THE UNIVERSAL ECONOMY UNIT XV: THE CRITICAL NEED FOR WAGE EARNING AMERICANS TO UNDERSTAND THE FEDERAL GOVERNMENT “DEFICIT”
It was the same fairytale spouted by President Ronald Reagan when he sold us the con-job of “trickle down” economics – – – “cutting taxes for the rich and corporations will lead to an economic boom, government revenue will increase, and everyone will live happily ever after.” Unfortunately, fairytales aren’t true and when congress once again cut taxes for the rich at the end of 2017, the result was the same as it has always been (and what the politicians voting for it know full well it will be). It Grew the Federal Government Deficit.
But when it comes to making the rich richer, few in congress care that it will increase the “deficit.” In fact, it is likely an unstated, deliberate goal. Because growing the “deficit” supports an even greater goal being pursued by the wealthy and their purchased politicians – – – the complete destruction (privatization) of social security, Medicare/Medicaid, and any other programs supporting the common good. Greed is a pathology, a metastasizing cancer. It will not rest until it owns everything.
It is absolutely critical for wage earning Americans to understand what the federal government “deficit” actually is. Any hope for a decent future, any hope of killing the metastasizing cancer, depends upon it. Indeed, two of the people most responsible for growing the deficit, Senate Majority Leader, Mitch McConnell, and Speaker of the House, Paul Ryan, are already spreading the alarm. “The deficit is out of control.” “Entitlements (a word specifically chosen to imply it is morally lacking for people to receive social security or Medicare/Medicaid) must be cut.” “They will leave our children in debt.” “We have to balance the budget.” “Entitlements must be cut.” Tragically, nearly all wage-earning people and otherwise progressive political leaders fall for this disgusting trash. We need to return to basics.
The United States of America is a sovereign nation with a sovereign fiat currency – the dollar. The government, through the U.S. Treasury, is the Creator of all of the nation’s money. If the government does not create money and place it into circulation through the Treasury and the U.S. Federal Reserve Bank, there will be no money in circulation to run the nation’s economy. Additionally, if the government taxes back all of the money it places into circulation, there will be no money in circulation to run the nation’s economy. There will be an economic collapse. No one will have any money. The difference between the money the government places into circulation annually and the money it taxes out of circulation annually is inappropriately labeled the “deficit.”
Let us repeat the above concepts because if we average, wage earning Americans do not grasp these, we, and our children, are going to be driven into serfdom by the billionaire class – the oligarchy – that now fully owns “our” government:
The government creates all of our money and spends it into circulation. If the government does not create money and spend it into circulation, we will have no money. The difference between the money the government spends into circulation and the money it taxes out of circulation is inappropriately called the “deficit.” If the government taxes all of the money out of circulation to “end the deficit” and “balance the budget,” there will be no money in circulation and the economy will collapse. Therefore the U.S. Government must always operate in a “deficit.”
When Mitch McConnell and Paul Ryan begin spreading alarm about the government deficit, one of two things is true. Either they are abysmally ignorant about how our sovereign fiat monetary system actually works, or they are deliberately lying to the American public to serve their billionaire donors by attempting to privatize all things public.
It is highly unlikely that McConnell and Ryan do not understand how our fiat monetary system works because every time government money is needed to support tax cuts for the rich, massive increases in military spending, bailouts for criminal, billionaire bankers, or anything else that makes the rich ever richer, the “deficit” is thrown to the wind. McConnell and Ryan couldn’t care less. So, when these two men scream alarm about the “deficit” where “entitlements” are concerned, they are lying through their teeth. Greed is a pathology, a metastasizing cancer.
If the physical resources and knowledge exist, the U.S. Government can afford to do whatever is necessary to care for its people. The government is the creator of the nation’s money. It can never run out of money. The only limitation on the amount of money the government can create is inflation. The money supply in circulation must approximately equal the productive capacity of the nation. The United States has been operating far below its true productive capacity for decades.
We have the resources, manpower and knowledge to rebuild our infrastructure. We have the resources, manpower and knowledge to provide public healthcare for all. We have the resources, manpower and knowledge to replace polluting electrical power generating systems with non-polluting alternative energy. We have the resources, manpower and knowledge to provide free higher education for our youth. We have the resources needed to cancel all student debt. We can always fully fund social security, Medicare and Medicaid. The only things standing in our way are deliberately perpetuated ignorance and the greed of our ruling billionaire class and their puppet politicians.