In the midst of chaos in Iraq and Lebanon, while the American Empire tries to expand its presence throughout the world as outlined years ago in the “pax Americana” manifesto authored in part by John Bolton that almost no one has bothered to read, the Bush administration is preparing to take its desperate need for more money to outlandish extremes.

On Friday, August 11, on page seven, the Washington Post published an article titled “President Remains Eager to Cut Entitlement Spending.” The keyword here is "spending." This is not an attempt to rein in the excessive payroll taxes the government has collected for the Social Security supplemental retirement system that’s been their cash cow for ages and taxes that Bush has increased every year he’s been in office (see table). It’s an attempt to cut benefits as soon as this year’s elections are over.

On Thursday, August 3, the bastion of integrity located in Arlington, Virginia, just a stone’s throw from Washington, Gannett's USA Today published a front page article called “What’s the real federal deficit?” which threw numbers all over the place without explanation in an attempted soap opera strategy to make people feel their situation is better than it might be according to auditing actors. This article was salted with statements about how Social Security benefits depend upon the “good will” of lawmakers and the administration, that they can take it away any time they want, and that it’s not really the greatest prosecutable implied contract that ever existed.

On Thursday, August 10, the normally helpful Tom Paine.common sense published an article titled “Back From The Dead: Privatization” that only added to the confusion because it pointed out how little the general public, including the politically astute, understand about what’s been happening to their money.

Ironically, on Thursday, August 10, the U.S. Treasury’s Monthly Statement for July was released showing exactly what’s happening to payroll taxes. In July, the Federal Old Age & Survivors Insurance portion of Social Security had “receipts” of $44 billion and “outlays” of $38.6 billion – producing an “excess” or surplus/profit of $5.4 billion.

At the same time, the Federal Disability Insurance portion of Social Security had “receipts” of $7.1 billion and “outlays” of $7.9 billion – producing a deficit of $769 million.

This means that in July the Beltway Bandits had another $5.4 billion to spend elsewhere and went to the General Fund of taxpayer dollars to get $769 million to pay benefits to the disabled. That’s the way it works. They get your money both ways.

I’ve been trying to tell you this for ages. But then, I don’t have the reputation and distribution of the above “news” outlets.

This year, the government is not doing any better than it did two years ago when in 2004 they stole $71.1 billion from Social Security. Unless the job situation changes dramatically in the next two months, or a great many illegal aliens start paying taxes, the government will not reach the mark of $86.5 billion stolen last year.

Social Security is nothing more than a worthy insurance program that, except for forced contributions without the need and expense of a sales force, operates just like any other profitable insurance company. It pays benefits from the premiums collected today in exactly the same way State Farm, All State, Hancock, Prudential, or any other successful insurer does the same, hoping all the while that they will not be called upon to tap their liquid reserves or profits. That's "the nut" of the insurance business -- more premium receipts than outlays.

The propagandists who are defrauding this system would like you to believe that this “pay-as-you-go” is somehow different and undesirable. These are the crooks that take Social Security’s dedicated profits, spend them wherever they please, and then deposit “special” nonmarketable treasuries in debit accounts that they deliberately mislabel as “trust funds” which in turn are part of the national debt. The taxpaying public will someday pay these taxes again plus interest. They even confess to this fraud and think they are protected from prosecution.

Since 1983, when Bob Dole and Daniel Patrick Moynihan introduced legislation that raised payroll taxes far beyond necessity, the federal government has, in Moynihan's words, “enjoyed” this extra money and has added to the national debt by yearly numbers as follows:

No sane person can deny that the money hasn’t been there to invest in something besides the Pay-It-Again Sam scam of nonmarketable treasuries in bogus trust funds. Adding annual compound interest against the previous year’s balance increases the scam as follows:

To even suggest that the politicians and bureaucrats can back out of the implied contract built upon almost seventy years of premiums and promises is one of the most ridiculous ideas in Washington. It’s tantamount to defaulting on all of the money we’ve borrowed from China, Japan, and other nations that willingly loaned us money. Social Security is now 23 percent of the national debt and stands at more than $1.8 trillion in payback markers or double taxation.

And it doesn’t matter that America’s workers don’t have a signed contract in their pockets or portfolios. An implied contract whereby the insurers have made promises and the insured plunked down their cash is just as valid and legal as any retail operation.

In point of fact, the government’s not living up to their promises would be just as unlawful as allowing people to drive into a fast food store, place an order, drive to the first window where they pay for the goodies, and then go to the pick-up window only to be told that there’s nothing for them or they only get part of what they paid for. Between the time you paid and the time you did or did not receive the goods – you had a valid implied contract. And you don’t need it in writing and you certainly don't need a contract in your pocket. All you need is a "receipt" for the money you paid.

And you have a receipt. You have it on the W-2 form your employer gives you every year. You have it on paycheck stubs. You can even contact the Social Security Administration and they'll tell you how much you've paid and what your retirement funds would be if you retired today.

There is no way that the Beltway Bandits can get away with what they’re suggesting in the recent propaganda. 

What's more, the idea of "privatization" is something of a misnomer. It's really a general proposal to take Social Security out of the hands of Congress and the Administrative Branch, as advanced by the CATO Institute, and putting it somewhere politicians and bureaucrats can't get their hands on the money. Put the cash in the hands of someone we can at least hold responsible for malfeasance. And it does not exclude the idea of letting the Social Security Administration manage a real trust fund and investments from their headquarters in Baltimore just like the government's own Thrift Savings Plan, managed by Barclay Bank of Great Britain, is a real investment program like a 401(k).

Let's not forget that it was the mumbled reference to this same Thrift Savings Plan that gave George W. Bush points when he first ran for office against lock-box Al Gore and when he said "good enough for them, but not for us." This was before he put Moynihan (a democrat) back in the driver's seat on his Commission to Reform Social Security. An appointment tantamount to putting the fox back in the chicken coop. To guarantee a debacle, he then put Richard Parsons, the CEO of AOL/Time Warner/CNN/USA Today, to co-chair the same commission (read old story).

All of this was long before he appointed John Bolton to be Ambassador to the UN, Christopher Cox from California's "Enron By The Sea" to run the Securities & Exchange Commission, and other neocons to help industries outsource or move out of the country profitably. Today, corporations that remained behind are even considering outsourcing their health plans.

We can't vote these appointees out of office this November. So either learn to live with it or get off the couch.