Tag: monetary sovereignty

MAGA Marco shows his ignorance for the world to see

I wrote to Sen. Marco Rubio, reminding him that the U.S. federal government, being Monetarily Sovereign, cannot unintentionally run short of dollars.During Iowa visit, Marco Rubio won't say if he's running for president Thus, no federal government agency can run short of dollars unless that is what Congress and the President want. Here is the response I received. It indicates MAGA Marco either is ignorant about federal finance or is lying.  I vote for both.

Dear Mr. Mitchell:

Thank you for taking the time to express your thoughts regarding the future of Social Security and Medicare.

Understanding your views helps me better to represent Florida in the United States Senate, and I appreciate the opportunity to respond.

Except, he doesn’t understand my views and/or doesn’t care about representing Florida or the United States. He is a weak and willing (and usually absent) tool of the extremist GOP.

Social Security and Medicare are critical pieces of the retirement security safety net for seniors. In 2023, more than 66.2 million Americans currently receive Social Security benefits of some form.

As currently structured, however, these programs are going bankrupt, and Congress must work to protect and reform them so that they can fulfill their promises to future retirees.

Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.” Alan Greenspan: “There is nothing to prevent the federal government from creating as much money as it wants and paying it to somebody.” Alan Greenspan: “The United States can pay any debt it has because we can always print the money to do that.” 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.” Quote from former Fed Chairman Ben Bernanke when he was on 60 Minutes: Scott Pelley: Is that tax money that the Fed is spending? Ben Bernanke: It’s not tax money… We simply use the computer to mark up the size of the account.
The federal government can and should fund Social Security just as it funds the military, the Senate, the House, SCOTUS, the White House and almost every other federal agency — by simply paying their bills.

Social Security began in 1935 as a social insurance program primarily for widows, orphans, and those living past the current average life expectancy. These benefits are funded by taxes on the wages of all American workers, called payroll taxes, which are automatically withheld each payday.

No, the benefits are not funded by taxes. The federal government destroys all tax dollars it receives. It pays its bills by creating new dollars ad hoc.

In 1950, 16.5 workers were paying in for every beneficiary receiving payments. Today, that ratio has fallen to 2.8 workers for every beneficiary and will continue to decline for the foreseeable future.

Wrong. Those FICA taxes are destroyed upon receipt. Workers do not pay for benefits.

According to the non-partisan Congressional Budget Office (CBO), the Social Security program is now running permanent deficits due to this declining ratio and a growing number of disabled individuals.

According to the Social Security Administration, benefits will only be fully payable until 2033. At that point, the Social Security Trust Fund will only be able to meet 77 percent of scheduled benefits.

The government can pay benefits forever. These scare tactics are solely for the rich who wish to widen the Gap between themselves and those below them on the income/wealth/power scale.

Medicare, created in 1965, is currently running deficits as well. Its solvency must be addressed to protect current and future generations of Americans.

Medicare, an agency of the Monetarily Sovereign federal government, cannot become insolvent unless Congress and the President want it to.

According to the CBO, total Medicare spending was $747 billion in 2022. By 2033, Medicare spending will be $1.6 trillion.

Though Congress has known about these problems for years, it has chosen not to address them straightforwardly with the American people.

Congress can “address the problem” simply by paying Medicare’s bills.

I will continue to highlight the need to reform this critical program in a responsible manner to ensure future generations have Medicare and Social Security in old age.

Marco’s idea of “reform” is to cut benefits and/or increase taxes. The “solutions” the rich want, so the income/wealth/power Gap will be widened.

Social Security should also be reformed to reflect the different kinds of economic insecurity Americans face in the 21st century.

For example, my New Parents Act of 2023 (S.35), which I reintroduced on January 24, 2023, would offer paid parental leave to new parents by allowing the option to use a portion of their Social Security benefits after the birth or adoption of a child.

This is a tacit benefits-cutting measure. The federal government should pay, not Social Security benefits.

They then would have the option to delay retirement by the benefit taken or receive a proportionate reduction in monthly retirement benefits for the first five years of retirement.

The rich always look for ways to reduce retirement benefits, so the poor will be forced to work forever.

At a time when working families are being left behind, and childbirth rates are falling, it is essential to realign our economic policies in support of American families. S.35 would not raise taxes or expand bureaucracy and would not change the long-run balance of the Social Security Trust Fund. 

The so-called “Trust Fund” is a bookkeeping fiction. No dollars are stored in any federal “trust fund.” The so-called trust funds simply are records of contributions that have nothing to do with the ability to pay for benefits.

It is an honor and a privilege to serve you in the United States Senate. As your United States Senator, I will keep your thoughts in mind as I consider these issues and continue working to ensure America remains a safe and prosperous nation.

Yeah, right. Blah, blah, blah. I’m sure he has us in his thoughts and prayers and is working day and night for us. Does anyone want to buy a bridge from this guy? Rodger Malcolm Mitchell Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell

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The Sole Purpose of Government Is to Improve and Protect the Lives of the People.

MONETARY SOVEREIGNTY

Is money real? No.

Is money real? Let’s first define “real.” Then you decide.

A case could be made that nothing is “real” in that everything is constructed in our brains. René Descartes addressed that problem when he wrote, “I think, therefore I am.” (“cogito, ergo sum”).

It was the one statement he felt he absolutely could accept as accurate. He couldn’t know for sure that the earth, the seas, the stars, and the people were not illusions or dreams.

But since we are defining, we can define real as we choose, so let’s say that “real” means something most people accept as having a physical existence. In one way or another, it can be seen, felt, heard, smelled, tasted, or otherwise having a physical presence.

In that sense, many things we commonly deal with are not real. Numbers are not real. You cannot see, taste, feel, smell, or hear a number. What does the number 6 look like? Does it look like this?

Or like this: Six, SIX, √36, IIIIII, seis

Numbers are concepts or ideas with no physical existence. 

In a similar vein, is a story or a novel real? No, a story can be told or written on paper or in a computer’s electrons, but the story itself is not physical. By our definition, that novel you are reading is not real, though the paper and ink are real. 

A Complete Guide to Car Titles - CARFAX
This is a representation of a title, not a title in itself.

A car and house are real, but is the title to a car or house real? The paper and ink are real if the title is printed on paper. But the title is not real. That title exists not only in printed forms but in electronic form. 

The printed form can be in a certificate or computer output, listing one or hundreds of titles.

The title is a legal concept that can exist in many forms and places.

Being a law, a title can exist in the records of one or more government agencies and in the electronic or paper files of a title insurance company, your attorney, or your own files.

You can see a car, but you cannot see a title. At best, you can see a representation of a title. If someone asks for an “original title,” they mean an original copy of a title.  

Now we come to the question, “Is money real.” Consider $10 (ten dollars). Amazon.com: 1907 Morgan Indian Head Ten Dollars Coin,Great American Commemorative Old Coins, Uncirculated Morgan Dollars,Discover History of USA Coins for Collectors (Gold) : Collectibles & Fine Art

How $10 dollar bill has changed through the years

Although the gold $10 coin is worth more in barter than the paper $10 bill, the two are worth exactly the same as money.

They both are titles to ten dollars.

So, where are the real dollars if the coin and bill are titles?

All U.S. dollars exist only as numbers on the books of the issuer of dollars, the federal government. And as we have seen, numbers have no physical existence. All numbers are nothing more than concepts.

American Maximum Speed Limit 65 Mph Road Sign Stock Illustration - Download Image Now - Number 65, Speed Limit Sign, Sign - iStock
This is not a law. It is a representation of a law.

Six houses, six cars, and six chickens differ; only their “sixness” is the same. Numbers are not physical, though they exist as concepts.

How did the dollar concept come into existence? They were created by laws, which also have no physical reality. You cannot see, hear, feel, taste, smell, or sense in any material way, a law.

You can read the representation of a law in a book of rules (of which there are many thousand), or you can hear the representation of a law from a judge or police officer.

You can see the representation of a law on a traffic sign. The law says you cannot drive faster than 65 (sixty-five) miles per hour.

You also can see a representation of the speed-limit law in law books.

But you cannot see the law itself.

Why is the non-physicality of laws and money important?

If something is physical, its creation relies on the availability of its material constituents. A government is limited in producing gold coins by the availability of gold.

Laws have no such limitations. They have no physical constituents. The federal government can create as many laws as it wishes, whenever it wishes.

And since dollars, which have no physical existence, are created by laws, which also have no physical presence, the federal government has the infinite ability to create dollars. If the federal government wished, it could pass endless laws making infinite dollars.

That power is known as Monetary Sovereignty. The federal government is the absolute sovereign over its creation, the U.S. dollar.

If you were a supplier to the federal government and sent them a bill for a trillion, trillion, trillion dollars, they could pay that bill instantly by passing a law and pressing a computer key.

Thus, the so-called federal debt is no burden on the federal government. 

Claims that the federal debt must be limited or is “unsustainable” are ignorant at best and heinous lies at worst.

Similarly, no federal government agency (Social Security, Medicare, etc.) can run short of dollars unless that is what the Monetarily Sovereign U.S. government wants. 

Then we come to the claims that Social Security and Medicare “trust funds” are on the brink of insolvency. I am too much of a gentleman to term claimers as dirty, rotten liars, so I’ll just leave it as “misguided souls who are spouting ignorance.” Better.

When I call these ignorant claims into question, I am greeted by throat-clearing, followed by the equally ignorant claim that “printing too much money causes inflation.”

First, we do not print money. As we have demonstrated, printed dollar bills are not money.

Second, most dollars are not represented by printed dollar bills.

And third, inflation is not caused by too much money; it is caused by scarcities of significant goods like oil, food, or services like shipping. Scarcities cause prices to rise. That is no revelation. 

Governments can prevent/cure inflation by obtaining and distributing the scarce items — and this often requires more money creation, not less.

Our inflation was reduced not by the Fed’s interest rate hikes (which made products and services cost more) but by the government’s release of oil reserves and the financial support given to the manufacturers and shippers of scarce commodities.

The Fed wrongly is tasked with using recession as a tool against inflation. Congress and the President are responsible for reducing the shortages that cause inflation. They need only use their infinite dollar-creation ability to cure those shortages.

The pretense that the finances of our Monetarily Sovereign U.S. government are the same as the finances of monetarily non-sovereign state and local governments stands in the way of doing what a government should do: Improve and protect the lives of the people.

So, “Is money real?” No, if “real” means a substance, the availability of which is physically limited. But yes, if “real” includes concepts, ideas, laws, emotions, beliefs, preferences, and creativity.

Think of money as the Monetarily Sovereign government’s ability to imagine and fund a better world. No limits.

Rodger Malcolm Mitchell
Monetary Sovereignty

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

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The Sole Purpose of Government Is to Improve and Protect the Lives of the People.

MONETARY SOVEREIGNTY

 

Is Medicare For All too good to be true and too much to ask?

Visualize this:
  1. A federally funded Medicare program that doesn’t just begin when you reach a certain age but covers every man, woman, and child in America, regardless of age or physical condition.
  2. That Medicare has no deductibles, so Medicare Supplements are unnecessary. All doctors, hospitals, nurses, and other healthcare professionals would be covered.
  3. It pays for all approved drugs, 100%.
  4. It covers every body part, including teeth (dental), eyes, and brain (psychiatry).
  5. It covers all equipment, from crutches to wheelchairs to eyeglasses.
  6. It covers all forms of long-term care with no age or dollar limits.
  7. It covers all forms of approved preventive medicine, including spas, gyms, fitness centers, exercise equipment, etc.
  8. It would be free to all. No healthcare taxes (FICA) would be collected. Companies would not fund employees’ health care insurance.
Further, visualize (correctly) that for the Monetarily Sovereign federal government, money is no object. The federal government can afford anything. Is that too good to be true? I thought about that question again when I read an article about Medicaid terminations. Here are some excerpts:

Lawsuit accuses state of ‘illegal’ Medicaid terminations By Caroline Catherman, Orlando Sentinel

Three Florida residents are suing the state’s Agency For Healthcare Administration and Department of Children and Families, alleging the public health insurance program for low-income and disabled people sent out illegal termination notices.

U.S. doctor: Treatment 'worth trying' in case of sick baby Charlie
Healthcare cancelled in Florida

A class-action lawsuit was filed Tuesday by the National Health Law Program and Florida Health Justice Project on behalf of a mom, her 2-year-old daughter, and a 1-year-old.

The suit alleges that Florida violated the Medicaid Act and the U.S. Constitution’s Due Process Clause by failing to give adequate notification to people losing coverage and failing to give them a shot at appealing.

The Due Process Clause has been interpreted by the U.S. Supreme Court as requiring “prior notice and a meaningful opportunity to be heard when an individual is in jeopardy of losing benefits,” according to the National Health Law Program.

Why did Florida terminate the health insurance coverage for some low-income and disabled people? The answer, of course, is “money.” Some bureaucrats, at the behest of Governor Ron DeSantis, decided that certain low-income and disabled should lead their miserable lives in greater misery so that the state of Florida can save money — money that perhaps could be used for shipping poor migrants to some other state? But why does the state of Florida need to save healthcare money when the federal government has infinite money? The Feds could pay for the above-described Medicare, so low-income and disabled people wouldn’t need to lack care. Here’s why:
    • The politicians on both sides of the aisle claim (falsely) that the government’s money supply is limited [Being Monetarily Sovereign, the federal government never unintentionally can run short of its sovereign currency, the U.S. dollar.
    • They claim (falsely) that the federal debt is “unsustainable” and will bankrupt the nation. [The federal government can instantly pay any bills of any size merely by clicking computer keys. It cannot be bankrupt for lack of dollars.]
    • They claim (falsely) that federal spending is funded by federal taxes and that Medicare itself is headed for insolvency. [Because the federal government has the infinite power to create dollars, it neither needs nor uses tax dollars, all of which it destroys upon receipt. As a federal agency, Medicare can run short of money only if the federal government wants it to.]
    • They claim (falsely) that federal spending for Medicare would be the dreaded “socialism.” [All governments spend money, but socialism is government ownership and control, not just spending.]
    • They claim (falsely) that federal deficit spending causes inflation. [Inflation never is caused by federal spending. All inflations are caused by shortages of critical goods and services, more commonly oil and food. Federal spending can cure inflation if used to obtain and distribute scarce goods.]
The federal government and the media have been crying “wolf” (or, in this case, “poverty”) since 1940, calling the federal debt a “ticking time bomb”. Yet, no one seems to notice that it never explodes.

Some people were told they had exceeded income limits but weren’t told Medicaid’s limits or how much DCF determined they made. 

There is no reason for federally funded medical insurance to have income limits. It’s possible to be wealthy while having a low income. Further, there are all kinds of income, each with different implications for a person’s ability to pay for medical services: Taxable, tax-free, liquid, hidden, deferred. No public purpose is served by income limits. The government simply should fund Medicare for everyone rather than creating Byzantine rules that accomplish nothing.

The mom of the 1-year-old named in the suit didn’t realize that the toddler was losing coverage until after her pediatrician told her that her child no longer had health insurance. She didn’t understand how to appeal, the suit states.

There is no reason for an infinitely rich government to put people through such heartache. It should pay everyone’s bills the same way, without “gotcha” rules.

“People don’t know that the reason for termination might be incorrect, that DCF was using the wrong information, or they made a wrong determination.

“They don’t know that they ought to challenge it. 

More than 182,000 Floridians have been issued notices saying they are no longer eligible for coverage since April, after the end of a COVID-era policy that banned states from dropping people from the program for low-income children, families, and young adults, even if they became ineligible.”

It’s ridiculous that the bureaucratically determined “end of COVID” policy should mark the beginning of rules that already have punished 182,000 Floridians and millions of other Americans.

“The scope of terminations in Florida and the State’s knowledge of inadequate notices are certainly egregious.

In a news release, “Unfortunately, similar patterns are happening in states across the country,” said Amanda Avery, senior attorney at the National Health Law Program.

The suit says Florida has known for years that their Medicaid termination notices are flawed.

In a 2018 case study of the state’s termination process, state officials reported “being well aware that notices sent to beneficiaries generate confusion” and that the “current notices that describe applicants as ineligible are considered insufficient explicit in terms of an explanation.”

The lawsuit asks that people who received “unconstitutional” notices regain Medicaid coverage until they are given new notices, with enough information to understand how and if they can appeal, Harmatz said.

Over the last few months, Florida has faced criticism for taking away sick kids’ coverage months before they were scheduled to undergo review, according to the state’s prioritization plan.

Ccatherman@orlandosentinel.com; @CECatherman Twitter

It’s another example of an economically ignorant government, intentionally or not, punishing its poorest, least-able-to-protest citizens. The solution is a free, comprehensive healthcare insurance coverage for every American paid for by an infinitely wealthy, knowledgeable, compassionate federal government. It’s not-too-good-to-be-true. It’s just good. Is that too much to ask? Rodger Malcolm Mitchell Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell

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The Sole Purpose of Government Is to Improve and Protect the Lives of the People.

MONETARY SOVEREIGNTY

The cure for all (OK, many) of your problems.

Recently, I read an article about one of my less favorite subjects, sewage, and it had me thinking about one of my most favorite subjects, federal spending. Brief background:
  1. The U.S. federal government, being Monetarily Sovereign, has the infinite ability to spend U.S. dollars. It is not limited by tax collections, so-called “debt,” or anything but government whim. It could pay a $100 trillion invoice tomorrow simply by pressing a computer key.
  2. Federal spending never causes inflation. Scarcities lead to all price increases. The cure for inflation is to cure scarcities, which the government can accomplish by funding and distributing the scarcities causing inflation.
Here are excerpts from the article that stoked my thinking:

We need rapid political intervention to end sewage pollution crise

THE UK has a very mucky problem. News feeds overflow with videos of raw sewage gushing into rivers during heavy rain.

Thames Tideway Pr Image
The Thames Tideway is a “super sewer” running under central London

In our report (see Sewage crisis: The truth about British rivers and how to clean them up), we explore why the country still dumps untreated waste into waterways and how to fix this.

The solution, it turns out, includes thinking about the water system as a whole: tackling sewage pollution is also about fixing flooding and drought problems. Tougher governance is essential, too.

The UK isn’t alone. Australia and the US have similar issues. 

In the UK, much of the blame has been leveled at privatized water companies. They have run up enormous debts while giving away billions to shareholders. They have also failed on many metrics, including poorly-maintained pipes.

However, the real culprit is the government, which has failed to give water companies stringent enough targets or enforce those that have been set.

It is a pattern we have seen over and over, from banking crashes to nuclear power accidents.

Hmmm. Question: What do banking crashes, nuclear power accidents, and sewage pollution have in common? Answer: The same thing global warming, health care, retirement care, food and housing scarcities, water shortages, and a myriad of other problems that bedevil us: Money. We intellectually know how to address, if not solve, many of our most important problems, but in many cases, ignorance limits funding. Read the “The truth about British rivers and how to clean them up” article, and you’ll see solutions: Stop using combined (water and sewage) systems, send rainwater to storage and treatment plants, construct artificial wetlands, etc. The problem: Money. The article says, “Hundreds of billions of pounds.” But, like the U.S. government, the British government doesn’t seem to realize it is Monetarily Sovereign. It already has those “hundreds of billions of pounds” at its fingertips — the fingertips that can tap a computer key and instantly pay any bill without resorting to taxation. Let’s visualize some of the other problems we can address or even solve: Problem: Sickness. Address the problem via federal funding of:
  1. Comprehensive, no-deductible Medicare for every man, woman, and child in America, regardless of age, income, or health
  2. All forms of medical research, mainly research unlikely to be addressed by the private sector because of limited profitability potential.
  3. Healthcare facilities like hospitals and long-term care facilities.
  4. Doctors, nurses, and other health workers.
  5. R&D into the causes and cures for all human, animal, and plant illnesses.
Problem: Global warming. Address the problem via federal funding of:
  1. Non-carbon energy creation — solar, geothermal, wind, water, nuclear (fission and fusion), hydrogen, and fuel cells.
  2. Electric cars, trains, trucks, and planes
  3. Roadways specifically designed to accommodate electric vehicles
  4. Home and business heating and cooling structural improvements, including insulation and reflective materials
  5. R&D methods of climate control.
Problem: Poverty and crime. Address the problems via federal funding of:
  1. Social Security and retirement benefits for every man, woman, and child in America, regardless of age and income/wealth.
  2. Free education, through postgraduate, for everyone who wants it.
  3. Reduce employeres’ costs associated with paying employees. Eliminate the FICA tax and business-funded health care and retirement programs.
  4. Greatly reduce or eliminate the federal taxes paid by all but the wealthiest Americans. Alternative methods: Tax deductions for rent paid and for home-owning costs.
  5. R&D methods of control.
Problems: Inflation, hunger, degradation of the environment. Address the problems via federal funding of:
  1. (Short term) Oil drilling and refining, plus biofuels.
  2. All aspects of farming, including education and efficient land use, R&D of more efficient farming tools and methods
  3. Current construction materials and methods plus R&D of new materials.
  4. Current storage and distribution systems plus R&D of new systems.
  5. Current and new computers, including quantum computers, chips, and algorithms.
  6. R&D  of maintenance of the environment plus support for all the sciences.
The potential for federal spending is limitless, but fortunately, the federal government’s ability to spend is unlimited. Our collective imagination is the only thing that limits our ability to address and cure all our ills. Think of any problem facing humanity, and you soon will imagine how federal spending could address or even cure that problem. Monetary Sovereignty shows that we humans were given the tools to create a paradise on Earth. Our brains open the universe to us, and our invention of money provides us with motivation. Most Americans, even in “red” states, even die-hard MAGAs recognize the above-mentioned problems and want solutions. But whether via ignorance or intent, the false claims that federal spending is “unaffordable,” “unsustainable,” “socialism,” “inflationary,” or requires tax increases, have held us back. Federal spending is none of those. Federal spending by our Monetarily Sovereign government is infinitely affordable and sustainable. We never can run short of dollars. Federal spending is not socialism, which is government ownership and control, not financial support. And, of course, the federal government neither needs nor uses tax dollars. It created new dollars to pay all bills. We need only to understand that we have the necessary tools, money and brains, then to use those tools and stop fighting each other. Sadly, we also have been given hatred, greed, and ignorance, so our Janus personalities have held us down, and I fear, eventually will destroy us. Rodger Malcolm Mitchell Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell

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The Sole Purpose of Government Is to Improve and Protect the Lives of the People.

MONETARY SOVEREIGNTY