Another looming ‘debt’ crisis
How is it that every few months in America we have a looming debt crisis?
On March 15, thanks to Kabuki Theater move pulled off by Barack Obama and former House Weeper John Boehner in 2015, the government’s current debt ceiling extension expires. This implies that the government’s borrowing limit will have been reached — or its credit card maxed out.
During the Obama years — and in many of the years prior — the debt ceiling was used as a political tool by one party or the other to extract concessions on spending or taxes and to agitate class warfare.
Always “essential” government services — payments to Congress members, military operations (though not always military paychecks), etc. — continue. But things like park access are restricted and Social Security checks are delayed; anything that can make the American public feel pain. It makes for good theater even if it is bad governance.
After a few days of grandstanding by politicians and caterwauling by the mainstream media, Congress does its “bold work” and votes to raise the borrowing limit.
But former White House Budget Director under Ronald Reagan, David Stockman, predicts this one will be different:
I think what people are missing is this date, March 15th 2017. That’s the day that this debt ceiling holiday that Obama and Boehner put together right before the last election in October of 2015. That holiday expires. The debt ceiling will freeze in at $20 trillion. It will then be law. It will be a hard stop. The Treasury will have roughly $200 billion in cash. We are burning cash at a $75 billion a month rate. By summer, they will be out of cash. Then we will be in the mother of all debt ceiling crises. Everything will grind to a halt. I think we will have a government shutdown. There will not be Obama Care repeal and replace. There will be no tax cut. There will be no infrastructure stimulus. There will be just one giant fiscal bloodbath over a debt ceiling that has to be increased and no one wants to vote for.
But we expect that after much theater and blather and brinkmanship, the debt ceiling will be raised and more of your liberties will have been “compromised” away through bipartisanship and cooperation “in the best interests of the nation.”
The trouble is that we hear the word “debt” and we try to apply the conventional definition of debt as a legitimate accounting concept. It cannot be done as it refers to the so-called national debt because the nation’s debt is created out of thin air or on government computers. It is fiat.
The terms “debt” and “fiat” are incompatible. Fiat, by definition, is default; but debt implies repayment. Yet the most learned writers I read actually believe there is a U.S. government “debt,” and they repeat it over and over.
During these “debt crises,” the media likes to trot out figures claiming to show how much each household owes on the U.S. debt. Isn’t that clever?
The media would have you believe that you are responsible for the trillions of dollars of debt that you did not rack up, had no say in creating and, in fact, represents money that was stolen from you.
I can easily see why the government cabal wants the people to believe that there is government debt. Otherwise, people might get wind of the truth, that money in America isn’t created by the U.S. government. Rather, it’s created out of thin air by the banks through accounting entries! They might discover that the Federal Reserve was operating on printing press money (fiat).
In fact, there was one man who did discover this, much to his chagrin. His name was Merrill Jenkins. Right in the Federal Reserve’s own literature, Jenkins found descriptions of how “money supply” was now irrelevant because a bank loaning money simply creates that money through bookkeeping entries and then deposits it into the account of the borrower.
The exception, of course, is interest due on the loan. That money would have to come from money already in circulation, and it is up to the borrower to come up with those dollars. If you click here, you can discover for yourself the truth about this theft and what you can do about it.
The net effect of this is that all wealth flows away from the producers to the nonproducers. Modern money (nonsubstance) expropriates wealth.
Translated, this simply means that one class of people perpetually steals from the other class. This makes them natural enemies.
The implication of the “debt crisis” is that if the debt ceiling is not raised then American will go into default. The truth is, America is already in default. But it cannot go bankrupt in the traditional sense.
Here’s how it happens: The process of government “money” creation is a concealed scheme of consuming (stealing) the national wealth. In effect, the government creates its own wealth — not from taxes, but by creating “money” and using it to fund the government and to transfer wealth from the people to itself. The simple equation is that when governments consume all the national wealth of the people, then the government collapses.
Governments produce nothing, so governments must live off of the producers. It is the nature of governments to grow bigger and bigger and consume more and more of the national wealth. Do you see this happening?
At some point, government overconsumes the national wealth and collapses. Government finally consumes more than the people can produce.
So then, modern bankruptcy of national governments is not overspending. It is overconsumption of the national wealth.
There is one way to protect yourself from the collapse and that is to use your fiat dollars (nonsubstance) to acquire gold and silver (substance).