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The USA is not in debt
I have discussed this in previous posts and comments, but the masses continue to remain brainwashed.
Consider this article titled, “U.S. Government's Foreign Debt Hits Record $5.29 Trillion.”
“The money the U.S. government owes to foreign entities rose to a record $5.2923 trillion in June, according to data released by the U.S. Treasury on 15 Aug 2012. In May 2012, the U.S. Treasury owed $5.2581 trillion to foreign entities. In June the U.S. government borrowed an additional $34.2 billion from foreign entities in order to fund U.S. government operations. The U.S. government’s indebtedness to foreign interests has grown by 72.3 percent during Obama’s term in office. Entities in the People’s Republic of China remain the largest holders of U.S. government debt. Entities in Japan, however, are on track to eclipse the Chinese as the top holders of U.S. government debt.”
Sounds grim, yes? The US government is $5.29 trillion is debt to foreigners, right? The US government is insolvent, and could go broke, right?
It’s all a lie, designed to fool you into believing that the reasons for “austerity” are legitimiate. Austerity means cutting social programs, and withdrawing money from the economy, in order to maintain the depression, so that the One Percent may rule as gods.
When foreigners buy $5.29 trillion in Treasury bills, the foreigners have simply invested that money in the US government.
If you started a corporation, and you raised $5.29 trillion in proceeds from the sale of stock, then you would not be $5.29 trillion in “debt.” Instead, you would say that investors have bought $5.29 trillion in your company’s stock. You have collected $5.29 trillion from them.
With Treasury bills, the government must give the money back to buyers when they demand it (and also give them interest if the bond has matured), but a monetarly sovereign government like America’s can just print the money. Or it can sell Treasury bills to Agent ‘B’, and use the cash proceeds to pay off agent ‘A.”
If you still believe that the US government is in “debt,” then you are still brainwashed into thinking that the US government finances are the same as a private person’s finances.
The truth is that you can go broke, but the US government cannot, since the government can create enough money for any purpose.
The government could simply print money and get it into circulation via government spending, but politicians prefer the current method of raising cash by selling Treasury bills. This helps them maintain the false illusion that the government is “in debt,” which in turn keeps us groveling before the bankers and the politicians. (Actually the process is even simpler, as I will explain below. It is done with accounting entries.)
When the government wants to launch a new imperialist attack, it raises money for war by selling Treasury bills. In this way, private interests invest in war. They also invest in social programs. However, when the masses want social programs, the government says, “Sorry, there’s no money. We are broke.”
People constantly ask, “Why is there endless money for wars, and no money for social programs?” The answer is simple. The government has a printing press. You do not. And the government does what it likes with that printing press.
Let’s look at that article again.
“As of the end of June, the total debt of the US federal government was $15,856,367,214,324.44.”
This is the amount of money that people have invested in the US government. If we falsely call this “debt,” then we think $15,856,367,214,324.44 is scary.
“However, of that debt, $4,812,182,369,712.78 was money the federal government owed to itself (i.e. money the Treasury had borrowed from federal trust funds such as the Social Security Trust Fund, etc.). The Treasury calls this type of debt ‘intra-governmental’ debt.”
There’s that word DEBT again. Notice how even this article admits that $4.8 trillion is money that the government owes to itself. In reality, all of the government’s “debt” is owed to itself. Since the government has raised $15.8 trillion by selling $15.8 trillion in Treasury bills, the government simply moves figures around on its accounting sheet. And if the government owes itself, then how can it be “broke”? If you as an individual owe $15.8 trillion to yourself, then how could you be $15.8 trillion in “debt”? It’s a lie.
“4.8 trillion in debt is held by foreign interests. The remaining $11,044,184,844,611.66 the federal government owed as of the end of June was debt held by the ‘public.’ This is debt in the form of Treasury securities the government is obligated to pay off in cash.”
The government is only “obligated” if Americans who invested $11 trillion in the government (by purchasing $11 trillion in Treasury bills) all want their money back at the same time. This won’t happen, and even if it did happen, the US government would simply create the money to pay it off.
The US government runs on money raised by selling Treasury bills. It does NOT run on tax revenue, which is destroyed upon receipt. That is, the government dissolves tax revenue by moving numbers around on its balance sheet. It’s all part of the scam. There is no need for federal taxes at all, except to maintain the illusion. If federal taxes were reduced to zero for rich and poor alike, it would make no difference to the functioning of the US government. If the FICA tax were reduced to zero, it would make no difference to the solvency of programs like Medicare and Social Security.
Why? Because, unlike you, the federal government has a printing press.
Some people complain that the USA gives billions in “aid” to Israel. Again, this is an illusion. Israel is monetarily sovereign, like the USA, and therefore creates as much money as it likes. When the corporate media says the USA gives “aid” to Israel, you become angry. You think, “Why are my tax dollars funding Israel?” The corporate media wants you to feel this anger, because your blind emotion maintains your brainwashing that finances for individuals are the same as finances for monetarily sovereign governments. It's the same anger you feel when you see that the rich and the corporations pay no taxes. In reality, no one should have to pay federal taxes, but this is concealed by anger about the rich paying no taxes.
Again, this is a lie because those governments have a printing press, while you do not. If YOU could print money in your house, then you would never be “in debt,” -- but you might tell the people who use your money that you are “in debt,” in order to make them grovel before you. When they want more money, you would shut down your printing press, and say, "We must all live within our means. Now start groveling."
This truth is so simple and obvious that it can only be concealed by non-stop lies. Hence the bankers, the politicians, and the corporate media constantly repeat that the USA is “in debt.”
This is not mere semantics. It is not merely an “interpretation,” or a “perspective.” It is an objective fact. The government has a printing press. You do not. Therefore the government can never “go broke,” but you can. The US government can never be crushed by “debt,” but you can. The US government does not have “debts,” but you do.
The more power that people have in society (e.g. bankers), the more their power rests on pure illusions. Deception is the strongest political force on the planet. The banker scam is smoke and mirrors, but it works, because the masses want to believe in fairy tales.
Since I mentioned Israel, I note again that Israel’s politicians and central bank are now imposing more and more austerity on the Israeli masses.
So much for Jews supposedly being “smart about money.” The average Jew is as stupid and brainwashed as the average Goy.
Because European bankers and politicians are deliberately sustaining a depression in Europe, there has been a corresponding drop in European purchases of Israeli goods. Hence there is less money circulating in the Israeli economy. The result is a borderline depression in Israel.
Therefore Stanley Fischer (head of Israel’s central bank) and Israeli politicians have announced that they will plunge the Israeli economy into a full-blown depression via tax increases (which remove money from the economy), and cutbacks in government spending (which remove even more money from the economy).
Fischer and the Israeli politicians will intentionally create this depression in order to increase the wealth and power gap between themselves and the Israeli masses.
To conceal this scam, Israeli politicians will continue to distract the Israeli (and foreign) masses by continuing to make false threats that Israel is about to go to full-scale war with Iran, and that Hezbollah has millions of missiles aimed at Israeli children. Thus, while US politicians have only used the “war on terror” camouflage since 9-11, Israeli politicians have used it since 1948. (Actually, Jews have used it for centuries, since Jews are “Chosen,” and therefore have always under threat of a holo-hoax.)
The “war on terror” dovetails with the holo-hoax, plus the lie that the USA and Israel are “in debt.” All conceal the tyranny of bankers, politicians, and the One Percent.
Incidentally, rhetoric about the “federal deficit” is also part of the scam. The deficit is the difference between the revenue collected in taxes, and the money the government spends, right? But if the government does not use taxes, then the “deficit” is meaningless.
You and I do not have a printing press. Nor do states and corporations. Therefore you and I can indeed have a deficit between our income and expenses. Not so for the federal government.
So whenever people argue for or against “deficit spending,” they are using a misnomer. Hence they automatically surrender to the bankers and politicians. The debate would be much more rational if we simply discussed “government spending,” but the bankers, politicians, and corporate media always inject the false words “debt” and deficit” into the mix. Hence the masses remain confused and bickering.
Still not convinced? In an online discussion of 14 Aug 2012, AARP President Rob Romasco answered questions about Social Security funding, and accidentally admitted the BIG LIE.
Comment From Guest: “I hear conflicting statements in the media about Social Security running out of money. Is that true?
Rob Romasco: “Social Security receives money from tree main sources: from the payroll tax, from interest earned from bonds that are held in the Trust Funds, and the taxation of benefits.”
Comment From Guest: “Is the FICA tax holiday hurting Social Security?”
Rob Romasco: “No, the FICA tax holiday is in no way hurting the Social Security program. Even though the payroll tax was decreased by 2 percent, money is transferred from the ‘General Fund’ to make up for the lost payroll tax.”
There you have it. To pay for the “lost payroll tax,” money is transferred from the General Fund, meaning the US government simply creates the money.
How? I said the federal government does so by selling Treasury notes, but even this is an illusion.
The General Fund, the Social Security Trust Fund, and all federal funds are accounting fictions. They do not exist in any real form. They are nothing more than numbers on balance sheets, wholly under U.S. government control.
Though dollars may seem real and scarce to you and me, for a monetarily sovereign federal government, dollars are an accounting fiction. They are mere numbers the government manipulates at will. Need a trillion dollars to pay for Social Security? No problem. Credit the General Fund by $1 trillion, and debit the T-security account. Need another trillion to pay for Medicare? No problem. Credit the General Fund, and debit the T-security fund by another trillion. Need more dollars in the T-security account? No problem. Credit the T-security account, and debit other accounts at the Federal Reserve Bank, which keeps all T-security accounts.
Dollars are an accounting fiction, wholly controlled by the government, which can create an infinite number of them, simply by crediting accounts. The government can credit Medicare, Medicaid and Social Security accounts endlessly, just as it can credit all federal agency accounts, endlessly. The government creates money by simply making an electronic accounting entry. It can do this forever, or until no one will accept these created numbers as having any value.
The only way Social Security, or Medicare, or any federal program could run short of dollars is if the US government decides not to credit the program’s accounts. Such a decision would be purely political, i.e. done to further empower the One Percent.