stagnating economy. Senate Majority Leader Mitch McConnell likes the sound of $1,200 per person.
Again, it’s not taxpayer money. Even if all federal tax collections totaled $0, the government could give that family of four $3,000 — or $13,000, or more. Federal spending is not limited by taxes.e
And then the little jab at McConnell, who is to blithely to “like the sound of” $1,200.
But people still working don’t need the cash. It will arrive as a gift (remember, a giftyou are paying for). This is profligacy. Past exercises in government largesse suggest many recipients will save the money instead of spend it.
More lies from the Department of The Big Lie. First, all federal government spending can be considered a “gift” to someone; no one pays for it.
And if some recipients save money instead of spending it, is that supposed to be a bad thing? Having some money saved gives the populace the confidence to spend money.
If you want the people to spend, you must allow them to save, and this is especially true of big-ticket items.
Bailouts also create a moral hazard, establishing the notion that business owners and investors can take aggressive risks — such as running up enormous debt during good times — because they believe the government will save them.
This creates a destructive cycle: Companies act recklessly, get bailed out, then go forward (even the weaker ones) while still being reckless. Remember that the airlines got bailouts after 9/11.
Ah, “moral hazard.” Apparently, the Tribune’s ever-so-moral Department of The Big Lie has forgotten the following, from Wikipedia:
On December 8, 2008, the Tribune filed for Chapter 11 bankruptcy protection. Company plans originally called for it to emerge from bankruptcy by May 31, 2010, but the company would end up in protracted bankruptcy proceedings for another four years. With the company’s overall debt totaling $13 billion, it was the largest bankruptcy in the history of the American media industry.
Oops.
During the Great Recession, General Motors and Chrysler received government help. Ford didn’t ask — because it was in better shape. It had prepared.
That’s why we didn’t like those bailouts. If Americans weren’t willing to save automakers by buying their vehicles, they shouldn’t have had to save them with their tax dollars.
The same principle should apply to United Airlines, Boeing and other companies.
The previous paragraphs are not just misleading; They are childish. They make the tacit assumption that allowing General Motors, Chrystler, United Airlines, Boeing and other companies to go out of business doesn’t harm the American public.
While true that this unforeseen epidemic caused passenger airline traffic to virtually disappear, it’s also true airlines failed to prepare for a few months’ disruption.
Few companies operate as though customers will disappear for months. In fact, that is an inefficient way to run a business.
There are ways for struggling companies to survive, such as enticing new investors to provide loans.
(Like the Tribune didn’t do??)
The scariness of this moment is balanced by a certainty: Chicago’s empty streets, closed dining establishments and reduced business activity represent part of a temporary freeze.
The pandemic will lift, and then the economy will roar back to life. Many analysts expect a deep recession with high unemployment followed by recovery within a year.
The above is typical Trump-like “Ho hum, no problem. It’s temporary.” And as for that high unemployment, that will recover in a year — except for the millions of people who cannot sustain a year without income.
This is The Department of The Big Lie’s clueless version of “Let them eat cake.”
Government should be there to provide appropriate assistance. “Appropriate,” we’d add, isn’t a synonym for “unnecessary” or “unlimited.”
And, we would further add, “Editor,” “Manager,” and “director” are not synonyms for “intelligent,” “truthful,” or “compassionate.”
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:
#Monetary Sovereignty - Mitchell 