California Free Press

Off the Top of My Head

Democrats Have to Come Up With a Plan to Make Real Estate Affordable Again

by John Lawrence

In the end Trump's and Musk's blitzkrieg may end up being a bunch of sound and fury signifying nothing. However, there is a lesson here for Democrats. They need to have a couple of bullet points and a well thought out plan that they can execute or start executing on Day 1 of the next Presidential election, and they need to start hammering on it now. This is exactly what Trump did. He hammered for four years in his campaign rallies on MAGA before the election of 2024. The major bullet point should be Make Housing Affordable Again. This is the Number One economic problem in the US, and is something that government can and should do something about. There are a number of ways to do this. Kamala's plan for down payment assistance is one. But a much larger effort is needed and it should be ready to go on Day One of a new Democratic administration in 2028.

The Federal government can also give much more than down payment assistance. It can provide much or all of the capital to pay for the home with the understanding that, when the home is sold, the government will be paid back. It can facilitate the transfer of equity that parents or grandparents may have in their homes to children to be used for their home in much the same way that a reverse mortgage works. That is equity in a home can be transferred from an older generation to a younger generation in such a way that there is no increase in expenses for the older generation. There are private companies that do much the same thing right now. It is called Home Equity Investment.  They will take an equity position in a home in such a way that when the home is eventually sold the company will get a percentage of the profits. At the same time they provide the homeowner with a bunch of cash which can be used to help a child buy their own home. This is different from a HELOC- a Home Equity Line of Credit - in which monthly payments have to be made. A HEI doesn't require monthly payments.Democrats should get involved in this and other creative  aspects in a big way and have well thought out plans that they can implement on Day One of a new Democratic administration.

Another idea is that government could let contracts to builders and developers to build affordable housing. Biden's Infrastructure and Jobs Act provided $547–715 billion for building and repairing infrastructure in the US which was and is very necessary. A similar act to build affordable housing could be implemented. It would also create thousands of jobs. These houses could be built in such a way as to be climate change resistant.  These various ideas could be fleshed out in a document similar to Project 2025. The point is to have plans to make real estate affordable and to make this the Number One bullet point for Democrats in 2026 and 2028. Secondary bullet points could be taxing the rich and giving tax breaks to the middle class, enhancing social security and  providing money for child care and elder care.

Off the Top of My Head

When Will Elon Take a Wrecking Ball and a Sledgehammer to the Military-Industrial Complex?

by John Lawrence

I'm still waiting. So far Elon's wrecking ball has saved small potatoes. The really big fraud, waste and abuse is in the Defense Department. The United States spends more on defense than the next 9 countries combined. In 2024 the US spent over a trillion dollars just on interest on the Federal debt. The current defense budget is $895 billion. The US budget for intelligence agencies in 2023 was $99.6 billion which was a nearly $10 billion increase from 2022. U.S. programs to operate and modernize nuclear forces would cost $756 billion over the next 10 years. So when you add it all up, the US spends well over a trillion dollars a year on defense/offense. In 2023 The federal government spent 38.0% more than it collected  resulting in a $1.7 trillion deficit. In 2024 the US added $2 trillion to the national debt. The last trillion was added just 4 months after the previous trillion. In the new Trump/Musk era, in which the US will purportedly retreat from being a globally connected power, there are much cost savings to be had by cutting all these budgets down to size. China's total military spending for 2024 has been estimated at US $471 billion, roughly half the US military budget. The US could bring it's defense/offense budget down to roughly that size and still spend more money than any other country.

The question is couldn't the US slash its military budget and still be a world power? The only other alternative to cutting US expenditures down to the size of US revenues is to cut spending on social security and medicare. The federal government spent $1.35 trillion on Social Security in fiscal year 2023. This accounted for 22% of the total federal budget. In 2023, the federal government spent about $848.2 billion on Medicare. Medicaid is financed jointly by the federal government and the states. In 2022, the federal government covered 71 percent of the program's cost, spending $592 billion. So the Trump/Musk cost cutting regime is likely to focus on Medicaid, which is the health care program that mostly helps poor and vulnerable people. The federal government collected nearly $4.5 trillion in revenue in FY 2023 and spent almost $6.2 trillion. So the US government was $1.7 trillion short! In 2024 $2 trillion was added to the national debt, and currently the US spends $882 billion just on interest on the national debt, about the same amount as the nominal defense budget and more than was spent on Medicare!

In the first Trump presidency the national debt rose by almost $7.8 trillion mainly due to tax cuts for the rich. Now that Trump wants the debt ceiling abolished, he will probably want to use the same playbook to give more humungus tax cuts to the rich. This will drive up the national debt, which now stands at $36 trillion to even higher nose bleeding heights. Meanwhile, Musk will find that his cost cutting measures can only come to fruition by raising payroll taxes, the money paid into the social security fund by working people. He could also raise the cap on social security payments which now stands at $176,100. So all those making more than this cap pay nothing on income above it. However, since this would affect rich people, it may not be raised except in the case that there would be all kinds of carve outs or exceptions for the very rich. In other words the working rich, who receive a salary, might have to pay more. What we are not likely to see is any kind of taxes raised on stock sales or carried interest, in other words money that is made by the very rich.

Medicaid will probably be the first target of Musk cost cutting. Many red states have already opted out of Medicaid expansion which was included in Obamacare. The Kaiser Commission on Medicaid and the Uninsured identified 21 states that, as of July 2013, were not proceeding with Medicaid expansion and 6 states in which a decision had not been made. Forty-six percent of uninsured adults in the United States who could become eligible for coverage live in a state that is not planning to expand Medicaid. In the south, the region with the highest rates of uninsured, more than 80% of potentially eligible adults will not gain coverage because of decisions to opt out. Trump/Musk will probably want to leave Medicaid totally to the states leaving Federal funding off the hook altogether. Many of these states will then totally opt out of any Medicaid responsibilities whatsoever.

‘Quantitative Easing with Chinese Characteristics’: How to Fund an Economic Miracle

From Web of Debt blog

Posted on February 11, 2025 by Ellen Brown

China went from one of the poorest countries in the world to global economic powerhouse in a mere four decades. Currently featured in the news is DeepSeek, the free, open source A.I. built by innovative Chinese entrepreneurs which just pricked the massive U.S. A.I. bubble. 

Even more impressive, however, is the infrastructure China has built, including 26,000 miles of high speed rail, the world’s largest hydroelectric power station, the longest sea-crossing bridge in the world, 100,000 miles of expressway, the world’s first commercial magnetic levitation train, the world’s largest urban metro network, seven of the world’s 10 busiest ports, and solar and wind power generation accounting for over 35% of global renewable energy capacity. Topping the list is the Belt and Road Initiative, an infrastructure development program involving 140 countries, through which China has invested in ports, railways, highways and energy projects worldwide. 

All that takes money. Where did it come from? Numerous funding sources are named in mainstream references, but the one explored here is a rarely mentioned form of quantitative easing — the central bank just “prints the money.” (That’s the term often used, though printing presses aren’t necessarily involved.) 

From 1996 to 2024, the Chinese national money supply increased by a factor of more than 53 or 5300% — from 5.84 billion to 314 billion Chinese yuan (CNY) [see charts below]. How did that happen? Exporters brought the foreign currencies (largely U.S. dollars) they received for their goods to their local banks and traded them for the CNY needed to pay their workers and suppliers. The central bank —the Public Bank of China or PBOC — printed CNY and traded them for the foreign currencies, then kept the foreign currencies as reserves, effectively doubling the national export revenue. 

Investopedia confirms that policy, stating:

One major task of the Chinese central bank, the PBOC, is to absorb the large inflows of foreign capital from China’s trade surplus. The PBOC purchases foreign currency from exporters and issues that currency in local yuan. The PBOC is free to publish any amount of local currency and have it exchanged for forex. … The PBOC can print yuan as needed …. [Emphasis added.]

Interestingly, that huge 5300% explosion in local CNY did not trigger runaway inflation. In fact China’s consumer inflation rate, which was as high as 24% in 1994, leveled out after that and averaged 2.5% per year from 1996 to 2023. 

Off the Top of My Head

Trump is Pissing Down Our Back and Calling It Rain

by John Lawrence

Trump and Elon are running roughshod over all the institutions of the Federal government. I'm still waiting for them to take the wrecking ball to the Defense Department though. I don't think they'll do it. They will just destroy every institution that helps people who need help. And it doesn't matter what the courts say. The courts have no enforcement mechanism. If Trump and Elon defy a court's order, there is nothing the courts can do to make them comply. They can stop payouts by the Federal government to whomever they choose, be it Medicare recipients, Medicaid recipients, social security recipients or whomever. They are inside the Treasury system which makes the payments for the Federal government, a place where they have no business to be. It's not just a question that they have information about people; they have the ability to stop payments to people.

As far as USAID, people are trying to justify it by twisting around the motivation to say that it's in the self interest of the American people to actually help poor people in other countries. Everything has to be justified in terms of self interest because that's the only dynamic Americans seem capable of appreciating. It's not enough to say that these people need our help. They deserve our help, and its in the tradition of every religion to help those in need. That runs counter to everything Americans stand for and have been taught, and that is don't do anything simply because it helps someone else. Only do things that are in your own self interest. No wonder the rest of the world is not exactly enchanted with American values. Americans look at every issue through the prism of their own self interest especially if it has anything to do with helping people in some other country.

Trump of course looks at everything through the prism of his own self interest. That's why in the runup to solidifying the budget for the next fiscal year, Elon is stripping all the money out of every program in the Federal budget that doesn't help rich people. This is in preparation for justifying a huge tax cut to the rich which is the main item on Trump's and Elon's agenda. The Republican controlled Congress will go right along with this. A huge tax cut for the rich will benefit 1) Elon and 2) Trump. And a lot of other billionaires and millionaires. The Democrats should make this their main issue something Bernie Sanders has been dwelling on for years. You can't have a democracy when you have such huge disparities in wealth. Inequality is the primary issue or should be for those who continue to be interested in whatever remnants of a Constitutional democracy that remain after Trump and Elon get done with it.

Off the Top of My Head

Trump's Idea for Redeveloping Gaza to Become the Riviera of the Middle East

by John Lawrence

At first thought Trump's idea doesn't seem all that bad. On second thought it seems terrible. Wouldn't it be nice if Gaza could be redeveloped to be the Riviera of the Middle East? But then what would happen to the Palestinians? Trump wants to move them to Egypt or Jordan. No way Jose say the leaders of those countries. Trump also implies that, after the Palestinians have been gotten rid of, then Gaza and the West Bank would become part of Israel. Israel would extend "from the river to the sea," and to boot rich people from all over the world could buy expensive ocean front property in what once was Gaza. Right wing Israelis and perhaps even Netanyahu himself like this idea very much. However, with some alteration, at least part of this idea might be a feasible solution to the problem. Gaza at present is really uninhabitable. It, as Trump says, is a demolition zone. If the Palestinians moved out, Gaza could be properly demolished and then rebuilt. Israel could finish the war without harming any more Gazan civilians. Gaza could be razed, the tunnels destroyed and then properly rebuilt. But where are the Gazans to go during this process? How about Israel itself? According to available information, around 93% of Israel's land is considered "state land" managed by the Israel Land Administration, which means it is mostly available for lease and not privately owned, effectively making it "vacant" land for development purposes; the remaining 7% is privately owned or under religious authority control. Therefore, temporary accommodations for Gazans could be built inside Israel itself possibly right adjacent to the Gazan border while Gaza is being redeveloped and while the war is being "finished." Supposedly at that point no Gazans whether Hamas or otherwise, would be left inside Gaza.

After Gaza has been redeveloped, the Gazans would be allowed to move back in. Security could be provided by UN peace keepers, other Arabic countries such as Saudi Arabia or some other coalition until the normalization of Gaza in its own right could occur, thus resulting in a two state solution ipso facto without ever proclaiming a two state solution. It would happen naturally as a matter of course. This would amount to not a two state solution but to a one and a half state solution until such time as it would eventually turn into a two state solution. In this way multiple things could be accomplished. 1) Israel could "finish the war." 2) No more innocent civilians would be harmed. 3) Hamas would be wiped out. Only militants would be killed. 4) Gaza could be properly demolished and rebuilt. 5) Gazans could return to a rebuilt and refurbished Gaza, a veritable Riviera of the Middle East and 6) Israel would no longer be Gaza's overlord. A third party would provide security and 7) Palestine would "grow into" its own de facto state.

So what about the West Bank? That could be considered a separate issue. Or other ideas might also make sense. One would be a land swap. Increase the land area of Gaza proportionately to the land area of the West Bank and absorb the West Bank into Israel. Then the Palestinians would have one contiguous homeland instead of being divided into two pieces. In the final analysis Trump's idea with some modification is not all that bad. Gaza is really uninhabitable in its present condition. Hamas is still there. Why wouldn't Gazans want to temporarily move to a place with more humane and hospitable conditions? Eventually, the Paletinian government itself might want to lease a portion of its ocean front property for a Trump Tower Gaza.

Finally, none of the above measures should be undertaken until all the hostages are out. The cease fire should continue till all the hostages are out