Richard Rowland wrote:
Did anyone watch the Mark Liven show last night, he and a guest discussed the downside of Single Payer health care. I was focused on writing an email to a friend but picked up on a few things. One was the income hit doctors would take. Another, I thought strange, is that the government now, or in the future, I didn't catch everything regarding that point, limits the number of students allowed to study medicine.
What was really troubling was hearing how they would manage cost by not treating people, and the horrendously long waits to be treated if one was allowed to receive treatment. Of course, those officials who are pushing this nonsense would have a separate system of care for them and theirs.
Unfortunately, the folks who should have been watching the program probably weren't.
Did anyone watch the Mark Liven show last night, h... (
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DEFICIT SPENDING IS THE FOUNDATION OF OUR PROSPERITY
Imagine two neighboring nations, each trading only with the other. Their mutual trade balances, equal but of opposite sign, sum to zero. A third nation joining the pair would have a trade balance with each, equal but of opposite sign, so that the three trade balances must also sum to zero. Now, consider as three separate accounting entities “trading” only with each other: our federal government, the foreign sector, and our domestic private sector, in which state and community governments function economically as ordinary private firms that serve paying consumers. The sum of these three “trade” balances exactly equaling zero gives us (after algebraic manipulation) the following valid equation:
Annual Federal Budget Deficit = Annual Trade Deficit + Annual Domestic Private Net Savings
showing that our consumption (a prime correlate of trade deficit) and our savings, both the definition, cause, and measure of our prosperity, vary directly with our Annual Federal Budget Deficit. Hence, our prosperity varies directly with Congress’ Deficit Spending, more accurately named: After-Tax Savings.
So, how can we maximize the quantity of money entering Private Savings Accounts? To maximize prosperity, we must maximize Deficit Spending, which needs maximization of Congressional Spending (created out of thin air!), which needs minimization of inflation, which needs maximization of discretionary income tax revenue combined with minimization of non-discretionary income tax revenue, a combination which needs steeply progressive tax brackets.
Such vastly increased Congressional Spending (on much-needed Federal Infrastructure!) would vastly increase After-Tax Savings (trumping any increased tax revenue!), Private Bank Accounts, Private Real Assets, and cash for Private Equity (corporate stock) and Private Debt (corporate and municipal bonds). Prosperity would be as rampant as after workers cashed in the War Bonds that were financed by huge deficit spending during World War II!
Deficit Spending creates Federal Debt as an accounting gimmick* that avoids upsetting the Fed’s bank reserves and its important federal fund interest rate but scares deficit hawks. That scare can be avoided by a better gimmick: have the Fed buy the debt directly from the Treasury. Starve the bond vigilantes!
Maximum prosperity also needs minimum money outflow from Private Bank Accounts via fees and taxes paid to state and community governments for Privately-Owned Infrastructure. Since any infrastructure failure can affect defense, Congress, responsible for defense, should pay for all infrastructure! Just as Federal Infrastructure is financed exclusively by Congress, so can it also pay for state and community Infrastructure (even pot-holes!) and all the federal trust funds, eliminating payroll taxes! With such payments, Congress would eliminate Municipal Bonds and stop taxing state and community residents who, forever renting Privately-Owned Infrastructure, pay more than double the construction costs.
Unburdened from those expenses, domestic private wealth and prosperity would surge to new heights. Voters must now tell Congress: maximize Congressional Spending and pay for all of our infrastructure!
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http://www.levyinstitute.org/publications/can-taxes-and-bonds-finance-government-spending ©2019 Marvin Sussman. All rights reserved. Search YouTube for Marvin Sussman!