Taking the weight off of Millennials' shoulders , so they can fight with Boomers, not against them. - Politics Forum.org | PoFo

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I hope I can convince you'all that this hate I see between Millennials and Boomers is being imposed on us by bots of the rich in order to divide the opposition to their evil plans.

As I see it the Main Basis of it is the thought that the US national debt is a crushing burden that the Boomers have imposed on all later generations. I can seriously tell you that this Boomer never felt the weight of the $1T national debt that Pres. Reagan inherited from past generations since 1837 when the Revol. War debt was paid off. Nor the later US debt that the Repubs increased.
. . . This is because my tax money was never or rarely used to pay down the debt. Instead the debt was always rolled over on to newly issued bonds . And all interest payments were also paid with newly borrowed $$.
. . . Now, I know that Mainstream (MS) economists will try to tell you that the payments were all made with dollars (=$$) that were collected with taxes. IMHO, this is just smoke and mirrors. All $$ are fungible, this is a fancy word meaning they are all the same. So, when the US Gov. both collects $$ with taxes and borrows $$ by selling bonds, the $$ all go into one pool and are spent from it. IMHO, we can choose to decide which sorts of dollars are being spent on each kind of expense. So, when someone says, “It is not right to spend borrowed $$ on things like welfare,” he is choosing to assign this spending to a category of $$ the Gov. can spend in order to make it seem bad. It's more smoke and mirrors.
. . . You can clearly, I think, see that I'm doing the exact same thing, but bare with me for just a little while. So yes, I'm choosing to put the spending for debt payments and welfare into categories that make such spending sound better.

My 2nd Main Point is that you young people are being lied to when you are told that “someday” you are going to suffer when the US *has to* start paying down the national debt. Yes, I claim this is a lie when it is made by a MS economist. When your friend says this he/she is just buying into the groupthink that surrounds you all.

My 3rd Main Point is that Modern Monetary Theory (MMT) has been used for many years now by Repub. politicians. You can see it in their actions. When a Repub. is Pres. Repubs. in Congress spend like crazy for the Army, etc. and to cut taxes on the rich; but when a Dem is Pres. suddenly the Repuds. in Congress are all worried about the deficit and the total huge national debt. Some Facts are --- when Reagan became Pres. the US debt was $1T, Pres. Clinton had a surplus for 3-4 years, Obama had to spend because Bush II crashed the economy, and Trump has been and now even faster spending like crazy. So, now the US debt is about $24T, or 24 times more than when Reagan became Pres.. And most of it was spent by a Repub. or forced on a Dem by a Repub. (also for 6 of Obama's 8 years Repuds. controlled 1 house of Congress so they voted for every $$ of that spending).
. . . MMT says very clearly that there is a limit on deficit spending and it is when the nation is using *all* the labor and natural resources of the nation or that it can buy. At that point more deficit spending will cause inflation.
. . . OTOH, MMT says that there should be more deficit spending than there has been for the last many years. This is because the Gov. can only create prosperity if the "debtless" money supply grows fast enough to make up for the 2 main leakages and provide more for the growth in the GDP. BTW, the leakages are 1} saving by Americans & Am. corps. and 2} savings made by foreigners who pulled $$ out of America with the trade deficit and didn't buy something from or in America with them. *All* such $$ are functionally saved by some non-American.
. . . So, the US deficit for the next few years should be (IMHO, not the opinion of Prof. MMTers) the total of $$ saved last year PLUS the total trade deficit for last year PLUS some more $$ to provide for economic growth.

My 4th Main Point is that the US has a full fiat currency, both dollars (paper bills and electronic $$) and US bonds are both just IOUs. Paper dollars are only redeemed to pay your taxes and fees; bond dollars also earn interest and can be converted to electronic $$ at maturity. Paying down the US debt with tax $$ has the effect of taking $100 from a taxpayer at “gun point” and giving them to a bond holder who wants a $100 bond and who knows she has a real financial asset. This redeeming of the $100 bond functionally burns it. Before the transaction there were 2 $100 assets (the cash and a bond), after the transaction there is just the $100 in cash left. Paying-off or even down the US debt destroys assets for no reason (now that the world is off the gold standard).

The Repub. politicians know that the US debt will never be paid off again like it was in 1837. And also, the US debt will never be paid down much at all, never as much as 5% of it. MMT explains all this quite clearly.
. . . You might ask, why should I believe that MMT is correct? I have many threads explaining why here on this site under “Political Circus”and “Credit & Debt”. Read some of them.
. . . My reasons for why the US debt can never be paid off are ---
1] The current debt is about $24T, depending on if you include $$ the Gov. owes to itself, like the Soc. Sec. Trust Fund.
2] The only “correct” way to pay the debt off is to use tax $$ to do it. It is not correct to pay it off with $$ it borrows from anyone. It is also not correct to pay the US debt off with $$ from the magic money tree. MMT says it can be paid off with $$ from the magic money tree, but I'll call that cheating here. [BTW, functionally the magic money tree does exist.]
3] OK, this means that the US Gov. would have to run a real surplus of (for example) $500B for 48 years. MMT claims that this would put the US and the world into a recession within 4 years, because the US economy needs that $500B/yr of income. You can see that less austerity in the EU has put Spain, Italy, etc. in a recession for the last 12 years. Austerity always does this. MMT explains why.
4] OK, who in America is going to pay the $500B per year? The rich and super rich do NOT want it to be them. The poor don't have $500B/yr to take from them. And I don't think the Middle Class does either. Only the super rich have this kind of money and they will NOT let the new taxes fall on them.
5] The UK, aka England, has had a national debt in every year since 1694, i.e. for 325 straight years. And despite graphs that show the debt as % of GDP going down in some years, actually the UK has has a real surplus in very few of those 325 years. So, the “someday” to pay it off, has never come, not even when the UK lost its Empire between 1946 and 1965. [Losing an Empire seems like a likely time for the market forces to demand the debt be paid off, but it was not the time obviously.]
6] So, to summarize ---
. . a] There does not seem to be a time for 325 years to *have to* pay the US debt off.
. . b] The only proper way is to use tax revenue dollars.
. . c] Using tax $$ is impossible politically.
. . d] Using tax $$ is economically impossible.
. . e] Converting one kind of IOU into the other kind of IOU seems pointless, plus it reduces the assets held by the American people.
Therefore, “what can *not* be done, will *not* be done” means in this case that, the US debt will never be paid off with tax $$, but maybe could be paid off with $$ from the magic money tree.

Therefore, you Millennials need to stop worrying about the crushing weight on you shoulders.
The weight or pressure you feel is quite real, but it is not the result of the national debt. It is *not* the result of the Soc. Sec. payments being made to retired Americans, they can be and are being borrowed. It is the result of political choices being made by Neo-liberal politicians being fed lies by Neo-liberal economists, who are in the pay of the super rich.

The super rich want you to hate Boomers because this divides their opposition.

In the current covidvirus crisis we all can see that the US Gov. can borrow massive amount of $$ in a failing economy and spend them to help the people but mostly to spend way over half of them to help the rich and super rich.

You Millennials need to vote and make the politicians do things that are good for you. Retired Americans vote and this is why there will be no cuts to Soc. Sec.. But, there is fiscal space to borrow much more and use it to help the mass of Americans.
You need to vote!
This time just vote to get more Dems in and Trump out. At local, state, and Federal levels.
In 2022 you can vote for progressive left of center Dems in the primaries and general election. I hope these Progressive Dems will use MMT thinking to increase deficit spending to help the mass of the American people, especially the young (we retired people don't need much more help).

You *need* to unite with as many voters as possible in the largest big tent possible if you want to get Progressive Dems to be a majority. This means you must stop shaming people for trivial sins and unite all possible voters for economic justice now. You can go back to the shaming after you win the economic war. [Do you think the shaming might also have been pushed by bots of the super rich to divide their opposition?]
Millennial s have been told that Soc. Sec. will not be there for them. MY solution for this is --- 268
1st, why is there a problem? Soc. Sec. benefits and the FICA tax are tied to wages and wages are caped at about $100K.
The big part of the problem is that Repuds in Congress have conspired with the corps. to keep wages from keeping up with productivity. Since 1975, or so, real wages have been flat and the CPI has been done wrong on purpose to make you think they are flat when really real wages have gone down. The min. wage went from $7.15 to $7.35 over the last 35 years. If wages had grown along with productivity all that time the min. wage would be about $15/hr and other wages more than that.
. . This would have done 2 things. 1] More FICA tax would have been paid and S.S. would be more solvent as a result. And 2] Millennials would have more money in their "account" and so would be getting a higher payment when they retire.
. . So, Millennials would be better off in 2 ways they would be earning up to twice as much per week and when they retire they would be getting more money from S.S..

2nd, the Repuds in Congress conspired with corps. to move many jobs overseas. This hurt workers, obviously. However, it also made S.S. collect less FICA taxes, making it less solvent.
. . The US and many other nations have always had tariffs. It is only recently that the free trade matra took hold. I think that nations for centuries were smarter than the free trade guys. Tariffs should not be too high but they NEED to be there.
. . Therefore, I propose that all the current tariff revenues be put into the Soc. Sec. Trust Fund, like all FICA taxes are. This will make S.S. much more solvent and costs the current workers nothing. I further suggest that the FICA tax be reduced because it was increased to fill up a pre-paid fund so the Boomers would not be too much of a burden on future workers. Many or most Boomers have retired and so it is not fair for the current workers to be taxed at the rate that is more than the "Pay as You Go" rate [at least if workers were being paid properly]. The difference would (in my plan) be made up with other taxes; either on imports or on US corps.
. . I want a corp. tax that will not be passed on to their customers. This seems to be hard to do. But, remember that the perfect market is supposed to keep prices down through competition. If this is true then it ought to be possible to tax corp. owners in a way they can't be passed on.
. . MY most recent idea is the tax the stock value of every US corp. that has more than 500 employees. The tax could be calculated as 1% of the average daily closing price of the corps' stock on the NYSE. It is payable, on the 5th of each month at a 1/12 of 1% rate on the closing stock price for the last month. Stock splits change the rate accordingly. Computers can easily calculate this.

Of course, all things that are good for the American people will have to wait until the people have broken the power of money to control the Congress. Millennials, it is up to you now to do this. [b]If you don't/b] then ACC will destroy your life if not kill you. So, you need to find a way to do this. I suggest street protests (on Saturday?) forever, until you win. That is until the vast majority in Congress are not paid shills for the 1%.

Te street protests are necessary, but not enough. You also need to vote.
Street protests are good for keeping people motivated to vote. They send a message to politicians to join you or get out of the way.
Notice that now the BLM protests are starting to get some results, where 50 years of asking and demanding have failed.
Did any of you feel the weight come off your shoulders?

Did any of you grok that the national debt can only be paid off with newly created digital dollars.
That ends the debt, but lets the bond holders keep the assets the bonds represent.
That the bond holders are all over the world and are not *just* the 1%.
Or, the bonds can be rolled over forever.
Also, since the Fed. Res. pays 97% of its receipts (not its profits) to the US Treasury, the US pays the Fed. a rate of 0.003% interest on the US bonds (if they were sold at 1% interest) that the Fed. holds.

Also, for Soc. Sec., that the US can honor its commitment to use "the full faith and credit of the US" to make the Soc. Sec. payments as long as the US exists.
That it isn't fair to have the high current FICA tax rate be paid by workers. The current FICA rate was set in 1983 to let the Boomers pre-pay for their SS payments. The idea didn't work out the way it was intended. Today the US sells bonds to pay off the bonds of the Soc Sec. Trust fund as they come due and are used to pay current SS payments. There was no need therefore, to raise the FICA tax in 1983. The SS Trust Fund has NOT kept the US from having to sell bonds to make the SS payments.
If the economy changes and American workers don't make the stuff Americans buy then there ought to be a tariff to help fund Soc. Sec. to some extent.
If the economy changes and American workers don't make the stuff Americans buy then there ought to be a tax on automation/robots to help fund Soc. Sec. to some extent. Besides is it *Green* to use electricity to do what people did before and can still do?

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