Tag: the big lie

The perfect expression of the Big Lie

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

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This blog frequently refers to the “Big Lie,” the lie that says our Monetarily Sovereign federal government uses taxes to pay its bills.

Based on the Big Lie, politicians and others tell you the federal deficit and debt are “unsustainable,” “dangerous,” and a “ticking time bomb”  — all lies.

And these lies lead to the lies that FICA must be increased, while Medicare, Social Security, and other social benefits must be decreased. The politicians say it because the rich want them to say it, and the rich want it, because those lies widen the Gap between the rich and the rest.

In various posts, we have addressed the specifics of many lies emanating from the Big Lie, but seldom have we seen them expressed in such concise fashion as in the following:

Trump’s Economic Plan is a Betrayal of the People Who Voted for Him

“President-elect Donald Trump’s race to enact the biggest tax cuts since the 1980s went under a caution flag Monday as Senate Majority Leader Mitch McConnell warned he considers current levels of U.S. debt “dangerous” and said he wants any tax overhaul to avoid adding to the deficit.

“‘I think this level of national debt is dangerous and unacceptable,’ McConnell said, adding he hopes Congress doesn’t lose sight of that when it acts next year. ‘My preference on tax reform is that it be revenue neutral,’ he said…

“The Committee for a Responsible Federal Budget, a nonpartisan think tank, has projected that Trump’s plans would increase the debt by $5.3 trillion over a decade, with deficits already over $600 billion a year and rising on autopilot…

“‘What I hope we will clearly avoid, and I’m confident we will, is a trillion-dollar stimulus,’ he said. ‘Take you back to 2009. We borrowed $1 trillion and nobody could find that it did much of anything. So we need to do this carefully and correctly and the issue of how to pay for it needs to be dealt with responsibly.'”

Let’s analyze this abominable series of lies:

Lie #1. “Current levels of U.S. debt (are) dangerous.”

Why? What is dangerous about the U.S. debt? Will the federal government run short of dollars to pay its debts? No. The U.S. cannot run short of its own sovereign currency.

Has the massive “debt” increase caused the much-feared, overblown threat of hyperinflation? No. Inflation has been running below the Fed’s target rate. In fact, the U.S. never has had hyperinflation.

Lie #2. Tax reform(should) be revenue neutral

No it shouldn’t. This is a restatement of the notorious “Balanced Budget Amendment” argument, in which somehow the U.S. economy is expected to grow without a growing supply of dollars. There is no known economic mechanism for that to happen.

Every depression and most recessions have come on the heels of reduced deficit growth.

Lie #3. The Committee for a Responsible Federal Budget, (is a) a nonpartisan think tank

While the CRFB does not self-identify as Republican, it strongly leans to the right, and it is highly partisan for one goal: Widening the Gap between the rich and the rest.

The CRFB invariably favors cuts to social programs along with increases in FICA.

Lie #4. Trump’s plans would increase the debt by $5.3 trillion over a decade

Whether or not the figures turn out to be correct, this is a lie by inference. The CRFB loves to quote large numbers, implying that somehow these numbers are bad. However, if you go to the CRFB website you will not find a single analysis telling you why the numbers are bad.

Because there are no reasons, the CFRB hopes you simply will believe the lie without substantiation.

Lies #5 and #6. We borrowed $1 trillion and nobody could find that it did much of anything.

These are the most outrageous lies of all.

The U.S. doesn’t “borrow.” The Federal Reserve Bank accepts deposits in T-security accounts. The intentionally misleading word “debt,” when applied to T-securities, should be changed to “deposits.”

“Nobody could find that it did much of anything” except the deficit spending is what brought us out of the worst recession since the Great Depression of the 1930s.

Mitch McConnell and his fellow liars have learned that if one repeats a lie often enough, and if many other people repeat the same lie, the populace will believe it, no matter how obvious the lie is.

Most people are aware the federal government cannot run short of its own sovereign currency. And most people also are aware that despite massive deficit spending, the Fed’s primary concern has been the lack of inflation.

Finally, most people are aware of what the above graph tells them: The sharp increase in stimulus spending (i.e. deficits) brought us out of the recession and into almost a decade of economic growth and reduced unemployment.

The rich have bribed McConnell and his fellow politicians to lie. But they haven’t bribed you to believe their lies.

So why would you?

Rodger Malcolm Mitchell
Monetary Sovereignty

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the rich and the rest.

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 AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

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

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and 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 CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be 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
 

 

 

It takes only two things to keep people in chains: Part II, Medicare

It takes only two things to keep people in chains: The ignorance of the oppressed and the treachery of their leaders

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In the previous post, we disclosed how the rich tell the Big Lie, in their efforts to ruin Social Security and thus to widen the Gap between the rich and the rest. (Widening the Gap is the #1 priority of the rich.)

Now, see how the rich use the Big Lie in their efforts to ruin Medicare.

Just to review: The Big Lie briefly is this: Federal taxes fund federal spending. You can read a more complete analysis, here.

The Big Lie is composed of several “sub-Lies”:

  1. Federal finances are like private finances
  2. The federal government can run short of its own sovereign currency
  3. FICA pays for Social Security and Medicare benefits
  4. Social Security and Medicare are “broke,” “going broke,” or will be “broke” at some future time.
  5. The Social Security and Medicare trust funds are insolvent or will be insolvent.
  6. Federal debt and deficts are “unsustainable.”
  7. Federal deficits cause hyper-inflation, like Zimbabwe and the Weimar Republic.
  8. Your children owe the federal debt.
  9. The government should run a balanced budget.
  10. The federal tax code should be “reformed” to “broaden the base.”

All ten of the above are absolutely false, their only purpose being to fool you, the public, into believing the federal government cannot afford [insert benefit here] without tax increases.

HEALTH NEWS FROM NPR

Paul Ryan’s Plan to Change Medicare Looks A Lot Like Obamacare November 26, 2016

President-elect Donald Trump and House Speaker Paul Ryan agree that repealing the Affordable Care Act and replacing it with some other health insurance system is a top priority.

The ACA (“Obamacare”) should be replaced, not because it is President Obama’s signature achievement, and not because it first was implemented by Mitt Romney, but because it is based on the Big Lie.

It requires the young people of the middle- and lower-income groups (the “99%”) to do what the federal government easily could, and absolutely should do: Fund healthcare coverage for all people.

But they disagree on whether overhauling Medicare should be part of that plan. Trump said little about Medicare during his campaign, other than to promise that he wouldn’t cut it.

Ryan, on the other hand, has Medicare in his sights.

“Because of Obamacare, Medicare is going broke,” Ryan said.

Ryan told the Big Lie.  Obamacare cannot cause Medicare to “go broke.” The federal government cannot “go broke,” nor can any federal agency  “go broke.”

Our Monetarily Sovereign federal government, unlike state and local governments, never will run short of dollars.

Even during wars, recessions, and depressions, and natural disasters, the United States government never has run short of its own sovereign currency, the dollar. And it never will.

In fact, the opposite appears to be true — Obamacare may actually have extended the life of Medicare.

This year’s Medicare trustees report says the program would now be able to pay all its bills through 2028, an improvement Medicare’s trustees attribute, in part, to changes in Medicare called for in the Affordable Care Act and other economic factors.

” . . . trustees report says the program would now be able to pay all its bills through 2028 . . . “

The trustees told the Big Lie. Medicare can pay all its bills forever, and this has nothing to do with Obamacare.  It has to do with the fact that the federal government is Monetarily Sovereign, and therefore creates dollars by paying its bills.

So rest easy, President Obama, Rep. Ryan and you Medicare trustees.  The federal government will not and cannot run short of dollars to pay your salaries, pay your expenses, pay your retirement benefits — and of course, pay Medicare benefits.

And the irony of the Ryan Medicare plan, say some health policy analysts, is that it would turn the government program into something that looks very much like the structure created for insurance plans sold under the ACA.

Ryan’s plan would set up “Medicare exchanges” where private insurance companies would compete with traditional government-run Medicare for customers.

People would get “premium support” from the government to pay for their insurance under the Ryan Medicare plan.

The subsidy would be tied to the price of a specific plan offered by an insurer on the exchange, much like the Affordable Care Act subsidy is tied to the second-cheapest “silver” plans.

The above demonstrates the rich running like hungry swine to slurp from the money-trough, with Ryan leading the herd.

Medicare benefits currently are paid directly to hospitals and doctors, by our not-for-profit, federal government. The Ryan plan would insert private insurance companies as middlemen, to pay health care providers.

Billions of dollars, rather than going directly to health care providers, would flow through the for-profit insurance companies, who would siphon off some for themselves.

So, if insurance companies act as middlemen, taking some of the government’s money for themselves, rather than all of the money going to healthcare providers, how does that save the government money?

Answer: You, the public will have to pay the difference.

It would be a bonanza for the rich insurance companies, their highly-paid officers, and their wealthy shareholders. And importantly, it would be an additional tax on you –exactly the Gap-widening effects the rich want.

(The rich are made richer if they receive more and/or if the not-rich receive less.  Ryan’s plan accomplishes both.)

The federal government doesn’t need to save money; it has infinite money. Nevertheless, Ryan has invented a convenient excuse to funnel billions of dollars into insurance companies coffers. His excuse is the Big Lie.

One can be sure he will be well-rewarded by the insurance companies for his efforts on their behalf.

As for the public: You, the public, be damned.

 Like in Obamacare, people who choose plans that cost more than the government subsidy would have to pay the balance.

The changes would start in 2024, when people who are now about 57 become Medicare eligible.

Avik Roy, founder of the Foundation for Research on Equal Opportunity, agrees with Ryan that Medicare is going broke and that a program structured in this way would save money through “the magic of competition.”

“If you have 10 insurers competing for that business, you’re going to negotiate a better deal,” he said.

Ah, yes, that old black “magic of competition” will get you a “better deal.”

How about the “greater magic” of having no middlemen to suck dollars from consumers, while they contribute nothing to the process?

How about the even greater magic of having our Monetarily Sovereign government pay for the whole thing, saving you tons of money?

Most seniors today are enrolled in what’s known as traditional Medicare, where the government pays for medical appointments, tests and hospital stays on a fee-for-service basis.

Alongside that program is Medicare Advantage, an insurance plan provided by a private insurer which may offer seniors additional services like dental care at the same price.

The government pays a fixed monthly fee to the insurer for each Medicare Advantage patient, rather than paying for every service separately, as it does in traditional Medicare.

Henry Aaron, a health care economist at the Brookings Institution, says Ryan’s proposal aims to move almost all seniors into Medicare Advantage-style insurance by making traditional Medicare too expensive for the consumer.

There it is — “making traditional Medicare too expensive for the consumer.” That is the way Ryan plans to protect you from Medicare.

Feel better, now?

The health care and health insurance systems are very complex. Doctors move in and out of networks, copayments can vary and plans can change.

Millions of people on Medicare are also eligible for Medicaid, meaning they are poor and vulnerable, Aaron says. And at least 8 million Social Security beneficiaries have been declared financially incompetent and are assigned a representative to manage their money.

“What you’ve got here is a group of people who are very sick, poor, and often cognitively impaired one way or the other,” Aaron says. “Tossing people like that into a health care marketplace and saying, ‘Here, go buy some insurance,’ is a recipe for problems.”

Not only is it a recipe for problems; it’s completely unnecessary. The federal government simply should fund comprehensive Medicare for every man, woman and child in America.

Why insert middlemen insurance companies between the government and the doctors?

Seniors may feel the same way. Researchers at Brown University last year found that as people get older and sicker, they tend to drop Medicare Advantage and opt for traditional Medicare.

Ryan has been working on his plan to change Medicare for many years. A version of his “premium support” plan was included in several budget proposals he put forth when he was chairman of the House Budget Committee.

The Congressional Budget Office says the proposals would reduce federal spending on Medicare.

Yes, it’s a plan to reduce federal spending and increase consumer spending. Is that what we want?

And, why stop at a convoluted “Ryancare” plan to (unnecessarily) reduce federal spending. How about eliminating all federal support, and making the people pay for everything? Isn’t that the next, logical step?

At this point it’s unclear whether Trump shares Ryan’s ambitions to upend the current Medicare system.

Trump didn’t include Medicare reform on his campaign web site. But since his election, “modernize Medicare” has been included on the list of health care priorities on his transition web site.

We have moved to a new euphemism. The politicians usually have talked about “reforming” Medicare and Social Security. The word “reforming” always has meant, “Take from the poor and give to the rich.”

Now they use an even more mealy-mouthed term: “Modernizing.”

Whatever term is used, the method and the result always seem to be the same: First, tell the Big Lie. Then use the Big Lie to steal benefits from the 99% and give benefits to the 1%.

So long as the 99% fall for the Big Lie, the process will continue. It takes only two things to keep people in chains: The ignorance of the oppressed and the treachery of their leaders.

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 rich and the rest.

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 AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

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

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and 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 CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be 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.

MONETARY SOVEREIGNTY

Now that you have voted, here is what you voted for

You may have thought you were voting for people — Trump, Clinton or someone else, but in fact you were voting for programs that will affect your life. So now that voting is over, you might as well learn what you voted for.

Those of you on the “ABC” (Anyone But Clinton) team must feel great to have dispatched the evil witch, and now you have a chance to “Make America Great Again.”

The following post tells you where your jump from the frying pan has taken you.

Here are some excerpts from an article in today’s Chicago Tribune,  a right-wing newspaper that opposed Trump (as did almost every newspaper in America):

President-elect Donald Trump’s stunning victory Tuesday has delivered to GOP congressional leaders the gift they dreamed of, even if they never quite believed it was within reach: a Republican president to sign Republican bills passed by a uniformly Republican Congress.

House Speaker Paul D. Ryan (R-Wis.), who rose to prominence based on his plans to dramatically scale back federal spending, said Wednesday that Trump “earned a mandate” in his victory to enact years of conservative promises and that Republican lawmakers stood ready to help.

These days, every political victory, no matter how narrow, is termed a “mandate” by the winning party.

Trump’s “mandate” is pretty much the same “mandate” Bush had over Al Gore, when Gore received more votes and Bush won the electoral college. Last I heard, Clinton actually received more votes than Trump.

“This is the kind of unified Republican government that we set out to deliver,” Ryan told reporters. “I think we are going to hit the ground running.”

Senate Majority Leader Mitch McConnell (R-Ky.) also called the election a rejection of Obama’s policies and said Republicans would work with Trump to overturn them — and to fill the Supreme Court vacancy they have kept open for eight months.

Once again we will have a conservative Supreme Court, which may please those who agree with the “Citizens United” (money is speech) decision that allows the rich to spend unlimited dollars to elect candidates favoring the rich, and with the “Hobby Lobby” (corporations are people) decision saying a corporation has religious rights that supersede the religious rights of its employees.

If you have noticed a certain bent in conservative Court rulings it’s this: The rich should have more rights than the not-rich.

Among the first priorities next year is likely to be an effort to repeal and replace the Affordable Care Act, aka Obamacare. McConnell said that would be “pretty high on our agenda” and that he “would be shocked if we didn’t move forward and keep our commitment to the American people.”

Obamacare (originally Romneycare) was created as a result of the Big Lie, the lie that federal taxes fund federal spending. They don’t.

Unlike state and local taxes, which do fund state and local government spending, federal taxes are not in any way related to federal spending. That is the fundamental difference between a monetarily non-sovereign (state and local) government and a Monetarily Sovereign (federal) government.

The public’s ignorance of the Big Lie has done more damage to the American economy than all the wars in U.S. history.

Yes, Obamacare should be replaced, but not with another jury-rigged, anti-middle-class, Rube Goldbergian program based on the Big Lie.  It should be replaced with a federally funded, single-payer, comprehensive Medicare for every man, woman, and child in America.

The more money the federal government spends on Medicare, the more stimulus dollars will enter the economy and the faster the economy will grow.

(By the way, don’t let the oft-used “inflation” excuse confuse you. Being Monetarily Sovereign, the government has total control over both the supply and the demand for [i.e. the value of] the U.S. dollar.) The government can cause or stop inflation any time it wishes.

Ryan told reporters that he also expects to work with Trump to scale back regulations for coal mining, ranching and other industries.

If there is one thing conservatives hate it’s those pesky regulations that prevent the rich from polluting the air, exacerbating global warming, cheating food and drug buyers, and taking America’s land for themselves.

And puh-leeze let’s not regulate those downtrodden banksters, who created the Great Recession. Those poor $100 million a year folks would be able to make $200 million if only you and the government would let them do whatever they want.

Wicker predicted Republicans would get to work immediately on replacing the health-care law, swiftly confirm Trump’s first pick for the Supreme Court and work toward a bipartisan infrastructure package.

In reality, “bipartisan” means, “We have the votes, so shut up. (Does infastructure include a wall on the American/Mexican border? Just wondering.)

Conservatives are expected to push anew to slash domestic programs and to reduce the size of entitlement programs such as Social Security and Medicare.

Is that what you thought you were voting for? Read it again: The Trump Republicans want to reduce entitlement programs such as Social Security and Medicare.

Fortunately, you and your children won’t need either Social Security or Medicare.  Right?

The problem is not that money is lacking. There is plenty of money — an infinite amount, really.  The problem is that your life is not harsh enough, and the ultra-rich are not happy about that. You, the servant class, don’t deserve all that “free stuff.” Only the rich deserve free stuff in the form of tax loopholes.

The overriding goal of the rich is not to make more money, but to widen the Gap between them and you. That is accomplished by giving the rich more and/or by giving you less.

The Gap is what makes the rich, rich.  Without the Gap, no one would be rich (We all would be the same). And the wider the Gap, the richer they are. A man making $100 is rich if everyone else makes $10.

That widening Gap is the single, most important problem facing the American Economy.

When you and your children receive less Social Security and a more restrictive Medicare (both programs having been invented by liberals) don’t be surprised. It’s what you voted for. Didn’t anyone tell you?

Last year, Trump said that he would eventually insist on a balanced budget but did not elaborate.

“Right now, we’re so under, we’re so far under that you can’t go too quickly,” Trump said in an interview with Fox News. “But I would absolutely insist on it relatively soon.”

If you believe that a balanced budget (i.e increased taxes and reduced spending) will grow the economy, then you also must believe that your anemia can be cured by applying leeches or by draining your blood into a pail.

While your personal lifestyle depends on many factors, money always is the lifeblood of an economy.  The federal government not only has the unlimited ability to create U.S. dollars, but also has the unlimited ability to control the value of the U.S. dollar (i.e. inflation).

There is absolutely no reason to run a balanced budget, and in fact, a balanced budget would lead to recession or depression.
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THE RECESSION CLOCK

Monetary Sovereignty
Vertical gray bars mark recessions.

Deficit reduction puts less money into the economy, thereby recessing the economy. Recessions begin an average of a year after the red line (Federal Debt Held By The Public) slides to its bottom. 

As the federal deficit growth lines drop, we approach recessions, which have been cured only when the growth lines have risen.

Increasing federal deficit growth (aka “stimulus”) is necessary for long-term economic growth.

And if deficit reductions are bad, surpluses are even worse, because they actually remove dollars from the economy. U.S. depressions tend to come on the heels of federal surpluses.

1817-1821: U. S. Federal Debt reduced 29%. Depression began 1819.
1823-1836: U. S. Federal Debt reduced 99%. Depression began 1837.
1852-1857: U. S. Federal Debt reduced 59%. Depression began 1857.
1867-1873: U. S. Federal Debt reduced 27%. Depression began 1873.
1880-1893: U. S. Federal Debt reduced 57%. Depression began 1893.
1920-1930: U. S. Federal Debt reduced 36%. Depression began 1929.

Bill Clinton ran America’s last surplus, immediately after which we were fortunate to have “only” a recession — in 2001 — rather than a depression.

“On Tuesday, America demanded disruption,” said Sen. Ben Sasse (R-Neb.), a Trump critic who nonetheless said Wednesday he would “do everything in my power” to hold Trump to his pledges to overturn the Affordable Care Act, pursue congressional term limits and nominate conservative judges.

Congressional term limits are wise for the same reason Presidential term limits are wise. The longer Congresspersons hold their jobs, the less responsive they are to the public good. 

But, can you imagine Congress voting for term limits? Trump’s wisest proposal has the least chance of passing.

Another Trump critic, Sen. Lindsey O. Graham (said) “We have wars to win, threats to be dealt with, and a stagnant economy which must be revived. I believe there is consensus to be had on keeping trade free but fairer, rebuilding our military, restoring our standing in the world, reforming our tax code, repealing and replacing Obamacare with an alternative that empowers patients while reining in costs, and confirming conservative justices to the Supreme Court.”

“Empowers patients,” is political doubletalk meaning reducing patients’ benefits and increasing their costs. Implied in all this are two fundamental, conservative beliefs:

  1. More money must be spent on the military.
  2. This money must come from the working class.

Tax “reform” always seems to mean increasing a regressive tax on the working class, like a sales tax, a flat tax or more FICA, while taking care of the very rich idle class.

The working class voted Republican, but the Republicans will disappoint the working class. Sadly, while the Democrats lean (ever so slightly) more to the left, they too have disappointed the working class, because they have become right-wing.

The Democrats too, espouse the Big Lie as a reason to limit social programs. For both parties, it has become a matter of faith that social programs promote laziness, and the only way to eliminate poverty is to punish the impoverished — i.e. to whip the slaves until they are willing to work.

The myth is that cutting social programs is the best way to prod the working class into greater effort.

Until at least one politician has the knowledge, the courage and the power to publicly demonstrate the fallacy of the Big Lie, America will forever be plagued with booms and busts, and after each cycle, the working class will be worse off than before.

Historically, the Republican’ bases are the rich and the Christian fundamentalists. Hillary Clinton lost because the Democrats forgot their own historical base, the working class.

All those thousands of people attending Trump speeches were actually Democrats. They just didn’t know it, because the Democratic party ignored them in its drive for dollars.

Clinton was not a Democrat. Obama was not a Democrat. The last real Democrat was Lyndon Johnson, who did many great things before enmeshing himself in the Vietnam war.

  • Civil Rights Acts of 1964 and 1968
  • Appointed Thurgood Marshall (first black Supreme Court justice)
  • Voting Rights Act of 1965
  • $11 billion tax cut
  • Elementary and Secondary Education Act
  • Public broadcasting
  • Higher Education Act
  • Established the National Endowment for the Arts and Humanities
  • Outlawing most racial segregation
  • Medicare
  • Medicaid
  • Aid to education
  • Head Start
  • Food stamps
  • Work study
  • Environmental protection
  • Reduced poverty from roughly 23 percent to 12 percent

Those were liberal initiatives.  If you feel they are worthwhile, don’t allow anyone to use the world “liberal” as a pejorative.

Bottom line: The election was based on ignorance.

The Democratic Party was, and has been, ignorant for using the Big Lie as an excuse to ignore their base: The working class.

The Democrats also have been ignorant in allowing the Republicans to characterize liberalism as socialism and communism.  Liberalism is what Jack Kennedy and Lyndon Johnson did.  Socialism and communism are what Mao and Castro did.

If the working class understood the realities of  liberalism and of the Big Lie, they would vote liberal every time. The Democrats ignorantly allowed the Republicans to steal the Democrats’ “natural” base.

The working class voters were ignorant about what Trump and the right wing plans to do to them. They voted for change, without considering the fact that change can be bad.

And in fact, if the Republicans accomplish their goals, the change will be horrible for the working class and for the entire country, except for the rich, who will prosper.

To win back the Presidency and the Congress, Democrats must re-embrace Roosevelt/Kennedy/Johnson liberalism while teaching the public the facts about Monetary Sovereignty, the Ten Steps to Prosperity (below), and the Big Lie.

Rodger Malcolm Mitchell
Monetary Sovereignty

P.S. Within a year, no one will remember voting for Trump — but we will remind you.

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the rich and the rest.

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 AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

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

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be 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.

Lies, damned lies, and Treasury Direct Kids

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

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The federal government has been relentless in its efforts to brainwash us about the supposed similarities between federal deficit and debt vs. personal debt.

Here is a typical communication — a letter to me from United States Representative Bob Dold:

OUT OF CONTROL SPENDING

Rodger – As our state digs itself deeper into debt, families throughout Illinois are struggling just to get by. As a small business owner, I’ve had to make the tough decisions needed to meet a budget. But far too many so-called leaders have never had that experience – they’re solution to seemingly every issue is more government and more spending.

If hardworking Americans across the country need to live by a budget each and every day, then the government should have to do the same.

That’s why I’m a strong supporter of a balanced budget amendment to the Constitution, and it’s why I’ve voted for budgets that come into balance.

You’ll notice, that to confuse American voters, Rep. Dold mixes state, business, and pesonal (monetarily non-sovereign) finances in his first paragraph, with federal (Monetarily Sovereign) finances in his second paragraph.

It’s a perfect expression of the Big Lie (i.e. the lie that federal finance is like personal finance, and that federal taxes fund federal spending).

Not satisfied with brainwashing adults, the federal government has created a site called: Treasury Direct Kids.

Here are some of the lies your children will be fed:

Bureau of the Fiscal Service

It takes a lot of money to keep the U.S. Government running and a good deal of it is borrowed money.

That’s where we come in. Our job is to borrow the money needed to operate the federal government and account for that debt.

It’s sad that you must tell your kids their government is lying to them.  But it’s one of life’s realities.

The federal government does not need to borrow to “operate the federal government.” In fact, the federal government (unlike state and local governments) does not borrow at all.

The federal government provides you with safe investments in the form of deposits in T-security accounts at the Federal Reserve Bank. These are the world’s most secure bank accounts.

To make your deposit, you instruct your local bank to deduct dollars from your personal checking account and deposit those dollars into your T-security account, which is very much like a savings account.

(The process is similar to taking dollars from your checking account and putting them into your savings account.)

The dollars stay in your T-security account and are not used to “operate the federal government.”

Instead, to pay its bills, the government instructs creditors’ banks to increase the balances in creditors’ checking accounts. When the banks do as instructed, dollars are created. Thus, the government actually creates brand new dollars, every time it pays a bill.

The government pays down its so-called “debt” (deposits) every day, simply by transferring existing dollars from T-security accounts back to the owners’ checking accounts.  No new dollars are needed.

Have you ever wanted to buy something, but didn’t have quite enough money? If you’ve borrowed money from friends, family, or anyone else and promised to repay them, then you are “indebted” to pay it back. This is called “debt.”

Debt is money one person, organization, or government owes to another person, organization, or government. Typically, the person who borrows the money has a limited amount of time to pay back that money with interest (an additional amount you pay to use borrowed money).

Again, you see the confusion between personal finances and federal finances.

While debt is money one person, organization, or government owes to another, the federal  “debt” is not borrowed and it is not debt in the usual sense. It is deposits.

Rather than being called “debt” it should be called “deposits.” 

The Beginning of U.S. Debt

Even before the United States was founded in 1776, debt existed. Paying for the American Revolutionary War (1775 – 1783) was the start of the country’s debt. Some of the founding fathers formed a group and borrowed money from France and the Netherlands to pay for the war.

That was personal debt, not federal debt.

To manage the new country’s money, the Department of Finance was created in 1781. The next year, Government debt was reported to the public for the first time. The U.S. debt in 1783 totaled $43 million.

That year, Congress was given the power to raise taxes to cover the Government’s costs. However, the taxes did not bring in enough money. The debt continued to grow as the Government grew and provided more services to the people.

Question: There were no dollars at all before the United States was founded. So, where did the new citizens get dollars to pay federal taxes?

To create the United States, a group of men first needed to create laws. These laws were arbitrary words, created from thin air.  

Laws are not physical things. They are just ideas, written down. You cannot touch or see a law.

Among these laws, created from thin air, were laws that created U.S. dollars, also from thin air.  Dollars are just accounting numbers. (Those paper things in your wallet are not in themselves dollars.  They are titles to dollars. The dollars themselves are just numbers in balance sheets.

All the government did was create a balance sheet, and into this balance sheet, men wrote an arbitrary number that represented a number of dollars. Because the men completely controlled the balance sheet, they wrote whatever number they wished.

Then they paid people for goods and services with these newly invented dollars. That is how the American people obtained the dollars with which to pay taxes.

The U.S. Treasury Department was created in 1789 to help the country borrow money and manage the debt. Alexander Hamilton was the first Secretary of the Treasury and one of the country’s founding fathers.

By 1789, the federal government no longer could create more dollars from thin air, because it had passed laws arbitrarily stating how much silver each dollar represented. These laws limited the government’s ability to create new dollars.

This silver was collateral for dollars, with the federal government arbitrarily deciding how much collateral each dollar needed.

He felt getting into a reasonable amount of debt would help the country get its feet on the ground. He said, “A national debt, if it is not excessive, will be to us a national blessing.” By 1791, he estimated the federal government’s debt to be $77.1 million. To help raise money, federal bonds were issued by the Government.

The government convinced people to deposit dollars into T-security accounts, which the government used as collateral for obtaining more silver with which to create more dollars.

Through the years, the government has enacted many laws changing the amounts of silver, and then gold, it required itself to have as collateral before creating new dollars. These were arbitrary, self-imposed limits.

That all changed on August 15, 1971, when President Richard Nixon created new laws once again, and thereafter, the government arbitrarily allowed itself to create dollars without having any gold or silver as collateral.

Today, the only collateral for dollars is the full faith and credit of the United States government.

Because the government has an unlimited supply of full faith and credit, it has the unlimited ability to create dollars. And given the unlimited ability to create dollars, the federal government has the unlimited ability to pay any bill, and to service any debt, of any size.

The U.S. government never can run short of its own sovereign currency.

Previously we mentioned the government’s web site, Treasury Direct Kids

This site has a “Contact Us” page that allows you to ask questions about T-securities. Some good questions might be:

  1. “Is it possible for the federal government to run out of U.S. dollars?”
  2. “Why does the government borrow dollars if it has the unlimited ability to create dollars?”
  3. “Has the government ever been unable to pay off its loans?”
  4. “Why did President Nixon take us off the gold standard?”
  5. “If the federal government runs a balanced budget, how will the economy grow?”

If you receive answers to any of your questions, be sure to add them to the comments section of this blog. 

That should be interesting.

 Rodger Malcolm Mitchell
Monetary Sovereignty

…………………………………………………………………………………………………………………………………
The single most important problems in economics involve the excessive income/wealth/power Gaps between the rich and the rest.

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 AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

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

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be 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