How You Can Enter Money Heaven
and spend money now you haven’t got [yet]
Money heaven. The state where you can spend money infinitely and indefinitely, where you can forget about “spending less than you earn.”
Until recently, this state of bliss was only possible for governments: if you’re sitting in the White House, 10 Downing Street, the Élysée Palace—or even the Kremlin—the idea of spending less than you earn is—how shall put it?—just for the plebs.
Consider the United States government: from 1901 to 2017 its budget has balanced or been in surplus in just 27 of those 117 years. 22.5% of the time. For a total surplus of $120,372,000,000. Or $4½ billion per surplus year.
But this seriously overstates the achievement of the budget-balancers.
The 90 years of deficits adds up to a whopping negative number of $16,251.4 trillion.
On average, every year since 1901 the US government has spent $180.8 billion a year more than it received. Though that’s peanuts compared to $865.8 billion average annual projected deficit from 2018 to 2023—for a cumulative total of $5.2 trillion!
By the way, I didn’t make up those numbers. They come direct from the White House: The Office of Management and Budget. See for yourself: whitehouse.gov/omb/historical-tables.
And if you think I’m unfairly targeting the United States, according to the CIA only 36 of the world’s 221 countries and territories balance their budgets. And most of those 36 are tiny countries most people have never heard of: Tuvalu, Kiribati, Palau, Saint Pierre and Miquelon, Marshall Islands, or smaller places like Liechtenstein, Hong Kong, and Gibraltar.
The other 84% of the world’s governments regularly spend more than they receive.
So how can we join governments in this state of monetary bliss—and forget about “spending less than we earn”?
By applying the government way of accounting to our own expenditures.
First of all, you’ll notice that governments project that their budgets will balance sometime in the future. A future that often recedes to infinity.
For example, last year Donald Trump projected the US budget would be balanced in 2027. But this year that projection has moved further into the future: to 2030.
Secondly, the government way is to spend projected income now—and make up for it with future spending cuts. After all, spending cuts and tax increases in the present are vote-losing no-nos. Except when they’re targeted at a minority, the rich and Big Business being the universal favorites.
So the necessary spending cuts and tax increases to meet the balanced budget target are always projected to happen sometime next year or (preferably) the next decade.
We can easily do that. For example, I can project that sometime in the next 10 years I’ll quit caffeine and nicotine. That’s not a problem. A helluva lot easier than doing either today!
But wait a minute. Some government spending is sacrosanct. Social Security, Medicare, the military—not to mention Congressional salaries and other perks of office, like taxpayer-funded junkets. First class of course.
Finally, when it comes to framing the following year’s budget governments always start with a blank sheet, ignoring or conveniently forgetting any previous oaths and promises.
How to spend a million dollars you haven’t got—yet
To begin with, instead of worrying about whether we balance our budgets this year, let’s make some projections so that our budgets will balance sometime in the future.
For example, I could project that sometime over the next 10 years, I’ll get a book on the New York Times bestseller list. Unlikely perhaps, but not impossible.
To get on that bestseller list I need to sell 9,000 or 10,000 copies a week. And once I’m on it those sales levels will continue for a month or two or three.
A hardcover book retailing at $27 gives the author a royalty of $4.05 per copy—or $40,500 a week if you’re on the list. So in 25 weeks the author collects a bit over a million dollars.
Admittedly that’s before taxes and various other expenses, so to be conservative (heh-heh) let’s just take $500,000 as a reasonable projection.
That works out at fifty grand a year.
Not too shabby.
If I were the government I could start spending that money right away. I could take that projection, assume it’s accurate and issue debt. And my [projected!] budget would still balance . . . by 2028.
But if I made this proposition to a bank I think they’d probably laugh their heads off. Banks will lend to governments because governments’ revenues come mainly from taxes. And unlike book buyers, “taxees” have no choice about coughing up.
Unfortunately, the only way you or I could raise “taxes” ourselves would be to stand on a street corner at midnight with a gun or a knife. Not a particularly good strategy, especially at my age: I can’t run very fast.
We could collect “taxes” by some other means. Say, a Ponzi scheme like Bernie Maddoff’s. Or some other fraudulent scam.
Again, not a safe proposition.
What we need is some activity where people will voluntarily give us money without expecting any money-back guarantee.
The only possibility I can think of: start a religion!
Why a religion and not, say, a charity?
Non-profit organizations like charities are more heavily regulated. You usually have to spend nearly all the money on good works, leaving little that can be “skimmed off.”
By comparison, a church is essentially an unregulated, tax-free operation. Especially in the United States.
The second major benefit is that a church is the only operation where people will freely donate money—or, like the Mormons, agree to a tithe, which is nothing more than a voluntary tax—for a promised payoff that occurs only in the hereafter. So if it turns out that Mohammed or Richard Dawkins was right, there are no refunds to worry about.
Unfortunately, as an atheist, this option is unlikely to succeed for me. Though a St. Paul-like “revelation” on the road to Damascus could work. Maybe.
Issuing debt and raising taxes are two ways governments can finance their deficits.
If neither of them will work for us is there a third option?
Happily, there is.
Print Your Own Money!
Thanks to Bitcoin, printing your own money is no longer an option reserved to governments.
Anyone and everyone can now follow the government way by simply starting their own cryptocurrency.
And it doesn’t even matter if your new crypto doesn’t follow Bitcoin to the moon, but crashes on its launch.
After all, if it floats, say, at $1 and immediately drops to 50 cents, your “founder coins” will still be worth a whole bunch.
Next year (or next month!): repeat.
Admittedly, there’s a glitch or two with this plan. [“Plan,” of course, is not an accurate assessment of this, uh, plan—except in government-speak.]
For starters, I don’t know anything about blockchain—except that you need to know something about blockchain programming to start a cryptocurrency.
Related: all the good blockchain programmers are busy starting their own cryptos, so it would probably cost an arm and a leg to start the “Mark Tier deficit-financing crypto.”
Not impossible. I could learn blockchain programming myself, for example. Though chances are by the time I’d mastered it the Bitcoin Boom would be history department.
So . . . I guess that leaves just two remaining options: become a politician myself or somehow get to be the chairman of a central bank.
Or, (sigh!), get started on that book.