Ending economic crisis simply and easily, in America and globally

1 post / 0 new
DrKrbyLuv's picture
DrKrbyLuv
Status: Diamond Member (Offline)
Joined: Aug 10 2008
Posts: 1995
Ending economic crisis simply and easily, in America and globally

   Excerpts from Full Article

Economist Michael Hudson explains that "debt leveraging is what caused our economic collapse," so piling on more ("The Recovery Plan from Hell" he calls it) makes things worse, especially the way it's done:

-- in America, by a private banking cartel Federal Reserve bailing out its members to enrich them - the key giant ones referred to as Wall Street; and

-- the US Treasury doing the same thing; it let the federal debt skyrocket to stratospheric levels and affirmed Adam Smith's dictum in The Wealth of Nations that no country ever repaid its debts, surely not huge ones in a private banking cartel run state, and therein lies the problem - easily solved with a bold stroke, thus far not taken nor will it without mass public action demanding it.

"debt service will (keep) crowd(ing) out spending on goods and services and there will be no recovery. Debt deflation will drag the economy down while assets are transferred further into the hands of the wealthiest 10% of the population (mainly the top 1%), operating via the financial sector."  Eventually the economy will collapse, but Wall Street will profit hugely - aided and abetted by corrupted public officials allied with the private parasitic Federal Reserve turning America into what Hudson calls a "zombie economy" and banana republic.

Certified, card-carrying bankers are allowed to do something nobody else can do....create 'credit' with accounting entries on their books." It turns money into credit by what's called "fractional reserve banking" that multiplies each dollar deposited magically into about 10 in the form of loans or computer-generated funds. It's literally money created out of thin air so that banks can re-lend it many times over, and the more deposits, the greater the amount of lending.

At issue is whether credit should be private or public, and as Brown wrote in a December 29 article titled "Borrowing from Peter to Pay Paul: The Wall Street Ponzi Scheme called Fractional Reserve Banking:"

"Readily available credit has made America 'the land of opportunity' ever since the days of the American colonists,  What has transformed this credit system into a Ponzi scheme that must continually be propped up with bailout money is that the credit power has been turned over to private bankers who always require more money back than they create" because they charge high interest rates to make a profit. When governments lend their own money, profit isn't at issue so rates can be low and affordable to businesses, farmers, and private individuals, and for their own and municipality needs, it's interest-free.

This writer and Brown believe that credit should be a public utility under a nationalized banking system, creating its own money at the federal level and with deposits into state-run banks - to serve people, not predator bankers. It would be the most equitable, sustainable, efficient and democratic system, free from parasitic lenders, and it would work equally well at the federal, state and community levels with local branches of government banks serving municipalities, their businesses, and residents at affordable costs.

Under the privately-run Federal Reserve and parasitic giant banking system, corporate monopolies run America and use "their affiliated banking trusts to generate unlimited funds to buy up competitors, the media, and the government itself, forcing truly independent private enterprise out" - the very system classical economists abhorred.

Private banks hold nations hostage by making them pay interest on their own money as well as "advanc(ing) massive loans to their affiliated cartels and hedge funds, which use the money to raid competitors and manipulate markets."

In America, it's an extreme form of Darwinism with the federal government and 46 of the 50 states insolvent - and small businesses and ordinary people faring worst. Another way is essential to keep the nation, individual states, local communities, and most people from becoming "zombies" and America transformed into Guatemala.

With federal, state, and community banks made a public utility under a nationalized banking system, consider the benefits: personal and payroll taxes could be eliminated; stable, sustainable economic growth could be generated; America's manufacturing base could be rebuilt; vital infrastructure projects could be undertaken on a scale never before imagined, including cleaning up the environment and developing alternate, sustainable, clean, safe, and affordable energy sources; many millions of new good-paying jobs could be created, putting an end to unemployment for everyone willing and able work; and for those willing but unable, aid could be provided; home foreclosures would end, and the dream of home ownership would be in reach for everyone because mortgages would be plentiful, cheap, and not designed to scam the unwary; inflation could be ended; booms and busts would be a thing of the past; destructive currency devaluations and economic warfare for private gain would no longer be a threat; private pensions, savings, and investments would be secure; and federal, state, and local debt could be eliminated.

Weeks back, Bloomberg and others reported that from $12 - 14 trillion in bailouts and stimulus have been allocated or spent, while the Fed can't account for $9 trillion in off-balance sheet transactions. Why? Because of unprecedented willful fraud given a wink and nod by the highest officials in Washington partnered with criminal bankers to loot the Treasury and fleece the public.

Now imagine if $1 trillion of the total looted went to publicly-run banks for productive purposes. "Fractional reserve" magic would create $10 trillion. If around half of it went there (remember already allocated or spent), an astonishing $70 trillion could be used productively, not wasted, used to buy damaged assets cheap for greater consolidation, or for speculation at the risk of a severe future inflation. Then envision a new future:

-- the federal debt could be eliminated;

-- all unfunded liabilities, including Social Security, Medicare, and Medicaid would be secure in perpetuity;

-- the nation and all 50 states would become solvent and on their way to comfortable surpluses; and

-- a sustainable, inflation-free, prosperous future would result with essential social benefits for everyone, including affordable or perhaps free health care, education, and the end of poverty because a guaranteed minimum income could be assured.

Overall, it would be nothing short of a revolutionary new America, only rhetorically addressed up to now, with all winners and no losers - except the private predator banks and their corrupted public sector partners.

And remember, newly created money isn't inflationary as long as imbalances are avoided and it's productively used for new goods and services.

That's the kind of America to work for and not quit until achieved. If not now, when? If we don't do it, who will? If not done soon enough, it may be too late. If that's not incentive enough, what is?

 Larry

Login or Register to post comments