Neither a borrower nor a lender be. What sage advice from Shakespeare, but try to avoid it in America today when money is taken by force under the pretense of borrowing it from you or investing it for you.

In one activity, we’ve got a not-for-profit government borrowing money hand over fist from people that were once our enemies, our competitors, or just want to “invest” in America because U.S. Treasuries are the “safest investment in the world.” More than ninety percent of these lenders are foreign nations that walk in with their eyes wide open, strike a deal with the U.S. Treasury's Bureau of Public Debt to buy securities that are backed by the “full faith and credit of the United States Government” in exchange for set annual interest and full payback at maturity. Nobody is "forcing" these people and these arrangements come in more flavors than Baskin-Robbins, continuously being “auctioned” off by Mr. Van Zeck Commissioner of the Bureau.

Unfortunately, the full faith and credit of the government and what makes these instruments the safest investment in the world is nothing more than the fact that the taxpayers of America are responsible for paying both the interest and the final payment on this debt. There’s no one else to cover it. It’s honest debt accumulated in the name of every taxpayer in the country. The government has no way of paying for it other than taxes it levies on citizens, by borrowing even more, or by robbing Peter to pay Paul with elements of the budget.

As of August 31, 2005 , this part of the debt stands at more than $4.6 trillion under what the government calls “Public Debt.” An amount that is certainly not chicken feed and an amount that can be cashed-in at any time the lenders decide they want their money back before maturity and are willing to forego the annual interest. That was part of the deal when contracts were made. Redeeming any sizable portion of this obligation could bankrupt the nation overnight.

But this isn’t everything, not by a long shot. The national debt comes in two parts. Let’s look at the other side of borrowing.

Today, the nation’s total debt stands at almost $8 trillion and the nearly $3.4 trillion balance is tied up in a scam where the government pretends to have borrowed money from its own citizens when they actually stole and spent it just as flagrantly as any band of pirates or thugs might put a gun to your head and take your money.

This portion of the American taxpayer’s obligation is deceptively labeled “Intragovernmental Holdings” or IH for short. And it’s recorded to the penny by the Bureau of Public Debt which, by the way, is not called the “Bureau of Public and Government Debt.”

The tools of this scam are bogus trust funds and “special” bonds deposited in more than 150 various accounts. Most of the debt accumulated here comes from entitlements like Social Security that, by itself, accounts for about 54 percent of IH, but is by no means the only rip-off account.

Many of these entitlements are currently producing more money in taxes than their program requires. They are generating surpluses.

These surpluses arrive at the Treasury’s General Fund, mostly via the IRS, where they stay until the money is spent which often isn’t long at all since Congress and the Administration estimated how much would be coming in, planned it in their budget as “off budget” revenue, and spend it immediately on other things as planned.

Other accounts, like the Unemployment trust or the Federal Employees Retirement System (FERS) trust, are not producing surpluses and are being drawn down. When this happens, the government must raise money to pay benefits by either (1) raising taxes (2) borrowing from nations like China (3) cut other programs or any combination thereof. As a not-for-profit institution, these are the government's only sources of revenue, its only options.

These are the same three choices the government would have in order to pay promised or, more properly, “entitled” benefits if there were no bogus trust funds at all – if they were not pulling this scam, and if they were honest.

The difference is that honestly meeting these obligations would require legislation. The way it is, when a department or cause needs money, it simply turns to its trust fund and leaves it up to the Treasury to raise the money – mostly by borrowing or taking it from other programs. No one wants to raise taxes, even when necessary. It’s very unpopular and much easier to steal or borrow more money on the honest side of the debt. Get it from Japan or the Chinese WalMart with an army.

Most of the general taxpaying public doesn’t even know this is going on. They may accept the idea of a war against an adjective, that the war against "terrorism" is costing us two or three hundred billion, but they have no idea why the national debt went up $596 billion last year, fiscal 2004 and, in fact, believe the debt is the government's problem, not theirs. Few realize that borrowing is really a tax on their future or that of their children. If they did, they would worry about and object to both the honest and the dishonest types of borrowing our government is constantly engaged in.

Worst of all, the taxpayers are being double taxed plus interest. As “lenders,” they not only forfeit their extra retirement payroll tax payments, but are required to buy them back, to pay a second time, with interest added when the so-called trust is drawn down.

And where does the interest come from? Is it really an asset that’s paid to the lenders? Do they get a check in the mail? No, it’s an additional obligation that’s to be paid by the lenders, scheduled to come to the borrowers someday. The government simply deposits more bogus bonds in the bogus trusts, at no cost whatsoever, with no actual money involved. This is probably the most heinous part of the scam because it increases taxpayer indebtedness only to maintain the fiction of “borrowing.”

Any honest and legitimate form of interest would be money in hand. It would be a payment or profit lenders could spend – but not this interest. This interest increases debt. It increases the lenders obligation by increasing the national debt that only taxpayers are responsible for paying off. And the borrower makes the profit when the debt is redeemed. Isn’t that nice? The government not only steals the original surplus, but eventually more than doubles the take.

And it gets worse.

Many of these so-called “trusts” are set up without ever receiving any cash at all. The government simply names a trust, dumps some “special” nonmarketable non-negotiable bonds in it, and when they need real money to spend they withdraw it from the Treasury, no questions asked.

The $88.6 billion State Department “Unconditional Gift Fund” was one of these trusts. It disappeared completely when Colin Powell was building the coalition of the willing. And no one even noticed.

Another is the Federal Employee’s Life & Health trust fund that, month after month, has “zero” receipts, yet increases the more it spends. You might argue that these “public servants” are our responsibility and that we should pay for their health and life insurance, but what right do they have to accumulate $42 billion in “holdings” in the process and by spending? How ludicrous can it get? Wouldn’t you like to accumulate funds every time you use your credit card or otherwise spend cash?

Even philanthropists like Carnegie and Morris Udall who donate money for libraries or scholarships, or Esther Cattel Schmitt who gives the government an extra five thousand every year because the poor dears need it, get ripped off too. The Beltway Bandits spend their money as soon as they get their hands on it. Then they set up a “trust,” throw some “special” bonds in it, and taxpayers end up paying for libraries and scholarships that were supposed to be gifts.

It’s exactly the same thing that they do with Social Security’s extra payroll tax money, but these other trusts are peanuts in comparison to the hundreds of billions they’ve stolen from the supplemental retirement system. An account that now stands at nearly $1.8 trillion in substitute and counterfeit bonds and interest accumulated since 1983.

All of these nefarious transactions are recorded by the U.S. Treasury. They’re not hiding it. It’s flagrant.

Still, these same pirates are today telling us that we must reform Social Security now because it is going to soon be necessary to start drawing on the trust and that trust can't last more than another four decades or so. They even invent booga-booga stories about how it's costing us hundreds of billions the longer we put off reform. While what's really happening is that the surplus to steal is decreasing because of a sour job market and wages that are not keeping pace with inflation.

In other words, there's less to steal and they want to kick it back up by increasing payroll taxes in one way or another.

If they wanted to, they could just dump more "special" bonds in the Social Security trust funds just as they do with so many of the accounts of advantage to them (see Trust Fund List). Even Thomas Savings, one of the Social Security trust fund trustees says they could make this account anything they want. They could even increase the annual interest payment to 100 percent, thus ensuring that it would last forever.

Here's what Mr. Savings said at the first public meeting of the President's Commission to Save Social Security: "We can make that trust fund anything we want to. If we want to change the interest payments, which is a suggestion that’s been made, change the rate of interest, make it 100 percent a year, we can make this last forever, but we can never actually find the real resources because retired people, as I say, drive real cars, eat real food, and live in real apartments and use real medical care, and that’s real output in the country and that’s the only thing we have. We can’t change it with writing numbers on a sheet of paper.”