Tag: monetary sovereignty

How not to run a Brexit

Some facts:

1. The Value of a currency is based on the Supply and Demand for the currency vs. the Supply and Demand for goods and services.
2. The Demand for a currency is based on Risk and Reward.
3. The Reward for owning a currency is interest.

That is why, to fight U.S. inflation (i.e. increase the value of the dollar) the Fed increases the Reward for owning dollars (i.e. increases interest rates), which increases the Demand for dollars.

4. A growing economy requires a growing supply of money.

That is why, to stimulate the economy, Congress and the President increase deficit spending, which pumps more dollars into the economy.

Carefully balancing the creation of dollars with interest rates stimulates the economy without inflation.

Keep those 4 points in mind as you read the following excerpts from an article in CNN Money:

Brexit rescue: Bank of England slashes interest rates
by Mark Thompson

The Bank of England has cut interest rates for the first time in seven years, and will revive a broader economic stimulus program to try to limit the damage from June’s Brexit vote.

Rates were cut to a record low of 0.25%, which should reduce mortgage rates for some homeowners and make it cheaper for companies to borrow.

Savers, pension funds and banks, on the other hand, are likely to suffer.

“Following the United Kingdom’s vote to leave the European Union, the exchange rate has fallen and the outlook for growth in the short to medium term has weakened markedly,” the bank said Thursday. “

The Bank’s concern is: The exchange rate has fallen. So what does the Bank do? It reduces the reward for owning pounds, thereby guaranteeing a further decline in the exchange rate. Counter-productive and non-sensical.

The bank also said it would pump £70 billion ($92 billion) into the economy by printing money to buy bonds issued by the British government and companies.

The bank’s program of quantitative easing — already worth £375 billion — has been on hold since July 2012.

Bonds issued by the British government were purchased by the public. The money used to purchase those bonds did not disappear.  It was deposited in bond accounts owned by the public.

These bond accounts are very much like bank savings accounts. Just as money continues to exist when it’s deposited in a savings account, money also continues to exist when it’s deposited in a government bond account.

When the bank of England buys those bonds from the public, it merely transfers existing pounds from the public’s bond accounts back to the public’s checking accounts. No new money is “printed.”

By purchasing those bonds from the public, the government reduces the amount of interest money it would have pumped into the economy.

Contrary to what the Bank of England (and the Fed) claim, “Quantitative Easing” is anti-stimulus. It moves money around without adding any, and in fact, reduces the stimulus that government interest payments provide.

Recent surveys of business activity, confidence and optimism suggest that the United Kingdom is likely to see little growth in GDP in the second half of this year.”

There’s a 50% chance of a recession over the next 18 months, according to the National Institute for Social and Economic Research.

Based solely on the BOE’s efforts, there is a 100% chance of recession, and it may come sooner than 18 months.

Rather than uselessly buying its own bonds, and adding nothing to the economy, the government should cut taxes and increase spending, according to some version of the Ten Steps to Prosperity (below).

The Monetarily Sovereign British never can run short of its own sovereign currency, the pound. In theory, this should provide a huge advantage over the euro nations, which are monetarily non-sovereign, and cannot control their money supplies.

Sadly though, the British government promotes the false notion that its debt is unsustainable, and austerity (deficit reduction) is the path to economic growth.

Taking money from an economy, in an effort to grow that economy, is like applying leeches to cure anemia.

One only can pity the British people, who are forced to live under such misguided rule. Of course, we Americans are exposed to the same Big Lie from our leaders.

Pity us.

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten Steps to Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE (H.R. 676, Medicare for All )
This article addresses the questions:
*Does the economy benefit when the rich afford better health care than the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE AN ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-tranferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be an good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME. (TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

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

MONETARY SOVEREIGNTY

Commitment denial: A story of cardiologists and economists

You may have noticed on this site, repeated examples of economists parroting the Big Lies in economics: Federal taxes fund federal spending, federal deficit spending is “unsustainable,” Medicare and Social Security are running short of money.

We never have seen a precise explanation for “unsustainable,” but we expect the economists want you to believe some combination of:
–The U.S. federal government is running short of its own sovereign currency, the dollar
–Taxpayers pay for federal spending
–Deficit spending causes inflations
–Deficit spending causes recessions and depressions
–At some unknown future time, the federal government will not be able to pay off its debts

All of the above are false.

The facts are: The U.S. government cannot run short of dollars; taxpayers do not pay for federal spending; deficit spending doesn’t cause inflations; deficit spending prevents and cures recessions and depressions; the federal government could pay off all its debt tomorrow.

Why do many economists, who of all people should know better, disseminate harmful myths about our economy?

In previous posts we have attributed the Big Lies to bribery by the rich — specifically those people who want to widen the Income/wealth/power Gap between the rich and the rest. (Without the Gap, no one would be rich — we all would be the same — and the wider the Gap, the richer they are.)

The rich bribe economists by employing them in “think tanks” and by making donations to their universities.

There may, however, be an additional factor: Commitment denial

Are Good Doctors Bad for Your Health?
New York Times, by Ezekiel J. Emanuel, 11/15/15

“Get me the best cardiologist” is our natural response to any heart problem. Unfortunately, it is probably wrong.

One of the more surprising research papers published recently appeared in JAMA Internal Medicine. It examined 10 years of data involving tens of thousands of hospital admissions.

It found that patients with acute, life-threatening cardiac conditions did better when the senior cardiologists were out of town.

And this was at the best hospitals in the United States, our academic teaching hospitals.

As the article concludes, high-risk patients with heart failure and cardiac arrest, hospitalized in teaching hospitals, had lower 30-day mortality when cardiologists were away from the hospital attending national cardiology meetings.

And the differences were not trivial — mortality decreased by about a third for some patients when those top doctors were away.

The research began as an investigation of how much harm cardiology meetings did (by calling doctors away from their hospitals), and instead found that heart patients did better when the hospitals’ best cardiologists were away!

There were several speculations about why this might be true:

One possible explanation is that while senior cardiologists are great researchers, the junior physicians — recently out of training — may actually be more adept clinically.

Another potential explanation is that senior cardiologists try more interventions.

When the cardiologists were around, patients in cardiac arrest, for example, were significantly more likely to get interventions, like stents, to open up their coronary blood vessels.

We usually think more treatment means better treatment.

We often forget that every test and treatment can go wrong, produce side effects or lead to additional interventions that themselves can go wrong.

The point of this post is not specifically to discuss medicine, for which I have very little background. Instead, the point is to discuss the medical establishment’s response to this research: Commitment denial.

When the AMA and several doctors were questioned about the research results, the responses could be summarized as, “We’re pleased that doctors made sure their staff was fully prepared.”

Get it? Rather than worry about why such results occurred, they tried a “lemons into lemonade” approach, in effect claiming that greater mortality with top doctors was a good thing.

Also, they questioned the research itself, and seem less concerned about the possibility the research may have uncovered a real problem.

Doctors themselves intuitively believed the results were impossible. And why should they not?

They have devoted their entire lives to the “self-evident” postulate that better, more experienced doctors always create better patient outcomes.

They are committed to denying otherwise.

In the same vein, many economists have devoted their lives to the belief that federal taxpayers, (like state and local taxpayers) fund their governments’ spending, and that deficits and debts are economically bad.

To them, it’s “self evident.” No proof needed, and no contrary evidence accepted.

Economists have written papers and read papers on the subject, given speeches and heard speeches , attended meetings and had informal discussions with fellow economists, received awards for their hypotheses, taught classes and corrected students who said otherwise — day after day after day — all of which have solidified their beliefs.

In short, the economists, like the doctors, are not just financially committed, but also emotionally committed to their versions of the Big Lie.

You probably have not heard much about the above-mentioned medical research. The doctors and media don’t discuss it.

Nor have you heard much about the Big Lies in economics. The economists and media don’t discuss them.

They believe what they believe, and anything that disagrees “obviously” is wrong.

Each group of doctors and economists fervently prays the data simply will disappear — the head-in-sand approach, though in each case, the data point to ways in which physical and financial lives may be saved.

In human psychology, a saved life sometimes is less valuable than a saved self-image.

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten Steps to Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE (H.R. 676, Medicare for All )
This article addresses the questions:
*Does the economy benefit when the rich afford better health care than the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE AN ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-tranferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be an good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME. (TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

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

MONETARY SOVEREIGNTY

Medicare for Education: The “Free College” promise could come true

The web site, “Reason.com,” published an article titled, “Hillary Clinton’s Free College Promise Won’t Be Free—and Won’t Help College Students.”

The article is right — and wrong — and if you’re interested or confused about the “Free College” promise, here are some excerpts from the article:

“It’s just not right that Donald Trump can ignore his debts and students and families can’t refinance theirs,” Hillary Clinton said during her acceptance speech Thursday night.

She specifically name-checked Sanders and promised to work with him “to make college tuition free for the middle class and debt free for all.”

Actually, she and Bernie are on somewhat different paths. She even is on a different path from herself.

She spoke about refinancing debt, which is a long way from “debt free for all.”  For example, in the past few years, as interest rates fell, millions of people refinanced their mortgages, but that didn’t mean they were “debt free.”

By contrast, Bernie really did suggest free college, though supposedly (and erroneously) “paid for” by taxes.

The attack on Trump here is something of a non sequitur.

Sure, Trump may have overused and even abused America’s bankruptcy laws, but there’s actually an important reason why student loan debt can’t be wiped out in bankruptcy court while the debt of poorly run casinos can.

When a person or business goes through bankruptcy, there are physical assets that can be sold and used to pay lenders.

The bankruptcy process is meant to bring both sides to the table to work out a middle ground. Lenders get something back, and borrowers have to pay what they can.

There are no physical assets in student loan debt.

A college grad with $100,000 in unpaid loans can’t slice off a portion of their knowledge or experience and sell it, any more than they can hand over a portion of the better economic opportunities they have because of a college degree.

The explanation is wrong. Many people, who have no assets, go bankrupt every year. For them, the purpose of bankruptcy is to give them a fresh start, and not to be indebted forever.

So yes, the student loan laws could be amended to allow for bankruptcy, rather than the permanent, “indentured servant” system now in place.

America is damaged when its educated students are hamstrung by debt much of their lives, unable start a family, unable to use their education to create new business opportunities, unable to work in the lower-paid sciences or teaching, because they need to earn more to pay their debts.

To anyone who graduated in the last decade, during which tuition costs have skyrocketed, the idea of “free” or “debt free” college tuition probably sounds great.

But attempts by state and federal government to lower the cost of college have contributed mightily to the high cost of attending post-secondary school.

Government subsidies have hidden the price of college and broken the market forces that would naturally keep tuition costs down, allowing universities to charge pretty much whatever they want.

This is identical with the objections we all heard to Medicare: “Subsidize doctor and hospital bills, and doctors and hospitals will charge whatever they want.”

But, in fact, the opposite happened. Medicare has limited doctor and hospital bills.

Not that this is economically beneficial. By cutting medical bills, Medicare reduces the amount of money the federal government pumps into the economy, thereby reducing economic growth.

And the idea of “market forces that would naturally keep tuition costs down” doesn’t stand up to scrutiny.  It means that poorer students would seek out lower ranked colleges, theoretically forcing the higher ranked colleges to lower rates in order to compete.

Not only is this disgustingly elitist (Shall we also require poorer sick people to use lower ranked health care?), but colleges already compete on price, and that competition has not reduced prices.

Under a plan she announced earlier this month, anyone from a family making less than $85,000 a year would get free tuition to public universities.

(But) her vice presidential pick, U.S. Sen. Tim Kaine, (previously) wrote, “By making all public university education free, we’d be giving away college education to richer Americans who don’t need the assistance paying for it.”

So, does this mean a family making $86,000 a year should not receive free tuition?  Should we set up an income “no-man’s land,” whereby no one wishes to earn $86,000 – $126,000?

This would be yet another instance of Congressional “fine tuning” that creates more problems than it solves.

The entire discussion of “free college” would greatly be simplified if it revolved around two facts:

  1. College education is just as important to America today, as was high school education yesterday, and elementary school education before then.

    The world has become much more complex, much more technical, and for America to retain its leadership, we must ensure that all those who want a college education get it.

  2. The federal government has the unlimited ability to fund college for everyone. There is no benefit to America in limiting anyone’s financial ability to attend college. Taxpayers do not fund federal spending.

    There is no reason not to “give away college education to richer Americans who don’t need the assistance paying for it.”

    The money enters the economy, thereby stimulating the economy, benefitting many Americans.

    At any rate, “family income” is a horrible way to measure one’s ability to pay for college.

    It is a measure that does not consider the varying costs of living in different geographical areas, the number and ages of people in the family, the family’s wealth, the family’s other financial obligations, the family’s health — a whole host of considerations that are not considered by family income.

What should be done: In the Ten Steps to Prosperity (below), Steps #4 (FREE EDUCATION, INCLUDING POST-GRAD, FOR EVERYONE) and #5 (SALARY FOR ATTENDING SCHOOL) describe in more detail, a financial plan for education.

Medicare already has solved many of the functional problems for us. It shows how the government can fund an important function, in this case, healthcare, in an evenhanded, highly beneficial way.

We should institute a “Medicare for education” plan, without the FICA and the age limits.

The government can afford it.
The country needs it.
Medicare has shown us how to do it.

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten Steps to Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE (H.R. 676, Medicare for All )
This article addresses the questions:
*Does the economy benefit when the rich afford better health care than the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE AN ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-tranferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be an good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME. (TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

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

MONETARY SOVEREIGNTY

The Committee for Screwing the Middle Classes and the Poor

We’ve written before about an organization that calls itself, “The Committee for a Responsible Federal Budget.” (CRFB)

We suggest they change the name to “The Committee for Screwing the Middle Classes and the Poor.” To say that what they publish is rank nonsense, would do a disservice to the words “rank” and “nonsense.”

CRFB is a prime promulgator of the Big Lie, the lie that the federal government somehow can run short of its own sovereign currency, the dollar, with which to pay its bills.

The Big Lie devolves to the Big Screwing, the never-ending effort by the rich, to cut Social Security, cut Medicare, cut Medicaid and cut virtually every other program that benefits the middle classes and the poor.

Here are a couple of CRFB’s luminaries (quoting from their website), nearly all of whom are rich and all of whom are white:

Maya MacGuineas, the President of the CRFB as well as the head of the Campaign to Fix the Debt. (She once was) dubbed “an anti-deficit warrior” by The Wall Street Journal.

Since deficit spending is the method by which the federal government grows the economy, MacGuineas should more properly be dubbed “an anti-economic growth warrior.”

Erskine Bowles was appointed by President Barack Obama to serve as co-chair of the National Commission on Fiscal Responsibility and Reform with fellow CRFB board member Senator Alan Simpson.

Erskine and Bowles authored a report that recommended cuts in the federal spending that was pulling us out of the Great Recession. Remember “sequestration” and the “fiscal cliff”?

Peter Peterson is the founder and chairman of the Peter G. Peterson Foundation is the founding president of The Concord Coalition. Prior to this, he served as chairman and CEO of Lehman Brothers.

Peterson is a very rich man who does everything possible to make sure your Social Security and Medicare are cut. The Concord Coalition is, like the CRFB, an organization devoted to widening the Gap between the rich and the rest.

In true CRFB tradition, our intelligence and our pocketbooks once again are assaulted with an article like this:

Long-Term Budget Outlook Underlines Trouble Ahead for Social Security
JUL 29, 2016

The Congressional Budget Office’s (CBO) 2016 Long-Term Budget Outlook release came with updated projections of the 75-year solvency of Social Security.

CBO now projects that Social Security faces a 75-year shortfall of 4.7 percent of taxable payroll – 0.3 percentage points worse than its projections from December – but maintains an exhaustion date of 2029.

Social Security is an agency of the federal government. Neither the federal government nor any of its agencies can become insolvent unless Congress wants it.

Unlike state and local governments, which can be insolvent, the federal government is Monetarily Sovereign, meaning it has unlimited control over both the supply and the value of the U.S. dollar.

The U.S. government invented the dollar, created it from thin air by the simple device of passing laws, which also were created from thin air. Because the government never can run short of laws, it also never can run short of dollars.

The U.S. government never, never, never can be unable to service any invoice denominated in dollars. Never has, never will.  All talk about federal agency insolvency is 100% BS.

The rest of CRFB’s article attempts to put a scientific spin on its woefully false claims by touting such measures as: “actuarial shortfall” and “projections involving life expectancy, fertility, and growth in the consumer price index.”

But all the phony math in the world will not cover up the Big Lie, the basic premise, that the federal government can run short of its own sovereign dollars.

And then comes the real pitch to the suckers:

Now is the time to start making reasonable changes to Social Security rather than waiting until the last minute when the necessary changes become much more drastic.

Instead of discussing ways to expand a program whose funds are already strained, policymakers should be considering both spending and revenue changes to ensure the long-term health of this important program for millions of beneficiaries across the country.

To hide the truth from you, these con artists use the innocent-sounding phrase, “reasonable changes,” when they really mean: Cut Social Security benefits and increase the FICA taken from your paycheck.

And then they have the chutzpah to end with, “ensure the long-term health of this important program for millions of beneficiaries across the country.”

Please gimme a break. If these characters cared one whit about the “millions of beneficiaries,” they would demand benefit increases and tax cuts.

The fact of Monetary Sovereignty is this: You, and the rest of salaried Americans, could pay $0 FICA, while Social Security benefits were doubled, and still the federal government would not run short of dollars.

Why do you pay FICA? Why have Social Security benefits begun later and later? Why do organizations like CRFB lie to you again and again about mythical insolvency threats? Why even, was a complex, convoluted program like “Obamacare” necessary?

Because our political leaders are paid to lie by the rich, whose primary objective is to widen the income/wealth/power Gap between the rich and the rest.

The Gap is what makes the rich richer, and the wider that Gap, the richer they are.

So the rich bribe Congress (via campaign contributions); they bribe the media via ownership; they bribe the economists via contributions to universities and think tanks; and the rich pay the salaries of MacGuineas, Simpson, Bowles et al, and finally, the rich even bribe the Supreme Court justices with free vacations and other perks.

Bernie Sanders made a stab at narrowing the Gap, but he wasn’t believed by the very people who would have been helped most: The middle classes and the poor.

So now we are stuck with Hillary Clinton, who if she is like Barack Obama, will do very little to close the Gap, or worse yet, stuck with Donald Trump who with his ignorance and hubris, not only will do nothing to close the Gap, but who will destroy America’s economy.

It doesn’t need to be this way.  The federal government easily could provide Social Security and Medicare for every man, woman, and child in America.

The first step is for you and enough other people to understand and believe Monetary Sovereignty, and to demand the same of Congress. 

You need only to get up off your butt and make it happen.

Rodger Malcolm Mitchell
Monetary Sovereignty

====================================================================================================

Ten Steps to Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE (H.R. 676, Medicare for All )
This article addresses the questions:
*Does the economy benefit when the rich afford better health care than the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE AN ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-tranferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be an good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME. (TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

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

MONETARY SOVEREIGNTY