14 May 2013

Russia Today (owned by ANO TV-Novosti in Russia) is as full of baloney as is the Western corporate media. I see this constantly, which is why I carry my rubber stamp at all times.

In the item above, we read:

As Europeans become increasingly outraged with draconian cuts at home, officials have started to speak about the need to ease the austerity measures. Now the question is how to come up with a middle ground between cuts and economic growth.

BOOM! There goes my stamp.

First of all, euro-zone officials have not “started to speak about the need to ease the austerity measures.” On the contrary, they continue to impose more austerity. They have no choice, since their governments must borrow all their money from Troika bankers and Germany (or else they must sell bonds, which is basically the same thing).

When “austerity” became a dirty word, the bankers and politicians switched to euphemisms like “fiscal consolidation.” Hence, austerity is indeed over, but fiscal consolidation (i.e. austerity) continues to accelerate.

Second, there can be no “middle ground between cuts and economic growth.” If you must borrow all your money, then you will go deeper into debt forever, which means negative growth, i.e. a depression with ever–accelerating debt and poverty. It’s like using one crrdit card to pay other. Your debt just keeps expanding.

The RT article even talks about politicians having a “dilemma” between cutting and growing! There is no “dilemma.” The path is clear. Since euro-zone nations no longer create their own money, they are compelled to keep cutting, and the only thing that’s growing is debt, poverty, and the wealth gap between the rich and poor. The one exception is Germany, since Germany issues the euros, and has a trade surplus with the other euro-zone nations.

There’s plenty more bullshit in the RT article above, but I’ve already used my quota of red ink for today, and I need to ration what little I have left.

http://rt.com/business/european-union-austerity-growth-950/

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WHY THE LIES WON’T DIE

The lies are not sustained only by rich people, politicians, media morons, and mainstream economists.

The lies are also sustained by average people. Everyone at all levels uses the lies for his own purpose. That’s why the lies won’t die.

For example, in the above blog post, the author wants to condemn the US-led campaign to destroy Syria.

The Syrian civil war appears stalemated. The cautious US President Obama seems reluctant to get US forces involved in a Mideast ground war – and for good reason. The US military is dangerously stretched across the globe and the US Treasury runs on money borrowed from China and Japan.

Okay, so if the US Treasury runs on money borrowed from China and Japan, then you should welcome increased austerity, and therefore increased poverty, right? Thank you for your support.

The masses are so brainwashed that even when they purport to call for peace or justice, they actually support the lies that keep them enslaved and impoverished.

http://ericmargolis.com/2013/05/a-welcome-pause-in-the-craziness-over-syria/

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Aljazeera (owned by the Emir of Qatar) is so full of lies that I never read it, but today I noticed a foul stench in my room. Looking everywhere for the source, I found it in the above article by Dean Baker.

By now almost everyone knows of the famous Excel spreadsheet error by Harvard professors Carmen Reinhart and Ken Rogoff. It turns out that the main conclusions from their paper warning of the risks of high public sector debt were driven by miscalculations.

Spreadsheet error? Miscalculations? Everyone knows that Reinhart and Rogoff intentionally LIED. They faked their so-called “data” to make it justify gratuitous austerity. To call it a “miscalculation” is to live in denial. A lot of blogs do this, even MMT blogs. The blog below says that Reinhart and Rogoff “flubbed.”

Anyway, Dean Baker (who calls himself an “economist”) commits other errors like this…

The only argument left against government deficits is that it could raise interest rates by crowding out private investment. This argument can easily be shown to be ridiculous; there will almost certainly not be any crowding out in the economy now. Interest rates will likely remain very low even if the government undertook a major investment program.

Baker does not clarify what he means by “interest rates.” He seems to think that interest rates in the USA are entirely subject to “the markets.” I shall correct him.

Some interest rates are subject to indexes like the LIBOR, but most interest rates in the USA are driven by the Federal Reserve’s prime rate and overnight rate. The Fed chooses whatever interest rate it wants to charge, and everyone down the line adjusts accordingly. There are slight variations between lenders (e.g. mortgage companies) but the Fed rates are the benchmark rates. No one chooses these rates for the Fed. The Fed chooses the rates itself.

To his credit, Baker understands that the “national debt” is mainly “owed” to ourselves.

Government debt (bonds) will be passed on to future generations. Future generations will not just owe future debt; they will also own future debt. The burden of the debt will be money that Americans are paying to themselves. How can that make them poorer?

Correct, except that no American “owes” a single penny on the national debt, or will ever have to pay a penny on this debt. The Federal Reserve pays interest on T-securities (only some of which are bonds. Mr. Baker) using money created out of nothing, on the Fed’s keyboard.

When you buy a T-security, you essentially open a savings account with the Fed.  Let’s buy one million dollars worth of Treasuries, so we can see how this works. Pay attention, because this is complex. (Not.)

Thus, the “debt crisis” is a totally fake chimera. No American “owes” it. To call it a “crisis” is to flat-out LIE. Dean Baker (an “economist”) does not understand this.

Then Dean Baker commits more errors…

China is able to buy up government debt because it has a trade surplus with the United States of roughly $300 billion a year. As long as it has a $300 billion trade surplus, China can buy up government debt, regardless of whether or not the government is currently running a deficit. If the government is not currently borrowing, then China could just buy up government bonds in the secondary market where hundreds of billions of dollars of government debt are bought and sold every day.

Wrong! The U.S. government never needs to “borrow,” since the government creates its own money by changing the numbers in computers. (Nor does the US government rely on tax revenue, or even use tax revenue). The Treasury sells T-securities by choice, not necessity. Therefore China does not “buy up US debt.” The Treasury simply sells T-securities to China, using the Fed’s OMC. The Fed is necessary because money cannot exist without a bank (i.e. without some place that keeps the computerized score).

Dean Baker again…

Even though our debt burden is relatively large, because interest rates are extremely low, the interest burden is not.

Wrong! There is no “debt burden” from the sale of T-securities. You saw the process graphically illustrated above. Was that a “burden” on you?

Baker commits many more errors, but I will ignore them. My point is this: he wants an end to austerity, but when he makes false statements, he leaves the door open for politicians to impose more austerity, by harping on the (non-existent) “debt burden.”

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The above article earned a bullshit stamp right from the start:

The deficit is shrinking quickly, and–as evidenced by today’s super-low interest rates–the bond market is not worried about our ability to maintain our debt load over the long haul.

The “bond market” is irrelevant, since the Fed chooses its interest rates, irrespective of any bond market. The “debt load” is trivial, since the “national debt” is also a national asset.

When customers deposit money in a bank, they lend that deposited money to the bank. They become creditors. The bank considers that debt to be an asset. The more debt (assets) the better.

Over the long-term, if we don’t get our health care and military spending under control, we will face a big deficit problem. But we don’t today.

That’s the Paul Krugman “deficit dove” bullshit. We must have austerity, but not this minute. WTF? Austerity is always bad. ALWAYS, since it removes money from the economy, thereby causing recessions. Austerity is as bad tomorrow as it is today. The date is meaningless.

The article also discusses the debt-to-GDP ratio. This is crucial for euro-zone nations, but utterly meaningless for nations that create their own money, like the USA. (That’s why the article got the certified stamp, in addition to the bullshit sticker.)

You can chill out a bit about the federal budget deficit. As this chart from BCA Research shows, it’s getting better fast. 

Nonsense. The government’s deficit is the public’s surplus. (They match exactly, to the penny.) Therefore, the smaller the deficit, the smaller our surplus, and the closer we come to a depression. That means the economy is “getting better”? Bullshit!

http://www.businessinsider.com/the-deficit-is-shrinking-fast-2013-5?op=1

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In the above article we read:

Australia’s economy is hitting a brick wall after 21 straight years of uninterrupted growth, and this will be made apparent on Tuesday when Canberra unveils its annual budget, which will likely show a big deficit and could risk the country losing its coveted triple-A rating, said experts.

Australia is Monetarily Sovereign, which means it creates its own money, which means it can pay any debt or bill, no matter how huge, simply by changing the numbers in computers. Therefore if a corrupt ratings agency (e.g. Standard & Poor’s) downgrades Australian T-securities, it will be utterly meaningless.

At the moment, Australia deficit is increasing, because Australian politicians have not (yet) imposed gratuitous austerity on their voters. (Austerity meaning tax increases and spending cuts.) US austerity has reduced US demand for goods from China, which has reduced Chinese demand for mined goods from Australia. Thus, tax revenue is down in Australia (not that the government needs tax revenue.)

Therefore the Australian government’s deficit has increased from $10 billion last   fiscal year (June 2012 – June 2013) to a projected $17 billion for this financial year (June 2013 – June 2014). And that’s a good thing.

Unfortunately, right-wing Australian politicians (puppets of the rich) will use the growing deficit as an excuse to impose austerity on the Australian public. Even though Australia’s government can create limitless money, simply by changing the numbers in computers, politicians will say, “We’re broke. Therefore you must have austerity.”

Andrew Robb of the Liberal Party is already saying this. Robb is Shadow Minister for Finance and Deregulation. A “shadow minister” is someone who is part of the “shadow cabinet,” a collection of MPs in the opposition party, each of whom heckles the real (actual) minister in every branch of Australian federal government. Mr. Robb is extremely right-wing and pro-austerity, and he is hoping to steal power from the current Prime Minister, Julia Gillard. Mr. Robb of the Liberal Party says of his opponents (the Labour Party) that, “They have spent in a reckless way and now the chickens are coming home to roost. Most commentators, business people and everyone else feel that this government has lost control of the government’s finances.”

Total bullshit, of course. The Australian government can create and spend all the money it wants, with no problems whatsoever. However, since the deficit has increased, Mr. Robb will use this as an excuse to impose austerity, thereby plunging Australia into a depression.   This will make the rich even richer, since a depression simply means the disappearance of the middle class, and a widening of the gap between rich and poor.

http://www.cnbc.com/id/100733673

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The above article got only a small bullshit stamp, because it’s so awful that it didn’t even merit the waste of red ink.

There is little doubt that the enormous national debt will have a potentially devastating long-range impact on the U.S. economy — on our grandchildren’s generation.

Bullshit! The US Treasury sells T-securities because is chooses to, not because it has to. As for having a “devastating impact,” politicians have been screaming, “The sky is falling!” for decades. It’s all lies. The US government can pay any debt of any size, any time, simply by changing the numbers in computers.

When interest rates begin to rise again, as expected, the annual amount of interest paid on the existing debt will exceed $1 trillion.

The author is a brain-damaged community college teacher who has no idea what interest rate the Fed will choose, and doesn’t care. He thinks that Fed interest rates are set by “the markets.” (He sounds like a gold trader. All gold traders are notorious liars and hucksters.)

A significant majority of leading economists agrees that the elimination of the national debt can only be accomplished through austerity. As ridiculous and frustrating as it sounds, our government has been unable and/or unwilling to develop such a plan.

Don’t you love it when morons claim that “everyone agrees with me?” By the way, Mr. Moron, the U.S. government has been imposing severe austerity, as proven by the plunging federal deficit. That’s why the depression continues. You want to make it worse.

There’s much more sewage, but it’s too nauseating to wade into any further.

http://www.mcall.com/opinion/yourview/mc-balanced-budget-amendment-national-sales-tax-fi-20130513,0,4926093.story

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The idiot at left is Richard Swett, former US Representative from New Hampshire, and former US ambassador to Denmark.

The clown in the middle is Judd Gregg, Republican, former governor of New Hampshire and former US Senator from New Hampshire. Gregg is a co-founder of “Fix the Debt,” a club of rich little maggots who want more wealth for them, and less for you.

The twit at right is some nobody with an ugly shirt and gauche necktie who dreams of basing his career on shilling for the rich, like Reinhart and Rogoff, or like Niall Ferguson.

All of them wear their “LIAR” buttons so proudly that I didn’t need my BULLSHIT stamp. (Thanks, guys.)

The two congressional has-beens are seen here at Dartmouth College in New Hampshire, helping to launch the Dartmouth chapter of “The Can Kicks Back,” a Pete Peterson-funded campus program to promote austerity, based on lies about the “national debt.”  And austerity, of course, has only one purpose, namely to widen the wealth gap.

Judd Gregg says that “the U.S. debt is unsustainable.” He says the USA is on its way to becoming bankrupt like Iceland, Greece and Ireland. Evidently he has advanced Alzheimer’s disease, since Iceland is not even part of the euro-zone, and is therefore not bankrupt. And if he’s worried about the federal debt being “unsustainable,” then why doesn’t he ask the Treasury to stop selling T-securities? It wouldn’t make any difference in the US economy.

Gregg wants to cut or eliminate social programs, saying: “If you’re under 21, you’ll have to pay close to $200,000 to pay off the sovereign debt.”

Of course, no one will ever have to pay ONE SINGLE PENNY on the national assets. (Or “national debt” if you prefer.)

It would be rude and uncouth of me to brazenly call Mr. Gregg a liar. Therefore I will politely call him a worthless-piece-of-shit-lying-asshole.

http://thedartmouth.com/2013/05/14/news/gregg

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