The relationship between federal deficit spending and GDP growth Wednesday, Oct 30 2019 

Those who do not understand (or who pretend not to understand) economics, repeatedly confuse federal finances with personal finances.

These people decry the size of the federal deficits and debt as being “unsustainable,” which these measures would be if they were personal deficits and debt.

The federal government, being uniquely Monetarily Sovereign, never can run short of its sovereign currency, the U.S. dollar, so the government can “sustain” any size deficit and debt.

  1. Gross Domestic Product is a common measure of the economy
  2. Federal deficit spending adds dollars to the economy.
  3. Economic growth, by formula, requires additional dollar supplies:

GDP = Federal Spending + Non-federal Spending + Net Exports

If the deficit critics were correct, you would expect to see:

  • GDP reduction caused by deficit growth
  • GDP increases caused by deficit reduction
  • Recessions caused by deficit growth
  • Recessions cured by deficit reduction

Yet that is exactly the opposite of what you see.

Image result for great depression

Every depression in U.S. history has been caused by federal debt reduction*

 

*Historically, reduced deficits have caused recessions and even depressions. Increased deficit spending is necessary to cure recessions and depressions.

The following graph compares the annual federal debt percentage changes (red line) which reflect deficits, vs. GDP percentage changes (blue line). The vertical bars are recessions.

What you do see is:

    • Reduced debt growth leads to recessions
    • Increased debt growth cures recessions
    • Increased debt growth leads to increased GDP growth

For clarity, let’s examine individual segments of the above graph:

Prior to 1974, federal deficits rose then fell, pulling GDP along with them. This reduced deficit spending precipitated the recession of 1974, which was cured by increased deficit growth through 1976.

The increased deficit growth precipitated increased GDP growth, with momentum carrying GDP through 1979, when it too began to fall.

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As a result of the long period of falling deficit growth, even the short upturn in the last quarter of 1979 could not save the economy, and the falling momentum of GDP resulted in the recession of 1980.

The increased deficit growth cured the recession, which ended in the 3rd quarter of 1980, when GDP turned up, and continued to be pulled up by more deficit growth.

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Continued, increasing deficit growth pulled GDP up, and even when deficit growth declined, in 1981, momentum pulled GDP upward.

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Yet again, you see that familiar pattern. Declining deficits lead to the recession of 1981, which growing deficit cure by the end of 1982.

Increasing deficits pull GDP upward, and even when deficit increases end in the 2nd Qtr of 1983, momentum continues to carry GDP upward.

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The enormous deficits of 1983 force powerful GDP growth momentum, which reverses as deficit growth continues to decline.

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And there again, the familiar pattern: Reduced deficit growth forcing down GDP growth, and even a short period of deficit growth increase cannot forestall the recession of 1990-1991.

And again, increased deficit growth cures the recession and turns GDP growth upward.

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As always, the predictable pattern:

  1. First, deficit growth pulls us out of a recession and forces GDP growth upward.
  2. Then, deficit growth tops out, but momentum carries GPD grow along for several years.
  3. Finally, GDP momentum yields to decreased deficit growth. (This time, we actually ran a federal federal surplus, which normally would cause a full-fledged depression. However, we were “fortunate,” and “only” suffered the recession of 2001.
  4. Then, as always, it took increased federal deficit spending to pull us out of the recession in 2002.

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And here we go again: Massive deficit spending pulls us out of a recession; after escaping that disaster we begin again to cut deficit growth, then (in mid-2007) to increase deficit growth; but it’s too late, and we enter yet another recession; this one is the “Great Recession” of 2008.

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Now here we are, today. Huge deficit growth, having cured the recession, we continue not only those big deficits, but even grow them, first at 30% annually, finally leveling off at about 5% annual deficit growth — a big number, considering the size of the deficit.

This has caused GDP to average a robust average of about 4% annual growth.

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Despite all the incontrovertible data, the next time you open your newspaper, or watch you local federal finance TV “expert,” you will be told that the federal debt and/or deficit are (oh, horrors) at record highs, and are “unsustainable,” or a “ticking time bomb.”

It’s no coincidence that GDP is a record highs, too. Federal deficit spending lifted it there.

Rodger Malcolm Mitchell
Monetary Sovereignty
Twitter: @rodgermitchell
Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..

The most important problems in economics involve:

  1. Monetary Sovereignty describes money creation and destruction.
  2. 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:

Ten Steps To Prosperity:

1. Eliminate FICA

2. Federally funded Medicare — parts A, B & D, plus long-term care — for everyone

3. Provide a monthly economic bonus to every man, woman and child in America (similar to social security for all)

4. Free education (including post-grad) for everyone

5. Salary for attending school

6. Eliminate federal taxes on business

7. Increase the standard income tax deduction, annually. 

8. Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.

9. Federal ownership of all banks

10. Increase federal spending on the myriad initiatives that benefit America’s 99.9% 

The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.

MONETARY SOVEREIGNTY

Why are the Democrats so cowardly? Tuesday, Oct 29 2019 

The Democrats have a great plan. They want to expand Medicare to cover everyone, which could be accomplished very simply by lowering the eligibility age of the current Medicare plan from 65 to 0.

The hard work already has been done. The process has been created. The government, the hospitals, and the doctors all know how to handle the paperwork. Everything is in place.

Just lower the eligibility age, cover everyone, and go.

No need for Medicaid, ACA, Medigap or Parts A, B, C, etc., etc. No deductibles. Just one simple plan for every man, woman, and child in America.

And certainly no need to tell everyone they will be forced to give up their current plans. Simply offer Medicare to everyone, and let nature take its course.

But no. The Democrats get all hung up trying to answer one simple question, “How will you pay for it?”

The correct answer, the honest answer, would be: “Federal deficit spending.”

1. Federal financing is not like state and local government financing. The federal government, unlike state and local governments, is Monetarily Sovereign. It has the unlimited ability to create its own sovereign currency, the U.S. dollar.

The federal government never can run short of dollars. It could fund any Medicare for All plan with the push of a computer key.

2. Unlike state and local government deficits, the federal deficit and federal debt are not a burden on anyone. They do not burden the federal government; they do not burden taxpayers.

Unlike state and local taxes, which fund state and local government spending, federal taxes do not fund federal spending.

3. Contrary to a popular myth, federal deficit spending does not, and never has, caused inflation. Inflation, a general increase in prices, is not caused by too much money. Inflation is caused by shortages of food and/or fuel.

Those historical photos showing people carrying paper money certificates in wheelbarrows, fail to show the actual cause of the inflation: Food and fuel shortages. The printing of those certificates was an ineffectual response to inflation, not the cause.

One of the surest cures for any inflation is government deficit spending to acquire and distribute the scarce food and fuel.

Sadly, those Democrats who know all this to be true, are too cowardly to explain it to the public. Instead, they go along with ridiculous articles like the following:

The Democratic plan for a 42% national sales tax
Rick Newman, Senior Columnist, Yahoo Finance — October 28, 2019

If you’re a Democrat who supports “Medicare for All,” pick your poison.

You can ruin your political career and immolate your party by imposing a ruinous new sales tax, a gargantuan income tax hike or a surtax on corporate income that would wreck thousands of businesses.

This is the cost of bold plans.

Or better yet, you can tell the truth about federal financing, and tell everyone who will listen that Medicare for All will be financed the same way as “Military for All,” as well as Congress, the Supreme Court, and the White House.

They all are funded by federal deficit spending.

There is no FICA tax supposedly paying for the Military, the Congress, the Supreme Court, or the White House. There is no tax supposedly paying for Congressional health care, Congressional travel, and Congressional lunches.

The reason why there is no FICA tax, or any other tax, dedicated to paying for these expenses is very simple. Federal taxes pay for nothing. Those dollars deducted from your paycheck, and those dollars you “voluntarily” send to the U.S. Treasury are not needed or used for anything.

They do not fund Medicare. They do not fund Social Security. They do not fund the military, or the Congress, or the Supreme Court, or the White House, or any other of the myriad federal initiatives.

Federal taxes are destroyed upon receipt.

Here is the A-Z Index of U.S. Government Departments and Agencies. You don’t pay for any of them. Even if all federal tax collections totaled $0, the federal government could fund all these activities.

Supporters of Medicare for All, the huge, single-payer government health plan backed by Bernie Sanders, Elizabeth Warren and several other Democratic presidential candidates, say it’s time to think big and move to a health plan that covers everyone.

Getting there is a bit tricky, however. A variety of analyses estimate that Medicare for All would require at least $3 trillion in new spending.

That’s about as much tax revenue as the government brings in now. So if paid for through new taxes, federal taxation would have to roughly double.

Right. IF (big “if”) Medicare for All was paid for through new taxes, federal taxation would have to double.

That is exactly why Medicare for All should not be paid for by taxing people.

It should be paid for via federal deficit spending, which would cost you nothing. Yes, for a Monetarily Sovereign government, lunch really can be free.

Oh, are you worried that the so-called federal “debt” would be an unsustainable “ticking time bomb”? If so, you’re in bad company, for that is exactly what phony “experts” said way back in 1940, and they’ve been saying it every year thereafter.

In 1940, the federal debt was only $40 Billion, and it was a “ticking time bomb,” according to Robert M. Hanes, president of the American Bankers Association.

Today, the federal debt exceeds $22 Trillion, a gigantic 55,000% increase, and that time bomb still is ticking. And the country still is here. And the government still is sustaining.

The Committee for a Responsible Federal Budget (CRFB) spelled out what kinds of new taxes it would take to come up with that much money.

A 42% national sales tax (known as a valued-added tax) would generate about $3 trillion in revenue. But it would destroy the consumer spending that’s the backbone of the U.S. economy.

A tax of that magnitude would be like 42% inflation, wrecking consumer budgets and the many companies that depend on them.

Other options include a 32% payroll tax split between employers and workers or a 25% income surtax on everybody.

Or, the government could cut 80% of spending on everything but health care, which would include highways, airports and the Pentagon.

Or here’s a good one: Just borrow the money and quadruple Washington’s annual deficits.

Or do none of the above, and simply create the money by federal spending, just as the federal government has been doing since 1940, the year Robert M. Hanes had his meltdown.

We’ve written about the CRFB several times before. They are mouthpieces for the very rich, who, because of Gap Psychology, do not want the middle class to receive federal benefits.

The CRFB comes up with all sorts of scare tactics to make you believe federal financing is like state and local financing or personal financing. So they print big deficit numbers and say, in effect, “Oooohh. Look at these big numbers. Aren’t they big?

The best idea might be charging every enrollee in the new program $7,500 per year, so they’d be paying directly for the coverage they’re getting.

Some people pay more than that now for health care, by purchasing insurance outright or sacrificing pay raises in exchange for employer coverage.

It would still be a nifty trick to propose that to voters.

If by “best idea,” Mr. Newman means “another bad idea,” I’d agree. So would the voters.

It’s possible that Medicare for All would cover health care for more people at a lower total cost than we spend now, meaning the average cost per person would go down.

Yes, the cost would be lower, especially if the people are asked to pay nothing for health care, and it all was provided free by the government — and especially if we eliminated the useless, harmful FICA tax, the single, worst, most regressive, pays-for-nothing tax in America.

The problem is transitioning from what we have now to whatever Medicare for all would be.

And it’s a giant problem, like crossing the Mississippi River without a bridge or a boat. The other side might look great but you’ll die before you get there.

The author, Mr. Newman, wants you to believe that having created the entire Medicare program, now simply cutting the eligibility age from 65 to 0 is an insurmountable problem.

That’s like saying that after having built from scratch, a 5,000 square foot house, changing the knob on the front door is ” . . . a giant problem, like crossing the Mississippi River without a bridge or a boat.” Pulleeze.

Warren, Sanders and others tout the virtues of this magical health care program without explaining what it would cost.

Sanders has at least suggested some possible ways to pay for it, including premiums paid by enrollees, a wealth tax on millionaires and income tax rates as high as 52%.

Warren has been cagier, saying only that under her plan “costs” would go down for middle-class families. Under pressure to explain, Warren has pledged to come up with a financing plan soon.

Now, maybe she doesn’t have to.

So again I ask, why are Warren, Sanders, and the rest of the Democrats so cowardly? When all other options lead to failure, why not simply tell the truth?

Rodger Malcolm Mitchell
Monetary Sovereignty
Twitter: @rodgermitchell
Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..

The most important problems in economics involve:

  1. Monetary Sovereignty describes money creation and destruction.
  2. 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:

Ten Steps To Prosperity:

1. Eliminate FICA

2. Federally funded Medicare — parts A, B & D, plus long-term care — for everyone

3. Provide a monthly economic bonus to every man, woman and child in America (similar to social security for all)

4. Free education (including post-grad) for everyone

5. Salary for attending school

6. Eliminate federal taxes on business

7. Increase the standard income tax deduction, annually. 

8. Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.

9. Federal ownership of all banks

10. Increase federal spending on the myriad initiatives that benefit America’s 99.9% 

The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.

 

The lesson Qatar teaches America Monday, Oct 28 2019 

Consider these facts:

1. The gulf state of Qatar is one of the wealthiest nations on earth: U.S. GDP per capita: $54,541.70; Qatar GDP per capita: $112,531.50

2. Petroleum and natural gas account for more than 70% of total government revenue.

3. The Qatari riyal is pegged to the US dollar at a fixed exchange rate of $1 USD = 3.64 QllR.

4. Qatar spends massive amounts on . . . well, on whatever it wants, for instance:

Qatar Is Air-Conditioning the Outdoors Because of Climate Change
Qatar can afford the absurd costs of outdoor air-conditioning because it has a $320 billion sovereign wealth fund, which invests the country’s immense wealth derived from oil and natural gas reserves into real estate, infrastructure, and corporations around the world.

And:

5. The inflation rate in Qatar in 2019 is running at about only .10% compared with the U.S inflation rate of 1.7%, seventeen times higher

Qatar’s government spends massively and “prints” enormous amounts of money, yet the nation has an infinitesimal inflation rate — How is this possible?

Contrary to popular wisdom, inflations and their big brothers, hyperinflations, are not caused by government spending or by money “printing.”

Changes in federal deficit spending (red) do not parallel changes in consumer prices (blue).

Inflations are caused by shortages, usually shortages of food or energy .

In fact, government spending actually can cure an inflation if the spending is directed toward curing the shortage (For instance, if an inflation is caused by a shortage of food, the government could buy food, or supplement farming, and give free food to the populace. That instantly would end the inflation.)

The Qatar government is wealthy because it has vast amounts of oil, which it exchanges for vast amounts of U.S. dollars.

But, the U.S. is even wealthier, because being Monetarily Sovereign, the U.S. government has infinite U.S. dollars.

Image result for ben bernanke

Former Fed Chairman Ben Bernanke

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 borrowing to remain operational.

Qatar’s government has to drill oil and sell oil, to obtain dollars with which to fund its lavish spending on outdoor air conditioning, artificial islands, and other luxuries.

America’s government needs only to press a computer key to create enough dollars to:

–Eliminate the FICA tax,
–Federally fund free Medicare — parts A, B & D, plus long-term care — for everyone,
–Provide Social Security for all,
–Provide free education (including post-grad) for everyone,
–Pay students a salary for attending school,
–Eliminate federal taxes on business,
–Increase the standard income tax deduction, annually,
–And do whatever else it wishes.

Yes, America has the financial power to do all these things, while funding research to eliminate poverty, cure every disease, and fly to Mars, all without causing inflation

All we need is the desire and the understanding of what is possible.

Rodger Malcolm Mitchell
Monetary Sovereignty
Twitter: @rodgermitchell
Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..

The most important problems in economics involve:

  1. Monetary Sovereignty describes money creation and destruction.
  2. 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:

Ten Steps To Prosperity:

1. Eliminate FICA

2. Federally funded Medicare — parts a, b & d, plus long-term care — for everyone

3. Provide a monthly economic bonus to every man, woman and child in America (similar to social security for all)

4. Free education (including post-grad) for everyone

5. Salary for attending school

6. Eliminate federal taxes on business

7. Increase the standard income tax deduction, annually. 

8. Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.

9. Federal ownership of all banks

10. Increase federal spending on the myriad initiatives that benefit America’s 99.9% 

The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.

MONETARY SOVEREIGNTY

Why Congress does nothing to solve the student loan problem Monday, Oct 28 2019 

Student loan debt is a huge problem, not only for the students themselves, but for all; of America.

Congress has several alternatives available to it, that would remove this huge albatross from the necks of America’s best and brightest, and even from the rest of us.

  1. Congress simply could pay off all existing and future loans. Unlike students, the U.S. government never can run short of U.S. dollars.
  2. Congress could provide Free education for everyone (Step #4 of the Ten Steps to Prosperity), and
  3. Congress could provide a Salary for attending school (Step #5.)

But Congress has not lifted a finger to solve this national problem. In fact, Congress caused the problem.

The reasons can be found in the following excerpts from an article that ran in the “naked capitalism” web site:

Wall Street Has Been Gambling With Student Loan Debt For Decades
Posted on October 27, 2019 by Lambert Strether

Student loan debt burdens 44 million people in the United States.

However for CEOs of student loan companies, or investors on Wall Street, student debt is a lucrative commodity to be bought and sold for profit.

There, in two words, “lucrative commodity,” you see the fundamental reason why Congress, and especially this right-wing administration, like things just as they are, thank you.

Congress and the President are run by money.

Corporations such as Navient, Nelnet, and PHEAA service outstanding student debt on behalf of the Department of Education.

These companies also issue Student Loan Asset-Backed Securities (SLABS) in collaboration with major financial institutions like Wells Fargo, JP Morgan, and Goldman Sachs.

For these firms and their creditors, debt isn’t just an asset, it’s their bottom line.

You might wonder why the U.S. federal government, which handles trillions of dollars worth of Treasury certificates (T-bills, T-notes, T-bonds) needs to farm out the servicing of student loan debt and SLABS.

And, you might wonder why the government helps to create the indebtedness of America’s potential leaders.

MONEY is the answer.

Congress loves privatization, not because it is “more economical” than the federal bureaucracy (It isn’t), and not because the private sector can do the job better and more safely (It can’t, as the recession of 2008 demonstrated.)

Congress loves privatization because big donors love it. If somehow big donors wanted the federal government to do 1, 2, and 3 (above), that would be the way Congress and the President would vote.

Investors holding SLABS are entitled to coupon payments at regular intervals until the security reaches final maturity, or they can trade the assets in speculative secondary markets.

There is even a forum where SLABS investors can anonymously discuss their assets and transactions, free from unwanted public scrutiny.

Yet the financialization of student debt is almost never reported on in the media.

There is little public awareness that when student borrowers sign their Master Promissory Notes (affirming that they will repay their loans and “reasonable collection costs”), their debts may be securitized and sold to investors.

The rich speculators do not want you to know how valuable student debt is to them. You might want to eliminate student debt, heaven forbid.

SLABS resulted from specific federal policy decisions. On November 27, 1992, the Securities and Exchange Commission adopted Rule 3(a)(7) of the Investment Company Act of 1940, which allows companies who issue asset backed securities to be exempt from the legal definition of an “investment company.”

This exemption permits companies to avoid asset registration fees and regulatory oversight – making it profitable for student loan companies to issue securities, which effectively created the market for SLABS.

“Regulation” is a dirty word in the eyes of the rich. They opt for “free enterprise,” meaning “We can get away with anything when everything is legal.

Over the past few decades, student loan companies and Wall Street have amassed record profits.

Meanwhile, $1.6 trillion of student debt is crushing generations of Americans by delaying home ownership, causing generational wealth to decrease, and contributing to widespread depression and even suicide.

Since the ironically-named Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, student debt is virtually impossible to discharge in bankruptcy.

Donald Trump repeatedly was able to discharge his and his companies’ debts via bankruptcy. He has boasted about how smart he was to take advantage of bankruptcy laws.

The rich lenders have made sure that students are not afforded this privilege.

Navient is the largest student loan servicing company and the largest issuer of SLABS. In filings with the SEC, Navient acknowledges the following risk factors: “An economic downturn may cause the market for auction rate notes to cease to exist… Holders of auction rate securities may be unable to sell their securities and may experience a potentially significant loss of market value.”

Due to the “securitization food chain”, if Navient or other SLABS issuers and holders experience a significant loss of revenue, they could default on their obligations – triggering negative consequences for Wall Street firms that market these securities to investors and supply credit to the greater public.

Those of you who remember the painful Great Recession of 2008, will note that massive debt default was the cause. For the rich, this lesson has not been inhibiting.

Greed and power tend to preclude caution.

As economist Michael Hudson has argued, “debts that can’t be paid, won’t be paid”, and the insistence of creditors to collect on those debts can trigger social unrest.

As the rational discontent of younger generations continues to grow, catalyzed by a lower quality of life than older generations, the accelerating climate crisis, and insurmountable student debt – activists may choose to utilize “the power of economic withdrawal.”

Young people could exploit the vulnerabilities of the SLABS market via debt strikes or boycotts, as advocated during the Occupy Wall Street movement in 2011.

Writes David Graeber in his comprehensive 2011 book Debt: The First 5000 Years. “For the last five thousand years, with remarkable regularity, popular insurrections have begun the same way: with the ritual destruction of the debt records-tablets.”

Activists concerned about student debt should ask themselves: what would such a symbolic protest look like in the United States today, and could it become popular enough to pose a significant threat to the status quo?

Historically, most social progress has been initiated by the young and the progressive, and resisted by the older and conservative.

The battles between the two often have been bloody and destructive, leaving the nation in tatters for decades or even generations. We still have not completely recovered from the atrocities of the Civil War, the Great Depression, and Vietnam.

For very good reasons, city, county, and state governments pay for grades K through 12. And these governments are not Monetarily Sovereign, so supporting education is a huge financial strain on them. Yet they do it.

For the same very good reasons, the federal government should fund grades 12+ — and it is Monetarily Sovereign, so such support would be no financial strain at all.

Student debt is an abomination that should not have begun, should not continue, and easily could be solved, if our government leaders had the morals and spine for it. 

Perhaps, by rising up, marching, engaging in civil disobedience, and especially voting, young people may help our Congresspeople develop some decency, integrity, and vertebrae.

Congress should initiate Steps #4 and #5, now.

Rodger Malcolm Mitchell
Monetary Sovereignty
Twitter: @rodgermitchell
Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..

The most important problems in economics involve:

  1. Monetary Sovereignty describes money creation and destruction.
  2. 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:

Ten Steps To Prosperity:

1. Eliminate FICA

2. Federally funded Medicare — parts a, b & d, plus long-term care — for everyone

3. Provide a monthly economic bonus to every man, woman and child in America (similar to social security for all)

4. Free education (including post-grad) for everyone

5. Salary for attending school

6. Eliminate federal taxes on business

7. Increase the standard income tax deduction, annually. 

8. Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.

9. Federal ownership of all banks

10. Increase federal spending on the myriad initiatives that benefit America’s 99.9% 

The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.

MONETARY SOVEREIGNTY 

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