It’s that time of the election process, when politicians, desperate to be remembered by the voters, come up with silly ideas.
Today’s SI (silly idea) award goes to a guy whom I believe to be one of the more intelligent of the candidates, Pete Buttigieg.
This only goes to show that even smart people can be silly when under pressure.
Pete Buttigieg wants Americans to expect a year of ‘national service’ after college, 10:44 a.m., Politico, Kathryn Krawczyk
Pete Buttigieg is serving up a brand new plan.
The South Bend, Indiana mayor and 2020 Democrat has proposed “A New Call to Service” that would push the number of people participating in national service to 1 million by 2026.
He’d like to expand the ranks of 7,300 Peace Corp volunteers and trainees and 75,000 AmeriCorps members to a total of 250,000, (then) grow that total to 1 million by 2026, with an estimated cost of $20 billion over the next decade.
Buttigieg hopes to fill all these programs by promising a credit toward workers’ student debtsunder the already existent Public Service Loan Forgiveness Program.
That looks similar to debt forgiveness service programs mentioned by fellow candidates Sen. Elizabeth Warren (D-Mass.), Sen. Kirsten Gillibrand (D-N.Y.), and former Rep. John Delaney.
I can almost visualize Pete and his handlers, crouched together in a locked room, sweating and mumbling:
“Bernie has Medicare, and Liz has corporate fraud. We need something. Something! “How about student debt? “It’s being done. We need something else. Something really unique and patriotic. “Like military service? “You mean college kids tramping around in the infantry? “No. OK, wait. I’ve got it: Student debt combined with the Peace Corps. That’s unique, liberal and patriotic, all rolled into one.”
What a wonderful idea.
To compete economically and scientifically, America needs educated people — not just high school graduates, but college grads and advanced degree people: Medical doctors, engineers, scientists — all those people that really advance our nation.
So here’s what we do. First, we already have discouraged kids from going to college, and punished them if they do go to college, by putting them deeply into debt.
Now, rather than simply relieving them of this debt, we have them to waste a couple of the most productive years in their lives by forcing them to take a low pay job they don’t want — a job that has nothing to do with their college education and expertise.
I can see it now. All those PhDs planting crops in Batswana, building huts in Burkina Faso, carrying water jugs in Eswatini.
Our indebted college grads and future leaders will flock to the idea, and it will greatly benefit American competitiveness, especially in Comoros and Lesotho (where I’m told the volunteers learn to speak Sesotho).
Of course, the alternative would be to encourage advanced education by making college free, for the same reason we already make grade school and high school free.
But then we wouldn’t be able to send our best and brightest young people to Benin (where “volunteers learn to speak local languages, including Bariba, Ditamari, Dendi, Fon, French, Mahi, and Nagot.”)
O.K., seriously, I admire the young people who volunteer to go to 3rd world countries and help. But the key word is “volunteer.”
The notion of basing the payoffs of those outrageous college loans, on a couple years of forced labor in Myanmar not only is repugnant but is counter to the best interests of America.
Pete, we should do everything possible to encourage advanced education, instead of discouraging it.
The most important problems in economics involve the excessive income/wealth/power Gaps between the richer and the poorer.
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 The Ten Steps To Prosperity can narrow the Gaps:
Crocodile tears (or superficial sympathy) is a false, insincere display of emotion such as a hypocrite crying fake tears of grief.
The phrase derives from an ancient belief that crocodiles shed tears while consuming their prey, and as such is present in many modern languages, especially in Europe where it was introduced through Latin.
While crocodiles do have tear ducts, they weep to lubricate their eyes, typically when they have been out of water for a long time and their eyes begin to dry out. However, evidence suggests this could also be triggered by feeding.
The media continually cry crocodile tears for the American taxpayer, bemoaning the “unsustainable” federal spending that supposedly forces federal taxpayers to pony up.
In reality, federal spending benefits all Americans by pumping dollars into the private sector, and federal taxpayers do not pay one dime to fund that spending.
Even if all federal tax collections — FICA, income taxes, luxury taxes, etc. — totaled $0, our Monetarily Sovereign federal government could continue spending, even increase it dramatically, forever.
Here are excerpts from an article that ran in the 7/1/19 Chicago Tribune (Marc A. Thiessen writes for The Washington Post. He is a fellow at the American Enterprise Institute and former chief speechwriter for President George W. Bush.):
The debates’ biggest losers? American taxpayers
By Marc A. Thiessen
Sen. Kamala Harris of California may have been the breakout winner of Wednesday and Thursday’s Democratic presidential debates, but there was one clear loser: the American taxpayer.
These were the most expensive presidential debates in American history. Never have so many candidates proposed to spend so much.
The author, Marc A. Thiessen knows as much about economics as does the average America, i.e virtually nothing.
No harm in knowing nothing. We all know nothing about many things. But if you know nothing about a subject, either do some research or don’t embarrass yourself by writing nonsense.
That is why I don’t pontificate about quantum chromodynamics. I assume you don’t either.
Sadly, Thiessen thinks federal taxpayers fund federal spending. They don’t.
Yes, state taxpayers fund state spending. County taxpayers fund county spending. City taxpayers fund city spending. States, counties, and cities are monetarily non-sovereign. they don’t have a sovereign currency.
But the federal government, being Monetarily Sovereign, has a sovereign currency, the U.S. dollar, which it creates, ad hoc, every time it pays a creditor.
Thiessen’s headline, “The debates’ biggest losers? American taxpayers” is wrong, and not just wrong but diametrically wrong. He prattles about finances, but doesn’t even understand the differences between Monetary Sovereignty and monetary non-sovereignty.
What next? Writing about accounting and not knowing the difference between a debit and a credit?
America’s taxpayers gain from federal spending, because those newly created dollars go into the private sector, i.e the pockets of Americans.
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Ben Bernanke: “The U.S. government can produce as many U.S. dollars as it wishes at essentially no cost.”
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In speaking about finances, Thiessen’s headline should have been something like: The debates’ biggest winners? Americans.”
In the first debate, NBC anchor Savannah Guthrie asked Massachusetts Sen. Elizabeth Warren about the economic impact of her plans for “free college, free child care, government health care, cancellation of student debt” and in the second asked Sen. Bernie Sanders, I-Vt., whether his proposals “for big, new government benefits, like universal health care and free college,” would require middle-class tax increases. (They would.)
(No they wouldn’t). Think about it. If taxes funded federal spending, why would the federal government pretend to borrow dollars?
I say “pretend,” because the federal government not only doesn’t need to tax, it also doesn’t need to borrow. It has the unlimited ability to create unlimited dollars.
So what is the purpose to Treasury Securities, if not to obtain dollars?
I’m glad you asked. The purposes of issuing Treasury Securities are:
To assist the Fed in setting interest rates, which helps moderate inflation.
To provide the world with a safe place to “park” unused dollars, which helps stabilize the value of the dollar.
To make you believe the federal government does not have the unlimited ability to create dollars, and is in danger of running short of dollars, so you will not demand more federal benefits.
Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”
Instead of shoring up Medicare, Democrats want to expand it to cover virtually everyone in the country.
Sanders’ “Medicare for All” legislation has been co-sponsored by Sens. Warren, Harris, Cory Booker of New Jersey and Kirsten Gillibrand of New York.
Medicare doesn’t need “shoring up.” It needs truth from our politicians.
The federal government easily could pay for a comprehensive, no deductible Medicare plus long term care, the same way it pays for everything else: By creating new dollars.
Nonpartisan estimates put its cost at $32 trillion over the first 10 years.
If true, that would add $32 trillion growth dollars to the U.S. economy. Today, it’s the people in the private sector (the “taxpayers” Thiessen pretends to be concerned about.
There are only two health care alternatives: Pay for it or do without it.
The federal government has the unlimited ability to pay for it. People do not. When the federal government pays that helps grow the economy.
So who should pay?
Or take free college. Harris, Warren, Gillibrand and Booker have signed on to the Debt-Free College Act, which would cost at least $840 billion over 10 years.
Sanders has introduced a $2.2 trillion College for All Act that would make public colleges and universities tuition-free and debt-free, and erase the roughly $1.6 trillion in student loan debt.
Warren has also proposed a $640 billion student loan debt cancellation plan.
Warren has proposed a plan for “universal child care” and early learning that would cost $700 billion over 10 years, while Harris, Beto O’Rourke and Rep. Eric Swalwell, D-Calif., have endorsed the Child Care for Working Families Act, which would cost $700 billion over 10 years.
As with health care, there are only two alternatives for college: Pay for it or do without. When the government pays, the populace is enriched. When the people pay, they are impoverished.
Further, education helps grow the U.S. economy and make it more competitive.
That is why states, counties, and cities, which do not have a sovereign currency, still pay for education.
“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%!” Warren Buffett
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Amazingly, none of the NBC anchors asked about the Green New Deal, but climate change was front and center in both debates.
Joe Biden’s climate plan would cost $1.7 trillion over a decade. Warren has pitched a $2 trillion plan, O’Rourke’s proposal would cost $5 trillion, while Washington Gov. Jay Inslee’s green jobs plan would cost $9 trillion.
Regarding the moderation of climate change, once again there are only two alternatives: Pay for it or let it go and pray that Trump is correct that it’s a “Chinese hoax”, and 97% of climatologists are wrong about major floods, species loss, farmland loss, more disease, and greater poverty.
Between Trump and the scientists, I’ll go with the scientists.
Then there are government-guaranteed jobs. Harris, Warren and Gillibrand have co-sponsored Booker’s Federal Jobs Guarantee Development Act, while Sanders has proposed an ambitious government jobs plan with guaranteed wages of $15 an hour, retirement and health benefits, child care and paid family leave.
Andrew Yang proposed a government-provided universal basic income that would give every American over the age of 18 a monthly check of $1,000 — which would cost between $28 trillion and $40 trillion over 10 years.
If correct, that would add $28 trillion – $40 trillion growth dollars to the economy. Is it better for the economy, businesses, and people to do without those dollars?
As if all of the above weren’t ignorant enough, now comes the really ignorant part:
Where things get really expensive is the nexus between the Democrats’ spending plans and their immigration policies.
During the first debate, former housing and urban development secretary Julián Castro said he would decriminalize illegal border crossings.
When the candidates in the second debate were asked how many supported his plan, nearly every candidate’s hand went up. (Sen. Michael Bennet of Colorado was the only one to abstain.)
Every candidate raised a hand when asked if their government health plan would provide coverage for illegal immigrants.
The combination of decriminalizing illegal entry and offering those who enter illegally free health care would create a magnet for millions to enter our country — dramatically increasing the cost of every public health care plan.
And once here, these migrants would presumably also seek to take advantage of other free programs the Democrats are proposing, which means their costs would also skyrocket beyond these estimates.
Like all migrants before them, these migrants also would be workers, consumers, creators, and thinkers, i.e economy builders.
That is how America grew from a few thousand people to more than 330 million, and became the most powerful nation on earth.
Contrary to President Trump’s wrong-headed warnings, the U.S. is not “full.” (Later, he admitted we need more people, but him speaking on two sides of his mouth is not news.)
Open borders and socialism are a path to national suicide.
Thiessen knows so little about economics that he thinks federal spending is socialism. It isn’t, but it’s a term the ignorant right loves to toss around because it has become a pejorative. (Socialism is government ownership and control, not just spending.)
And no one but Trump uses the term “open borders” to describe having an immigration policy similar to what our policies have been for 200+ years.
It’s a lie, but what can you expect?
According to the Congressional Budget Office, under current law — without all the Democrats’ new entitlements — debt held by the public is already projected to increase from 78% of gross domestic product today to 144% by 2049.
This level of debt is unsustainable and could lead to another financial crisis.
First, it’s not “debt.” It’s investments in T-securities, which are paid off every day, simply by returning the dollars that reside in T-security accounts.
The federal government neither needs nor uses those dollars. It simply returns them when T-securities mature.
Second, the economically ignorant have been making exactly the same “unsustainable”claim for at least 80 years. (See “ticking time bomb.”)
They were wrong then, in 1940 when the so-called “debt” was $40 billion, and they have been wrong every year since, now that the “debt has grown about 50,000%.
Last I saw, Japan’s “debt” was 250% of GDP, and so far they have “sustained.”
The reason is simple. “Debt” increases add dollars to the nation’s economy, and “debt” decreases take dollars from the nation’s economy.
Which is more likely to cause recessions and depressions?
So you now can add Marc A. Thiessen’s name to the depressingly long list of people who talk and write about economics, but are clueless about the science.
What next, Mr. Thiessen, an article about quantum chromodynamics?
The most important problems in economics involve the excessive income/wealth/power Gaps between the richer and the poorer.
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 The Ten Steps To Prosperity can narrow the Gaps:
There were times when I thought Donald Trump was politically suicidal with his public philandering, his easily disproved lies, his blatant ignorance, his financial profiting from the Presidency, his nepotism, his sucking up to communists, and on and on.
But apparently, his “religious” followers admire philandering, lying, ignorance, criminal profiting, nepotism, communism, etc. So Trump survives.
Lately, I have realized that it is the Democrats who are politically suicidal. The Democrats have the marvelous ability to take a good idea, a popular idea — health care for everyone — and muck it up into a barely recognizable mess, until they now are on the defensive about something that should be a lay-down winner for them.
As readers of this blog well know: The federal government’s finances are not like state and local governments’ finances.
It’s our little secret. Don’t tell the people we don’t use their tax dollars.
Ben Bernanke: “The U.S. government (can) produce as many U.S. dollars as it wishes at essentially no cost.”
Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”
St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e.,unable to pay its bills. In this sense, the government is not dependent on (borrowing) to remain operational.”
Unlikestate and local governments:
The federal government has a sovereign currency, the U.S. dollar, over which it has total control.
Those four, simple truths are absolutely basic to economics. Yet they seem not to be understood by the vast majority of Americans, even including media writers and university economists — and especially not understood by the legions of Democrats chasing glory via the Presidency.
The following article demonstrates the Democrats’ suicidal ignorance:
Sen. Bernie Sanders, challenged at Thursday night’s Democratic presidential debate on how he would pay for universal health care and his other proposed programs, admitted income taxes on the middle class would have to go up — but maintained that the savings in medical expenses would more than offset the tax hike.
Sanders, who took the first question from NBC correspondent Savannah Guthrie, talked about his Medicare for All proposal for his allotted minute.
But when Guthrie followed up and pressed him about taxes on the middle class, he conceded, “Yes, they will pay more in taxes.”
If Sanders’s version (or any other candidate’s version) of Medicare for All were proposed by a state governor or a city mayor, the above answer would be correct. Additional taxes would be needed to pay the cost of the medical services.
But apparently, neither Sanders nor any other candidate (nor any Republican, for that matter) knows or admits to knowing that federal finances are completely, totally, 180 degrees different from state and city finances.
The federal government uniquely has total control over the U.S. dollar, cannot unintentionally run short of dollars, neither needs nor uses tax dollars, and does not borrow.
The U.S. federal government could finance even the most liberal, generous version of Medicare for All, at the tap of a computer key. No tax dollars involved.
Sanders said, “Health care in my view is a human right and we have got to pass a Medicare for All single-payer system. “Under that system, [the] vast majority of the people in this country will be paying significantly less for health care than they are right now.”
Not only is health care a “human right,” but it is an economic imperative for any nation hoping to compete and grow — certainly as much an imperative as military defense and effective government.
Yet there is Sanders, essentially hat in hand, pleading for universal health care on the basis of cost savings, when in reality cost is not a real issue. It is a fake issue put forth either in ignorance or in malicious intent, depending on one’s politics.
Quite simply, there is no financial reason why any American should be forced to pay one cent for health care insurance — either via taxes or via premium payments.
And if after all these months of researching and developing his Medicare for All plans, Sanders still has not learned this, he is mentally unfit to be left alone with a sharp object.
But it continues. Sanders also said:
“I believe that education is the future for this country and that is why I believe we must make public colleges and universities tuition-free and eliminate student debt, and we do that by placing a tax on Wall Street.”
“Every proposal that I have brought forth is fully paid for.”
Sanders believes (!) education is the future for this county? He believes so? What a relief that he believes something so obvious, that American states, counties, and cities have been funding elementary, high school, and even some college education, for centuries.
Unfortunately, states, counties, and cities are not Monetarily Sovereign, so they must have some form of income (taxes, fees, tourism, borrowing, etc.) in order to spend.
The federal government, being unique, is not similarly constrained.Yet Sanders, a federal politician, doesn’t recognize this difference. Tragic.
Sanders babbled on:
“People who have health care under Medicare for All will have no premiums, no deductibles, no copayments, no out of pocket expenses. Yes, they will pay more in taxes, but less in health care for what they get.”
Then the Yahoo News reporter added her dollop of economic ignorance by quoting the Associated Press:
Still, taxes would significantly increase as “the government takes on trillions of dollars in health care costs now covered by employers and individuals, the Associated Press fact-checked.
“Independent studies estimate the government would be spending an additional $28 trillion to $36 trillion over 10 years, although Medicare for All supporters say that’s overstating it.
How those tax increases would be divvied up remains to be seen, as Sanders has not released a blueprint for how to finance his plan.
Note how the media automatically and wrongly translate “spending an additional $28 trillion to $36 trillion” into “tax increases.”
(Does that also mean federal tax cuts require federal spending cuts?)
There is zero relationship between federal spending and taxes. Again, the pretense is that federal finances are like state and local finances, where spending is funded by taxes.
Sen. Michael Bennet, who was the last candidate to earn a spot on the debate stage, took a shot at Sanders on taxes.
Bennet said he believed in getting to universal health care. “I believe the way to do that is by finishing the work we started with Obamacare and creating a public option that every family and every person in America can make a choice for their family about whether they want a public option which for them would be like having Medicare for All or whether they want to keep their private insurance. I believe we will get there much more quickly if we do that.”
“Bernie mentioned the taxes that we would have to pay, because of those taxes, Vermont rejected Medicare for All,” he added. Sanders shook his head in response.
If by “public option” Bennet means people should be given the choice between free, comprehensive, no deductible Medicare and long-term care vs. paying for private insurance, sure. Why not? That is exactly the choice people should be given.
Of course, the result is a given. Perhaps a dozen people in America would choose to pay for private insurance.
But then, the Democrats’ stupidity continues:
When asked which candidates would abolish private health insurance in favor of a government-run plan, only Sanders and Harris raised their hands.
Since the words “abolish private health care insurance” instantly click the insanity button in America, two Democrats dive right in and say, “Yes, that is what we would do.”
OMG! Why?
“Everybody who says Medicare for All, every person in politics who allows that phrase to escape their lips has a responsibility to explain how you’re actually supposed to get from here to there,” said South Bend, Ind., Mayor Pete Buttigieg.
“I would call it Medicare for All Who Want It.”
Buttigieg said he would take parts of Medicare and give people an option to buy into it, providing “a very natural glide path to the single-payer environment.”
“Parts of Medicare”? Which parts would you leave out? Even Medicare itself is insufficient.
It has deductibles and partial payments, which are why many people pay for Medicare Supplement insurance. And it doesn’t cover pharmaceuticals, which is why people pay for Part D coverage.
And don’t even mention long-term care coverage, which Medicare doesn’t provide, and which even frightfully expensive private insurance covers only partially.
So add Buttigieg to the list of politicians who either don’t know what they are talking about or don’t want to give you the facts.
Bottom line, the federal government has the unlimited power to pay for comprehensive, no deductible health care insurance, including pharmaceuticals and long term care — and it can do so by pressing a computer key.
Cost is not the issue. Coverage is the issue — the only issue.
Even if you have no background in economics you should realize that federal spending is not funded by taxes. Didn’t the GOP massively cut taxes on the rich while increasing federal spending. That alone should have given you a clue.
Sorry folks, but ignorance has its penalties. Pay up.
The most important problems in economics involve the excessive income/wealth/power Gaps between the richer and the poorer.
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 The Ten Steps To Prosperity can narrow the Gaps:
“In a generation hard hit by the Wall Street crash of 2008, the government forgives all student debt and ends the absurdity of sentencing an entire generation to a lifetime of debt for the ‘crime’ of getting a college education,”
Sen. Bernie Sanders
I could not agree more. Education is our prime device for creating America’s economic growth and leadership.
The notion of making education difficult to obtain, while punishing those who get an education, either is madness or stupidity — both, really.
It’s our little secret. Don’t tell the people we don’t use their tax dollars.
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 wishes at essentially no cost.”
Alan Greenspan:“Central banks can issue currency, a non-interest-bearing claim on the government, effectively without limit. A government cannot become insolvent with respect to obligations in its own currency.”
St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e.,unable to pay its bills. In this sense, the government is not dependent on credit markets to remain operational.
Sadly, the following two articles tell why the madness and stupidity will not easily be solved.
WASHINGTON (AP) — Days before the first Democratic presidential debates, Sen. Bernie Sanders and House progressives are unveiling legislation cancelling all student debt, going further than a signature proposal by Sen. Elizabeth Warren as the two jockey for support from the party’s liberal base.
Excellent idea. We absolutely should cancel student debt. We should take the millstones from the necks of our future social, economic and political leaders. See: Student debt, the intentional crisis.
By canceling all student loans, Sanders says the proposal addresses an economic burden for 45 million Americans.
The key difference is that Warren’s plan considers the income of the borrowers, canceling $50,000 in debt for those earning less than $100,000 per year and affecting an estimated 42 million people in the U.S.
There is no economic reason to consider the income of borrowers. Warren’s plan is based on the false idea that federal spending is financially limited and is paid for by taxpayers.
Instead, each time it pays an invoice, it creates new dollars, ad hoc.)
Sadly, Warren seems to lack the courage to tell voters the truth.
Questions face both candidates about how to pay for all of that plus their proposals for free tuition at public colleges and universities.
Sanders’ effort at one-upsmanship on student loans, named the College For All Act,would cancel $1.6 trillion of debt and save the average borrower about $3,000 a year, according to materials obtained by The Associated Press.
The result would be a stimulus that allows millennials in particular to invest in homes and cars that they wouldn’t otherwise be able to afford.
Yes, not only would the elimination of student loans benefit students, but the additional dollars in the economy would grow the economy.
But here is where the excellent idea goes sour:
It would cost $2.2 billion and be paid for — and then some — by a series of taxes on such things as stock trades, bonds and derivatives, according to the proposal.
Thus, Warren guarantees her plan will be rejected by the rich (who actually run America):
Warren’s plan, which she has suggested in published reports will be introduced as legislation, would be paid for by imposing a 2% fee on fortunes greater than $50 million, a wealth tax designed to target the nation’s top 0.1% of households.
Not only will this idea be dead on arrival at the U.S. Senate, but it also will prove to be uncollectable. The rich always find ways to duck taxes.
Warren projects the levy would raise $2.75 trillion over 10 years, enough to pay for a universal child-care plan, free tuition at public colleges and universities, and student loan debt forgiveness for an estimated 42 million Americans — with revenue left over.
Even if the economy operated the way Warren seems to think, she is proposing that the federal government take $2.75 trillion from the economy, and because there would be “revenue left over,” return less than $2.75 trillion to the economy — a net loss for the economy.
But if the free college and student debt relief advocates don’t hit their revenue goals, they could simply add to the deficit — as President Donald Trump and congressional Republicans have by passing more than $1 trillion in tax cuts without paying for them.
Exactly right. And just like the tax cuts and everything else that takes dollars from the federal government and gives them to the private sector, the student debt relief would stimulate the economy.
The Mercatus Center, a think tank at George Mason University, “conservatively” found that Sanders’ “Medicare-for-All” would cost taxpayers $32.6 trillion over a 10 year period, or an average of about $3.26 trillion per year after associated cost saving.
The question is where would Sanders find the additional $3.26 trillion in revenue to cover these costs?
Mercatus found that “doubling of all currently projected federal individual and corporate income tax collections would be insufficient to finance the added federal costs of the plan.”
That makes sense as the federal government’s total revenue from all sources for fiscal year 2018 was $3.3 trillion, or about the $3.26 trillion annual cost of Sanders’ proposed healthcare plan.
If the plan had been proposed for a city government, a county government, or a state government, the above would be correct. Those governments are monetarily non-sovereign. They do need to use tax dollars for spending.
But the federal government’s finances are unique — nothing at all like state and local government finances. The Monetarily Sovereign federal government has the unlimited ability to create its own sovereign currency, the U.S. dollar.
The federal government never can run short of dollars. Even if all federal tax collections were $0, the federal government could continue spending, forever.
Puzdner’s article ends with this ignorant nonsense:
Should we ever enact Sanders’ economic policies we would end up with higher taxes — on everyone — declining growth, fewer jobs, vastly more borrowing and massive underfunded programs(some new, some old) unable to meet the expectations of everyone who wants to take advantage of them — because their costs will grossly exceed our revenue.
All of which will last until, as Margaret Thatcher once said, the government “runs out of other peoples’ money.”
Absolute tripe. Our Monetarily Sovereign government can go on forever with “costs that grossly exceed revenue,” simply because the U.S. federal government has no use for revenue.
I pray for the day when the populace finally learns the differences between Monetary Sovereignty and monetary non-sovereignty. Then, the politicians, magazine writers, and economists will claim in Trumpian fashion, “Hey, we knew it all the time.”
Meanwhile, the elimination of student debt is an excellent idea, soon to be ruined.
The most important problems in economics involve the excessive income/wealth/power Gaps between the richer and the poorer.
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 The Ten Steps To Prosperity can narrow the Gaps:
