It's All Your
Fault, Part II
©30 June, 2011
We're all familiar with the refrain by now: "There's
no money. Revenues have all dried up; we need to cut, cut deeper and
cut again into government spending, and (of course), lower taxes on the
ruling class. Obviously, we must also privatise Social
Security if it is to survive at all. We cannot afford any kind of
health care reform. What else can we do? What do you
do when you lose
revenue? That's right: you make
cuts and scale back. Government must do the same, least we bury future
generations in a tsunami of debt".
The logic seems firm and unassailable: don't spend
beyond your means. The logic seems
unassailable because it is,
rather the premise it is based on
that's faulty. A neat propaganda trick: get them to say "yes" by
presenting them with a fact that is unquestionably true, (in this case
the premise that spending money you don't have can be risky) and it's
much easier to get them to keep believing (and saying yes to)
everything that follows. Stated another way, postulating truisms at the
start is a great
way to insure
that they'll never think to question what follows.
It's quite true, cuts are one of the best ways to
respond to diminished revenue. Except
that we don't have diminished revenue. There is not one penny
less money around now than there was when things were going well. Not
one red cent less.
Probably because so many other things
in our lives
are consumable, we
think of money that way also. "I
lost $156 in a poker game last Saturday night, or I lost $275,000 in
the stock market. Just as food or fuel is consumed and ceases
to exist in its original form
and vanishes, it is easy to perceive of money as consumed if we don't actually stop to think about
it. The fuel you burned is gone, but that $156 you lost in the poker
game last Saturday is now in someone
you lost in the stock market is by no means non-existent: you no longer
have it, but someone else does. The point is, that money
still exists. To be clear, in that last example, I am talking
about real money: If you buy a share of stock at $5/share and it rises
to $500/share and you sell it, you made $495. If you hold it and it
crashes, and you sell it off at $5, did you lose $495? No. You broke
Let's return to the question I asked in the first
part of this series: Where did the money go? Pause and think about that
for a bit. Was it destroyed? Did, (for example) the Army load it into
boxcars, drag it out to the middle of the desert and burn it? Did
little green men from outer space vaporise it with their ray guns? I'm
goofing around a little, but do
you have any
explanation as to how those physical dollars could have been destroyed?
The answer to all these questions is no. The inevitable conclusion is
that if the actual, physical dollars were not somehow destroyed, (they
were not) then
they still exist, (someplace) and
amount of total wealth therefore remains the same, regardless of recessions, depressions or
plain old hard times.
It Had To
If we accept the postulation that the money was not
destroyed, and we can see that it is no longer "here", we can only
conclude that it went somewhere else. The trick now is to divine just
"somewhere" is. Here is another joyful opportunity to hoist Rush
Limbaugh by his own petard. He always told us to "follow the money",
didn't he? Yes, but I don't think he wants us to explore this
particular trail. Let's take a look at some of today's conditions and
analyse them a bit.
and Massive Unemployment.
The value of labour diminishes as the
supply far exceeds the demand. Jobs are cut (or rather sent overseas)
and those who are working get pay cuts. The money flows upward.
You and/or the bank may come out with less than
you started with,
but again, that wealth didn't just disappear: it was paid to the seller
who sold the house to you. In other words, regardless of how much money
you or the bank may end up losing, it has no effect on the total
of wealth, but don't worry about the bank. It will add extra interest
and fees and foreclose, or get bailed
out by the
government. Or both. The
(And guaranteed C.E.O. bonuses) for the very
banks that are turning you out to the street. What a deal! Your tax
dollars contribute to the bonus of the C.E.O. who's bank is
dispossessing you. It's a sweet deal, all right, it's just not sweet for you.
Wall Street got a nice, soft, cushy landing and you paid for it. Your derrière hit the pavement.
Hard. The money flows upward.
These come in three delicious flavours:
tax breaks for sending jobs overseas,
pay no taxes at all, or
pay no taxes at all and get
a (multi-billion dollar) "refund" cheque!
Could it possibly get any better than that? Just
where on the form 1040
is the option box you check to: "pay
no tax and receive a multi-billion dollar "refund" "?
me; I just can't find it. Oh, and by the way, is this the sort of
"wasteful government spending" that Republicans want to eliminate? Hell
Choose whatever flavour you wish but: The money flows upward.
Record profits, billions in gifts
from the government every year, and
it still isn't enough! The
money flows upward.
For The Rich:
A Republican for-the-rich-only
tax cut is in their 2012 budget. The money flows upward.
Public resources are sold to private firms for a
pittance. The money flows
services you once received at cost (through taxes) are now sold to
you at cost plus profit plus C.E.O salaries and bonuses. The
money flows upward.
Unions created the middle class by fighting for fair
wages and hours, workplace safety, pensions and medical coverage. As
such, they are the only major organisations dedicated to the well-being
of workers. No, they are not perfect, (what human organisation is) but
would you rather return to a five dollar per 112 hour, 7 day work week?
Which, by the way, works out to seventy-one cents per day or 4.5 ¢
If you are middle class, chances are that your
parents or grand parents
belonged to a union, (or worked at a shop that had to improve its
conditions to match those of its unionised competitors) making it
possible, for example, to send their children to
Effective propaganda causes people to whole-heartedly endorse
positions, policies and politicians who work against their own best
interests. The right has scored a major victory
workers that unions are to blame for current economic conditions. Don't
fall for it; ask not why the union guy makes so much, but rather why you make so little.
Remember, the ruling class considers the middle class to be created
with wealth stolen from them.
They want it back.
Weaken unions and: the money
Wall Street Non-Regulation:
Wall Street demands the right to do whatever it
wants, whenever it wants to whomever it wants. Speculators, (just one
example) are parasites on the public well-being who serve no useful
purpose except to themselves. They artificially drive up prices on most
of what we consume, in effect, driving our incomes down. The money? (you guessed it)
Any tax that is not based on your ability to pay is
rapacious and tyrannical while punishing people for being poor and/or
falling upon hard times. I'm thinking of property tax here. How is it
justifiable that the government should steal your home because you lost
Vilified as the I.R.S. is, at least they are fair
enough to lower your tax as your income falls. Should your income drop
below a certain level, you owe them nothing at all. Property tax,
however, is based on an arbitrary "assessed value": an imaginary amount of money that you
don't have, and may never get. Once you've paid your tax for the
year to the I.R.S., you're done. You
never pay tax on that money again. Property tax will tax you
again and again on that imaginary
money that you don't have. Property tax forces folks who have
already hit hard times into homelessness.
If these local taxes were income based, this could
never happen. When any government demands a tax that is not based on
your ability to pay, they are robbing you of your wealth and security.
As newly impoverished people are forced from their homes, guess
what?The money flows upward.
Of, By And For The Lobbyists:
Ever wonder why big corporations and the ruling
class always seem to get just what they want? That's easy. They pay the
campaign bills. They want laws written to favour them, and they
get them. It's the guy who signs the
cheque that always names the tune. The money flows upward.
For example: want
alternative energy? Well, Exxon does not. Since they are paying the
campaign bills, (and will, thanks to the Supreme Court, be paying more
of them), don't expect anything more than a token alternative energy
programme until the last practical
drop of petroleum is gone.
If we want government that serves our needs, we have to sign the cheque, and
that's called public campaign financing: no private money, no corporate
money, and no money of your own. Everyone gets the same amount for the
same office. Some side benefits: a level playing field, candidates who
are beholden to no one but their constituents and the opportunity to
run for public office becomes available to everyone.
I have attempted to illustrate how the money flows
upward and why (that)
although there seems to be no money around, there is, in reality, no
less of this resource now than there was before this depression.
that public campaign financing is truly the most important issue before
us today, the one issue that affects everything
else, the only solution to the
über-capitalism that will make peasants of us all.
Unless the upward flow of wealth is reversed, we will see nothing but
the dawn of the New Feudalism; the return of the basic two-class
society, consisting of the very rich and the very poor. By the way,
want to guess which one they have in mind for you?
Should money be considered a public resource?