Part II - Brief 6: Conservative Congressional Action Required To Stop The Creeping Rots of Inflation and Socialism in the United States
Copyright 1982-2010 by Bernard Palicki. All Rights Reserved.

Object of this brief is to put all government, Federal, State and Local, On Fixed Budget Incomes; and, for the very first time in the history of government, politics and economics, the rule of man-made law, in conformity with the iron hand of natural law, will be imposed to control the controllers. Beginning with a quote from The Declaration of Independence, July 4, 1776.

"... Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shown that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security. ..."

A perverse marriage exists between officials of the federal government and the private central banking authority. That perverse marriage constitutes the single largest monopoly and organization of the most wealthy welfare recipients on Earth.

Corrective actions cited here and required for execution by legislative action are predicated on the following natural law facts:

  1. The structure of any national household is exactly the same as the structure of the electronic circuit. (Power Supply and parallel loads.)

  2. The circular flow of money is exactly the same as the circular flow of electron energy of the electronic circuit. (Electron energy transfer.)
See Figure 44 Fundamental Structure and Circular Flow of Money
The required set of four 'corrective law-making actions' can be enacted by an Act of Congress by adding them to the Federal Reserve Act of 1913. These are cited below as follows:
1. ZERO INFLATION

Stop and eliminate the creeping rot of inflation of the U.S. dollar.

Fix the dimension of money as a standard unit of measure of the cost of human labor, dependent on population growth and population densities. Fix the rate of growth of the U.S. Money Supply to the natural rate of growth of the naturalized citizen population headcount provided by the Census.

NOTE:
Given there is integrity in real-time maintenance of the data base of the Social Security System (Names, addresses and dates of birth and death of U.S. Citizens), the Social Security System data base could be used to conduct the Census, and do so every five years instead of every ten years, and do so more cost-effectively than the costly- time-consuming 'mail-in' and/or supplemental 'door-to -door' solicitation questionnaires.

Whether you like it or not, the U.S. Social Security Number, assigned to each newborn child from its moment of birth, is a U.S. Federal Identification Number.

The U.S. Social Security Card should carry a photo of its 'owner', just as State Driver's Licenses require photo of its owner, renewable every five(5) years. Thus, we would be able to distinguish 'Citizens' from 'Aliens' and update the U.S. Census every five years (at far less cost than the current archaic 'system' of census-taking every ten (10) years.
END OF THIS NOTE

2. FIX THE COST OF BORROWED MONEY AT 5%

Fix the cost of borrowed money at 5% annual percentage rate (APR) to the borrower. Reason for fixing the cost of borrowed money at 5% is provided with graphics in pages 93 through 96 of 'A Capitalist Manifesto' (See the short bio).

The concept of an 'elastic money supply' must be abandoned. 1. and 2. above, applied together, fixes units of money as a unit of measure of the cost of human labor, where the cost of human labor is the cost of human life.

3. PUT ALL LEVELS OF GOVERNMENT, FEDERAL, STATE AND LOCAL, ON FIXED BUDGET INCOMES

Natural law dictates that maximum efficiency is achieved only when the power of the 'load' is equal to the power of the 'source'.

Accordingly, this corrective action provides that 50% of the total national money supply (using the M3 component of total national money supply as a number) be allocated and reserved to support the total cost of total government (all levels of government - federal, state and local) with distribution of fixed government budget income amounts. Reserve 25% of the money supply to support the total cost of Federal Government and the other 25% to support he total cost of State and Local Governments. Distribution to the States according to a State's population as a percent of the total national population headcount; and distribution to Local Governments as a percent of a given State's population headcount.

This is no other way to contain the size, power and force of 'government' or 'ruling establishments' to interfere with the natural demand and supply forces of 'trade' in the market place.

4. RETAIN THE FEDERAL INCOME TAX BUT ELIMINATE MANY OF ITS CURRENTLY ALLOWABLE DEDUCTIONS

The classic national household management problem has never been distribution of wealth. The classic national household management problem has always been distribution of the tax burden.

  1. Eliminate all government grants, subsidies and loan guarantees.

  2. Eliminate taxes on all goods, products and property, leaving only the current Federal tax on gross incomes.
    1 No deductions except the 'time-cost of borrowed money' paid to banks/creditors in a given taxable year, not distinguishing between government agency entity incomes, structured business entity incomes and/or individual or family incomes.

Summarizing Corrective Actions Required For the 21st Century:

Fixing units of currency as a standard unit of measure of the cost or worth of individual human life

???What is required to fix units of currency as a standard unit of measure of the cost or worth of individual human life???

Re Corrective Action 1:

Fix the controllable rate of growth of total national money supply (M) to the natural and uncontrollable rate of growth of total national population headcount (P). M is the total supply of money/currency of any given Nation, and P is the total population headcount of any given Nation.

Re Corrective Action 2:

Fix the cost of money borrowed by the public at 5% per annum (per year), to support a continuous and un-interrupted circulation of units of currency through the buy and sell transactions of the market place.

Restrict judgement for bank approval/disapproval of loan/credit to a borrower's history of employment and a proven ability to repay loans. Fix the cost of money borrowed by all banks from the Reserves of the Federal Reserve Banking System at 3% per annum, allowing banks a 2% profit to sustain banking operations.

Re Corrective Action 3:

Put all operational and enforcement costs of government (federal, state and local) under fixed budget income, wherein the fixed budget income to support the total cost of total government, federal, state and local, is fixed at 50% of total national money supply (M).

Re Corrective Action 4:

Remove taxation of all goods, products and services 'property', retaining taxes on imports from international trade of products.

'Poverty level income' of any national household can be calculated by the simple ratio of M/P (where M = Total National Money Supply and P = Total National Population Headcount)", without performance of bureaucratic paper shuffling of numbers from surveys.

Maintenance and expansion of 'poverty' of the citizens of any given Nation on Earth is forced and deliberate.

'Poverty', and the maintenance and expansion of 'poverty', is forced, by the very simple and destructive act of growing any Nation's 'Total National Money Supply' at some rate that exceeds the natural rate of growth of any Nation's 'Total National Population Headcount' and a variable cost of borrowed money in excess of five percent (compound interest).

If you want the 'natural law of demand and supply' to rule in 'market-driven management', within and between all 'national households', federal and world bank government (International Monetary Fund) subsidy of all markets for products and services should be abolished.

Competing Ideas of Different Systems of Taxation

It is a fundamental position of this work, that the 'federal tax code' treat the individual or family the same as it treats the structure of a 'company' or 'corporation'. Without the private individual or family, the company or corporation structure is just a useless piece of paper.

Further, the only thing wrong with the Federal Income Tax, is its containment of all of its exemptions, exceptions and the myriad of taxable items (for example, like Capital Gains or Estate taxes) that make it so feared and hated. Its interpretation is absurdly and onerously complex. Solve that problem by removing the exemptions, exceptions and the myriad of taxable items that are not income.

By the way, the so called Fair Tax is no less an absurdity because it taxes the cost of consumption - and the cost of consumption is the cost of living - so the Fair Tax taxes the cost of living at roughly 23% in addition to an average 15% required for state and local taxes - or what? - a total 38% from incomes required to pay taxes in addition to the cost of living? Forget the lure of rebate. What would be the cost to employ all the government employee cost-of-living tax collector counters and the cost of administration of all the government employee rebate monitors? You should be especially galled by the additional 23% Fair-Tax amount added to the purchase price of a home over and above the cost of your home insurance and real estate taxes.

  1. The elected 'politician' will always make 'law' in favor of personal gain.

  2. The 'banker' is the only one who profits by unlimited rate of compound interest on debt for 'time-cost' of borrowed money.

  3. The professional 'economists' and 'investment counselers' influence making of law and the tax code but have never shown evidence that they know the difference between their 'assholes' and 'holes' in the ground.

Contrary to all popular myth, ALL MEN ARE NOT CREATED EQUAL into a material existence.

The first two 'corrective actions' are required to fix money/units of currency as units of measure of the variant and un-equal cost or worth of the individual human life.

The third 'corrective action' is required to contain abuse and corruption by elected officials of 'government'.

The fourth 'corrective action', prevents use of the Federal Income Tax from granting favors to lobby interests.

Constitutional Amendment is not required to implement these 'corrective actions'. These 'corrective actions' can be accomplished by simple amendment to the Federal Reserve Banking Act of 1913.

The Federal Reserve Banking Act of 1913 was a deceitful Act of ignorant menbers of the U.S. Congress at that time. That ignorant U.S. Congress of 1913 forfeited original Constitutional power of the U.S. Congress to regulate the value of money and of foreign coin.

In fact, ignorant members of the U.S. Congress of 1913 handed over original 'constitutional' power and authority of the U.S. Congress, 'to regulate the value of money and of foreign coin', to a private banking authority, the 'money changers' in the temple.

Destructive consequence was the 'Great Depression of the 1930s' and reduction of the United States into a 'socialist-welfare-state' and a 'beggar' Nation during the 20th Century.

These 'corrective actions' for the 21st Century offer a way out, hopefully, without resort to violence in the streets in years to come.

Advance to Brief 7

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