Tuesday, February 15, 2011

A Balanced Budget for America?

A Balanced Budget for America?
"We can't win the future with a government of the past."
PRESIDENT OBAMA, in his State of the Union address.

       I would debate whether a balanced budget is actually a good thing for America.  Inflation is a GOOD thing.  Karl Marx (1818 – 1883) in his Communist Manifesto (1848) predicted that the Proletarians would revolt to throw off the Bourgeois.  Now with the fall of the Soviet Union and the Communist Block it is thought that Marx’s prophecy will never come to fruition.  

I have to disagree.  It has ALREADY happened.  The only exception being the Proletarians did not use conventional weapons, they used Baron Mayer Amschel de Rothschild’s weapon:

"Give me control over a nation’s currency, and I care not who makes its laws.
Baron Mayer Amschel de Rothschild (1818 –1874)

     “We the People” threw off the Bourgeois by taking away the gold standard with the “greenback” (1862).  Abraham Lincoln was the first president to use INFLATION to the good and issue a paper currency — the “greenback” (1862) — that wasn’t backed by gold or silver.  He did this to finance the Civil War and free the slaves.  Almost as was predicted by Karl Marx (1818 – 1883) in his Communist Manifesto (1848) again except for the fact that we were using a different nomenclature.  “We the People” redistributed the wealth by creating inflation.
     Free Enterprise v. Communism is all about nomenclature.  Cornelius Vanderbilt (1794–1877), a contemporary of Karl Max (1818–1883), Baron Mayer Amschel de Rothschild (1818 –1874) and Abraham Lincoln (1809–1865), was an American entrepreneur.  At the time of his death he was reportedly the richest man in America.  Today he is still believed to have been the richest man EVER in America.  Relatively speaking he was richer that Bill Gates is today, by a factor of 3.345.  His fortune was estimated at $100,000,000.  The Gross Domestic Product for the United States of America in 1877 was $8,520,000,000.  That meant that as a percentage of GDP, relative wealth, Vanderbilt was worth 1.2121% of GDP.  If you compare that to Bill Gates today $53,000,000,000 v. GDP (2010) of $14,623,900,000,000 (+/-); Gates is worth 0.3624% of GDP.  Vanderbilt as a percentage of GDP v Gate as a percentage of GDP, 1.2121% of GDP 1877 v 0.3624% of GDP 2011: Vanderbilt was (1.2121% / 0.3624%) 3.345 times as rich as Gates relatively speaking.  

     Now Vanderbilt was not a bad man, he was a self made man of his era.  Unlike Mr. Gates he left 95% of his fortune intact to his son.  So I ask where did it go.  Most of it disappeared into inflation in the subsequent 134 years.  We the People redistributed the wealth by “control over a nation’s currency.”  In the 134 years (1877-2011) between Vanderbilt’s death and today we have diluted his wealth by printing money and CREATING new wealth ($14,623,900,000,000 / $8,250,000,000= 1,773) by a factor 1,773.  So if Vanderbilt had taken his wealth (not his greenbacks) and just put it in his mattress, his 1877 wealth would be worth $56,414 ($100,000,000/1,773) today.    
      We have achieved the results of Marx via the weapon of Rothschild and redistributed the wealth without any wars, without any blood shed, without the micro management of Communism.  That is a GOOD thing.   

     IF Abraham Lincoln had not printed the “greenback,” USING INFLATION, we might still have ethnic slavery.  If Franklin D. Roosevelt had not started printing money, USING INFLATION, with the New Deal we might today still be economic slaves to the robber barons, Vanderbilt.  That is how “We the People,” unbeknownst to ourselves, redistributed wealth and brought about the prophecy of Marx without the blood shed, the denial of human rights, and the micro-management that bankrupt the Communist Block.
      I see no reason to hamstring ourselves today to balance the budget based on government cut backs.  Yes there is such a thing as hyperinflation,[1] we are not there yet.  And to try to intimidate the American voting Public into thinking that we are on the verge of hyperinflation is a misrepresentation of the facts.  Tax increases while maintaining the government safety net would be a better solution to ward off the possibility of hyperinflation.  “We the People” have government safety net because we have discovered through trial and error that without a safety net the haves tend to push the have-nots over the cliff to protected their vested interests.  The GREAT DEPRESSION and the New Deal taught us that didn’t it?

    Our current economic issue is the direct result of 30 years of the GOP’s deregulation in the Banking Industry and TAX cutting.  Bankers were able to create an over-inflated international housing bubble with unregulated government insured loans. 

    “We the People” have taken it on the chin and burst the over-inflated bubble.  “We the People” are now in the process of RE-regulating the Banking Industry to hopefully avoid a repeat of this problem. 

    Now the GOP (Republicans) will tell you that Government action is not to be trusted.  Government’s efforts to correct a wrong will always result in over regulation and wasted resources.  And to some extent that is correct.  Not because it is a government effort though.  Government’s flaws are the result of Government’s limited resources, humanity.  Anything done via humanity will be flawed as an unavoidable result of human fallibility.  A government of the people, by the people and for the people is, to date, the BEST way to get the onerous work of regulation done.  Laissez-faire de-regulation is a seductive theory but if our current economic issues, the result of banking DE-regulation, have taught us anything, “We the People” need government’s mutually agreed authority to REGULATE and thus keep the GREED of “We the People” in check. 

       We can eliminate the Bush era tax cuts and go a LONG way to balancing the Budget and avoiding the possibility of hyperinflation.  Inflation is a GOOD thing.
Think about it!!!!!!!!!!!!!!!!



134 Year Inflation Rate
      C2 / C3

V Discounted by Inflation
      B3 / D5

Vanderbilt v Gates
      D3 / D2




             Imagine if we had not invented inflation and held to the gold standard and balanced budgets.  The Vanderbilt's would be sitting on an even larger percentage of GDP now.  Balanced budgets and the gold standard are what created the Pyramids, the Taj Mahal, the Palace of Versailles and the Biltmore estate,[2] monuments to the individual at the expense of the "We the People."

DGJeep "The Earth and everything that's in it" (http://dgjeep.blogspot.com/)

Thanks in advance,
“Time is of the essence"
David G.Jeep  
E-mail is preferred Dave@DGJeep.com, DGJeep@DGJeep.com
(314) 514-5228

David G. Jeep
c/o The Bridge
1610 Olive Street,
Saint Louis, MO 63103-2316

[1] In economics, hyperinflation is inflation that is very high or "out of control".
[2] The Biltmore Estate was built on the proceeds of Cornelius Vanderbilt, but it would have gone on and on like Royal Dynasty without the advent of INFLATION.