July 29, 2005
The bill had 39 sponsors when it was introduced and rumors are that its gaining more. Its also known as a bill to amend the Social Security Act and the Internal Revenue Code of 1986 to stop the Congress from spending Social Security's tax revenue surpluses on other Government programs by dedicating those surpluses to personal accounts. In that regard, its more specific than anything weve heard from President Bush with the exception of his committee to Strengthen Social Security that thankfully seems to have been set aside somewhere since 2001. (Doesnt it bother you to see that the House has already considered more than thirty-three hundred new bills? How many is that per day of not being in recess or on vacation?)
Bringing a halt to the governments stealing payroll tax surpluses, at least insofar as Social Security is concerned, addresses the one and only major problem the supplemental retirement system has had all along and particularly since 1983 when these taxes were raised far beyond necessity a government that steals its profits/excesses.
Stopping that theft is good. Its about time Congress started talking about abandoning this crime.
Unfortunately, the way this bill is implemented doesnt do a thing for we the people. Oh, the entire surplus is meant for ownership accounts of argumentative value, but the government ends up with the surplus anyway. It turns out to be nothing more than another method of stealing these surpluses, spending them wherever they please, and leaving us stuck in a fraudulent system of double taxation plus interest.
Instead of the Social Security trust funds receiving bogus special nonmarketable bonds, the ownership accounts will receive real, honest to God, marketable bonds just like the ones we sell to China, Japan, and others who invest in America. And thats the only so called investment proposed for these new accounts.
This crafty trick has confused many good hearts who believe marketable bonds would get us off the hook. But the truth is that only American taxpayers can redeem any part of the national debt where these securities rest and gain annual interest. It really doesnt matter whether our money is transformed into real or unreal treasuries. Taxpayers are still the only ones responsible for paying off all of them. So the government gets the surplus money anyway and the double taxation scam continues.
In fact, it can even be argued that personal accounts are the only way this trick can be pulled off. Instead of their stealing the money, they want young workers to voluntarily hand it to them.
Marketable bonds make up the honest side of the nations debt. They are where people, organizations, and nations walk in with their eyes wide open to invest in or loan our government money. Its voluntary and therefore much different from the bogus bonds weve been getting where no payroll taxpayer authorized it, where there is no valid law requiring us to loan the government our retirement money, and where the government simply dumps nonmarketable bonds in an account in order to pretend they borrowed the money instead of having stolen it outright. The pirates need this voluntary scheme to pull off their new version of the scam, hence the label ownership accounts where people must voluntarily sign up; i.e., agree to the terms which require investing in marketable bonds. Its still double taxation plus interest.
And the fact that honest marketable bonds are liquid, that Social Security or individuals might sell them at any time to nations that already have us by the shorthairs doesnt help. Taxpayers would still have to pay them off on demand or maturity. Theres no escaping the fact that the securities, whatever they are, must be redeemed by the same people who in large part provided the surpluses in the first place.
Once the government borrows the cash under this latest version of the scam, they will still need to redeem and pay the annual interest for these ownership accounts with taxpayer money. The new twist means that annual interest must be paid with real taxpayer dollars instead of merely dumping more bogus bonds in trust accounts, but even that goes back to the government and it still leaves us exactly where we are now with phony trust funds holding fictional securities that become very real when its time to redeem them as is already happening with entitlement accounts other than Social Security.
But thats not why democrats are against this bill.
You would think that the democrats who want Social Securitys surpluses to go into a lock box would be in favor of this bill, but you would be wrong. The term lock box has always been a trick bandied about in order to make the American people believe that the pirates are talking about a safe, a vault, or some secure place where the money cant be touched. And Ive been telling you until Im blue in the face that real trust funds are by their nature already lock boxes.
As a not-for-profit organization, the only predominant way the federal government can carry cash (liquid assets) from one fiscal year to another is through a trust fund. By law, it must bring its books to a zero balance at the end of the fiscal year. Any cash that is not in a trust fund at the close of the fiscal year will automatically be thrown against outstanding obligations the national debt. And thats exactly what the democrats want. Thats why they do not want surpluses put in a real trust fund of any kind. Thats why they talk about lock boxes. Its that simple.
Now, you are free to think like the Center for Economic & Policy Research (CEPR), and many others, that throwing our retirement money against the real and honest side of the national debt, paying off the Chinese for loaning us money, is an admirable thing to do because someday were going to have to pay these obligations anyway. And it would be, if we stopped borrowing from whoever will loan us money. If we started to show some financial responsibility and the government was able to live within its means. If Congress and the administration balanced their budgets instead of running deficits every year.
Like Alan Greenspan, even I would be in favor of paying down the honest side of the national debt if the government abided by paygo what in Greenspeak is a balanced budget. But that isnt happening is it?
Instead, were borrowing money hand over fist, increasing the national debt limit almost every year, and getting deeper and deeper in the hole. The national debt is almost $8 trillion ($7.836 trillion at the end of June), a huge chunk of our GDP, and the Social Security surplus scam is keeping right up with that at 23 percent (22.9 percent) of the total debt or almost $1.8 trillion ($1.792 trillion at the end of June).
Bush promises to cut the deficit in half by 2008 which is like getting a 60 percent bargain after a 120 percent markup.
In short, the 2000 Clinton surplus that the democrats are so proud of was nothing but a small payment against the governments credit card, a payment that has allowed George W. Bush to charge even more money for his ventures and for America's taxpayers or their children to pay back someday, somehow.
And they never told you and still will not talk about where this $237 billion fiscal 2000 surplus came from. Well, $87 billion came from personal and corporate income tax overcharges while $150 billion ($149.8 billion) came from entitlement overcharges with Social Security leading the pack with a surplus of $94.5 billion and more than twenty other entitlements making up the balance.
The democrats have been screaming bloody murder ever since Bush cut income taxes that went primarily to corporations and the wealthy. But think about what your local government does whenever a company threatens to pull out and leave your city. They offer all sorts of financial incentives to stay, to give your city and its labor force another shot. What else can a governmental body do? At the same time, the democrats did nothing to even suggest cutting payroll taxes which would have been a relief to everybody, companies included.
In summary, neither the republicans nor the democrats are willing to give up the lucrative sums they continue to confiscate from excessive payroll taxes. They need this money as part of their off budget planning as well as continuing to borrow honestly from nations that are either our enemies or strategic competitors.
And the day when the people must pay off a substantial portion of our honestly incurred debt may be coming sooner than we think since honest treasuries are cashable on demand. Some of the major lenders, holding hundreds of billions in our promises, may decide that theyre sick of our Empirical Military aggression, threats and expansion. Why do you think Greenspeak is so worried about Americans not saving much if anything while the Chinese save fifty percent of their GDP? And we worry about the frivolous.
Add in our huge trade deficit, companies and jobs leaving the country, illegal immigration running rampant, and youve got to admit that our management is almost hopelessly incompetent, and crooked on top of that. Oh well, the frick or frack elections are coming up again in a year or so arent they?