“We were just following orders” was the excuse of most Germans at the Nuremberg Trials. It was true, like any good soldiers they were trained to follow orders, but that didn’t absolve them from higher crimes against humanity. Maybe justice only prevails when the bad guys have been defeated, when they’ve lost their position in the brotherhood of politics.
“We were just following the law” is the final excuse for American politicians who can’t keep their hands off billions in dedicated dollars paid into the supplemental retirement system, Social Security. Elected representatives who literally steal retirement money in the greatest fraud the world has ever seen. We give them extra money. They give us more debt in return.
And it’s true, the law that was written into the 1935 Social Security Act does say that the Secretary of the Treasury “MAY” invest surplus payroll taxes in securities backed by the “full faith and credit” of the American people (taxpayers).
This law doesn’t require them to do it. They were not “ordered” to do so. Hence, their excuse isn’t as valid as the German’s.
As every first year law student knows, this law doesn’t say that the Secretary of the Treasury “SHALL” invest surplus money in treasuries. In fact, the law gives them a choice because it goes on to say “OR” in “obligations guaranteed as to both principal and interest by the
You will not hear this from politicians, mostly lawyers themselves with the responsibility to change bad laws, but here’s the full decree:
"It shall be the duty of the Secretary of the Treasury to invest such portion of the amounts credited to the Account as is not, in his judgment, required to meet current withdrawals. Such investment may be made only in interest-bearing obligations of the
Let’s take a closer look at that second choice. After all, it’s the way the FDIC (Federal Deposit Insurance Corporation) guarantees bank deposits. If the bank is robbed, defrauded, or simply screws-up, the loss is covered by the American people, taxpayers who will make up for the missing funds as happened in the S&L follies of the Reagan eighties.
In effect, the surplus receipts from over-taxation could be invested in anything, even hula-hoops, if it’s “guaranteed” by the people.
Every major consumer corporation in the country would love to have such a guarantee since more than eighty percent of their new venture and product ideas fail. But they don’t have such assurance and they pay for their mistakes, hopefully before they reach the market place. It’s called research and development (R&D) and it’s usually part of their budget.
If we invested tax surpluses in something that didn’t sell, something that lost money; we would have to make up the losses. Is that any different than the situation we’re in anyway?
As it is now, was then, and every shall be unless we do something about it, the federal government takes our surplus overpayments, spends the money elsewhere, and then deposits nonmarketable bonds in a so-called trust fund so we can pay these taxes again, plus interest. The “trust fund” never holds any real money, only debt that the taxpaying public must someday redeem plus more debt in the form of interest accumulated annually by dumping more bogus bonds in the debit account. The Social Security trust fund is today about 23 percent of the national debt.
What may be more difficult for people to understand is that it wouldn’t make any difference if this surplus money first went into the trust fund where it was “invested” in treasuries instead of having them foisted upon us after the fact, after the money is spent. Depositing cash in the account would only be a matter of minutes before the cash went into the General Fund and the politicians had it to spend. And we would still be where we are now, owing $1.8 trillion to Social Security and having to come up with that cash someday in a second payment. And we are the people who gave them the surpluses in the first place. That’s what makes it a double taxation, the Pay-It-Again Sam scam.
Also, it would not make the slightest difference if this Social Security trust fund disappeared tomorrow. As taxpayers, we would still be accountable to make up any shortfall Social Security suffered because the government would increase taxes, borrow, or take our money out of other budgeted programs in order to pay benefits to the retired and disabled who are due certain defined amounts each month. Many authorities have confessed to this fact.
Most importantly;
The surplus money that’s being paid in excessive payroll taxes, and it’s no small amount (see table), might instead be handled in either of two ways.
First, it might be rescinded in a tax break for every person earning a living in the
Secondly, and the solution I prefer, is to put the surplus money in a real trust fund, not a phony debt or debit account as is happening now. In other words, put it in a fiduciary activity meant to preserve and enhance property. Instead of debt, we would have lucrative assets and, hopefully, a profitable annual increase that would at least equal the five to seven percent annual interest currently added to the account.
We would still be taking a risk, but it’s a risk in investments that win or lose just like, but not limited to, the stock market. What it comes down to is who would you rather trust with your money, someone like TIA-CREF or politicians who steal it from you?
Such a trust fund might be managed by the Social Security Administration itself or it might be turned over to people in the private sector we could monitor and could at least hold accountable. It would be very much like the government’s own Thrift Savings Plan for federal employees currently holding more than $60 billion in contributions, matching funds from taxpayers, and profits.
No one in their right mind can say that the money isn’t there to invest sensibly (again, see table). And George W. Bush could have done it if he had bothered to explain the scam that the government is currently running. But he didn’t, and on top of it all he appointed Daniel Patrick Moynihan to co-chair his committee to reform Social Security.
In 1983, Moynihan and Bob Dole were responsible for increasing payroll taxes far beyond what was necessary and still isn’t necessary today in order to pay benefits. The resulting report was exactly what you should expect from putting the fox back in the chicken coop. The committee’s recommendations were hogwash and an increase for the scam artists. Instead of meaningful reform, it was more of the same rip-off.
There never was any intention to build a lucrative trust fund for the so-called onslaught of baby-boomer retirement. The 1982-83 reform ideas were the direct result of Social Security withdrawing bonds from its small trust fund and upsetting Congress and the administration for seven years in a row – nothing else.
Much more importantly;
The first thing many Americans must understand is that the national debt is divided into two parts. The first part, which is all debt we owe investors who loaned us money under contract, is what the government erroneously calls "Public Debt" and wants you to believe that it's the only part taxpayers are responsible for paying off.
The second side, what the government calls "Intragovernmental Holdings," is completely fraudulent. The hucksters would like you to believe that this is debt the government owes itself or that it's some sort of fantastic "wash" that no one will have to pay. The trouble is that no one but the tax paying public can redeem this debt and you are already paying off parts of it.
There are currently about 137 so-called “trust funds” in the Intragovernmental Holdings $3.5 trillion side of the national debt – all of them in exactly the same boat as Social Security and without any “law” to provide the Beltway Bandits with an excuse.
More than ninety percent of this debt is held by entitlement programs and many of these debit accounts are being drawn down today and we are paying for it. Without a tax increase, the money to keep these programs going is coming from money borrowed from
If the entire $3.5 trillion in “Intragovernmental Holdings” were to disappear tomorrow, if these so-called trusts and “special” nonmarketable bonds were abolished, we would be in exactly the same situation. Congress and the administration would have to raise taxes, borrow, or cut programs to cover the benefits due – the same thing that happens when any of these so-called “trusts” turn to their bogus assets.
At the extreme end of this scam, the government has even set up its own perks with things like the Federal Employees Life & Health program where the “trust” never receives any contributions, spends millions every month, and increases its “holdings” the more it spends. An absolutely ludicrous bit of accounting and manipulation.
When are the people going to do something about this criminal behavior on the part of our elected representatives and their appointees?
