Chris Macdonald: Why you are broke

Do you have trouble making end's meet? Do you feel one paycheque away from sharing a New Yorker with no door on it with a foul-mouthed alcoholic in Sunnyvale Trailer Park? Do you feel time is your enemy? Another day older and not an hour richer? Why is that?

The rich get richer, the poor poorer. In America, the rich argue against social assistance and health care on the basis of flawed theory regarding complacency of the lower classes. Tax cuts and assistance for the well connected in the name of producing jobs continues to be the norm, while mere mention of such things for middle and lower classes is met with anger, garbled arguments, and Fox News on the rampage. Government spending is at an all time high, as politicians scramble to maintain electoral status and feed those who financed their campaigns. The Federal Reserve, or the Bank of Canada up in these parts, spew out Monopoly money at an ever-increasing rate to keep private institutions that control these central banks, flooding the market and causing inflation and higher prices.

The most crucial thing to understand about all of this is Inflation. Prices go up, while wages stay the same—for most of us, anyway. When was the last time you got a salary bonus? The Federal Reserve system is the primary reason people in the middle class are being driven into poverty. The U.S. government under the Constitution has the authority to print interest-free money, as presidents Lincoln and Kennedy did. Unfortunately, they both ended up dead. Coincidence? Money is printed by the Federal Reserve at an interest rate set by private banks. This is what causes inflation and higher prices.

U.S. Democratic Senator Elizabeth Warren argued recently that the minimum wage, if adjusted for inflation, would be over $22 an hour today. Politicians and the media like to look at stocks and the economy as indicators of how a country and how a people are succeeding or failing. But which people? I'm not inciting class warfare here. If anything, there was a war here long before a few moments ago when I sat down to write this. Is raising the minimum wage in itself the solution to our problems? In itself, it seems a Band-Aid solution. While the media hypes up a "strong economy", much of the money goes into the pockets of the already wealthy and well-connected and rarely benefits you. Corporate fascism at its finest. George Carlin noted that the game is rigged. It's not a free market but free market socialism. Free market for the lower classes, socialism for the rich. The economy waxes and wanes, but still the majority feel little benefit. We are told that the increasingly poorer jobs with the lower pay and reduced benefits are a sign that the economy is recovering—people are “back to work”.

Revisiting that great philosopher Carlin, "The rich make all of the money, pay none of the taxes; the middle class pays all of the taxes, does all of the work; the poor are there just to scare the shit out of the middle class—keep them showing up at those jobs!" The only “solution” the politicians have for this problem is to run the printing press to feed the banks, while providing tax relief for the middle class and poor, whose savings are now nullified by inflation and higher prices. You are fighting a losing battle, while the media tells you things are getting better.

Comments (11) Add New Comment
u_r_lifesaver
I normally don't post on my own articles, but apologies on all the links if they are distracting to you; in which case, please say so in the comments and I will ensure they don't reappear again in the future. Thanks. Chris.
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Graeme Kilshaw
Ever heard of binary economics? What about the Hegelian dialectic and the plan for a digital world economy? Guys like you and me are pretty lucky. One day we are stuck in the middle class doing boring work, and the next day our work becomes much more important and exciting. I believe that to a large extent, increasingly in the 21st century, that class is consciousness. Language is culture, and wealth favours the binary. It could be that there is indeed a deeper purpose in this life, and that this purpose would initiate a ripple effect of good deeds that enabled deeper levels of unity, light, and order. www.Medium.com/@Cube/latest
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bag of jewels
JFK's released "United States Notes" which looked almost identical to Federal Reserve Notes and probably would've become the world's currency if they didn't immediately shelve the idea after he was assassinated. He backed each note with silver they were totally debt free so the entire US economy could tank and it wouldn't matter those notes would always be worth the same and independent of any foolish government printing too much money to finance costly military adventurism.

What we have now is the equivilant of Emperor Nero debasing the Roman currency so he could double the coins with an empty promise to always accept their face value even though they weren't actually worth that value.
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Greg
I think the exact opposite of this is true. The rich are terrified of inflation, it kills trust funds and inheritances like nothing else. Since Reagan, governments in the US have shifted largely from policies concerned with full employment to ones interested in keeping inflation down no matter the social cost. Inflation is a boon to the poor and leveraged, it basically helps to erase debt. Ask an older neighbour who has a mortgage of $100 a month still on a $300,000 home. Countries like Italy and Greece used to routinely debase their currencies as a strange form of taxation as the rich refused to pay income tax; their cash holding decreased in real terms, while the debt load on the working classes went down in real terms. The Ron Paul types who want to get rid of fiat currencies most certainly are advocating on behalf of the 1%, don't be fooled into thinking it will help the working class, it most certainly won't.
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Pat Crowe
Graeme, that sort of wishful idealism will win you first place in the line at St. Vinny's for lunch..
As for a "deeper purpose" in this life? The worms have the answer to that.
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derpface
@greg

you missed the point, the rich have an increasing income to deal with inflation while the rest of us don't. A debt free currency immediately unshackles everybody from gov incompetence. Look around the world at rising food prices, it's not going to get better.
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bobo
Nice rhetoric. But the main reason people are broke is because they have bought into the consumeristic crap of having everything for nothing. Obviously you can't get anything of value for nothing (except hugs and love). No, people think they really need that designer cup of coffee, their icrap toys, new shoes because their girlfriend has new shoes, etc., etc., etc. I remember reading a post on this very site a few weeks ago where the person was saying that it was 'IMPOSSIBLE' to survive without a cell phone. I'm still laughing at that nugget.
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Abe Stinkin
Socialism for the rich!

In other words, profits are privatized, and losses are nationalised!

The author's hit the proverbial nail right on the head.
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Jon
Don't apostrophize a plural.
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anonymous


The Iranian Oil Bourse, Hegemony Of The USD & The Emergence Of A Multi-Polar World
Iranian Oil Bourse As Challenger To USD’s Hegemony:
Iran announced it’s intention to create the Iranian Oil Bourse (IOB) in 2005. This move would facilitate transactions for oil and petroleum products in a basket of currencies, other than the USD. This is bad for us, for many reasons, which I’ll cover in part III.
In November of 2007, Iranian President Mahmood Ahmedinejad, at an OPEC meeting, called for a “credible and good currency to take over U.S. dollar’s role and to serve oil trades”. Remember, killing the petro-dollar is bad.
Then, in December 2007, in an act of defiance, Iran requested that all oil transactions be paid for in denominations other than the USD, officially opening the IOB in 2008.
The Chinese signed a refinery development agreement with Iran in 2008 ($8 B) and in 2011 inked a $20 billion agreement to develop the north and south Azadegan and Yadavaran oil fields.
These agreements give Iran hitherto unrealized ability to refine their own oil, thus producing their own gasoline.
The petro-dollar, and why the dollar has remained relatively strong:

With the USD previously pegged to gold, the great society initiative of LBJ and the Vietnam War, were bankrupting America. Their costs were grossly exceeding the ability of our gold holdings to underpin the dollar. With the adoption of the petro-dollar, came the ability of foreign countries to invest their oil riches in US banks.
If the UK wanted to buy oil from OPEC, they couldn’t simply pay for it in pounds sterling. They had to convert their cash to US dollars (treasuries/ US debt).
The advent of the petro-dollar allowed the US to ease the strain on the dollar (just like today’s quantitative easing/monetization), by deflating the dollar (thus, inflating costs over time – “why does a loaf of bread now cost $2.50″) and easing the burden of interest payments on our debt.
By pegging our dollar to petro-transactions, we were allowing the folks that we’d just pissed off by decreasing the value of our indebtedness, the opportunity to make money on their transactions in USD (debt being paid to them).
This gross debtor status also created an environment of easy money and entitlement which has afforded our nation it’s
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peter palms
Why people are broke by age 65. EFFECT OF "MODEST" 5% INFLATION
For the past fifty years, all the published charts illustrating the decline of the dollar from such-and-such a date to the "present" show the following type of curve. Confiscates 64% each 20 years and confiscates 90% over 45 year working lifetime. Total confiscation by 50 years. These, of course, are averages. A few people in the middle class of the bureaucracy will have managed to place some of their dollars into tangible assets or income-producing securities—what few remain—where they are somewhat protected from the effects of inflation. For the vast majority, however, inflation hedges constitute but a tiny fraction of all they have earned over a lifetime.
And so we find that, in The New World Order, inflation has been institutionalized at a "modest" level of five per cent. Once in every five or six generations—as prices climb higher and higher—a new monetary unit can be issued to replace the old in order to eliminate some of the zeros. But no one will live long enough to experience more than one devaluation. Each generation is unconcerned about the loss of the previous one. Young people come into the process without realizing it is circular instead of linear. They cannot comprehend the total because they were not alive at the beginning and will not be alive at the end. In fact, there need not even be an end. The process can be continued forever.
By this mechanism—and with the output of work battalions— government can operate entirely without taxes. The lifetime output of every human being is at its disposal. Workers are allowed a color TV, state-subsidized alcohol and recreational drugs, and violent sports to amuse them, but they have no other options. They cannot escape their class. Society is divided into the rulers and the ruled, with an administrative bureaucracy in between. Privilege is now largely a right of birth. The worker class and even most of the administrators serve masters whom they do not know by name. But serve they do. Their new lords are the monetary and political scientists who created and who now control The New World Order. All of mankind is in a condition of high-tech feudalism.


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