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Soft money, hard line

By Owen Paine on Monday January 26, 2009 04:20 PM

An earlier post by your obedient savant here, calling for a huge rebate of the social security trust funds, caught the following comment -- right on its glass jaw, or at least so thought the commenter:

"Trouble is, there is no $2 trillion surplus to distribute -- it's already been spent. All there is are government bonds, and you have to stand in line with the Chinese and Arab oil states to get anything back from them."
A mass three-card monte game, this business of treasury bonds.

If you make the dollars, and they cost you nothing to make, where's the limit on 'em?

I know, I know -- shades of Robert Mugabe and Zimbabwe's zillion percent rate of runaway inflation rise to spook you if any one mentions uncle's unchecked power of moneyfacturing: "It will lead to a collapse of the dollar system! What of the widows and orphans?"

Not at all. Like an occasional plebian armed uprising, what's so wrong about an occasional hyperinflation? It may water the tree of liberty -- long as the right people stay ahead of the curve, that is. The right people, to my way of thinking, are the low prolers and the other honest live-by-toil citizens of the Jacobin republic. It's just as easy to keep the ordered masses ahead of the wave as the high rollers.

"So," you say, "it's the kulaks and shopkeepers, the petty rentiers and such -- it's them that suffer from galloping inflations, eh, Citizen Paine?"

Not even. It's only creditors in all their shapes and sizes that suffer.

Inflation can operate like a debt cram-down. It can cut real debt burdens. In fact in the right hands, it could be the cheapest, fastest, fairest way to do it, if it's planned and taken step by step.

I throw this out as a challenge, like the guy in the dunking chair.

Thesis: Uncle can spend all he wants, so long as it's dollars, Worst case, he creates the conditions for total transformation, total liberation from the social debt harness.

Here's how: Uncle says, this inflation will be a deliberate policy, and by proper indexation all real wage rates and real savings and real pensions of all sweat-of-the brow breadwinner American jobblers can be maintained intact despite inflation's mighty surf.

The prudence of Scrooge McDuck only insures and protects the incarceration of society's producing classes.

Comments (13)

i was just thinking this same thing the other day. if the system functioned when it was based on the trading as assets of loans against artificially inflated property values, why wouldn't it function based on printed dollars? what say $10,000 for every man, woman and child in the US?


Al, Al, Al!! Whattaya drinking? Inflation hurts us as much as it hurts the far cats. $5 a beer? $15 a pack a cigarettes? $25 a pay on demand porno flick while the wife fills the car with greenbacks to go to the grocery store!

Instead, how about cancelling all subprime mortgages, all credit card debts under $10,000, all the CDS without any collaterall (about $15 tril), and starting a program of NFL game stamps (like food stamps) to families with incomes less than $40K?

Just throwing it out as a challenge.

Al Schumann:

Seneca, Owen (not me, though I'd be delighted to be mistaken for Owen) is proposing a controlled wage spiral for us, to keep up with a controlled inflation of prices. The key is getting the indexation right. Overheating is possible, I suppose, but shouldn't be too hard to handle.

Peter Ward:

But why on earth would the powers that be want to? The world abounds with examples of countries subject to neoliberal economic policy where most people live on the verge of starvation and the fact cats are not only happy with this arrangement, they enthusiastically endorse it. I think what is currently happening is the application of NAFTA-esque reforms such as those imposed on Mexico on the US itself. I get the impression, though I haven't seen it stated explicitly, that Owen is making the delusional assumption that the powers that be want a good economy (in the sense you and I would mean) they just haven't figured out how to make it work. Whereas, in fact they're getting more or less what they want with the present setup.

As always, making it too socially costly for the powers that be not to provide a decent living for general population is what's going to bring this reality about. So, given sufficient organization, we could bring the Owen's program into practice, but if we have our shit together enough to do that why only make such modest reforms? Let's instead demand, among other things, that the work we do be meaningful, as rewarding as possible and where work is undesirable that the burden be justly divided--that is, since making democracy work, even to bring about the modest reform suggested is, a prerequisite let's make our economy democratic. And even if we don't come close to what we really want in the first round, as doubtless we won't, that fact we made the attempt will put us a hell of a lot closer than we are today.

Owen proposes we open asking way less than we want. Isn't good negotiation asking way more than we expect?

Son of Uncle Sam:

I think I might like hyperinflation, pre 1982 pennies would eventually be worth more than dollars. It's like letting people vote who don't own property. Pirates of yester-year used to let everyone on board vote, but everyone was in that together as a team and they split the profits evenly as well.


"how about cancelling all subprime mortgages, all credit card debts under $10,000,.."

a jubilee year

how biblical senny

but alas i fear our politically prefered route runs thru higher wages not forgiven debts

folks like to think they earned stuff
and their neighbors tend to second that emotion
if its goin to be general dole outs
its got to be
3 parts a reward for virtue
to 1 part
forgiveness of vice

"all the CDS without any collaterall (about $15 tril)"
don't worry an uncle indemnification
is in the works
after all unlike common as cow flaps
household debt heaps
that synthetic high flyin' shit's "systemic"

"a program of NFL game stamps (like food stamps) to families with incomes less than $40K"

tut tut
u know better then that !!
never feed the bears senny


mr ward

yup i'm game
lets up the ante

lets build a decent front line struggle org
start local
get a pack of lawless resolutes
and ram ourselves straight into
the nearest house of surplus extraction

i'm old but im game

as to your more general Rx
don't u agree
round here at least
its likely we'll stick
to popular front gigs ???

economic democracy as in like
catalonia 1936 ???

that may be pushin
the tinker belle button
a bit to hard for my likes


my posts on occasion serve a fairly obvious function
debunking the big media bug a boos

now some of us may feel immune to the sea of corporate agitprop we exist in

as the image invoked
by our commenter up top
of a helplessly bonded uncle
bound by the moral adamantine
of his obligations to the rock of promises
and there suffering
the trillion pecks
of them devilish yellow han-birds ...

seems brother ward
even "we few we happy few "
have in our ranks
deluded souls
thrashing about for dear life
in rotarian goo



to be taken for u
made my day...

even if the comment
had about it
the air
one deeply dis -illusioned


"Pirates of yester-year used to let everyone on board vote,...." s of s


"arhh how vote yee mates
are ya with me or not
me blade's a bit curious to know ...arrrrh "
ned teach

"but everyone was in that together as a team and they split the profits evenly as well."


"arrh i've counted the boodle mates
...and here be yorn ...ahhrrrhh ..
and here by mine ....
fair enough ??
or would yee like
an independent solicitor's opinion
on this...arrghhhh
fairs fair i sez so u got a doubt
well ole davy jones is awaitin ya ... down below ready to answer any inquiries "
hank morgan -the first-

u be a bull the buggar lee dupe
dearest Sonny Sam

watch the aweful truth ...from hollywood

Black Beard vs the crimson pirate

featuring cap'ins Blood and Hook

Son of Uncle Sam:

Calendonia 1936
Little Rhody 1636 plantation folk must work in the birth place of real freedom per former mayor Cianci

Son of Uncle Sam:

According to my paper boy pirates were quite diplomatic to avoid mutiny. Were capt's blood and hook metaphors cause all I can picture when the words Hollywood and pirate connect are

(voice of Don LaFontaine)
"Little Billy Parsnips, wishes on his eigth birthday for a puppy..... and a chance to go back in time to be a pirate!!!! You'll never guess which won he gets.....

little billies high pitch voice as he runs across the deck (voice close to Ralph Wiggum): oh cool!!! Pirates (he approches 6'4" Teach sportin' 2 pistols and a cutlass) hey mister your long legs make your sword look tiny he he he he he...

Teach(played by Brian Libby): Odell... how far 'till land yo ho ho?
Odell: Four more morns Capn'

Teach: smear this lad 'cross the squid arms of the crew..... and i'll be waitin' for ya lil' bill... and remember tees words..... north of the knee caps and south o' the belt buckle...I'm loaded like a Dragoon...


OP, you'll never be mistaken for anyone, or anyone for you! I didnt realize Al was only seconding a position you'd already proclaimed. That's the beauty of your fancy prose style. . .

Mr Ward: do I recall your name from a certain site whose name is also the name of the first book of A La Recherche du Temps Perdu?

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