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Obama Administration Seeks to Appease the Austerity Gods

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United States Note - an example of debt-free money by Wikipedia

The Obama Administration says their budget that reduces Social Security payments with the "Let them eat Cat Food" Chained CPI is "about reducing the deficit in a balanced way that economists say is best for the economy and job creation."  

Well, as the Washington consensus only understands debt-based money it is simply impossible for all of these things to be true at once, though it does make a swell soundbite!  You CANNOT reduce the deficit in an economy that is already teetering on contraction - and IS mostly contracting for the bottom 90% of people - without killing job creation and the economy.  We are seeing it already in the asset markets today, as it anticipates the double growth whammy of sequestration and the payroll tax hike (a tax on working people).

Of course, if the President, or his sycophant advisers, had any knowledge of history and any imagination, they would do something like what another Illinois president did, Lincoln, and create debt-free money out of Treasury directly. Even though the Constitution only gives Congress - and BTW, not a Central Bank - the power to "coin Money" (Art. 1, Sec. 8), there are reasons to believe that the president, under certain unconstitutional conditions like the debt ceiling, could instruct Treasury (a part of the Executive branch) to "coin Money" (capitalization in the original article) too. See here for how.
Almost daily, more mainstream economists are arguing for direct debt-free money creation (we have a fiat money system, after all, so money is not something we can "run out of", as the trillion dollar/year QE of the Fed, good mainly for creating asset bubbles, demonstrates). See Adair Turner, the UK Financial Services Administration chair's recent speech here and this article about British Chancellor George Osborne as well as organizations like the UK's Positive Money group and America's American Monetary Institute, which, until recently, had Rep. Dennis Kucinich to sponsor its plan: HR2990, or even Obama's Transportation Secretary, then Congressman, Ray LaHood's plan to fund highway construction with interest-free United States Notes (the original legal tender under Lincoln): HR1452 (1999).

Until we break free of the debt-free money tyranny of the financial terrorist banking system, we will never pay off our debts, and the interest payments will go to enrich an already obscenely wealthy rent-seeking class at the expense of the productive classes.  As Margaret Thatcher would say, though completely misapplied in her case, TINA - There Is No Alternative...to creating debt-free money.
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http://newthinking.blogspot.com/

Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a blogger for Huffington Post, Daily Kos, and Global Economic Intersection.

His anthology of updated Opednews articles "America is Not Broke" was published by Tayen Lane Publishing (March, 2015) and may be found here:
http://www.americaisnotbroke.net/

Scott is former President of Common Ground-NYC (http://commongroundnyc.org/), a Geoist/Georgist activist group. He has written (more...)
 

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