Many thanks to Rodger Malcolm Mitchell over at his Monetary Sovereignty blog for letting us share his post at Kos on the Money and Public Purpose blog.
http://mythfighter.com/...
Below is the linked post:
Background:
The BIG LIE is the claim that federal finances are like personal finances, so the federal government can run short of dollars to pay its bills.
But, being Monetarily Sovereign, the federal government never can run short of its own sovereign currency, unless Congress and the President wills it.
The purpose of the BIG LIE is to widen the GAP between the rich and the rest. The BIG LIE is perpetuated by a Congress and a President that have been bribed via campaign contributions and promises of lucrative employment, later.
Every time you read or hear that some federal spending is “unaffordable,” or “unsustainable,” or that federal taxes must be increased to support some federal project, you are hearing the BIG LIE.
Here is the latest in a long, shameful and destructive series:
Here Comes Congress’ Next Big Economic Crisis, And It Could Be Even Worse Than The Fiscal Cliff
REUTERS/Jason Reed
The Highway Trust Fund, a transportation and infrastructure fund financed by gasoline taxes, is set to run out by the end of the summer.
The article begins with an immediate reinforcement of the BIG LIE. The so-called “Highway Trust Fund” is nothing more than an accounting file, created by the federal government. This file can contain any numbers the government wishes it to have. It cannot “run out.”
Thus far, Congress has not come up with a solution, and both sides are beginning to dig in. By July, thousands of projects and contracts could be put on hold amid the uncertainty — right in the middle of summer construction season. In one economic analysis released last week, the Obama administration warned 700,000 jobs tied to the fund and its uncertain future are at stake.
The solution would be for the federal government merely to pay for these projects, just as it pays for all White House expenses, all of Congress’s expenses, all of the Supreme Court’s expenses and all other federal initiatives.
No taxes or “trust funds” needed.
“Right now, there are more than 100,000 active projects paving roads and rebuilding bridges, modernizing our transit systems,” Obama said Wednesday in remarks near the Tappan Zee Bridge in Tarrytown, New York, where a $3.9 billion effort to replace the current aging structure is underway.
“States might have to choose which ones to put the brake on. Some states are already starting to slow down work because they’re worried Congress won’t untangle the gridlock on time. And that’s something you should remember every time you see a story about a construction project stopped, or machines idled, or workers laid off their jobs.”
What you should remember is that this is all a charade by Congress and the President. They want you to believe they are oh, so helpless to solve this oh, so difficult problem.
They neither are helpless, nor is there a problem. Congress and the President intentionally have created a situation in which workers “must” be unemployed and/or taxes “must” be raised — in short, the GAP must be widened.
The fundamental problem is that gasoline taxes alone are no longer enough to finance the Highway Trust Fund, due to declining fuel use across the U.S. However, neither the White House nor Congress wants to raise those taxes, and there is a disagreement about how to fill the fund without them.
Oh woe! We, the bribed politicians, simply don’t know what to do. Yes, we know that even if all federal taxes fell to $0, the federal government still could pay any bills of any amount.
But we don’t want you chump voters to know that. So we wring our hands in mock agony, to show you we really care about you.
Simply put, spending on transportation and infrastructure now exceeds gas taxes taken in. During recent testimony before the Senate Finance Committee, Joseph Kile, the assistant director for microeconomic studies at the congressional budget office, laid out two politically painful potential solutions — either cut spending in the fund’s two accounts by 30% and 65%, or raise the gas tax by 10 to 15 cents per gallon.
Or, they just could pay the bills without raising taxes. But then you chump voters would realize that federal finances are not like personal finances, not like state finances, not like local finances and not like business finances.
And then you would begin to understand the difference between a Monetarily Sovereign entity and monetary non-sovereign entities. And if you had that knowledge, how would we widen the GAP?
When he issued his dire warnings Wednesday, Obama advocated for his solution to the fund fiasco — a four-year, $302 billion transportation and infrastructure plan. Warning the “cupboard will be bare,” he urged Congress to act on his plan — but that too seems unlikely.
No, the cupboard will not be bare. There is no cupboard. Unlike you and me, the federal government creates dollars by spending. The more it spends, the more dollars there are.
“Both parties are miles apart on how to replenish the Highway Trust Fund,” said Greg Valliere, an analyst at Potomac Research.
Here is what Potomac Research says about itself:
Potomac Research Group’s team of top-notch analysts deliver an unrivaled product to institutional investors. Coupled with superior customer service from sales directors, our research helps mutual funds, pension funds, and hedge funds understand the impact of legislation and regulation on markets, industries and companies.
In other words, “Our clients are rich people.”
And then we have Guggenheim Partners:
For Chris Krueger, an analyst at Guggenheim Partners in Washington, the obvious solution is raising the gas tax.
Here is what Gugenheim Partners says about itself:
“Guggenheim Partners is a privately held global financial services firm with more than $210 billion* in assets under management.”
In other words, “We are rich people; we like rich people; we suck up to rich people; and we will do anything to advance the interests of rich people.”
And raising the gas tax is an obvious solution to widening the gap between the rich and the rest, because that tax impacts the rest far more than it impacts the rich.
And the BIG LIE is alive and well in Congress, the White House, Potomac Research Group and Gugenheim Partners.
Rodger Malcolm Mitchell
Monetary Sovereignty