–Why does the 1% upper income WIN the war against the 99%?

Mitchell’s laws: The more budgets are cut and taxes increased, the weaker an economy becomes. Until the 99% understand the need for deficits, the 1% will rule. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity = poverty and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
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WHY THE 1% FIGHTS THE WAR AGAINST THE 99%

In the previous post, Why does the 1% upper income FIGHT the war against the 99%? we discussed the reasons why the rich want to extend the gap between them and the less rich. The reasons have to do with the psychology of money.

Once the basic needs of food, clothing, shelter, health and security are satisfied, the desire for more money to buy more goods and services, begins to morph into having more money for self image. While dollars in of themselves do not inflate the ego, comparative dollars do; the greater the income gap, the greater the ego inflation.

An income gap also translates into a power gap; the rich have power over the less rich, which has practical benefits as well as further massaging the ego.

From the standpoint of the rich, the true goal is not to acquire more dollars; the true goal is to extend the gap, which can be accomplished by raising the rich and/or by lowering the less-rich.

This is why the budget initiatives, of virtually all Republicans, and many Democrats, involve such gap extenders as reduced Social Security, Medicare and Medicaid benefits, reduced federal employment, extension of FICA, broadening the tax base, taxing Social Security benefits and reducing food stamps and other aids to the poor.

All of these are stated as the false goals: Reduce the federal deficit and debt.

The 1% correctly care nothing about deficit and debt reduction. They know the federal government, not only could service unlimited debt, but could eliminate the entire debt (i.e. T-securities) tomorrow. They also know the federal deficit is the government’s method for adding dollars to the economy – necessary for a growing economy. Federal debt and deficit are no problem whatsoever, for a Monetarily Sovereign government.

However, the 1%’s wrap gap-increasing initiatives in the semantic misdirections: “reduce the debt,” “reduce the deficit,” “balance the budget,” “be frugal,” “be sustainable” and “live within our means – all meaningful for personal finances, but destructive of a Monetarily Sovereign nation’s finances. Thus, they hide their evil in a false veil of noble intent. They label the poison bottle, “Honey.”

WHY THE 1% WINS THE WAR AGAINST THE 99%

They are only 1%, with 1% of the vote, while 99% of the people presumably would like to see the gap reduced. So why do the 1% manage to win the voting war?

Every nation, whether totalitarian or democratic, is ruled by a small elite, and they all use the same methods. In that sense, America resembles Hitlerian Germany, Stalinist Russia and Kim Jong-il’s North Korea. How, in all these nations, does a tiny minority rule the great masses?

DIVIDE AND CONQUER

It begins with the simplest of concepts: Divide and Conquer. And this too is based on the gap.

Each of us, no matter how poor, has a self image, which, in part, relies on being superior to some group that is poorer or less respected. Dictators control their armies by fostering a gap between soldiers and the average citizens. Within the army, officers maintain a gap between themselves and their soldiers, and even the lowest soldiers maintain a power gap between themselves and the civilians – a gap they will defend fiercely with guns and machetes. As it happens, this defense actually is a defense of the 1%.

It is why the soldiers of Syria willingly bomb and maim and murder their neighbors. In a dictatorship, the 1% Divides to Conquer. It enlists the 99%, to do the dirty work.

A democracy works much the same way, though here the power is in the vote rather than the gun. The 1% convinces the higher levels of the 99% – the upper-middle class – to vote against the best interests of the middle class, which in turn votes against the best interests of the lower classes.

And this division occurs, even when classes share best interests.

In the coming elections, millions of people from the middle classes will vote Republican, despite Republican philosophy having extended the gap between the middle classes and the 1%. They will vote Republican to extend the gap between themselves and the lower classes.

THE BIG LIE

The 1% successfully divides the 99% to conquer them, and the method is control of the media, which promulgates the Big Lie, which includes:

1. The poor are criminals, dangers to society, who will destroy what we have built.
2. The poor are lazy, do not wish to work, and any benefits they receive addicts them to further benefits (unemployment compensation, food stamps, health insurance, housing).
3. Our taxes pay for federal spending. The government spends taxpayer money.
4. We and our children owe the federal debt.
5. Like us, the federal government should run a balanced budget.
6. Immigrants are poor, lazy, uneducated and criminal (though supposedly smart enough to take our jobs).
7. Small government is better than big government.

By continuously pounding away at these lies, the media and the politicians convince the 99% to vote against their own best interests, and to extend the gap. The 99% agrees to raise the qualification age of Social Security and to tax its benefits, which will hurt the 99% and their children. The are told by the media to eliminate “Obamacare,” despite its benefits for the vast majority.

In the name of “deficit reduction,” the 99% agrees to limits on spending, education, homelessness, hunger, health care, infrastructure, sustainable energy, government employment and services, and all types of R&D – all of which would help close the gap. The 99% votes against their own best interests, just to open the gap.

The income gap is not just about money and ego; it is about power. Being on the upper side of the gap, gives you power over those on the lower side. With a word or finger twitch, you can make people grovel and scurry – an addictive feeling for many.

In short, the 1% never does its own dirty work. To survive, it must divide the 1% into warring groups, each trying to align itself with the 1% in opening the gap between them and those below. Thus does “Divide and Conquer” have the entire nation working and voting on behalf of the 1%. It is true in America; it is true in every society on earth.

THE SOLUTION

The overall solution? There is none. The gap is in our nature. But we do have the power to moderate it, which requires knowledge and a leader. The leader must support the knowledge, and the knowledge must support the leader.

The knowledge is understanding why the Big Lies are indeed lies, and the leader must be willing and able to articulate the knowledge believably. He must be a uniter, not a divider. He must embrace the usually incompatible attributes of leadership and modest ego needs.

We thought it might be Mr.Obama, but he long ago succumbed to the 1%. The siren songs of banker and Hollywood money have seduced him.

The leader certainly isn’t Mr. Romney, who not only is part of the 1%, but is a man with neither core beliefs nor morality, who will say anything and “believe” anything to gain power. His mutually incompatible beliefs on every key issue, would be humorous if they were not so disgusting.

Something tells me Hillary Clinton might have been that leader, but we missed our chance to find out. Could she have been a great leader? I don’t know. No one does. But losing a potentially great leader is no trivial matter. Imagine America without Washington or Lincoln.

So the 1%, Divides and Conquers, using the BIG LIE, which compels 99% to vote to extend the gap and to act against their own best interests. And that is why the war is lost. Our only hope: To gain the knowledge and to find the leader, and meanwhile to vote for, not against, our best interests.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com

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No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption + Net exports

#MONETARY SOVEREIGNTY

–Why does the 1% upper income FIGHT the war against the 99%?

This is Part 1, of a two-part post, the second part of which will be titled, “Why does the 1% upper income WIN the war against the 99%.” This first part features excerpts from an article in NewScientist Magazine.

Poor little rich minds: The price of wealth
26 April 2012 by Michael Bond
NewScientist Magazine, April 21, 2012.

Psychologists now have evidence that money breeds greed and kills empathy.

From Scrooge to Gordon Gekko, stories have featured individuals who forsake compassion as they amass their fortunes. More recently, bankers have awarding themselves huge bonuses while taking excessive risks with investments.

Dacher Keltner at the University of California, Berkeley, and Michael Kraus at the University of California, San Francisco, divided about 100 volunteers into pairs, and then filmed each pair meeting and getting acquainted for 5 minutes. The poorer subjects were more likely to use warmer and more expressive body language and gestures that signal engagement, while the richer participants were more stand-offish (Psychological Science, vol 20, p 99).

To find out if wealth can influence empathy, the researchers asked 200 university employees, with jobs ranging from administrative support to managerial positions, to rate the emotions expressed in 20 photographs of human faces – a standard test of emotional intelligence. As predicted, those with the more prestigious jobs were consistently worse at the task.

When asked to imagine a conversation with someone they deemed to be higher up the social ladder, wealthier participants became immediately better at reading emotions. The team concluded that the observed effects are probably automatic reactions that lead us to become more vigilant and mindful of others when we feel subordinate.

A selfish tendency on the part of the better-off seems to translate to all kinds of situations in which wealthier people are more likely to behave unethically than those from poorer backgrounds. Hazel Rose Markus at Stanford University in California, who studies the effects of culture on behaviour, has also found that social and financial success can make people less caring. The more self-centred mindset that comes with riches might also have a profound effect on someone’s political opinions.

When the team asked university students to explain increasing economic inequality in American society, those from poorer backgrounds thought it due to political influence or disparities in educational opportunities. Those from wealthier backgrounds put it down to hard work or talent (Journal of Personality and Social Psychology, vol 97, p 992).

Keltner’s research might also suggest that the money and prestige of high office could degrade the altruistic tendencies of even the most well-meaning politicians. “A government run by wealthy, educated people is going to be interested in maintaining the current social order,” says Kraus. “[Its members] will not be interested in the welfare of everybody, but in the welfare of themselves and their own goals.”

No news here. Rich people focus on what affects the rich; poor people are more interested in what affects the poor. While poor people might protest cuts in food stamps, the rich might protest a tax on derivative trading.

More generally, the work could be seen to undermine “trickle-down economics”: the notion that money made or inherited by rich people will end up benefitting poorer individuals, through the creation of new businesses that provide jobs for middle or low-income earners, for example. This argument is often made in support of tax cuts for the wealthy.

Yet if the rich do create more jobs as a result, Keltner’s findings suggest they will be more concerned with preserving their own interests, by awarding themselves hefty bonuses, for instance, rather than creating a constructive working environment with fair wages for all. “Our results say you cannot rely on the wealthy to give back, to fix all the problems in society,” Keltner says. “It is improbable, psychologically.”

“Trickle down” economics works only to the extent that the rich will spend federal payments to them, and this spending will go to businesses, that grow and hire people. But, cutting taxes on the rich so-called “jobs creators” will not in itself, cause them to create jobs.

That said, all tax cuts, whether on the rich or the poor, do help create jobs. Tax cuts puts dollars into consumers pockets, and spending those dollars stimulates the economy. Tax cuts, not on the 1% “jobs creators” but on the 99% “buyers and spenders,” will have a more immediate benefit to the economy. (This is why FICA should be eliminated.)

Fortunately, not everyone seems to be corrupted by the trappings of success – as many instances of generous philanthropy attest (New Scientist, 24 September 2011, p 36).

Altruism may be part of it. But I suspect a large part is personal glory. Few large donations are made anonymously. From the numerous charity lists of donors (organized by the size of their gifts,) to the naming rights demanded by large donors (“The Smith Building,” “The Jones Auditorium,” “The Johnson Scholarship” et al) to the award banquets and honors, the wealthy crave admiration.

That is why the 1% continue to work. It’s why they build mansions, buy yachts and own limousines, not because mansions, yachts and limousines provide for important housing or travel needs, but because they evince superiority, cause envy, and elicit admiration. The rich work for glory.

Bottom line: In answer to the headline question, “Why does the 1% upper income fight the war against the 99%: The greater the gap between the two, the greater the glory — the greater the admiration and control the 1% believes it gains. The primary motivation of the 1% is not merely to acquire dollars, but rather to extend the gap, and it matters not whether a method lifts the 1% or crushes the 99%. Either way will do.

That is why the politicians and the media fail to “understand” the basic facts of Monetary Sovereignty. An understanding of this fundamental economic truth eventually leads to a reduction in the gap, for it demonstrates why federal benefits to the 99% need not be reduced.

Income gap reduction is an anathema for the 1%.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com

#MONETARY SOVEREIGNTY

DINOs and RINOs still trampling the LAWN, which enjoys being trimmed and stepped on.

Eleven months ago, I wrote, “When the DINO battles the RINO, the LAWN will suffer.” The post said “The Democrats are the new Republicans; the Republicans are the new fascists.”

Today again, we see how the Republicans and the Democrats have moved far to the right, the purpose being to extend the gap between the upper 1% income group, and the rest of the nation, the 99%.

Why extend the gap? Because both parties are owned by the 1%, which wants not just to be rich, but more importantly, to be as far above the 99% as possible.

Psychologically, the 1% has the dual needs to distance themselves from the 99%, while enslaving the 99%. For the wealthy, the important point is not the absolute number of dollars they own, but the comparative number of dollars — i.e. compared to the rest of the world.

So for the 1%, pushing down the 99% is just as good as lifting up the 1%. It’s the comparison that counts. This is the basis for the economic misinformation being promulgated by the politicians and the media.

Los Angeles Times
Food stamp funds may be reduced

Republicans gain some Democratic support in efforts to trim back on food stamp eligibility in the farm bill. Anti-poverty groups and some Democrats object.
By Lisa Mascaro, Washington Bureau, June 20, 2012,

WASHINGTON — With 1 in 7 Americans now receiving food stamps, Republicans in Congress are leading efforts to cut back the social safety net program that has swelled to one of the largest in the federal government — and they are getting some support from Democrats.

The farm bill being debated in the Senate reduces funding for food stamps and is finding support from both sides of the aisle as lawmakers look for ways to cut the nation’s rising debt in an election year.

Translation: Yes, we know that for a Monetarily Sovereign nation, the “rising debt” is meaningless. It merely is the total of outstanding T-securities, all of which could be eliminated, tomorrow. But we have brainwashed the public into believing federal “debt” is like personal debt, and so should be reduced.

Why do we run this giant swindle? Because it gives us DINOs (Democrats In Name Only) and RINOs (Republicans In Name Only) a perfect excuse for cutting benefits to the LAWN (Lower Average Wage Nobodies).

You see, the highest 1% wage earners, consistently want to increase the gap between them and the other 99%, and cutting benefits is the best way to do it. And the 99% are so easy to fleece. Brilliant, huh?

Trimming back on eligibility for the Supplemental Nutrition Assistance Program, or SNAP, as food stamps are called, would save $4 billion over the decade. Republicans are pushing to reduce that even more.

Translation: Not only will we take away their benefits, but we’ll starve their kids — really bring them to their knees. That way, we can own them. It’s the perfect con. Take away their money, food, pride, education, jobs and future, then criticize them for being lazy criminals. And they fall for it!

But the shift in attitudes at a time when the economy remains sluggish in many parts of the country has drawn protests from anti-poverty groups and some Democrats.

“Increased SNAP participation has helped millions of families avoid hunger during this deep recession,” said Matthew Sharp, a senior advocate at California Food Policy Advocates. “We see any reduction of the size of benefits as a hit that families can’t afford to take.”

Translation: The DINOs and RINOs will demand huge cuts, and the LAWN finally will acceed to small cuts or no change (which in this time of recession, population growth and natural inflation, amounts to a per-person cut).

Demand a lot; settle for a little, and slowly chip away at the benefits for the 99%. Why not? It’s worked for Social Security, hasn’t it?

“Is the benefit going to the right people? Is the money being expended wisely?” questioned Sen. Jeff Sessions (R-Ala.), who has led efforts to change the program, during a recent Senate speech. “Is it encouraging people to look for ways to be productive and be responsible for their families? Or does it create dependency on a series of government programs?”

Translation: “I am Jeff Sessions. I love rich people and hate the 99%. Show me any benefit program, and I will ask this coded question: ‘Does it (insert name of benefit program, here) create dependency on a series of government programs?’

My answer always is, ‘Yes,’ the (insert name of government benefit program, here) turns people into sloths. I say, people should be hard working, productive slaves to the 1% — like me.”

An estimated 45 million Americans received food stamps in 2011 — more than ever, at a cost of $78 billion. The average household using food stamps has a monthly income of $731 and receives $287 in SNAP benefits, the budget office said. Three-fourths of the households include a child, a disabled person or someone older than 60.

Translation: This is outrageous. All those people, bathing in the luxury of $9 thousand per year, have the audacity do ask for food stamps, too? Clearly, that additional $3,400 per year handout is what keeps them from being ambitious, productive workers.

If we take away their food, we can force them to crawl before us, with their charity cups in hand.

The bipartisan bill making its way through the Senate would trim benefits by about $90 a month for about 500,000 households, the budget office said, largely by eliminating automatic enrollment for some households receiving nominal aid under federal home-heating assistance programs.

Translation: We don’t want to make this too easy on those people, who already have such luxurious lives, so let’s eliminate automatic enrollment. And really, does anyone need home-heating assistance? Hey, it’s June; it’s hot outside.

And what’s a measly $90 per month? I spend more than that on shoe shines.

Republicans want to further limit the eligibility requirements. Sessions proposed a pair of amendments that would have saved an additional $11 billion over the next decade, but both were defeated Tuesday.

Translation: Hi, it’s me again, Jeff Sessions, the guy who brings the poor to their knees. What me worry? I’ve got mine.

Sen. Kirsten Gillibrand (D-N.Y.) was leading efforts to restore the food assistance program by paying for its costs with cuts elsewhere to agricultural subsidies.

Translation: The RINOs and DINOs are involved in the old shell game. The RINOs propose some truly outrageous cuts in benefits for the poor, then the DINOs offer to cut benefits for the not-so-poor. Everyone thinks the DINOs are so compassionate, but its all a pre-planned switcheroo — like “bad cop, good cop. Both parties want to cut benefits to the 99%.

Ironically, when you try to explain this to the LAWN, they get angry. I guess the LAWN enjoys being trimmed and stepped on.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com

#MONETARY SOVEREIGNTY

–Traders buy 2 myths: Fed and austerity stimulate economy. Proof money and brains don’t always go together.

The media would like you to believe the Fed is responsible for our economy. Total nonsense. But, the stock traders, who have no clue about economics, fall for it.

Yahoo Finance
Stocks snap higher on hopes for new Fed action
Stocks up sharply on Wall Street on hopes that the Fed will take new action on the economy
By Pallavi Gogoi, AP Business Writer | Associated Press

NEW YORK (AP) — Stocks rose sharply on Wall Street Tuesday as traders turned their focus back to corporate news from the U.S. and hopes that the Federal Reserve will come up with a plan to jumpstart the economy.

Amazing that all hopes lie with the Fed, while it is Congress and the President who have the power to “jumpstart” the economy. Here are what Congress and the President should do, none of which involves the Fed: “Nine Steps to Prosperity”:

1. Eliminate FICA (Click here)
2. Medicare — parts A, B & D — for everyone
3. Send every American citizen an annual check for $5,000 or give every state $5,000 per capita (Click here)
4. Long-term nursing care for everyone
5. Free education (including post-grad) for everyone
6. Salary for attending school (Click here)
7. Eliminate corporate taxes
8. Increase the standard income tax deduction annually
9. Increase federal spending on the myriad initiatives that benefit America

Stock traders are also latching on to recent signals from the Federal Reserve that the central bank may reveal plans to stimulate the economy at the end of its two-day meeting Wednesday.

“A good portion of today’s strong market action is from a hope factor that we’re going to get more easing from the Fed,” said Peter Cardillo, chief market economist at Rockwell Global Capital.

“Recent signals” “May reveal plans” “More easing from the Fed”?? Those are the hopes? What exactly do you want the Fed to do? Cut interest rates below zero?

Economists say that even if the Fed does not act after its meeting, it will send a clear message that it is standing by to do so if needed.

Yes, that’s what we need: The Fed “standing by,” and sending “clear messages,” just as Congress is “standing by” and President Obama is “standing by.” Rather than standing by, and sending clear messages, how about implementing the Nine Steps.

Financial companies were among the best performing stocks as investors hoped for Fed action: Bank of America soared 4.5 percent, Citigroup gained 3.5 percent, JPMorgan Chase was up 2.2 percent and Morgan Stanley rose 3 percent.

Sure, the big banks have friends in the Fed and in the Treasury. Do well; make millions. Do poorly; the Treasury will bail you out — and you still make millions. Can you visualize any big banker being so stupid, he can’t make millions? By the way, what was Jamie Dimon’s bonus for losing $3 billion?

In Europe, Spain’s cost to raise money skyrocketed. The Spanish government had to pay an interest rate of 5.07 percent for 12-month bills, up sharply from 2.98 percent.

Still, investors were heartened to see that people were willing to lend Spain money. “Even though it cost Spain dearly and yields rose to a record, the fact is that it was not shut out of the markets,” said Cardillo.

Wonderful! Monetarily non-sovereign Spain, which is deeply in debt, now is able to go even deeper in debt, at “only” 5.07%. The U.S., which is Monetarily Sovereign and even deeper in debt, borrows at 1/10%. Why? Hmmm . . . Could it be because Spain is monetarily non-sovereign, so can’t pay its debts, while the U.S. is Monetarily Sovereign, so can pay any size debt?

Or could it be because a Monetarily Sovereign nation, having the unlimited ability to create its sovereign currency, doesn’t even need to borrow?

Those who do not understand the difference between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.

Bottom line, Congress and the President have been foisting the myth that somehow the Fed is responsible for economic growth. Total crap. Congress and the President are 100% responsible. The Fed is just a bank. Do you go home at night hoping your bank somehow will stimulate your company?

Whatever happens to this economy, it’s neither the fault nor the credit of the Fed. All of the fault and credit lies on the shoulders of Congress and the President. Period.

Unfortunately, Congress and the President evade and avoid their responsibility, with the Big Lie, that federal deficits should be reduced, while austerity will grow the economy. It’s a Big Lie promulgated by the upper 1% income group, in cahoots with the mainstream media, also run by the 1%. Austerity takes more from the 99% than from the 1%. Austerity grows the income gap.

The Democrats are horrible about spreading these myths, but the Republicans are even worse. They are completely in the pockets of the 1%. Anyone earning less than $300 thousand per year and voting Republican, is a fool.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com

#MONETARY SOVEREIGNTY

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