The Debt Debate Track is the Wrong One.

The debt debate has been on the wrong track since the beginning, yet we’re still being led down that track. The deficit debate and the debt debate should not be treated as though they are the same topic for they are not. But the deficit and the debt ARE in some ways a result of the same cause.

The deficit, as it’s currently defined, is the difference between what the government takes in via tax collections and what the government spends.

A problem with that scenario though is that the government shouldn’t be able to or have to borrow to make up the difference, since the government, being of a sovereign nation and having a rulebook called the Constitution that says Congress shall “coin” the money, would only need to create sufficient money to fill in the gap. So the deficit debate is a result of a lack of sovereign currency more so than overspending or undertaxation.

The debt is not caused by the deficit. The spending that contributes to the deficit though also exacerbates the debt.

The debt is caused, as was the deficit essentially, by the lack of sovereign currency. Every dollar in US circulation is a dollar of debt to a private bank, plus interest.  Those banks create the nation’s mostly digital currency.  Since the government has shirked its responsibility to coin the nations money, it has shifted taxes to the role of paying interest on the debt and has shifted to selling bonds (borrowing) to obtain spending money for itself. To make things crazier, that process of selling bonds essentially is a national debt mill. It scoops out a bucket of debt money from the already flowing river of debt called the US money supply or currency, gets the debt from it, and then puts it back into the stream just to repeat the process indefinitely. All currency in the US, other than a few remaining United States Notes and the nation’s coins, is debt to a private bank. Some of that debt is multiple layers deep.

Increasing taxes will NOT end the debt, and won’t even reduce it.  And even if it makes a slight dent, it’ll bounce back bigger than ever since the entire money supply is debt and the nation will demand and need more money of course, especially as population continues to grow and prices continue to soar and the wealthy continue to hold money out of the circulation.

Decreasing spending won’t help much either.

Only by shifting back to a sovereign currency, replacing all debt notes with that sovereign currency, and paying off both the Federal Reserve Bank (give to Caesar what is Caesar’s) and the outstanding bonds/treasuries can we be debt free as a nation. To replace all debt notes with positive US Notes would by definition require fractional reserve lending to be ended and replaced with a Constitutional “new currency” distribution method.

Few, if any, politicians, as you can see, talk about anything that will actually work to reduce or eliminate the debt. But it CAN be done, and done fairly quickly with a coordinated effort among the states and our representatives.

What really makes a nation wealthy?

Is a country’s wealth REALLY determined by what they produce? What is wealth? I don’t want to get too far away from the end the debt focus, but a sub-topic of money is what is the purpose of money, and one of the main purposes of the US dollar is to enable internal trade, not international. How can the nation measure its wealth? By the number of millionaires or billionaires? By how many widgets are sold? Or could it be better measured by things like education level, baseline lifestyle, shorter workdays, actual progress towards some achievable goal like space travel, or something along these lines which can thrive if the means of trade is appropriate? People work 40, 50, 60+ hours per week from the day they’re 21 or sooner to do what? What is truly being accomplished? Most of the big problems of the nation have only gotten worse over the decades – poverty, health, retirement age, division…

We’ve been on and off the gold standard, with little to no difference. What remains unchanged for over a century is who controls (and owns) the currency – a private bank called the Federal Reserve and the public has grown blind to it. Americans even go so far as to protect the system that is driving them into the ground. I did so myself for a time, but then I had reality hit me in the face hard.

Jobs leaving America, and shifting to a service economy are symptoms not of a departure from a gold standard, but of a departure from a sovereign currency, a departure from local economies, a departure from sanity in some ways. And “jobs” are not really what people need – busywork created out of an imposed need to chase the dollar bill rather than real work for the accomplishment of a purpose. Meaningful, purposeful work in balance with education, family life, community involvement, leisure time, etc, is I think better. Jobs are going overseas because of a shift from local businesses to mega-corporations which is being driven by the monetary system and the debt-based, non-sovereign, usury laden money that serves as its blood supply. Automation would be much more welcomed if people didn’t have to scurry around like rats looking for new work when their positions get automated.

We’re capable of far better than the system of systems we have accepted as “the only choice”. And we should not be laying down, accepting a debt that can easily be solved. The root cause of the debt is also the root cause of many other issues. We must eliminate it.

There are Problems, and then there are Causes.

There are problems, and there are causes, and then there are problems that are incorrectly claimed as being a cause. Poorly prioritized and wrongly chosen government spending is a problem. Overgrown government is a problem. Excessive taxation, especially for the wrong reasons, is a problem. The national debt is also a problem and it has root causes. But the root causes we’re given by those in public life – congressmen, newscasters, publicly paraded “experts” or “economists”, and would-be politicians – such as insufficient taxation or excessive spending or anything related to the budget deficit – are problems but are not causes of the national debt.

There are others who come close, saying that government borrowing is the cause, but then don’t seem to understand the difference between government borrowing and the mechanisms by which it borrows, and CONSUMER borrowing. They refer to the fractional reserve system as the source of government debt, but that borrowing is mostly done by consumers and while it does cause a flooding of the economy with debt money, the government gets it by selling bonds to people and entities who have somehow gotten it downstream of the borrowing including other nations who print THEIR money, and exchange it for Federal Reserve Notes.

The root causes of the national debt are two, but really it comes down to one REAL root cause or reason for the debt. That reason or root cause is that the US (as well as most other nations) has essentially no sovereign currency (save for coins and a few remaining US Notes) and has given away its right and responsibility to coin its own, so it is stuck with borrowing what it cannot tax. Taxation, though, is not what it seems either. If we were coining our own money as a nation, taxation would simply be a tool – of regulation and of expanding government projects with public permission. But as it is it is one of two means for the government to get money from the public since it cannot create its own. Taxation under the current system accomplishes no regulation as that is loosely done by the bankers for their own benefit.

The lack of ability (or willingness actually) to create sovereign currency leads to the government borrowing all of its currency. It borrows some directly from the private Federal Reserve Bank to supply the “reserves” and does so by “selling” bonds to them. Then it borrows the rest in an insane bond selling circular game where it re-borrows the same already-circulating currency over and over, where each time it borrows the currency it accumulates another batch of debt.

The national debt can only be eliminated by shifting to a sovereign currency. Give to Caesar what is Caesar’s, and let the people have their Constitutionally mandated sovereign currency coined and regulated only by Congress under the scrutiny and control of the people.

If we do that:
– We can eliminate all government bond sales (borrowing).
– Then we can return all circulating Federal Reserve Notes, replacing them with US Notes (which are bills of credit, not debt notes).
– We can change the distribution system of new currency to remove bankers from the picture and easily eliminate/outlaw fractional reserve lending with no adverse effects.
– We can thus eliminate all forced public usury and stop its negative effects.
– We can allow cities and counties to deal with consumer debt using local economic models.
– We can use the US Notes to buy back existing bonds in appropriate manners.

If we do these things, the US will be finally a debt free nation capable of accomplishing immense goals and all of the people can thrive.

No Taxes. No Spending Cuts. At least not to end the debt.

Tax increases will not end the debt, nor will spending cuts.

The only way to end the debt is to solve it from the roots and the roots of the debt have one main vein – that all money in our system is borrowed, contrary to what the Constitution specifies.  We could cut taxes to near zero and raise spending (appropriately, with better priorities) and still eliminate the majority of debt and prevent all future debt in under 2 years.

Every dollar in circulation is debt now.  The government sells special bonds to the Federal Reserve for Federal Reserve Currency called Federal Reserve Notes.  These notes are owned, controlled, and callable by the Federal Reserve which is a private bank.  We only pretend they are ours.  Once those notes (now referred to as dollars) enter circulation and find their way to the commercial banks they become reserves, get multiplied, and cause the injection of many more Federal Reserve Notes into circulation.  The government then sells bonds to borrow THOSE dollars that are simply multiplied debt notes from the Federal Reserve.  It is not NEW money.   In fact it’s like a monopoly game but every time the government passes go, instead of getting another $200 cash, they get another $200 billion in debt.

No sovereign nation should have to borrow a dime to supply currency to its own economy, but years ago the US turned from its sovereign, debt-free, usury free currency and started borrowing everything.  When there’s a debt ceiling debate, everyone should have a red flag going up in their head with the question “why is this government even $1 in debt, aren’t we a sovereign nation and isn’t Congress supposed to be coining our currency?”

While government spending DOES make a bad situation worse and there ARE a lot of priority problems and common sense problems with the spending, it is not in and of itself the reason for the debt.  The reason for the debt is that we don’t have a sovereign currency and the tangent causes generated because of that are the borrowing of currency from the Fed and the RE-BORROWING of existing currency over and over through bond sales.  That, and we haven’t discussed the over $9 trillion of accumulated debt from the international trade balance which has been negative every year since 1976.

Don’t allow another soul to scam you with the idea that cutting government spending or raising taxes is going to somehow solve the debt.  That’s the course of insanity.  We MUST return to a sovereign, credit/asset based, usury free, debt free, all-citizen controlled currency and end ALL government borrowing as the Constitution makes clear that we should be doing.   One such currency called the United States Note IS still legal tender and could easily and quickly replace all existing Federal Reserve Notes and should.

Scott Keller