Still Report #384 – My Greece Solution
July 6, 2015 in News, Video by RBN Staff
“Thereafter, here’s my solution in a nutshell: If you outlaw national debt – national borrowing – governments can NOT overspend. It’s self-imposed austerity.”
Euro coins in front of an old drachma banknote. Photograph: Dado Ruvic/Reuters
Source: YouTube
A friend of mine recently accused me of supporting raw unlimited Drachma creation in Greece without the restraints of much-needed fiscal discipline.
This is not true. It would be suicidal.
However, nations should be allowed to commit national suicide if their fiscal policies are stupid.
Greece can’t learn austerity unless it learns it by failing. They can’t fail as long as they are connected to EU debt machine and periodic injections of cash from the European Central Bank.
So step #1 is to extricate Greece from the Euro and the EU.
Thereafter, here’s my solution in a nutshell: If you outlaw national debt – national borrowing – governments can NOT overspend. It’s self-imposed austerity. Why? Because they would have to immediately raise taxes to cover any spending in excess of their tax income which would not only be highly unpopular but lay the basics of the national debt scam open for all to see.
My friend retorts that it is irrelevant whether a nation uses debt money or debt-free money, as long as a nation spends no more than it takes in via taxation.
Well, sort of, but two points: 1. What about the interest on the debt? It compounds day and night and eventually will eat up the entire budget of a nation. That’s just plain old arithmetic.
Number 2. What about the political control that debt gives to the lender?
So, the focus should NOT be on austerity; it SHOULD be on killing off the borrowing power that underlays the impossible calls for austerity in a debt money system. If nations can’t borrow, nation’s can’t overspend. It’s just that simple.
That’s what no national politician wants to talk about. That’s what no economist wants to talk about. That’s what no big-time news outfit wants to talk about. Why? Because they all borrow money from the biggest banks and that borrowing gives banks what they want most: control of the political process.
Merely beating on a drum and insisting in austerity is squeezing the system in the wrong place.
No More National Debt.
No More National Debt
I’m still reporting from Washington. Good day.
