A response to Wigwam and call to action
Wigwam has written a couple of diaries about coin seigniorage and in this one -“The Jumbo-Coin Option” he asks for people to “please publicize this jumbo-coin option to your congress critters and news outlets.”
And that is the ‘call to action’ I am referencing.
Here is my letter to Keith Olbermann at email@example.com :
“Dear Mr. Olbermann;
I have been watching your show on Current TV (never watched while you were on the corporate mass media,CMM) and while I think I get the gist of your program’s paradigm, I find it lacking in analysis that does not follow the CMM story lines.
For instance, with all the talk abut the deficit and ‘debt limit’, the ‘public budget’ put forth by the ‘progressive caucus’ hasn’t seen the ‘light of day’ in coverage either from you or the CMM. While the CMM can be excused inasmuch as it is nothing but propaganda initiated by the government or ‘powers that be’ -I’m thinking Ailes and Murdoch,etc.- I really can’t fathom why you are not providing the public with such information.
Additionally, regards the ‘debt limit’, a LEGAL alternative that DOES NOT raise ‘constitutional issues’ is ALSO not seeing the ‘light of day’ in reporting. Specifically, what is known as coin seigniorage. And since NO ONE else is reporting on this capability, it would truly be a ‘scoop’ for you to do so. Here is the information regarding this solution to the ‘debt limit’:
The jumbo-coin option, wherein the Mint strikes some trillion-dollar coins and uses them to buy up (i.e., pays off) the roughly two-trillion dollars of Treasury bonds (national debt) that the Fed has accumulated through its open-market operations (e.g., QE1 and QE2).
By law: http://www.law.cornell.edu/uscode/31/usc_sec_31_00005112—-000-.html
the Secretary of the Treasury has the authority to strike such coins and they are “legal tender”:
(h) The coins issued under this title shall be legal tender as provided in section 5103 of this title.
(k) The Secretary may mint and issue platinum bullion coins and proof platinum coins in accordance with such specifications, designs, varieties, quantities, denominations, and inscriptions as the Secretary, in the Secretary’s discretion, may prescribe from time to time.
And, since those bonds are debt, by law, the Fed cannot decline this transaction:
United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues.
Moreover, crediting the Treasury face value for coins is standard operating procedure for the Fed:
The distribution of coins differs from that of currency in some respects. First, when the Fed receives currency from the Treasury, it pays only for the cost of printing the notes. However, coins are a direct obligation of the Treasury, so the Reserve Banks pay the Treasury the face value of the coins.
Those coins would then be kept in a vault at the Fed, and by definition “vault cash” is not “money in circulation,” e.g., it is specifically excluded from the definitions of M1, M2, M3, and M4.
In effect, the Fed has already paid off two-trillion dollars of the national debt, thus putting two-trillion new dollars into circulation. This jumbo-coin transaction finally gets those bonds off the books, thereby making the books reflect this reality and the debt-limit crisis go away.
To save the social safety net from the death of a thousand cuts, please publicize this jumbo-coin option.
Additionally, while you appear to have a ‘soft spot’ for Talking Points Memo staff, let me suggest that interviewing Jane Hamsher or David Dayen of Firedoglake.com would be a good counter balance to the TPM folks.”
Feel free to copy and send or add your own comments or write something different that gets Olbermann
to discuss the ‘public budget’ and the use of the ‘jumbo coin’ option to address the ‘debt limit’.
(Mods, this is not the first time a youtube video couldn’t just ‘show up’; if you can get the picture in this diary, please let me know how you did it)