National
Debt - The Ticking Clock| National
Debt - The Ticking Clock |
03/20/10
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January 15, 2007 They took this money and blew it. Both republicans and democrats spent this “off budget” money on whatever they fancied, including wars, invasions, and pork barrel projects they could not otherwise afford. Even worse, pretending that they merely “borrowed” or “invested” this cash, the Beltway Bandits put “special” nonmarketable Treasury bonds in debit black hole accounts they labeled “trust funds” even though these have little or no resemblance to real trusts. Thus began what I call the “Pay-It-Again Sam Plan,” a dastardly scheme where the same people who contributed more money than Social Security needed in the first place, gave a surplus, are now required to pay the same amounts again, plus interest. It’s double taxation plain and simple. For the first 35 years of Social Security’s existence, these amounts were minimal and hardly noticed, but in 1983 the government accelerated this scam from minor theft to grand larceny. (See chart) Here are the amounts added during each of the thirteen years I’ve been following it:
To put it politely, anyone who can look at this chart and still believe that Social Security is “in trouble” and about to go broke must be mathematically challenged or completely bonkers. The annual profits (green sections) are enormous and the compounding interest is sufficient to sustain the program indefinitely, even if there were no surplus/profits. What could have been? The Social Security trust fund today stands at more than $2 trillion and is 23 percent of and keeping pace with our ever increasing national debt – a debt that can only be paid off with taxpayer money since our not-for-profit federal government has no other significant revenue and the Beltway Bandits couldn’t cover this amount of debt themselves if they were all John D. Rockefeller clones. Had the trust fund been real, and if surpluses had been invested wisely, even in Certificates of Deposit that pay about the same interest, we would today be sitting pretty. There would be enough money to increase benefits and, in the real world, the compounding interest would sustain the supplemental retirement system forever. Back to Bizarro World If the tools of fraud were eliminated, Congress and the Administration would still be left with the question of what to do with all the surplus money coming in. They could either cut payroll taxes letting America’s workers keep a greater portion of their wages – or they could invest the surpluses properly just as they do with their own Thrift Savings Plan. In my opinion, these choices should not be left to the Beltway Bandits who have already demonstrated their ability to twist things into an advantage for themselves. Short of a panel of honest citizens, we would be better off if the decision were left to the Social Security Administration housed in Baltimore and sufficiently removed from the District of Corruption to be trusted. It’s never going to happen Even though eliminating the tools of fraud would reduce the national debt by more than forty percent, making the United States at least appear to be on the road to fiscal responsibility, there are two major reasons why this will never happen. First, there’s too much money involved. Congress and the Administration have become accustomed to this constant flow of “off budget” money that they consider “theirs” and their natural right to spend. They are never going to willingly give it up. Remember the “lock box” farce? Second, and much more importantly, the elimination of Social Security’s nonmarketable bonds and phony trust fund is only part of the problem and would lead naturally into exposing the other scams. The entire Intragovernmental Holdings (IH) portion of the national debt is in the same boat with scam variations on the same theme. While the Social Security rip-off and double taxation currently amounts to more than $2 trillion, the total amount represented by 141 (at last count) just as bogus trusts in IH today amounts to $3.78 trillion and includes smaller entitlements like Airways, Unemployment, Highways, and so forth, being “drawn down” monthly as well as many perks set up for the government itself. Getting rid of all of the phony trusts and their holdings in IH would mean the end of the government’s own retirement program (FERS, the second largest insurance entitlement after Social Security) and health care programs that have so far been supported by monthly taxpayer payments because these programs have little if any money in “receipts” from their own participants. It would also be the end of the many “gift” accounts and other benefits the pirates have set up for themselves by simply naming trust funds and dumping some nonmarketable bonds in them. Even accounts established by philanthropists for scholarships and so forth would be abandoned. The Beltway Bandits spent the original money and set up IH “holdings” for these just as they have for Social Security surpluses they spent. How far can the scam artists carry the crazy idea that the same money can be both spent and saved? Unfortunately, today’s answer to that is – as far as they want. If the people ever grasp the full scope of what’s been going on, about the best the crooks could expect would be imprisonment in Gitmo. If we went back through previous administrations, we could probably fill Cuba or some other island. There would be some poetic justice to putting them in Guantanamo since that naval station was originally set up to stop piracy in the Windward Passage. Let’s use it for the modern pirates. Send a message to your elected representatives. Click here to start. Be sure to send a copy to Ed Henry.
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