It’s earnings season on Wall Street. Companies report how much money they made and lost and every nook and cranny of the business, and then traders trade the stock and prices change. Sometimes dividends have to be cut or people laid off or pay raises frozen or capital equipment sold in order to stay liquid. And the stock price will always reflect the reality at any given moment.

If government reported earnings it would be negative every quarter. The combined earnings of a company over its history is its retained earnings. The United States Government has retained earnings of negative $19,000,000,000,000. Its equity would be below zero. Its stock would have no value.

But government cutting expenses? HA! All the whiners will whine. Sequestration! Sounds so violent! The whole economy will collapse! The bureaucrats will all be unemployed and we’ll all be doomed! Cutting government spending is immoral! The last time there were any serious cuts was after War War II. Since then there have been no cuts. Government is never cut until it collapses. Like a cancer that can’t stop growing, eventually it kills its host, thereby killing itself. The rest of the body stays in equilibrium with itself. Cells live, cells die, conditions change, body adapts, growth and shrinkage keeps it in balance.

Cancer keeps growing until everything dies. So does government. Cells don’t die. They keep multiplying.

The “economists” who say the economy depends on government spending? Whose money do they think the government is spending? Do they think that once the government spends money, that money becomes infinite? Are we in some jack and the beanstalk fairytale here? Is government money an everlasting gobstopper? Is it manna from heaven? Why are all resources finite but people have to think about whether government resources are finite?

The “economists” who say that consumption comes before production, how do you respond to such nonsense?

Shares in the US Government would have a market value of zero. The only thing that gives government, any government, any value at all is its ability to borrow, tax, and inflate. Once it cannot borrow or inflate, due to a debt default (which ends your ability to borrow) and hyperinflation (which ends your ability to inflate), it will only be able to tax. At that point, the people will not be confused by economic myths like the economy depends on government spending. They will know the spending comes from them, their work, because borrowing and inflation will be impossible. They they will understand that the economy depends not on government spending, but on their efficient use of their own money and resources.

People only believe economic myths when the costs of those myths are hidden through borrowing or inflation.