Nationalism vs imperialism

This post was inspired by an article that I just read. (Link at bottom.)

On Democracy Now, Noam Chomsky said he would vote for Clinton. This means that Chomsky favors genocide (Clinton) over xenophobia (Trump). Chomsky favors the destruction of a few million people (Clinton) over the deportation of a few million (Trump).

This is the attitude of most members of Chomsky’s tribe (a.k.a. the “Chosen”) including Bernie Sanders. Most are Leftists regarding domestic issues, but fanatical Rightists regarding foreign issues. They champion the rights of immigrants, poor people, brown people, and so on inside the USA and Europe, while they praise the extermination of those same people outside the USA and Europe. Sometimes they frown on Muslim-bashing inside the USA and Europe, but they almost always applaud Muslim extermination outside the USA and Europe. Or they are silent about it.

For most of the Chosen (indeed for most Leftists) nationalism is “evil,” while imperialism is good, or is irrelevant.

Clinton (“we came, we saw, he died”) helped to organize the Libyan and Syrian genocides, and she primed the Ukrainian genocide. Trump only wants to build a wall that already exists. Yet Trump is supposedly the greatest threat to Western democracy.

Although Trump’s foreign policy will probably be “genocide as usual” there is a chance, however tiny, that Trump will disrupt the West’s march toward World War III.

Clinton will accelerate it.

The talking heads laugh at Trump’s slogan “making America great again.” However they praise Clinton, who wants to “make the American Empire great again.”

For many Leftists, nationalism (not imperialism) is to blame for everything. If only they were correct. If only America really was nationalist, and focused on itself and its own borders, while leaving the rest of the world alone.

The neocons hate Trump and his nationalism, because neocons are imperialists. They condemn nationalism as “isolationism.” They love war and genocide, as long as it occurs outside the USA and Europe. They say they will vote for Hillary.

Leftists fear Trump’s nationalism because it might force them to actually fight for their value system for the first time in their lives. They don’t care about Hillary’s imperialism, since Hillary’s killing fields will be in foreign lands, far away.

The thieves of Wall Street hate Trump’s nationalism, because the thieves are imperialists. Imperialism and neoliberalism always occur together. They are two heads of the same snake.

Yanis Varoufakis is a Greek economist who was a member of the Greek parliament between January and September 2015. Mr. Varoufakis, like Chomsky, condemns nationalism, but ignores imperialism. Varoufakis finds domestic xenophobia scarier than foreign genocide. In Varoufakis’ book “And the Weak Suffer What They Must?” Varoufakis analyses the crisis in the EU, but in 300 pages he doesn’t once mention NATO or imperialism , or seriously take into account the EU’s foreign policy that creates refugees in the first place.

He condemns Europe’s and America’s economic establishment, but ignores Europe’s and America’s military establishment. Frustrated by Europe’s narrow-minded elite, Mr. Varoufakis is himself narrow-minded concerning Europe’s crimes in the Middle East.

The fate of Greece is caught up with the fate of Libya and Syria, but Varoufakis ignores this. Or maybe he just likes the Arab genocide. He fears the neo-nazi Golden Dawn, just as Chomsky fears the irrational Republican Party (as if the Democratic Party is rational).

The West is rattling sabers at Russia and China, and is perpetrating an anti-Semitic genocide in the Arab nations. Compared to this, Trump and the Golden Dawn are harmless. They might be xenophobic, but not nationalism is not necessarily so. Meanwhile, imperialism despises everyone who is not rich.

Instead of America warring with the rest of the world, Trump raises the possibility of America warring with itself. This would be a good thing for the victims of Western imperialism.

The West is united in its support for imperialism. Leftists support it by ignoring it, or by praising it — e.g. Leftists who called Syria’s Assad a “dictator,” and who applaud the destruction of Libya, Syria, Somalia, and so on.

The antidote to imperialism is nationalism. But we can’t have this antidote until Leftists end their anti-nationalist dogma. The only thing that can stop America’s genocidal foreign policy is America itself. In other words the only thing that can stop US imperialism is US nationalism.

(Inspired by an article in Counterpunch.)

What’s wrong with us?


What is wrong with us as a species? Why do we insist that monetarily sovereign governments are “bankrupt,” when we know they create limitless money out of thin air?

When rich people want something, the government simply creates the money for it. However, when average people want something, they get this…


There is no tax increase for trillion-dollar Wall Street bailouts, or for trillion-dollar weapons systems, or trillion-dollar wars.  But when average people want something (such as universal health care) they are told that taxes must be increased to pay for it. And they accept it, because they think like peasants.

The following is from a blog titled Food and Water Watch…

The crisis in Flint Michigan is the harbinger of a desperate situation for our tap water in communities across the country as our water infrastructure crumbles. That’s why Food & Water Watch has worked with Rep. John Conyers (D-MI) to introduce the WATER Act to ensure our water’s safety for generations to come.

They’re talking about H.R. 5313, which, if passed, would “establish a trust fund to provide for adequate funding for water and sewer infrastructure.”

Conyers introduced the bill yesterday (24 May 2016). It has seven co-sponsors, all of them Leftist Democrats, including Raul Grijalva of Arizona, the most left-leaning person in the entire U.S. House.

Conyers’ bill was referred to the House Ways and Means Committee, which is an automatic red flag, since Ways and Means oversees federal taxation.

So right away we know that Conyers wants to use needless tax increases to pay for something. Why tax increases? Why not just create the money? Answer: because clean water is something that average people want.

The U.S. Constitution requires that all bills regarding taxation originate in the House of Representatives. House procedure requires that all bills in the House regarding taxation must go through Ways and Means Committee.

Our pipes are getting old. Most of the water pipes in our communities were built following World War II. Some pipes are over a century old. Too many are made of lead. As these aging pipes deteriorate, service interruptions will become more common. Lead and other contaminants will leach into our water, putting the health of entire communities in danger – especially the health of children.

Instead of increasing our funding for water infrastructure to deal with this looming need, the federal government has decreased funding sharply – by 82 percent per capita since 1977. negotiations. That’s just irresponsible, and it’s time for Congress to make sure our declining water systems get the repairs they need. 

Agreed! Let’s upgrade our water infrastructure. We’ll create jobs in the process, and avoid mass poisoning.

But wait…


Conyers’ bill would, if passed, provide up to $35 billion in dedicated funding each year to keep our water and sewer systems working. The money would come from “closing corporate tax loopholes.”

That’s right. Tax increases.

Therefore it will never pass. No politician wants to risk his career by voting for higher corporate taxes. Indeed, Conyers’ bill will never make it out of the Ways and Means Committee. It is just another Leftist gimmick that Democrats use to show that “they care,” while they intentionally make sure it will fail.

They know there is no need for tax increases, since the U.S. government can create the money out of thin air.


And what about these clowns at Food and Water Watch”? They look to me like just another “progressive” group that collects corporate donations for proposing things that sound good, but which they know are unworkable.

Tax increases? Forget it. Conyers’ bill to raise taxes will not pass, nor does it need to. But because of collective idiocy, we’ll all be drinking polluted water.


Re. mob psychology

Napoleon 01

Napoleon said this in 1806 after his army defeated the Prussians. Having risen up from the bottom, and observed politics and society, he concluded that average people collectively suffer from what we today would call bipolar disorder – i.e. they are obedient as long as they are winning as a group, but they howl for their leader’s head the minute something goes wrong.

Napoleon brought order and prosperity to France, doing away with feudal law and hereditary titles (except his own). He was loved as long as he was winning, but after his disastrous occupation of Spain, and the retreat from Russia in 1812, the mob burned him in effigy, and demanded the return of the monarchy that had enslaved them before, and would enslave them again.

Bonaparte escaped to the island of Elba by using a British ship, even though he had always been at war with Britain.

He who would save the world must walk a tightrope. The more happiness he brings to average people, the more he will be crucified when something goes wrong.

Put another way, the masses will submit to almost any degree of abuse by government, but they will revolt the minute their cherished savior makes a mistake.

Napoleon 02

Neoliberals understand this. They know it is dangerous to treat the mob with kindness. They know they must enslave average people, since this makes average people blame each other for their problems, rather than blame their rich oppressors.

Indeed, when average people are abused, they believe the lie that their government has run out of money, no matter how many times they are told otherwise by government officials…

Napoleon 03

They believe the lie that their government is “bankrupt” because it justifies their hatred of each other. It gives them a reason to grumble. They resent the idea that anyone (other than themselves, and rich people) gets government benefits. They act as a mob.


This is what we are dealing with…


In Brazil the neoliberals of the new (post-coup) government know they must crush the masses if Brazil is to be calmed down. Therefore the coup plotters have announced that they will impose drastic austerity on the lower classes because of a “budget shortfall.” This is a lie, of course, since the government creates Brazilian reais out of thin air.

The neoliberals will begin by eliminating 36 million people (including 17 million children) from the Bolsa Familia program, which provides financial aid to poor Brazilian families. About 26% of the Brazilian population depends on this program.


The neoliberals have also announced that they will take private ownership of Brazil’s airports, utilities and the post office. They will also “reform” (i.e. cut) Brazil’s social security system, using the excuse is that Brazil has a (fake) “national debt crisis,” and that the social security system is “unsustainable.”

As you can see, neoliberal lies are the same in every nation, since mob psychology is the same. If you grind the masses into the dirt, they may not love you, but they will envy and respect you. Most importantly, they will obey you.


The new post-coup president, Michel Temer, says that austerity will end Brazil’s recession. He knows that austerity will worsen the recession, but Temer doesn’t care, since the recession will only hurt the real economy, not the financial economy. Austerity only hurts Main Street, not Wall Street.

In Brazil, the Workers’ Party was popular as long as the global commodities boom kept Brazil’s economy strong and expansive. Brazil even became a net lender in its own currency. But when China’s economy cooled, and the commodity boom ended, the middle and upper classes called for President Dilma Rousseff’s head, and cheered when she was deposed in a coup.

Now the mob will be crushed under the heel of neoliberal billionaires. Average people will blame each other for their suffering, rather than blame their oppressors. White Brazilians will blame darker-skinned Brazilians, who will blame immigrants, who will blame “gay rights” people, who will blame “straight” people. Jews will condemn all non-Jews as “anti-Semites.” Non-Jews will condemn all Muslims as terrorists. Anti-abortion people will blame pro-abortion people. And so on, and on.  The masses will divide and conquer themselves, while the gap between them and the rich will become wider than ever. Poverty will grow like a cancer.


Speaking of Brazil, a strange event happened today that I can’t yet explain. The Folha de São Paulo (Brazil’s largest newspaper in terms of circulation) published proof (proof) that the coup against President Rousseff was designed to end the nationwide “Operation Car Wash” corruption probe. That is, politicians supported the coup in order to spare themselves from prosecution.

Folha de São Paulo (lit. “São Paulo Newspaper”) produced transcripts of a 75-minute phone conversation between the newly-installed Planning Minister, Romero Jucá (a senator at the time) and former oil executive Sergio Machado. The transcripts reveal how these two men plotted the coup with the cooperation of officials in the military and Supreme Court. They all agreed that removing President Rousseff would be the only way to end the nationwide corruption investigation.

It is not known who recorded and leaked the 75-minute conversation, but Folha de São Paulo reports that the files are currently in the hand of the prosecutor general.

My question is why would a corporate media outlet publish such a transcript.

Perhaps the U.S. National Security Agency recorded and leaked the conversation in order to expose a few people in the post-coup government that the U.S. government wants removed. Perhaps Washington does not approve of Romero Jucá, the minister of planning. Mr. Jucá admits that the recording is authentic, but he claims that it was all a “misunderstanding.”

Or perhaps Washington wants to replace President Temer with someone less hated by the masses. Someone who doesn’t act and dress like a gangster.  Ever since Temer’s installation as president, Brazil has seen intense and growing protests against him. Temer has had to put soldiers around his house.

None of this will reverse the coup, but it will be amusing to watch the developments.


MMT gets a boost

Apologies for vanishing, but I was sick for a week, and I’m still recovering.

MMT got a bit of a boost from Donald Trump’s recent comment that the U.S. government will never have to default on its debts, since the U.S. government can always print more money.

I wish that Trump had gone a bit further and admitted that no federal program can ever become “insolvent” or “unsustainable” (e.g. Social Security), and that Universal Health Care would not require any tax increases.

signIn discussing Trump, the VOX blog calls MMT “leftist,” perhaps because the truth is automatically leftist when it is spoken in a world of neoliberal lies. For example, it is “leftist” to admit that the U.S. government creates dollars out of thin air.

From Vox: 

MMT emphasizes the fact that countries that print their own money can never really “run out of money.” They can just print more.

Let’s be clear. Monetarily sovereign governments can never run out of money to pay expenses that occur in their own money. However in some cases, monetarily sovereign governments can run out of foreign currency. (This doesn’t apply to the USA, since U.S. dollars are accepted everywhere.)

Thus you really don’t need to balance the budget over any time horizon, and attempts to do so will hurt the economy. This is very much a minority view in economics — even among liberals. For instance, Paul Krugman has argued that MMT gets this all wrong.

Krugman is a right-wing huckster who calls himself a “liberal.” He is paid to deny the facts of MMT.

KrugmanKrugman says you still need people to buy government bonds, and if the interest rates on those get too high, then paying for it all might be hard to do without triggering runaway inflation.

For Krugman, we need a balanced federal budget, otherwise known as austerity for the masses, plus endless giveaways to the rich and to Wall Street.

Krugman2Oh, and thank you Krugman for remembering to throw in the hyperinflation bogeyman. (Next time just say the magic word “Zimbabwe.”)

Joe Gagnon, an economist at the Peterson Institute, notes that Australia and Canada ran surpluses for years without suffering economically as a consequence.

Ah yes, the Peterson Institute. Dedicated to neoliberalism, inequality, and the privatization of Social Security. Liars one and all.

shirtRegarding Joe Gagnon’s claim that Australian and Canada “ran surpluses for years without suffering economically,” he said that in 2012 when Australian and Canada were enjoying a commodities boom, caused by demand from China. The commodities boom created countless jobs, plus a housing bubble — but it ended when China’s economy cooled off. This end caused the economies of Canada and Australia (and Brazil) to plunge. Jobs evaporated. People became “underwater” in their mortgages. Then came austerity, which made the recession even worse.

Sooner or later, federal budget surpluses always cause recessions. Always. Since Australia and Canada have massive trade deficits, they would be in severe trouble if their currencies were not widely accepted outside their borders. They would not be able to buy imports that they desperately need.

That quote from Joe Gagnon was from the Washington Post, which goes on to say:

When the government deficit-spends, it issues bonds to be bought on the open market. If its debt load grows too large, mainstream economists say, bond purchasers will demand higher interest rates, and the government will have to pay more in interest payments, which in turn adds to the debt load.

Wrong. The U.S. government has no “debt load,” since the U.S. government can “print” limitless dollars, as the Washington Post admits. Would you personally have a “debt load” if you could create limitless dollars in your home?

Moreover the “national debt” is simply money that investors have deposited in Fed savings accounts. The amount of these deposits has nothing to do with whether purchasers of T-securities can demand higher interest rates. And even if the Fed decides to raise interest rates on T-securities, this still does not create a “debt load.”

bs bagAnd now the Washington Post evokes Zimbabwe.

“You can’t just fund any level of government that you want from spending money, because you’ll get runaway inflation and eventually the rate of inflation will increase faster than the rate that you’re extracting resources from the economy,” says Karl Smith, an economist at the University of North Carolina. “This is the classic hyperinflation problem that happened in Zimbabwe and the Weimar Republic.”

Translation: without austerity (which causes ever-increasing poverty and inequality) we will become Zimbabwe and the Weimar Republic.

Such nonsense has become as common as referring to anyone we don’t like as “Hitler.”

In April 2000, Two hundred fifty of James K. Galbraith’s fellow economists laughed at him to his face in the White House. President Bill Clinton had invited Galbraith to speak on a panel about Clinton’s budget surplus.

Most economists viewed the budget surplus as a chance to pay down the national debt, cut taxes, shore up entitlements, or pursue new spending programs. Galbraith, however, viewed it as a danger: If the government is running a surplus, money is accruing in government coffers rather than in the hands of ordinary people and companies, where it might be spent and help the economy.

Exactly. The economists who ridiculed Galbraith knew that the U.S. government’s deficit is the economy’s surplus, and the U.S. government’s surplus is the economy’s deficit. However, in order to keep their jobs, economists must continually praise the emperor’s new clothes, and ridicule anyone who notes that the emperor is naked.

Galbraith says the 2001 recession — which followed a few years of surpluses — proves he was right.

Of course Galbraith was right.


Then the Washington Post article repeats the MMT fallacy that taxes are necessary to make monetary systems work. “The need to pay taxes compels people to use the currency printed by the government.”

DollarsWrong. The “taxes drive money” nonsense is one of several fairy tales that MMT people cling to. Taxes are only one factor that makes monetary systems function. Other factors are habit, custom, convenience, and federal law. Dollars would be just as valuable if taxes were totally eliminated.

Mike Norman weighs in…

In one comment, Donald Trump has done more to expose the truth than what any of us have done in over a decade. Trump said the U.S. can never become insolvent or go bankrupt or default because we print our own currency. Stated another way, the U.S., in fact, really has no debt.

Not quite. When people deposit money in Fed savings accounts, the Fed owes them interest on it. That interest is a debt, but it’s no big deal, since the Fed creates money out of thin air to pay the interest.

Mike Norman…

This means the government is not dependent on tax revenue or borrowing to take on the spending and investment it needs to make. The government spends in dollars, and those dollars flow to people and firms who then swap them for Treasuries so they can earn a little interest. When it comes time to “pay those people back” the government simply takes the Treasuries back and issues dollars to the holders once again. There is never an inability to do this. You would think by now people would know this, but they seemingly don’t. Hopefully, the fact that Donald Trump stated the obvious will sink in for some.

Most people already know this, but they pretend they don’t know.  It’s like knowing that most of what they’ve been told about World War II is lies, but pretending that the lies are true so they can condemn each other “Hitler.”

Mike Norman…

They say that printing money causes inflation. Well, it doesn’t. If the chart below doesn’t clear up this myth, I don’t know what will. You might as well believe in alien abductions and the Loch Ness monster. (Oh yes, those are real, too. I forgot.)


From the chart you can see that the government has “printed” nearly $20 trillion, and inflation went down. Not up, down. You can’t simply keep saying, well, it’s going to happen someday. It won’t.

The only inflationary threat we would face is if we ran out of the physical resources and labor to produce the things that the spending was employed to purchase. I’m not saying that can’t happen, but at the moment it is not even something close to a reality. Furthermore, with the global economy so interlinked, there are plenty of resources and labor that can be tapped in other parts of the world pretty easily.

Plus, the USA can buy things abroad with dollars, so there is no conceivable shortage of things. In short, hyper-inflation won’t happen.

Trump exposed the lie that the government must “save money.” You don’t need to save what you can create without limit.

pillsElsewhere on the Internet there are plenty of articles that attack Trump’s comment, but all of them are garbage. According to Reuters, Trump would destroy the world…

Any way that you look at what Trump is inclined to do, the result could lead to unprecedented disaster on a global scale.

trump 02

The International Business Times says that after the Republican convention, Trump will need to seek donations from rich Republicans for the general election. And since rich Republicans want cuts in Medicare, Social Security, and so on, Trump will have to satisfy those donors by becoming more neoliberal.

Wealthy Americans are much likelier to want cuts than the population at large. And while Trump made it through primary season without the support of the 1 percent, he needs their money to compete in the general election. The wealthier someone is, the likelier that person is to favor entitlement reductions.

Why is that? The International Business Times doesn’t say, but the answer is that rich people want you to suffer. Their sensation of “wealth” does not depend on how much money they have, but how much more money they have than others have. Thus, the more that rich people can grind you into the dirt, the richer they feel. This is why they want “entitlements” to be cut, even though “entitlements” do not cost them one penny.

There’s no question that anti-entitlement fervor animates many of the most active Republican mega-donors. For example, the billionaire Koch brothers have poured hundreds of millions into advocacy groups that prioritize shrinking the safety net.

pain 01Exactly. The rich are not happy unless you are miserable. They want wages to keep falling and the cost of living to keep rising. To justify this, they spout pure bullshit. “Social Security, Medicare and Medicaid are unfunded sinkholes that will wreck the national budget and lay waste to society!”

The USA is on a neoliberal track. Today the Associated Press-NORC Center for Public Affairs Research released a poll which showed that two-thirds of Americans would have trouble immediately paying an unanticipated bill of $1,000.

This is the price of mass stupidity.

Ellen goofs again

Ellen Brown in the USA and the “Positive Money” people in the UK falsely think that all money is created by banks as loans. They falsely think there is only government borrowing, not government spending. They falsely think the U.S. and U.K. governments have a “debt crisis.”

Since I have often discussed Ellen Brown, I intended to ignore her latest blog post, but I see that it has been reprinted in blogs like Counterpunch, Common Dreams, and so on. So here we go again, correcting her flubs.

 “Print the money” has been called crazy talk, but it may be the only sane solution to a $19 trillion federal debt that has doubled in the last 10 years. The solution of Abraham Lincoln and the American colonists can still work today.

Ellen Brown and her disciples believe in the “national debt crisis” hoax. They also believe that the only time the U.S. government ever created money was during the U.S. Civil War. (Before that, there was colonial scrip, but the USA did not exist at that time.) They say it would be great if the U.S. government created money without borrowing it from banks (which the U.S. government already does).

Ellen Brown believes these falsehoods even though (in this same blog post) she quotes former Federal Reserve Chairman Alan Greenspan, who said in 2011:

“The United States can pay any debt it has, because we can always print money to do that. So there is zero probability of default.”

Ellen was quoting CNBC, which was quoting Greenspan…

For Ellen Brown this does not mean the U.S. government creates its spending money. No, she thinks it means that banks could “pay off” the national debt by increasing the debt (i.e. issuing loans).

A contradiction? Yes of course, but that’s Ellen for you.

In an article titled “Why Donald Trump’s Debt Proposal Is Reckless,” CNNMoney said: The federal government doesn’t have any money to buy debt back with. The U.S. already has $19 trillion in debt. Trump’s plan would require the U.S. Treasury to issue new debt to buy old debt. Trump, however, was not talking about borrowing the money. He was talking about printing the money.

CNN thinks the U.S. government has no money, and Ellen Brown thinks the U.S. government does not “print” money. Both are absurdities. Ellen thinks the “national debt” means that the U.S. government borrows its spending money from banks, and that this borrowed money (plus interest) must be paid back to banks.

Someone once remarked to Warren Mosler that no company wanted to publish Ellen Brown’s book Web of Debt. Mosler responded, “I wouldn’t publish it either. It is full of too many errors.”

Paying the government’s debts by just issuing the money is as American as apple pie – if you go back far enough. Benjamin Franklin attributed the remarkable growth of the American colonies to this innovative funding solution. Abraham Lincoln revived the colonial system of government-issued money when he endorsed the printing of $450 million in US Notes or “greenbacks” during the Civil War. The greenbacks not only helped the Union win the war but triggered a period of robust national growth and saved the taxpayers about $14 billion in interest payments. 

Monetarily sovereign governments create their own spending money, but Ellen Brown thinks they do not. Ellen thinks it would be an “innovative funding solution” if they did.

Ellen quotes the CNN Money idiots who falsely think that

[1] The “national debt” must be “paid off.”

[2] Creating money to “pay it off” would cause hyper-inflation.

Ellen Brown believes the first lie, but not the second.

The reality is that if the U.S. government suddenly spent $19 trillion into the economy, it might indeed cause inflation. Ellen thinks this is not so, as evidenced by the Fed’s “quantitative easing” program. However QE is not the same as pumping money into the economy. QE creates reserves, which is not quite the same as creating money.

Reserves can be spent into the economy if necessary, but reserves usually do not circulate like money does. Reserves are a kind of back-up scoreboard for the money scoreboard. QE adds reserves to banks, thereby giving banks the confidence to gamble in the markets. Indeed, the purpose of QE is to stimulate the financial economy at the expense of the real economy. QE is a stimulus for Wall Street, but not for Main Street. That’s why Wall Street is booming, while Main Street is dying.

CNBC says, “Central banks have been pumping money into the global economy without a whole lot to show for it other than sharply higher stock prices, and even that has been on the downturn for the past year.”

Yes, because the money has been pumped into the financial economy, not the real economy.

CNBC: “Growth remains anemic, and worries are escalating that the U.S. and the rest of the world are on the brink of a recession, despite bargain-basement interest rates and trillions in liquidity.”

Yes, because there is only growth in the financial economy, which sucks all the money and energy from the real economy. The parasite grows at the expense of the host.

Back to Ellen Brown

European economists and central bankers are wringing their hands over what to do about a flagging economy despite radical austerity measures and increasingly unrepayable debt.

Nonsense. European economists and central bankers know exactly what they are doing. They are promoting neoliberalism, which involves austerity, QE, privatization, “free trade” treaties, and so on in order to widen the gap between the rich and the rest.

One suggestion gaining traction is “helicopter money” – just issue money and drop it directly into the economy in some way. In QE as done today, the newly issued money makes it no further than the balance sheets of banks. It does not get into the producing economy or the pockets of consumers, where it would need to go in order to create the demand necessary to stimulate productivity. Helicopter money would create that demand. Proposed alternatives include a universal national dividend; zero or low interest loans to local governments; and “people’s QE” for infrastructure, job creation, student debt relief, etc.

Theoretically the U.S. government could help the real economy by spending more money, but as things are now, the added money would simply be vacuumed up by the Wall Street parasite. The parasite would raise interest rates on mortgages and student loans in order to get the added money. In other words, we need more government spending plus special laws to keep Wall Street from stealing all the money.

While the Fed has stopped its QE program for the time being, the European Central Bank and the Bank of Japan have jumped in, buying back massive amounts of their own governments’ debts by simply issuing the money.


[1] The Bank of Japan cannot be compared with the European Central Bank, since Japan is monetarily sovereign, while the euro-zone nations are not. The Japanese government creates its spending money out of thin air. Euro-zone governments cannot.

[2] The Bank of Japan is not “buying back the government’s debt.” There is no need to. The Japanese government’s “debts” are simply deposits in savings accounts at the Bank of Japan.  When you buy a Japanese Treasury security, your money is essentially held in a savings account at the Bank of Japan. When your Treasury security matures, the Bank of Japan gives you back your money, plus interest. There is no need for the Bank of Japan to “pay off” your deposits. The bank simply gives your money back to you. Or you can leave your money with the Bank of Japan and roll it over for more interest by purchasing more Treasury securities.

[3] The European Central Bank does not issue money to euro-zone governments. What happens is that European banks lend to euro-zone nations. Some euro-zone nations cannot pay back their loans (Greece, for example) because they have trade deficits, and therefore have no money coming in, except for loans. The European Central Bank (ECB) pays off the banks that lent to Greece, and then becomes the creditor. Greece remains in debt, and the ECB demands payment from Greece in the form of privatization and austerity.

One suggestion to jump start the economy is “helicopter money.” Just issue money and drop it directly into the economy in some way. In QE as done today, the newly issued money makes it no further than the balance sheets of banks. It does not get into the producing economy, or the pockets of consumers, where it would need to go in order to create the demand necessary to stimulate productivity. Helicopter money would create that demand. Proposed alternatives include a universal national dividend; zero or low interest loans to local governments; and “people’s QE” for infrastructure, job creation, student debt relief, etc.

True, but again, we would need laws to prevent Wall Street from stealing all the “helicopter money.”

Simply buying back federal securities with money issued by the central bank (or the U.S. Treasury) would also get money into the real economy, if Congress were allowed to increase its budget in tandem.

Again there is no need to “buy back federal securities.” The “national debt” money is given back to depositors when Treasury securities mature.

Instead, we could get money into the real economy via programs like those of the 1930s “New Deal.”

As Dean Baker, co-director of the Center for Economic and Policy Research in Washington, wrote in response to the debt ceiling crisis in November 2010:

“There is no reason that the Fed can’t just buy this debt (as it is largely doing) and hold it indefinitely. If the Fed holds the debt, there is no interest burden for future taxpayers. The Fed refunds its interest earnings to the Treasury every year. Last year the Fed refunded almost $80 billion in interest to the Treasury, nearly 40 percent of the country’s net interest burden. And the Fed has other tools to ensure that the expansion of the monetary base required to purchase the debt does not lead to inflation.”

Dean Baker, like Ellen Brown, thinks the U.S. government borrows all its dollars from banks, China, and taxpayers.

Moreover, to “buy back the debt” would be to give all depositors’ money back, plus interest. There is no need to do this, and it might even be inflationary.

And let me repeat this part, since it warrants an explanation…

The Fed refunds its interest earnings to the Treasury every year. Last year the Fed refunded almost $80 billion in interest to the Treasury, nearly 40 percent of the country’s net interest burden. And the Fed has other tools to ensure that the expansion of the monetary base required to purchase the debt does not lead to inflation.

This is irrelevant. Throughout a given fiscal year, the Fed creates $240 billion out of thin air, as interest paid on saving deposits at the Fed. Savings deposits are created when someone buys Treasury securities. About forty percent of T-securities are purchased by various branches of the U. S. government. Therefore the Fed pays the U.S. government about $96 billion a year.

What does this have to do with Ellen Brown’s blog post? Nothing. The Fed creates $96 billion out of thin air and gives it to the Treasury, which has no need or use for the $96 billion, since the Treasury also creates money out of thin air (about $4 trillion per year).

An even cleaner solution would be to simply void out the debt held by the Fed. That was the 2011 proposal of then-presidential candidate Ron Paul for dealing with the debt ceiling crisis. As his proposal was explained in Time Magazine, today the Treasury pays interest on its securities to the Fed, which returns 90% of these payments to the Treasury. Despite this shell game of payments, the $1.7 trillion in US bonds owned by the Fed is still counted toward the debt ceiling.

Huh? What do you mean “void out the debt held by the Fed”? Simply erase the $19 trillion that various parties (including the U.S. government) have deposited at the Fed? That’s absurd.

Today the Treasury pays interest on its securities to the Fed, which returns 90% of these payments to the Treasury. Despite this shell game of payments, the $1.7 trillion in US bonds owned by the Fed is still counted toward the debt ceiling.

WRONG. The Fed (not the Treasury) pays interest on T-securities. And what is this “the $1.7 trillion in US bonds owned by the Fed”? The Fed doesn’t “own” any T-securities at all. The Treasury creates T-securities, and the Fed auctions them off. The Fed collects the sale money, leaves that money on deposit at the Fed, and then, at an agreed-to time, gives the money (plus interest) back to whoever bought the T-securities.

Ellen is confusing herself more and more.

Get the Fed and the Treasury to rip up that debt. It’s fake debt anyway. And the Fed is legally allowed to return the debt to the Treasury to be destroyed.

Huh? Rip up depositors’ money? Destroy it? What for? How would you like to open a Fed savings account by purchasing a T-security, only to have your deposited money destroyed, or given to someone else?

Incidentally the national debt (i.e. depositors’ money) is not fake. What’s fake is the “national debt crisis.” There is a “national debt,” but there is no “crisis.”

The U.S. government has no crisis, since the government creates its spending money out of thin air. The Fed has no crisis, since the Fed creates money out of thin air to pay interest in T-securities, and also since the Fed is simply holding deposits for people who buy T-securities.

The right of government to issue its own money was one of the principles for which the American Revolution was fought.

It’s called monetary sovereignty, which the U.S. government still has. Ellen Brown thinks that only banks have monetary sovereignty. That is true in the euro-zone nations, but not in the USA.

In the USA, banks lend money, and they collect interest, but they do not do what monetarily sovereign governments do. Banks do not police counterfeiters, or levy taxes, or influence the federal budget, or make laws regarding money.

Americans are increasingly waking up to the fact that the vast majority of the money supply is no longer issued by the government but is created by private banks when they make loans; and that with that power goes enormous power over the economy itself.

Most of the money in the U.S. economy is indeed created by banks as loans, but the U.S. government also creates $4 trillion a year, and not as loans. Ellen Brown falsely thinks the U.S. government borrows that $4 trillion from banks. She thinks that banks create all the money except for coins and currency notes (which are not money, but can be used as money; coins and notes only represent money).

Ellen Brown has these false ideas because she believes the lies told by the Bank of England.

Bank of England: The amount of money created in the economy ultimately depends on the monetary policy of the central bank.

No. The money supply is also affected by the fiscal policy of the federal government. That is, the money supply is also affected by government spending.

Bank of England: In the modern economy, most money takes the form of bank deposits. The principal way that deposits are created is through commercial banks making loans.

Deposits are also created by government spending. For instance, Social Security benefits are directly credited to recipients’ bank accounts. The benefits create deposits.

Bank of England: Monetary policy acts as the ultimate limit on money creation.

Wrong. There is no limit on U.S. government money creation.

This nonsense appears in a quarterly bulletin from the Bank of England that is fourteen pages long. Nowhere does the bulletin mention government spending or fiscal policy.

For Ellen Brown, such garbage is gospel.

The issue that should be debated is one that dominated political discussion in the 19th century but that few candidates are even aware of today: should creation and control of the money supply be public or private?

At present it is both public and private. Government money creation is public. The creation of loans by banks is private.

Ideally all money creation should be public. There should be no privately owned banks, since they are necessarily obsessed with profits. Money should be treated like a public utility. It should be treated as necessary for modern life, but should not be the goal, purpose, and meaning of life.

Anyway the whole point of Ellen Brown’s post is that we should let the U.S. government create money, which of course, it already does.

The genius of Obama

freaks 34a

Imagine you’re Obama. You have not kept any of your campaign promises, and you have lied non-stop. You accepted a Nobel Peace Prize, only to launch new wars of aggression that destroyed Libya and Syria. You also escalated the 15-year war on Afghanistan, Sudan, and Somalia. You also assisted the Saudi war on and Yemen, which is an escalation of your own war on Yemen. You decreed that you can assassinate any U.S. citizen at will, and imprison any citizen for life without charge or evidence. You refused to prosecute or even charge any Wall Street bankers. You enacted Romney-care in order to check-mate Universal Medicare.  You imposed gratuitous austerity on the middle and lower classes. You sponsored coups in Honduras, Paraguay, and now Brazil.

And now, in addition to all of this, you are preparing to reduce mankind to being slaves of the bankers and corporations via TPP, TTIP, and TiSA.

However the peasants are restless — or at least the younger ones are restless. The younger ones understand what you plan to do to them. Your “free trade” treaties are so horrendous that younger citizens might actually become a complication.

What to do?

Simple: make the peasants attack each other, so that they forget about your campaign to enslave them. Order all public schools in the USA to let males use girls’ restrooms and showers, even if the males are registered sex offenders. Decree that American society shall accept sexual deviancy as normal, and sexual normalcy as deviancy.

freaks 30

Your edict does not have the rule of law, but you can blackmail 360 million people into submission by threatening to withhold federal dollars from any middle class or lower class school that fails to obey your decree.

The more that society gives to the freaks, the more they demand, thereby distracting everyone while you enslave them with your TPP, TTIP, and TiSA. Freaks are your storm troopers.

Your assault is aimed at the peasants. You would never order the White House, or a millionaires’ country club to have transgender restrooms.

The beauty of this scam is that it makes the peasants righteously support their own enslavement. The peasants cannot stop Wall Street, or unemployment, or inequality, or endless war, or Israeli atrocities — but by god they can champion special rights for sexual deviants!

freaks 31

None of this has to do with equality or human rights. It’s about keeping the peasants divided and bickering while you impoverish and enslave them. It’s about widening the gap between the 1% and the 99%. It’s about using a liberal agenda to promote a neoliberal attack.

Obama’s secretary of Education, John B. King, says, “No student should ever have to go through the experience of feeling unwelcome at school or on a college campus.” Unless, of course, a student is poor, in which case he is not welcome anywhere in Obama’s neoliberal society.

King says everyone should enjoy an environment free from harassment and violence. Unless people are poor and black, in which case they are thrown into prison.

Still, what is mass incarceration, endless war, and global climate change, compared to real issues, like letting boys use girls’ showers and restrooms?

freaks 27

Obama’s edict says that any male who wants to use women’s restrooms or showers can do so without presenting a medical diagnosis. All school districts must obey, even though the edict makes normal people uncomfortable. So much for equality. Once again we see that the deviants don’t want equal rights. They want special rights. And they are always in our face, demanding more. They are extremely hostile, as freaks and deviants always are. They are tools for rich people and their puppets (e.g. Obama) to promote social divisiveness, which permits financial inequality.

freaks 35

Anyone who questions the wisdom of letting men use women’s restrooms and showers is attacked. It’s almost as bad as being called an “anti-Semite.”

freaks 36

Finally, here’s a little item from yesterday in the Chicago Tribune.

A Chicago man is accused of strangling an 8-year-old girl unconscious inside the women’s bathroom of a restaurant. He then picked up the unconscious girl and carried her into a bathroom stall, closing the door so she couldn’t leave. When the girl’s mother came to rescue her, the man pushed her.

What if that was your own daughter? Would you be so eager to champion these creeps? What if that was Obama’s daughter?

The more helpless and alone we collectively feel, the more we distort ourselves in a futile attempt to imagine that we are not helpless and alone. After all, we are free to be mutants.

freaks 37

A hypothesis

Alan Greenspan admitted on national TV that the U.S. government can never go broke, and can pay any debt, simply by creating money. Why does the truth not wake anyone up? Here is one possible explanation…

Let’s use the Washington Post as an example.

cognitive 00

The Post says this…

Trump explained — correctly — that because the U.S. government prints its own currency, the U.S. government will never have to default on its debt. The government can print more money to repay the debts, which would cause inflation but not a default.

That’s a true statement, except for the inflation part. In the next paragraph the Washington Post says this…

Since the federal government operates at a deficit, any repurchases if government debt would have to be funded through borrowing, and that money would have to be borrowed at an increased interest rate, canceling out any savings.

Thus, the Washington Post says the U.S. government “can print more money to repay the debts,” and also that the government is forced to borrow to “repay the debts.”

This is a contradiction, and it is deliberate. The most effective lies don’t conceal the truth, or deflect attention away from the truth. Instead, they use contradiction to create cognitive dissonance, in order to generate an emotional response that the liar can control.

Wikipedia defines cognitive dissonance as “the mental stress or discomfort experienced by an individual who holds two or more contradictory beliefs, ideas, or values at the same time, or who performs an action that is contradictory to one or more beliefs, ideas, or values, or is confronted by new information that conflicts with existing beliefs, ideas, or values. A person who experiences inconsistency (and thus dissonance) tends to become psychologically uncomfortable, and is motivated to try to reduce this dissonance.”

Reducing the dissonance involves an emotional process of bundling, labeling, and shelving.

EXAMPLE 1: Every shred of evidence proves that 9-11 was an inside job. (A false flag attack.) For many people the conflict between obvious truth and government lies causes cognitive dissonance, which people cope with by dismissing the truth as a “conspiracy theory.” This lets people wrap up their cognitive dissonance in a convenient mental bundle so they can forget about it. The greater the contradiction, the greater is the urge to justify it with a bullshit label.

EXAMPLE 2: Most people believe that the U.S. government is “bankrupt.” People also admit that the government can “print” endless dollars. This contradiction creates cognitive dissonance, which people deal with by wrapping the contradiction in a mental bundle that they label with words such as “entitlements,” or “unsustainable,” or “hyperinflation,” and so on.

cognitive 01

The irrationality of the person on the left is exceeded only by his certainty that he is logical and correct, and that his garbage is “common sense.”

The skillful liar understands this. He controls people by using contradiction to create confusion and cognitive dissonance, and then he offers a label that the listener can use to irrationally resolve the cognitive dissonance.

cognitive 02

Clergymen understand this principle too. If a clergymen presents his dogma in a clear, coherent, and logical manner, he will cause others to ask for proof of his claims. But if he offers gibberish and contradictions, he sounds more convincing.

cognitive 03

In short, the skillful liar knows that he will be exposed if he presents only lies. Therefore he presents contradictions. He controls people’s minds not by lying, but by issuing contradictions, and then controlling how people resolve the contradictions. The more he issues self-contradictory garbage, the more his garbage is emotionally perceived as “truth.”

The Greenspan quote does not wake people up, since it contradicts the endless propaganda that the U.S. government has a “debt crisis.” The truth creates cognitive dissonance, which people resolve with emotion-laden bullshit.

As a result, people remain impoverished and enslaved.