So here we are in the midst of the Democrat’s post-election after party. Executive orders drafted by the far left marionettes are piling up on poor Joe Biden’s desk. Dutifully, he signs one after another as he reads his handler’s carefully drafted commentary from the teleprompter across from his desk. Never before have we seen such blatant disregard for the legislative process as we are witnessing now. This current president that ran on a moderate platform has now been swept in as the enabler of the far left agenda.
The one major issue that still needs congressional approval is the much touted stimulus package bearing a price tag of $1.9 Trillion. Granted, the economy is in sour shape because of the COVID-19 pandemic and help is needed. Included within the package are $1400 direct payments to individuals making $75,000 or less, $150,000 for married couples. The idea is to top off the prior $600 payments made under the previous administration to make it $2,000.
I am having difficulty understanding why a married couple with an income of $150,000 whose employment has been unaffected needs or deserves this kind of handout. Even Kevin O’Leary, aka Mr. Wonderful agrees with me. Instead, more needs to be directed to the unemployed and under-employed that have been victimized by the pandemic and, two, improve local vaccination distribution which has predictably been a disgraceful effort as predicted in my earlier post here.
The cost of a $1.9 Trillion package will contribute to a fiscal budget deficit projected at $2.3 Trillion for 2021 which will be added to our current national debt of $28 Trillion. No problem, say the democrats. We believe in MMT!
So, what is MMT? It stands for Modern Monetary Theory and it’s all the rage now in Washington DC. Those of sounder mind more aptly described it as “Mindless Magical Thinking.” In a nutshell, Modern Monetary Theory suggests that governments need not be concerned with fiscal deficits and balancing budgets because of their infinite ability to print money in their own currency. If you are so inclined, a more detailed and plain English definition can be found here at https://study.com/academy/lesson/modern-monetary-theory-definition-history-theorists.html.
Money, Money, Everywhere. The leading proponent of MMT, is Stephanie Kelton. She is a professor of economics and public policy at Stony Brook University and a leading expert on Modern Monetary Theory. A former Chief Economist on the U.S. Senate Budget Committee (Democratic staff), she currently advises Bernie Sanders and the likes of Alexandria-Ocasio-Cortez who look upon her as the financial guru. This opinion is shared by many of the Progressives currently in power. Ms. Kelton’s latest book, “Deficit Myth” is a good read for anyone interested in understanding MMT to form their own opinion. Me? I have read it and I view the theory as the ultimate Ponzi Scheme. Just sayin.
Governments raise money in three ways; Taxing, borrowing, and printing. According to MMT theorists, the government doesn’t need to tax in order to spend, but it does so to mainly offset inflation. Huh? Got that? Let me explain.
If the definition of inflation is too many dollars chasing too few goods, the government can simply just raise taxes as a means of confiscating our money rendering us unable to afford higher prices. Therefore, if we cannot afford to buy stuff, producers won’t produce. If producers cut production, what happens to the jobs? Think about it.
The best advice that I have heard lately goes something like this… “With America in the midst of a slow-motion collapse, we will give storage advice. Those who own the yellow metal (gold) should bury it six feet deeper.