NEWS! The Republicans actually are right (sort of) about something. The “Current Policy Baseline.”

If you voted Republican in previous elections, you probably thought you were voting for conservatives, not those big spending, big taxing bleeding heart liberals. You were fooled. It’s almost like falling in love with a beautiful, kind, intelligent, compassionate college girl, and today you are shocked and dismayed to discover she has become a gnarly, mean-spirited, ugly wicked witch. WHAT IS CONSERVATISM? Conservatives support reduced government spending to limit the size and scope of government. They push for cuts to social programs and other non-defense discretionary spending. Conservatives prioritize balancing the budget and reducing deficits. They support tax cuts, simplifying the tax code, and measures like a flat or national sales tax. They are concerned about the national debt and argue that high debt levels can lead to higher interest rates, reduced economic growth, and increased vulnerability to financial crises. They propose measures to reduce spending and reform entitlement programs to address this. TODAY’S REPUBLICAN PARTY There was a time when the Republican Party was conservative.  However, under Trump, there has been some slippage. They still favor reduced spending, but only when the reductions don’t touch the very rich. They want to cut (they call it “reform”) Medicare, Medicaid, Social Security, school lunches, and other programs that primarily benefit the middle and the poor. They still favor tax cuts and tax simplification, but only tax cuts that benefit the rich. And the simplification should not affect those complex tax loopholes that allowed billionaire Donald Trump to pay $500 a year in taxes. The still claim to worry about the federal debt, but here is the sticking point. To give their millionaire and billionaire voting base those juicy tax cuts, the GOP has to cut other spending or increase the federal debt. But there isn’t enough “other spending” to cut, unless the radically cut all the social programs the majority of voters treasure. They sent out Mad Dog Musk mindlessly to fire hundreds of thousands of good working people (without considering them as individuals), to take dollars from their pockets and to line the pockets of the millionaires and billionaires. But even with those dollars stolen from the poor and middle-income families, there isn’t enough money to satisfy the rapacious rich. Ah, what to do? What to do? While always lacking ideas to help poor and middle-income people, the Republicans never lack for ideas to enrich the rich. Here is the latest: THE CURRENT POLICY BASELINE Imagine that your credit card spending is $10,000 a year. Based on your income, you say, I can handle that. I’ll be able to pay it.” But you don’t. So, at the end of the year, you owe &10,000. The following year, again your credit card spending will be $10,000, and you say, “Last year, I spent $10,000 and my income stayed the same, so I can spend another $10,000 this year.” Do you see anything wrong with that? That is “Current Policy Baseline,” and it is the gimmick being proposed by fake conservatives to claim they still are being conservative, by following last year’s policies again this year. They want you to forget that the debt grows while the deficit remains the same. There is a huge difference between the “Current LAW Baseline and the Current POLICY Baseline, Here is the argument proposed by the U.S. Chamber of Commerce:

Under a current-law baseline, preventing the scheduled expiration of key individual, business, and estate tax policies enacted in the 2017 Tax Cuts and Jobs Act (TCJA) would be considered to cost around $4 trillion over 10 years. Consider a family that paid $10,000 in federal taxes for 2025 but for whom, under existing law, tax rates are scheduled to double in 2026, meaning the family would have to pay $20,000 in federal taxes that year. A current-law baseline would assume this planned change in the law. But if Congress later decides to increase tax rates by only 50%, using a current-law baseline would count the family as having received a $5,000 tax cut. Of course, in the real world, the family didn’t receive a tax cut at all; they got a $5,000 tax increase.

Get it? Congress passes a law that calls for a $10,000 tax increase, a later passes a new law that calls for “only” a $5,000 tax increase. Under the “current law” baseline, they could tell the voters they just cut taxes by $5,000. MAGAs might believe it, but would you?

Suppose Congress adopts a current-law baseline in its FY 2025 budget resolution. In that case, it is all but certain that most—if not all—of the TCJA’s temporary tax provisions would once again have to be sunset to comply with the Senate’s Byrd rule, under which titles in reconciliation bills cannot increase the deficit in years beyond the usual 10-year budget window.

This is because making the TCJA’s temporary provisions permanent would be considered to increase the deficit when measured against current law.

If, on the other hand, Congress were to adopt a current-policy baseline, then lawmakers would have a real chance to deliver permanent tax relief to American families and employers because extending the TCJA’s temporary provisions would not increase the deficit relative to current policy.

It’s all hocus-pocus designed to confuse you, allowing the Republicans falsely to claim they are not increasing the federal deficit while it and the federal debt rises massively. I AGREE WITH THE DECEPTION OF THE CURRENT POLICY BASELINE Yes, I agree with the deception because:

1. The federal debt and deficit are not burdens on the government, the taxpayers, or the economy.

The so-called “federal debt” is neither federal nor debt. It is the total of deposits into Treasury Security accounts. These deposits are, and remain, owned by depositors who want a safe interest-paying place to store otherwise unused dollars.

The accounts resemble bank safe deposit boxes in that ownership never passes to the government, which only holds the dollars for safekeeping.

Our Monetarily Sovereign government does not offer these deposits to acquire spending money; the government already has infinite spending money. The sole purpose of T-security accounts is to provide a safe storage place for those unused dollars (which stabilizes the U.S. dollar) and to help the Fed regulate interest rates (by providing a base rate).

Taxpayers do not pay for the debt. Upon maturity, the stored money is returned to the depositors along with interest created by a government computer. Federal taxes don’t fund federal spending.

2. Federal deficit spending benefits the economy by adding growth dollars to GDP. 

What does Congress do whenever we have a recession or even a threat of recession? It spends more to stimulate growth.

Nine consecutive recessions have followed this pattern:

1. Spending growth declines
2. Recession begins
3. Spending growth increases
4. Recession is cured.

It is not a coincidence. It’s simple cause and effect. SUMMARY A growing economy requires an increasing supply of money. The so-called “federal debt” (should be termed “economic income”) is not a burden on taxpayers, the government or the economy. Concerns about the so-called “federal debt” and federal deficits hinder economic growth. Under the “fight fire with fire” concept, I agree with deceiving the public about the Current Policy Baseline not increasing the deficit, because deficit increases are necessary for a healthy economy. It’s like telling your kids that spinach will make them as strong as Popeye. It won’t, but the spinach is good for them, so  . . . I see the current policy baseline as a white lie meant to accomplish a good purpose, though it exposes the hypocrisy of the GOP. Rodger Malcolm Mitchell Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell; MUCK RACK: https://muckrack.com/rodger-malcolm-mitchell; https://www.academia.edu/

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A Government’s Sole Purpose is to Improve and Protect The People’s Lives.

MONETARY SOVEREIGNTY