During this conversation, Mr. Johnson claimed that back in 1983 Alan Greenspan was responsible for raising payroll taxes far beyond what was needed, an action that was implemented over time, built up to 15.3 percent in payroll taxes, and has resulted in huge surpluses.

This is not true. There are plenty of things to criticize Mr. Greenspan about in his present position as Chairman of the Federal Reserve, but being responsible for the payroll tax increase of 1983 is not one of them. Comments like Mr. Johnson's only deflect attention away from the real problem of malfeasance and fraud with trust funds where Mr. Greenspan is a definite player.

Here's what really happened.

In 1982, Alan Greenspan was appointed to chair a committee to study Social Security. At the time, he was not a member of government or of the Federal Reserve. He had his own consulting firm in Washington.

The reason he was called to head the committee had to do with his reputation working with administrations before Reagan's and the fact that for seven years in a row payroll taxes had not been sufficient to completely cover benefits for the retired and disabled.

Recession was the main reason for this shortfall coupled with all sorts of things happening during the Carter administration ranging from the hostage situation in Iran, high gas prices, inflation, high interest rates and gold selling for more than $900 an ounce, to high unemployment.

For seven years in a row, Social Security turned to its trust fund to meet obligations. Although the amounts were never serious by today's standards (see chart), politicians went bananas because it means money must either be borrowed on the bond market or existing programs have to be shorted. (See: statements to this effect) There was a lot of hysteria about Social Security being "in trouble."

Greenspan's committee met once a month and in January of 1983, when the recession was over, delivered its final report. You can go through this entire report, which covers a great deal of actuarial data and typical Greenspan ambiguity, but you will not find a single mention of raising payroll taxes.

Senators Bob Dole and Daniel Patrick Moynihan had been members of the committee and, as Moynihan put it, they ran into each other in the halls of Congress and took it upon themselves to introduce a bill to raise payroll taxes.

Moynihan related the story himself in a speech he gave at the John F. Kennedy School of Government at Harvard University titled "Social Security Saved." (Entire speech)

In this speech, Moynihan said: "... no agreement could be reached by the time the commission expired at the end of 1982. Then the shade of Frances Perkins intervened. On January 3, 1983, Robert J. Dole, Senate Majority Leader, published an article on the op-ed page of the New York Times, entitled 'Reagan's Faithful Allies.' It seemed that many people thought Congressional Republicans weren't giving the President the support he needed and deserved. Not so, Senator Dole said, we are with the President and there are great things still to be done. Then this:

'Social Security is a case in point. With 116 million workers supporting it and 36 million beneficiaries relying on it, Social Security overwhelms every other domestic priority. Through a combination of relatively modest steps including some acceleration of already scheduled taxes and some reduction in the rate of future benefit increases, the system can be saved. When it is, much of the credit, rightfully, will belong to this President and his party.'

That day I was being sworn in for a second term in the Senate. I had read the article and went up to Senator Dole on the Senate Floor and asked if he really thought that, why not try one last time? And he did think it. A year of listening to Myers had altered a lifetime of Republican dogma. We met the next day. The day after that Barber Conable was brought in, a Republican who both understood and believed in Social Security. On January 15th, 13 days from our first exchange, agreement was reached at Blair House and the crisis passed. (In a November 2, 1997 interview on "Meet The Press," Senator Dole cited this as his greatest accomplishment in his Senate career. And well he might.)

Social Security was secure for the time being. Indeed, the payroll tax generated a considerable surplus which we have lived off ever since, and will continue to enjoy for yet a few years."

Other members of Congress probably felt that Dole and Moynihan must have known what they were talking about because they had each served a year on the Greenspan Commission. By March, in one of the quickest bills ever passed and signed by the President, raising payroll taxes over the next three years became a reality and the American workers have been paying extra ever since.

Senator Moynihan became known to many as "Mr. Social Security" and is the same man President George W. Bush appointed to co-chair his own committee on Social security—another commission that came up with little or nothing. The heads of this more recent committee have yet to sign off on a final report.

God rest his soul, Senator Moynihan passed away last year and is no longer able to "enjoy" the extra taxes American workers are still paying. Last year, Social Security produced an $82 billion surplus that the government spent elsewhere leaving us debt markers in exchange so we or our children can pay these same taxes again, plus interest.

Another glaring mistake Mr. Johnson made Thursday on the Dobbs show was to continually refer to the Social Security trust fund as currently standing at $1.7 trillion when it is really $1.5 trillion. Oh well, what's a couple of hundred billion here or there. It's all debt anyway.

An important thing to grasp is that the government frequently sets up what we might call "sham battles" that, with a great deal of publicity, serve little purpose other than to make people believe that someone is in the back room working hard to analyze, determine causes, solve problems and innovate solutions to some of our major problems. We all want to believe in this "institutionalized other," but in too many cases it doesn't exist and little or nothing is being accomplished. The sham only serves to hopefully put forth unquestioned acts of manipulators with their own agenda.

The fact that Greenscam and the government talk about surpluses and the lack thereof without ever telling you where they came from in the first place is yet another proof of this. It allows them to continue stealing your retirement and other entitlement money.