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The rich people in the U.S. and Japan have been able to convince the politicians to create a system where the rich pay less taxes so they have more money at hand to grow the economy, but will, at the rich peoples’ option, borrow money to the government to be returned plus interest to make up for the lack of revenue, with the national debt, debt ceilings and deficits always increasing. During depression/recession times the nervous rich, holding government paper, exchange this government paper for cash printed under the heading of "quantitative easing" supposedly conducted for the sole purpose of increasing value of this government paper and subsequent lowering of interest rates. In this way, we are investing in rich people to grow the U.S. economy that will result in increased revenue. Is this system working? It depends. The rich people are getting richer and the middle class is getting poorer because the politicians are allowing the rich to put small business out of business, big business is increasing productivity and globalizing manufacturing and bringing lower paid workers into their countries to lower wages and putting their own citizens out of a good paying jobs with less income tax revenue coming into the treasury. In the U.S. at this time, the top 1% makes more money each year than the bottom 90%. More and more monopoly money is going to the rich, which money is not used by the middle class to purchase stuff that may be manufactured in their own country which may increase economic growth and printing of "real" dollars” to add to the supply of "real" money in the monopoly game. Rich people can only buy so much stuff and horde most of this money and/or purchase investment products. I expect a similar play is staged in Europe except the central Fed in Europe is not as clearly defined. At some point, the townspeople can rush the castle and take the rich people's stuff and take back the system, meaning, forcing the rich people to pay more tax on income and assets and/or hiring and paying “hanger on” employees because we let big business put small business out of business, unless you believe in borrowing from the rich instead of true economic growth to generate revenue. These people paid 90% tax rates in the U.S. during the Republican Eisenhower years. What if we threaten not to pay the rich people back. In Europe, the private sector rich people are willing to cut the debt in half and extend pay back at a lower interest rate and the public sector may do the same. The government can tell the rich people, the government will pay you back the money we borrowed plus interest BUT we will go back to the 1960’s and recalculate your taxes up to today at 90% because you guys did not provide the jobs you promised to create. What choice do they have?
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