Fake federal trust funds and fake concerns Wednesday, Jun 13 2018 

It takes only two things to keep people in chains:

Pete Peterson


The ignorance of the oppressed
And the treachery of their leaders

The Peter G. Peterson Foundation is a self-described “nonpartisan” mouthpiece for the right wing.

Its “nonpartisan” leanings include advocating:

  1. cuts to federal support for Social Security
  2. cuts to federal support for Medicare
  3. increases to Social Security and Medicare taxes (FICA).
  4. increases to taxes on the middle-income groups.
  5. cuts to taxes for the rich
  6. cuts to the federal deficit spending that grows the economy

The Foundation continually publishes articles that falsely claim our Monetarily Sovereign nation somehow can run short of its own sovereign currency, and thus, Social Security, Medicare, and other federal “trust funds” are running short of dollars — all untrue.

It is 100% impossible for a Monetarily Sovereign entity to run short of its own sovereign currency. Similarly, it is 100% impossible for any agency of a Monetarily Sovereign entity to run short of the sovereign currency, unless that is what the entity wants.

Neither the U.S., nor Social Security, can run short of U.S. dollars, unless that is what Congress wants. Period.

So it was with amazement that I read these excerpts from an article published by the Peterson Foundation:

WHAT ARE FEDERAL TRUST FUNDS?
Sep 20, 2016, Peter G. Peterson Foundation

A federal trust fund is an accounting mechanism used by the federal government to track earmarked receipts (money designated for a specific purpose or program) and corresponding expenditures.

The largest and best-known funds finance Social Security, Medicare, highways and mass transit, and pensions for government employees.

Federal trust funds bear little resemblance to their private-sector counterparts.

In private-sector trust funds, receipts are deposited and assets are held and invested by trustees on behalf of the stated beneficiaries.

In federal trust funds, the federal government does not set aside the receipts or invest them in private assets.

Rather, the receipts are recorded as accounting credits in the trust funds, and the receipts themselves are comingled with other receipts that Treasury collects and spends.

This is all correct. Federal so-called “trust funds” are nothing like state and local government trust funds and nothing like private trust funds.Image result for money printing machine

All private sector financing is constrained by one simple fact: The private sector is monetarily non-sovereign.

It does not have the unlimited ability to create its own sovereign currency, for the simple fact that it has no sovereign currency.

The U.S. private sector (which includes state and local governments) uses the sovereign currency of the federal government.

And then, having admitted that federal “trust fund” receipts are comingled with other Treasury receipts, the article promptly forgets what it said:

Further, the federal government owns the accounts and can, by changing the law, unilaterally alter the purposes of the accounts and raise or lower collections and expenditures.

No need to raise or lower collections. The correct statement would be:

The federal government owns the accounts and can, by changing the law, unilaterally alter the purposes of the accounts and/or provide additional funding.

In the late 1770s, the federal government created the original U.S. dollars from nothing, and today it continues to create dollars at will.

Neither the federal government nor the misnamed “Social Security Trust Fund” (or any other federal trust fund) can run short of dollars unless Congress wants it to.

The Peterson Foundation, and far too many others, including those in the federal government, have been pretending that to save Social Security taxes must be increased or spending must be cut. It simply is not true.

The article continues:

What happens when a federal trust fund runs a deficit?
Treasury must finance trust fund interest payments and the redemption of trust fund securities through additional borrowing from the public (unless policymakers raise taxes or cut spending).

The above is wrong. Not only is it wrong about the supposed need for raising taxes and cutting spending, but it also is wrong about borrowing.

Unlike you and me and all other monetarily non-sovereign entities, our Monetarily Sovereign federal government creates unlimited dollars ad hoc, by paying creditors.

Thus, the federal government has no need for any kind of income. It has no need for tax income. It has no need to cut spending. And it has no need for borrowing.

Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”

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.”

St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e., unable to pay its bills.”

Thomas Edison: If the Nation can issue a dollar bond it can issue a dollar bill.  The element that makes the bond good makes the bill good also. . . . It is absurd to say our Country can issue bonds and cannot issue currency.”

The federal government has several trust funds. The three most important trust funds are for Social Security, Medicare, and transportation projects.

Social Security Trust Funds
In 2034, unless reforms are enacted, the Social Security trust funds are projected to be fully exhausted. At that point, Social Security’s receipts will only be sufficient to cover 79 percent of benefits.

Benefits will then have to be cut by 21 percent to continue making payments to all beneficiaries. 

Wrong.

As the article previously said, Social Security “receipts are comingled with other receipts that Treasury collects and spends.Image result for shhh

This means the receipts cannot be “sufficient” to cover anything.

The dollars, once received by the Treasury and comingled, disappear from any money supply measure.

They effectively are destroyed upon receipt.

Asking how many dollars the Treasury has is akin to asking how many sentences you have. The Treasury creates its dollars as needed, and you create your sentences as needed.

Just as the Treasury is Monetarily Sovereign, you are “sentence sovereign.” You never have to ask anyone — via taxing or borrowing — for sentences, and you never can run short.

The Social Security Disability program is in worse condition. Its trust fund will be depleted in 2023, and unless its finances are addressed, its benefits will be cut by 11 percent.

The Social Security Disability benefits will be cut only if Congress wants them to be cut.

Medicare Trust Fund
In the Medicare program, payroll taxes are credited to the Medicare Hospital Insurance (HI) fund and premiums paid by Medicare beneficiaries are credited directly to Medicare’s Supplemental Medical Insurance (SMI) fund.

Unless reforms are enacted, Medicare’s Hospital Insurance Trust Fund is expected to be exhausted in 2028, which will precipitate a 13 percent cut in its payments to hospitals and other providers.

The SMI fund cannot be depleted — each year, general revenue contributions are set to cover whatever costs remain after beneficiary premiums are taken into account.

Wait! What?!

“The SMI fund cannot be depleted — each year, general revenue contributions cover whatever costs remain after beneficiary premiums are taken into account.”

SMI, which pays for Part B and Part D benefits, is funded by Congress. It doesn’t rely on a fake “trust fund.” Congress directly authorizes what funds are needed.

So you have the ridiculous situation in which, Medicare Part A supposedly runs short of funds, but Medicare Parts B and D do not. And you are expected to believe this??

Ask your Senator or Representative why all of Medicare and Social Security cannot be handled like SMI, with the federal government simply paying expenses.

That approach would end all talk of trust funds supposedly running short of dollars.

Highway Trust Fund
The Highway Trust Fund will be depleted by 2021. In this fund, taxes on gasoline and diesel fuel are credited directly to the Highway Trust Fund, but the fund’s income falls short of its spending.

This situation has already precipitated a slowdown of highway and other surface transportation projects as states prepare for a shortfall in federal funding.

The same fraudulent situation as with other phony federal “trust funds.” The result: Either infrastructure projects are delayed, not done at all, or are passed to the monetarily non-sovereign state and local governments.

Does it get any more outrageous than this? A Monetarily Sovereign government, which has an unlimited supply of dollars, claims poverty and passes spending responsibility to monetarily non-sovereign state and local governments, which are limited in their spending ability.

The article ends with these truths:

How do trust funds affect the overall budget?
Although many believe that the existence of trust funds guarantees the sustainability of programs in the future, trust funds are simply accounting mechanisms that are part of the way the federal government keeps its books.

The actual cash inflows and outflows of the programs are combined with all other federal programs and therefore contribute to federal surpluses and deficits.

If a program is in surplus, the federal government’s overall deficit balance improves because it uses the additional receipts from the program to fund costs of other programs.

In effect, the government is conducting transactions with itself but keeping track of inflows and outflows of funds through trust funds.

Ultimately, trust fund income and outlays are not separate from the rest of the federal budget, and the sustainability of trust fund programs, like Social Security, depends on the overall sustainability of the federal government.

That last sentence completely destroys any notion that the fake Social Security “trust fund” is running short of dollars and so, taxes must be increased and/or benefits decreased.

The U.S. federal government can “sustain” (i.e. pay for) any amount of expenses because it has the unlimited ability to create dollars. It never can run short.

Unlike you and me, and the states, and businesses, and the euro nations, the U.S government is Monetarily Sovereign.

Remember this whenever you hear that Social Security, Medicare and any other federal program will run short of money or become “insolvent.”

It is a lie designed by the very rich, to make you believe you must settle for fewer federal benefits or higher taxes.

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

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

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 can afford better health care than can 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 A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All) (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Guaranteed Income)) 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 EVERYONE Five 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 benefitting 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 FEDERAL TAXES ON BUSINESS
Businesses are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the federal government (the later having no use for those dollars). Any tax on businesses reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all business taxes reduce 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 business taxes would be a 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 end of social security? Wednesday, May 30 2018 

Image result for federal reserve bank of st. louis

James Bullard, President & CEO, Federal Reserve Bank of St. Louis

Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”

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.”

St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e., unable to pay its bills.”

Thomas Edison: If the Nation can issue a dollar bond it can issue a dollar bill.  The element that makes the bond good makes the bill good also. . . . It is absurd to say our Country can issue bonds and cannot issue currency.

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Do you believe Social Security is running short of dollars and, without a tax increase or benefits decrease, in the future will be unable to continue paying benefits?

If so that is exactly what the very rich, who direct American politics, want you to believe.

The very rich want you to accept the notion that Social Security is going bankrupt, the Social Security “trust fund” is running short of dollars, and your benefits must be reduced to “save” the program.

Why do they want you to believe that? Because of Gap Psychology.

Gap Psychology is the desire to distance oneself from those “below” you on any arbitrary measure, and to approach those above you. You wish to disassociate with the poorer and less powerful than you, and to associate with those wealthier and more powerful.

Image result for rich stay away from poor

Gap Psychology at work

Gap Psychology is an evolutionary attempt to increase one’s relative power and thus, safety.

The “associate/disassociate” concept can relate to income, wealth, power, housing, clothing, neighborhood, college attendance, choice of restaurant, mode of travel — anything that confers relative prestige on the user.

Driving an expensive car is an attempt to associate with the rich and to disassociate from those who cannot afford an expensive car. Like everything associated with the Gap, “expensive” is a relative term.  A car you might consider expensive, would not be expensive for a billionaire.

The word “relative” is key. “Rich,” “powerful,” “influential,” etc. are not absolutes. They are comparatives.

If you had $1 thousand, while everyone else had $10, you would be rich. But if you had that same $1 thousand, while everyone else had $1 million, you would be poor.

The U.S. government is Monetarily Sovereign. It has the unlimited money-creation capabilities described (above) by Alan Greenspan, Ben Bernanke, and the St. Louis Federal Reserve.

Image result for endless money

Thomas Edison: If the Nation can issue a dollar bond it can issue a dollar bill.  The element that makes the bond good makes the bill good also. . . . It is absurd to say our Country can issue bonds and cannot issue currency.

Thus, the U.S. government can be viewed as infinitely rich. It can create infinite dollars. It’s purchasing ability is infinite. It has the infinite ability to fund its agencies, which functionally makes U.S. agencies as rich as Congress and the President wish them to be.

If such federal agencies as Social Security, Medicare, the Army, the Supreme Court, et al were to run short of dollars, the reason would not be that the U.S. government has run short of money (which is impossible).

The reason would be that Congress and the President arbitrarily had chosen to provide insufficient dollars to these agencies.

FICA is the tax incorrectly said to fund Social Security and Medicare. But they are federal agencies, so even if FICA collections were $ zero, the federal government could continue to pay Social Security and Medicare benefits, forever.

FICA is irrelevant to the real financial well-being of Social Security and Medicare. FICA is an excuse for cutting benefits.

Congress and the President, at the behest of rich donors, who are influenced by Gap Psychology, pretend Social Security and Medicare can run short of dollars. It all is a charade for the benefit of the rich.

In that vein, here are excerpts from a recent, online article in Money & Career CheatSheet, titled:

9 Lies You’ve Been Told About Social Security
By Megan Elliott May 28, 2018
(Megan is a Money & Career, Health & Fitness, and Culture Writer at The Cheat Sheet. She has a bachelor’s degree in cultural studies from Macalester College and a master’s degree in media studies from the New School University. Her writing has appeared in the Journal of Financial Planning and other publications.)

Social Security is the linchpin of the American retirement system. Nearly 40 million retired Americans receive an average of $1,335 a month from the program. For 64% of retirees, the check they receive makes up more than half of their total income. Without this retirement benefit, many of the oldest Americans would be destitute.

Yet for all its importance, Social Security remains a program that is shrouded in confusion and mystery. When Massachusetts Mutual Life Insurance Company quizzed people in 2015 on some basic facts about Social Security, only 28% received a passing grade.

Being misinformed about how Social Security works is costing retirees. “Americans who lack the proper knowledge and information about Social Security may be putting their retirement planning in jeopardy,” Phil Michalowski, the vice president at U.S. Insurance Group, MassMutual, said in a statement.

“In fact, many may be leaving Social Security retirement benefits they’re entitled to on the table, or incorrectly assuming what benefits may be available in retirement.”

Michalowski was referring to ignorance about Social Security law costing retirees. But there is a deeper, more important ignorance about Social Security, that costs Americans much more.

Unlike state and local governments, and unlike business and individual people, all of which are monetarily non-sovereign, the U.S. government is Monetarily Sovereign.  It never can run short of dollars.

Sadly, the American public has been brainwashed by the rich into believing the “Big Lie,” that the U.S. federal government can run short of dollars. The rich bribe three main information sources to promulgate the Big Lie:

  1. The media, who are bribed via advertising revenues and media ownership
  2. The politicians, who are bribed via campaign contributions and promises of lucrative employment later
  3. The economists, who are bribed via university contributions and employment in “think tanks.”

Continuing with excerpts from Ms. Elliott’s article:

Confusion about how benefits are earned, how much you can get, and the best time to retire abounds. Politicians and the media add to the confusion when they make dramatic — and sometimes false — statements about the future health of Social Security. In some cases, believing the lies you hear about Social Security could cause you to make planning mistakes that jeopardize your future financial security.

Here are nine of the biggest whoppers you’ll hear about Social Security.

1. You have a personal Social Security “account”

Roughly one-third of Americans think the money they pay into Social goes into a personal account. Instead, the money goes into a general trust fund, and is then used to pay benefits to current and future retirees.

When you retire, the money you receive will come from contributions of those currently working.

“Social Security isn’t like a 401(k) or even a traditional funded pension plan. Your contributions are immediately paid out to current beneficiaries,” Erik Carter of Financial Finesse explained in an article for Forbes.

This is completely false. There is no “general trust fund.” It is an accounting fiction. Think about it: Why would a Monetarily Sovereign entity, that has the unlimited ability to create its sovereign currency, in any amount at any time — why would that entity have any use for a “trust fund.”

The concept makes no sense.

When your FICA tax dollars are received by the federal government, they cease to be part of any money supply measure. In actual effect, your dollars are destroyed upon receipt.

Then, when the federal government pays benefits, it sends instructions to you (via a check) or to your bank (via a wire). Those instructions tell the bank to increase the balance in your checking account.

At the instant the bank obeys those instructions, brand new dollars are created and added to the money supply (called “M1”).

Our Monetarily Sovereign government, having the unlimited ability to create dollars, neither needs nor uses tax dollars for any purpose. (Review the statements by Greenspan, Bernanke, and the St. Louis Fed.)

2. Private accounts are a better alternative to the current Social Security system

Privatizing Social Security is periodically floated as a way to save what some see as a failing system. Former President George W. Bush was a big supporter of such a plan.

Bush’s proposal was controversial and ultimately didn’t go anywhere. But some still argue that letting people invest all or a portion of their Social Security would increase people’s savings and lead to a more secure retirement.

Others argue that such a strategy is just too risky given stock market volatility and how bad many Americans are at managing money.

The proposal is based on the Big Lie that the federal government cannot afford to fund Social Security and that it must take dollars from the public in order to pay for benefits. Absolutely untrue.

3. Younger workers won’t get a dime

Doomsayers sometimes claim Social Security is on the verge of going broke. Younger workers may never get their benefits, they warn, and future retirees could see their checks cut off. But the future of Social Security, while not exactly rosy-looking, isn’t quite so dire.

“The idea that the program is going to ‘run out of money’ or is ‘going broke’ is a zombie lie, one that deserves to have its head lopped off with a quick slice of Michonne’s katana,” Paul Waldman of The American Prospect wrote in The Washington Post.

So far, #3 is spot on. But then, the wrongheadedness returns:

It’s true current workers are paying less into the Social Security trust fund than is being paid out to retirees. By 2035, the reserves in the trust fund are projected to run dry.

At that point, Social Security could pay about 77% of projected benefits to retirees from the income it receives from people currently working. Obviously, that’s not a great situation, but future retirees will still get some money — just as not as much as they were promised.

So-called “trust fund” reserves are completely irrelevant. The federal government needs no “trust fund” to pay the President’s expenses, Congress’s expenses, or the Supreme Court’s expenses. Why would it need a trust fund to pay for Social Security?

President Roosevelt, the founder of Social Security knew this. But he insisted on collecting FICA taxes so as to give recipients a “moral right” to benefits, that Congress could not take away.

It hasn’t worked, however, as benefits have been decreased, for no reason at all. Social Security does not pay benefits from income. Period.

4. You have to be a citizen to get benefits

Provided you’ve worked for at least 10 years, are lawfully in the U.S., and meet all the other requirements, you can claim Social Security benefits when you retire, whether you’re a citizen or not. Even non-working spouses of non-citizens may be able to get benefits.

Correct. Since non-workers don’t pay FICA, there goes the Big Lie that FICA funds Social Security.

5. The retirement age is 65

For people born in 1937 or earlier, full retirement age is 65. If you were born between 1938 and 1959, full retirement age varies between 65 and 2 months and 66 and 10 months. For everyone born after 1960, full retirement is at 67.

No matter when you were born, you can start claiming early benefits at age 62. But if you claim early, your monthly benefit is reduced by 20% to 30%. If you wait until age 70 to claim Social Security, you could increase your monthly benefit by more than 30%.

This entire rigamarole is based on the myth that FICA funds SS. Without that myth, there would be no reason ever to reduce benefits.

6. You can’t get benefits if you’ve never worked

Even if you’ve never worked a day in your life, you may still be able to get benefits from Social Security. Non-working spouses may receive up to 50% of their husband or wife’s benefit amount.

In 2010, the Social Security Administration (SSA) estimated only 4% of people between 62 and 84 would never receive benefits.

Point #6, once again, demonstrates that people don’t pay for Social Security. The federal government merely makes up rules to suit its Big Lie.

Imagine if a life insurance company told its insureds,  “We’re going to cut your benefits because we want to pay people who never bought insurance.”

7. You should claim Social Security as soon as you can

If you can afford to delay taking benefits until 65 or even 70, you’ll get a bigger check every month. Given that people are generally living longer, holding off on requesting benefits is often a wise move.

It would be a “wise move” only if the federal government needed to ration dollars. Otherwise, forcing people to guess how long they will live is a terrible idea.

8. You can work and collect full Social Security benefits

You may not get your full benefit if you’re drawing a paycheck. “If you are younger than full retirement age and make more than the yearly earnings limit, we will reduce your benefit,” the SSA explained.

Reducing benefits is absolutely unnecessary.

9. Social Security is a Ponzi scheme

You’ll sometimes hear people dismiss Social Security as a Ponzi scheme. They’re comparing the program to the famous investment fraud perpetrated by Charles Ponzi in 1920.

In a ponzi scheme, investors are lured in with promises of big returns with little risk. In reality, no investment exists.

Instead, the first group of investors are paid with money gathered from a second group of investors, and so on down the line.

Once the pool of investors dries up, the scheme collapses.

On the surface, Social Security does share some resemblance with a Ponzi scheme, since the earnings of today’s workers are used to pay benefits to those who are already retired.

But there are important differences between the two. For one, no one is in the dark about the nature of Social Security. The program is transparent about the way it is funded and the state of its finances.

A Ponzi scheme depends on the ignorance of investors to survive.

Plus, as long as the government can require people to pay taxes, there will still be a source of new income, though it may not be enough to meet the promised payouts. With a Ponzi scheme, people will eventually wise up and stop investing, which causes everything to fall apart.

“What makes a Ponzi scheme a Ponzi scheme is that it’s a giant fraud. People think they’re investing in postal stamps. Their money is actually being invested in nothing. In Social Security, conversely, it’s perfectly clear what is going on,” Ezra Klein wrote in an article for the Washington Post.

If we were to believe the Big Lie about the government’s supposed inability to pay benefits, Social Security would, in fact, be a Ponzi scheme.

Here are some classic symptoms of the Social Security “Ponzi scheme”:

  1. Payouts arbitrarily can and have been reduced.
  2. The operator provides fabricated reports claiming there are dollars in a “trust fund.”
  3. The operator says the benefits it pays to older members from new members.
  4. The money is invested in nothing.
  5. The scheme depends on the ignorance of the investors regarding exactly how benefits are calculated.

If Bernard Madoff had legally been allowed to cut benefits whenever he wished, he still would be in business.

However, Social Security is not a true Ponzi scheme: Unlike the usual Ponzi scheme, the operator — the U.S. government — never can run short of dollars to pay benefits.

In Summary:

The FICA tax, being an unnecessary and regressive imposition on the middle and lower income groups, should be eliminated (See Step #1 of the Ten Steps to Prosperity).

The federal government can and should provide Social Security payments to every man, woman, and child in America. (See Step #3 of the Ten Steps to Prosperity)

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

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

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 can afford better health care than can 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 A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All) (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Guaranteed Income)) 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 EVERYONE Five 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 benefitting 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 FEDERAL TAXES ON BUSINESS
Businesses are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the federal government (the later having no use for those dollars). Any tax on businesses reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all business taxes reduce 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 business taxes would be a 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

Yet another article that relies on you being ignorant about federal finances and Social Security Sunday, Mar 11 2018 

It takes only two things to keep people in chains:
.

The ignorance of the oppressed
and the treachery of their leaders.

——————————————————————————————————————————————————————————————————————————————————————————–

Let us begin with three, very simple, related facts:

  1. It is 100% impossible for the U.S. federal government to run short of dollars unless the President and Congress want it to.
  2. Thus, it is 100% impossible for any federal agency to run short of dollars unless the President and Congress want it to.
  3. Social Security is a federal agency.

Therefore:

Social Security cannot run short of dollars unless the President and Congress want it to.

Image result for crocodile tearsIgnore all the crocodile tears about the Social Security “trust fund” running short of money.

Or, there not being enough FICA dollars to pay for future retirees.

Or, the “need” to cut benefits to certain groups, or to tax benefits to other groups.

They are all lies, there is no better way to say it — lies — designed to make you accept fewer benefit dollars, while the rich continue to grab more.

What set me off is the following Motley Fool article, that simply is loaded with the above-mentioned lies.

Will This New Social Security Proposal Gain Traction in Congress?
With Social Security facing a $12.5 trillion cash shortfall, this proposal aims to generate more revenue and reward those disadvantaged by the program.
By: Sean Williams  Mar 10, 2018

Social Security, arguably the most important program in the country as more than 42 million retired workers receive a monthly payout, is in trouble.

Yes, Social Security indeed is in trouble, but not because of any shortfall in cash. Rather trouble lurks because the President and Congress want to screw you, on behalf of the rich, who run this country.

According to the 2017 report from the Social Security Board of Trustees, Social Security is expected to begin paying out more in benefits than it’s generating in revenue by 2022.

Just 12 years later, in 2034, the roughly $3 trillion in excess cash held by the program is forecast to be completely gone.

Based on the current payout trajectory, there’ll be an estimated $12.5 trillion budget shortfall between 2034 and 2091.

All of the above nonsense would be true if Social Security were a private enterprise, owned and operated by a private company — a monetarily non-sovereign company.

But it is absurd nonsense when describing an agency owned an operated by the United States government — a uniquely Monetarily Sovereign entity.

The federal government created from thin air, the laws that in turn created the very first dollars, also out of thin air. Today, it continues to own the laws that allow it to create dollars at will, simply by paying bills.

For that reason, the federal government needs no “revenue.” It always pays its bills by creating new dollars.

Think about this for a moment:

Federal spending has risen 37,500% (from $40 billion to $15 trillion) since 1940. Where did the $14, 960,000,000 additional dollars come from?

They can’t have come from federal borrowing. Where would those borrowed dollars have come from?

And the new dollars can’t have come from taxes. Tax dollars already exist.

Dollars are created in two ways and destroyed in two ways:

Created: Lenders create new dollars when they lend, and the federal government creates new dollars when it spends.

Destroyed: Dollars are destroyed when loans are paid down, and when the federal government collects taxes.

When the federal government pays an invoice, it sends instructions (in the form of a check or wire) to the creditor’s bank, instructing the bank to increase the balance in the creditor’s checking account.

The instant the creditor’s bank does as instructed, new dollars are added to the nation’s money supply. Thus, because the federal government creates dollars by spending, it never can run short of dollars.

This shortfall has a lot of people, including working Americans, pre-retirees, retired workers, people with disabilities, and survivors, very concerned.

Americans are concerned because writers like Sean Williams tell them to be concerned. The people seldom are told the facts, so in the absence of facts, the people believe the lies.

There’s good reason for that, as 62% of today’s retirees lean on Social Security for at least half of their monthly income, and a majority of future retirees are expected to rely on the program in some capacity to make ends meet.

Yet, the trustees’ report suggests that benefits could be cut across the board by up to 23% in order to preserve the solvency of the program through 2091.

How sweet. The people desperately need Social Security, while the lying politicians prepare excuses for cutting this already insufficient lifeline.

What sort of cruel minds would find this acceptable?

The silver lining is that Social Security can’t go bankrupt as a result of the payroll tax, which provides the bulk of its funding; but that doesn’t mean the current payout schedule is sustainable.

A lie. Social Security payouts are infinitely sustainable. The pols and the rich don’t want you to know that the federal government never can run short of its own sovereign currency — the currency it originally created by writing laws.

The only option for current and future retirees to avoid having their Social Security benefits slashed is through congressional action.

Yes, Congress and the President can set Social Security benefits and FICA taxes at any levels they choose. The first step should be to eliminate the FICA tax altogether, while increasing benefits.

Lawmakers in Washington, D.C., certainly aren’t denying that a problem exists. Unfortunately, they’ve been unable to come to an amicable solution.

However, a new Social Security proposal, laid out last week by Sen. Patty Murray (D-Wash.), is aiming to change that.

They are “unable” to come up with an “amicable” solution (i.e. a solution that would be approved by rich donors), simply because they don’t want a real solution.

They only want a “solution” that will further widen the Gap between the rich and the rest, exactly what their rich donors tell them to do.

Known as the Stronger Safety Net (SSN) Act, Murray’s proposal aims to modernize the 83-year-old program for women, children, people with disabilities, and survivors, while at the same time having those who can afford to pay more cover the long-term funding gap in the program.

“Modernize” is one of those deceptive words, like “reform” that implies improvement but actually means nothing.

Making anyone pay more does absolutely nothing to “cover the long-term funding gap.” It takes dollars from the private sector (aka, the economy), which is recessive.

The SSN Act has four key proposals.

1. Divorced people over 62 who were married for at least five years would qualify, with a 10% step-down for each year below 10. A divorced person who was married for seven years would have a maximum spousal benefit of 70%, whereas someone who was married for nine years could max out at 90%.

Women often take care of children or loved ones who are sick. This means they take time out of the labor force, which can reduce their lifetime earnings and retirement benefit.

All this cockamamie rejiggering is “necessary” because of the myth that FICA pays for benefits and dollars are limited. The entire problem could be solved by simply giving every recipient the same, more-generous benefit. (See: Ten Steps to Prosperity: Step 3: Monthly bonuses for all)

2. Establish an alternative benefit for the surviving spouse where both husband and wife are retired workers.

The surviving spouse would be entitled to 75% of the sum of the survivor’s own work benefit and the primary insurance amount of the deceased spouse. This alternative benefit would be paid if it’s higher than what survivors would receive under the current law, and would begin in 2019.

More cockamamie rejiggering. Who could understand such nonsense, much less justify it? 

The process resembles trying to feed a hundred people from one potato, by cutting the potato into a thousand pieces.

3. Under the current system, minor children have to be under the age of 18, or high school students under the age of 19, to qualify for benefits. But beginning in 2019, full-time students up to the age of 23 of retired, disabled, or deceased workers would be eligible to receive benefits.

Why age 18? 19? 23? Murray has no idea. It’s a complexity no one understands and no one needs.

Which leads us to this:

4. The SSN Act seeks to generate additional revenue for the Social Security Trust by imposing a 2% payroll tax on earned income in excess of $400,000. The current payroll tax of 12.4% does not apply to any income above $128,400.

The mythical Social Security “Trust Fund” doesn’t need additional revenue, especially since it is an accounting deception.

A Monetarily Sovereign nation can add to or subtract from any so-called “trust fund” at will. It’s all hocus pocus, smoke and mirrors, to make you believe the government can’t afford your benefits.

That said, taxing the rich to narrow the Gap between the rich and the rest is a good idea, even though those tax dollars disappear from the money supply.

The single most important problem in our economy and the world’s economies is the large and growing Gap between the rich and the rest.

I know what you’re probably thinking: “The rich aren’t reliant on Social Security, so they should pay extra tax to shore up the Social Security Trust.”

However, the $128,400 figure in 2018 — exists because there’s also a maximum monthly payout at full retirement age. It’s not “fair” to add a 2% payroll tax to an extra, say, $5 million in income if that individual won’t see an extra cent in Social Security benefits.

That’s not what I’m thinking. I’m thinking:

  1. The mythical “Trust Fund” doesn’t need “shoring up.” It needs to be eliminated as an excuse for not paying benefits.
  2. The government should increase benefits
  3. The benefits should be paid to every man, woman, and child in America.
  4. Taxing the rich more would narrow the Gap and benefit America (See: Ten Steps to Prosperity: Step 8: Tax the very rich more (dictatorship warning)

It’s unlikely that Republicans would go along with such a measure, and their votes will be needed in the Senate to pass the SSN Act.

I may be wrong, but I do not remember the Republican Party (the party of the rich) passing any legislation that was not designed to widen the Gap.

Undoubtedly, you have been told that Social Security (or Medicare, for that matter) will soon run short of money, and the “trust fund” will be empty.

And undoubtedly, you have been told your taxes must be increased and/or your benefits must be decreased.

And you will hear it from reliable sources with impeccable credentials:

The politicians, who have been bribed with campaign contributions and promises of lucrative employment when they leave office.

And the economists who have been bribed with university contributions and lucrative jobs with think tanks.

And the media, who are owned by the rich and have been bribed with advertising dollars.

It all is a lie, the biggest lie in economics. It is The Big Lie. So, next time you hear it, contact the liars and tell them you know: It’s a damnable lie paid for by the rich to widen the Gap between the rich and you.

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

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

The most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

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 can afford better health care than can 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 A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All) (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Economic Bonus)) 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 EVERYONE Five 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 benefitting 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 FEDERAL TAXES ON BUSINESS
Businesses are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the federal government (the later having no use for those dollars). Any tax on businesses reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all business taxes reduce 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 business taxes would be a 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

 

–Which stinking liars are stealing your children’s Social Security and Medicare? Sunday, Aug 2 2015 

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

Mitchell’s laws:
•Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
•Any monetarily NON-sovereign government — be it city, county, state or nation — that runs an ongoing trade deficit, eventually will run out of money.
•The more federal budgets are cut and taxes increased, the weaker an economy becomes. .
Liberals think the purpose of government is to protect the poor and powerless from the rich and powerful. Conservatives think the purpose of government is to protect the rich and powerful from the poor and powerless.
•The single most important problem in economics is
the Gap between rich and poor.
•Austerity is the government’s method for widening
the Gap between rich and poor.
•Until the 99% understand the need for federal deficits, the upper 1% will rule.
•Everything in economics devolves to motive, and the motive is the Gap between the rich and the rest..

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Virtually all politicians are liars, as are some journalists and economists — but the scummiest low-life liars of all are the people who tell you Social Security and Medicare are running short of money and the “solution” is to cut benefits and/or increase taxes.

These people should be skinned alive, boiled and salted, after which painful things should be done to them.

They are paid by, and do the bidding of, the rich and powerful, to hurt the weak and powerless.

“Rich” is a comparative term. The Gap between the rich and the rest, is what makes the rich rich. Without the Gap, no one would be rich, and the wider the Gap, the richer they are.

So, it is a prime goal of the rich to widen the Gap by impoverishing the rest of us. And virtually all politicians, some writers, and some economists are only too happy to oblige the rich.

Who’s Ready for a 10% Cut to Their Social Security Benefits?
By Sean Williams, August 2, 2015

The Social Security program is designed to replace about 40% of a workers’ income.

In reality, though, nearly half of all unmarried elderly beneficiaries get 90% of more of their income from Social Security. The thought of tinkering with benefits is equally worrisome for baby boomers nearing or just entering retirement. Many were clobbered by the Great Recession, and a good chunk could be entering retirement with an inadequate amount of savings.

The Social Security program, however, isn’t in great shape. The Old-Age, Survivors and Disability Insurance Trust, or collectively the OASDI, is slated to burn through its remaining cash reserves by 2033.

If Congress can’t come to a long-term solution that involves raising additional revenue and/or cutting expenses, benefits for eligible beneficiaries will be cut by 23%.

If Social Security were a privately run program or a local government-run program, the above paragraph could be true. The program could “burn through cash reserves,” and the solution would be to”raise additional revenue or cut expenses and benefits.

But Social Security is a federally-run program, and unlike you and me and local governments, the federal government never can run short of dollars.

The author of the article, Sean Williams, is telling a great, big, fat lie, when he says, “If Congress can’t come to a long-term solution that involves raising additional revenue and/or cutting expenses, benefits for eligible beneficiaries will be cut by 23%.

Not that Congress won’t continue cutting benefits, as it already has been. But the point is, Congress doesn’t need to cut benefits.

In fact, even if FICA, the tax that supposedly funds Social Security, were cut to $0, Social Security could continue paying benefits forever — even increase benefits forever.

According to Republican presidential candidate Chris Christie, we need to make some pretty radical reforms to the entitlement program.

Christie’s recommendation to fix Social Security, like many before it, focuses on the coming generations to receive Social Security benefits and not on current retirees.

Thus, if you’re already receiving benefits, you can breathe a bit easier.

Yes, you can breathe easier, if you don’t give a damn about your children and grandchildren. Just sit back, and watch the politicians cut their benefits and increase their taxes.

Christie would like to see the full retirement age moved from age 67 to 69. He also wants to enact a raise to the minimum age at which retirees can claim benefits from age 62 to age 64.

It’s called the “work-until-you-drop (if you even can find a job at that age)” plan.

Christie’s proposal may coerce pre-retirees and Generation X to work longer, which makes sense given that we’re living longer than ever.

Sure it makes sense to the Party of the Rich. You are not rich, therefore you are a lazy good-for-nothing, who needs to be coerced to work and work and work. Heaven forbid you might enjoy a longer retirement.

In the eyes of the rich, only rich people are not lazy, so they deserve the enjoyment of a longer retirement. Not you.

Instead, you middle-class people, having been granted longer lives, are told you should be delighted to search for jobs and to labor those extra years. Strangely, most not-rich people believe it.

But Christie’s proposal also has adverse effects. It turns out that raising the retirement age could be very bad news for the nation’s poorest citizens who rely on Social Security income in their golden years.

But really, who cares about them, so long as the rich (courtesy of the right wing Supreme Court) legally are able to bribe politicians like Christie, to lie about Social Security?

As The Washington Post reports, lifetime Social Security benefits can often reflect a person’s socioeconomic status. The poorest Americans often lack access to adequate nutrition and healthcare, while the richest Americans have ample access to medical care and can make healthier food choices.

So, cutting Social Security benefits and Medicare benefits, while raising taxes, are exactly what the wealthiest nation on earth should be doing to your children and grandchildren. Right?

According to The Washington Post, which conducted an informal study last year that allowed online respondents to select which of 12 methods they’d support to fix Social Security (respondents could select all that appealed to them), boosting the earnings cap on the payroll tax proved to be by far the most popular fix.

The 12 options are:

Cut benefits across the board today (100%)
Raise the full retirement age (20%)
Freeze the purchasing power of benefits (95%)
Freeze benefits on a sliding scale (55%)
Change the cost-of-living adjustment (20%)
Do nothing (but cut benefits when the Trust Fund reserves are gone) (100%)
Increase the payroll tax on everyone today (100%)
Raise the earnings cap (30%)
Use the estate tax to tax health benefits (35%)
Transfer start-up costs to general revenues (100%)
Raise the return on assets by investing in the stock market (20%)
Do nothing (but raise taxes when the Trust Fund reserves are gone) (100%)

Could a survey be any phonier?

It provides 12 so-called “options,” all of which boil down to “cut benefits and/or increase taxes,” while leaving out the one true option: The federal government should pay for Social Security and Medicare. Period.

Here is what Sean Williams and all the politicians who want to cut benefits and increase taxes don’t tell you: FEDERAL TAXES DO NOT FUND FEDERAL SPENDING FICA doesn’t fund Social Security and Medicare.

President Roosevelt, who originated Social Security knew FICA was not necessary. He created FICA only to prevent politicians from eliminating the program, not to pay for the program.
fre are running out of money?

Why?

The answer: The rich don’t want the White House the Supreme Court and Congress to run out of money, but the rich do want Social Security to run out of money.

By pressing down on middle classes and the poor people’s income, the rich widen the Gap. They make themselves richer by comparison.

Whenever you hear any politician — Christie, Bush, Obama, Boehner et al — or read any article, saying that the Social Security “Trust Fund” is running short of dollars, know this: The speaker or writer is a stinking liar, who has been paid by the rich to take money from your children and grandchildren.

And pay no attention to phony claims that certain increases in FICA also will take money from the rich. The rich aren’t affected by a few dollars taken from salaries.

Many of the rich don’t even earn a salary (Have you ever wondered why FICA only is applied to salaries and not to capital gains?), A few dollars means nothing to the rich — though it can mean quite a lot to the poor and the middle.

Who is stealing your children’s Social Security and Medicare? The scummy, low-life politicians, journalists and economists — and you, if you believe their stinking lies.

Rodger Malcolm Mitchell
Monetary Sovereignty

===================================================================================
Ten Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Tax the very rich (.1%) more, with higher, progressive tax rates on all forms of income. (Click here)
9. Federal ownership of all banks (Click here and here)

10. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)

The Ten Steps will add dollars to the economy, stimulate the economy, and narrow the income/wealth/power Gap between the rich and the rest.
——————————————————————————————————————————————

10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt

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.
1. A growing economy requires a growing supply of dollars (GDP=Federal Spending + Non-federal Spending + Net Exports)
2. All deficit spending grows the supply of dollars
3. The limit to federal deficit spending is an inflation that cannot be cured with interest rate control.
4. The limit to non-federal deficit spending is the ability to borrow.

THE RECESSION CLOCK
Monetary Sovereignty

Monetary Sovereignty

Vertical gray bars mark recessions.

As the federal deficit growth lines drop, we approach recession, which will be cured only when the growth lines rise. Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

#MONETARYSOVEREIGNTY

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