Saturday, April 23, 2011

Sure enough, that lock box was unlocked all along!

"It is difficult to get a man to understand something when his salary depends upon his not understanding it."
- Upton Sinclair

The street needed a bull market, so they persuaded the autoworker union honchos to put their pension funds out there where the air is rare – Wall Street.

I think we all know how that last great bull market turned out.

Most cars are now made overseas.

They created a lot of jobs, all right.

Such a deal.

Now, they tell us the chief barrier to creating jobs and putting Americans back to work is “uncertainty.”

That's probably true, but one thing is for certain. When you get that job and get to work and draw that first paycheck, Uncle Sam is going to be there to collect 12.5% in Social Security payroll deduction – up front. Of that you may be certain.

Like, you have to work to get some money, but you have to pay the deduction before you are allowed to collect your money.

Why? Well, they have this thing called the Social Security Trust Fund.

Naturally, billions – trillions - are generated by these deductions and they don't necessarily stay in that trust fund. They loan them out to other governments through the Treasury Department's “Exchange Stabilization Fund,” a creature of the Gold Reserve Act of 1934. A lot of dough went to Mexico to shore up its “financial crisis” during the 1994 difficulties with the peso. They changed the law in 1970 to allow the Secretary of the Treasury, with the approval of the president, to use money in the ESF to “deal in gold, foreign exchange, and other instruments of credit and securities.”

And then on September 11, 2001, some men from Saudi Arabia used American commercial passenger jet aircraft to attack the World Trade Center, the Pentagon, and the White House.

Obviously, that was proof positive that it was high time to declare war on some terrorists in Afghanistan and a dictator in Iraq who controlled one of the world's largest reserves of petroleum.

How do you pay for all that?

Well, it's simple. You cut taxes for the top earners in the nation, make sure the multinational corporations don't have to pay much of a corporate income tax, and go to the Social Security Trust Fund and borrow like mad.

After all, the preceding administration proclaimed the surplus funds generated by the increased payroll taxes were a form of a “lock box” to make sure the money would be there after 2016, when the fund will start paying more out than it takes in.”

Then, when people start to realize they're facing some very hard times, you tell them the lock box was always unlocked, their cash ain't nothing but trash, and it's time for some “common sense” conversation, some “adult conversation” about how we're going to pay for all this.

During a speech on April 5, 2005, in Parkersburg, W. Virginia, President Bush freely admitted that the Social Security Trust Fund surplus had been spent.


He said, “There is no trust fund, just IOU's that I saw firsthand that future generations pay – will pay for either in higher taxes, or reduced benefits, or cuts to other critical government programs.”

Do we raise the retirement age to 70? Cut benefits?

The guys who are calling the shots aren't giving any really straight answers about all that.

The new budget with its $6 trillion in cuts “forces policymakers to come to the table and enact commonsense reforms to keep Social Security solvent for current beneficiaries and make it stronger for future generations,” said Rep. Bill Flores, R-Dist. 17.

Maybe it means what Charles Krauthammer said in response to President Obama's budget chief, Jack Lew, when he told us all that the Social Security Trust Fund is solvent until 2037.

Mr. Krauthammer, the well-noted conservative, said “the trust fund is empty, indeed fictional.”

Bill Flores and his staff are highly resistant to answering questions such as that. They don't return phone calls, you see.

Behold then-House Minority Leader John Boehner, now Speaker of the House, in a television appearance going into the latest elections in 2010, the ones that swept the Democratic super majority out the door and replaced Congressmen with a lot seniority, people like 10-term veteran Rep. Chet Edwards with people like Mr. Flores, the fiscal conservative who wouldn't dream of cutting spending in any other area besides “entitlements.”

Antonio Carlo Jobim wrote a “One Note Samba” that sounds a lot like this on-message diatribe from the future Speaker.

One thing is for certain. It's as certain as the fact that God made little green apples that before he left office, President George “Dub-yah” Bush entertained the King of Saudi Arabia at the ranch, accepted an ornate sword and a bejeweled gold chain pendant with an emerald big enough to drown you if you fell overboard, and started collecting his pension just as sure as the world.


How much is unleaded gasoline? Well, they say a barrel of crude is somewhere around $108 on future delivery contracts. But, when you get really fiscally responsible about that, you know it's a fair question to ask if you want to know does that include the cost to taxpayers of keeping troops, ships, planes and missiles in 100 foreign countries, two carrier battle groups on station in the mideast all the time, divisions of Marines and brigades of Army stationed on two fronts?

(There are 911 words in this article.)

No comments:

Post a Comment