The federal kleptocracy steals surpluses belonging to dozens of entitlements, spending that money wherever it pleases. Since 1983, Social Security's surplus has provided the largest booty, having now grown to proportions of more than one hundred billion per year and about to skyrocket into the trillions. Almost all of the $5.6 trillion surplus predicted over the next 10 years comes from extra payroll taxes the working people of America are paying. It's America's working stiffs that are being ripped off, not the wealthy.

Payroll taxes are limited to salaries or income under $80,400 per year. Providing more booty, this has been raised from $72,200 over the last two years but it's still a working man's tax burden. Unlike personal income taxes, once the wealthy pass the ceiling they no longer pay payroll taxes.

Since 1998, the federal government has been engaged in a money laundering, six cents for a dollar, operation to pay down one side of the National Debt with these surpluses. At the same time, a few who have glimpsed the inequities and ramifications of this rip-off have been talking about reforming Social Security. Unfortunately, most of the proposed reform ideas range from the ridiculous to the sublime and all are off the mark.

Part of the problem is that many of the so-called reformers have only an uneasy feeling that something is wrong and often end up chasing ghosts. Not trusting the federal government (for good reason), they want either to take the system out of the government's hands entirely or institute internal reforms that would radically alter a system that is functioning very well. Many of these well intentioned good hearts risk crippling a system that functions on less than one percent of its annual budget, maintains offices in every major city, and promptly delivers payments to something like 39 million Americans currently retired or disabled, and has always been able to do this with hardly a hitch.

The quickest and easiest solution is to take away Social Security's excess profits. Cut payroll taxes. Reduce these taxes by putting them back the way they were prior to 1983. At least one advocate of such a correction is former Senator Daniel Patrick Moynihan who now claims, probably out of guilt, that Social Security should be returned to the pay-as-you-go system. This would mean lopping out about 16 percent of the FICA taxes currently making up the working man's cost of being employed.

The difficulty lies in what happened in 1983. There's some question of whether it was the Greenspan Commission or an idea hatched in the hallway by two of its members, Moynihan and Bob Dole, who served on the year long committee to study Social Security's supposed problems at that time. Social Security was supposed to be taken off the pay-as-you-go system, a system not unlike most small and medium sized businesses in America, and put on a "partial reserve" system. In other words, Social Security was deliberately programmed to have a surplus through higher, and unwarranted, payroll tax increases.

The partial reserve plan was a good idea—if the reserve had been invested wisely. If that had been done, we would now be sitting on at least $1.016 trillion (ONE TRILLION, SIXTEEN BILLION DOLLARS) in real assets. We would be well on the way to making Social Security into a true pension plan.

Unfortunately, the reserve was not invested wisely. Instead, it has been consistently pilfered by Congress and the Administration. First, to help beat the Russians into the ground economically and win the Cold War. And later to support a false economy based on borrowing and the theft of these funds.

Instead, we now have Social Security accounting for $1.016 trillion or 18 percent of the National Debt and rising. The public is in the hole by that amount and will someday be called upon to repay it in a form of double taxation. We give them money. They give us debt in return. And no one asks the Beltway Bandits to explain why our supplemental retirement system accounts for 18 percent of the National Debt. Investigative journalism, so-called, is strangely silent on the subject.

And Social Security is still operating on the pay-as-you-go system. Every cent of its "partial reserve" having been stolen, it left Social Security operating exactly the way it has always operated. Nothing really changed from the period before the "reform" of 1983.

This theft continues every day at the rate of about $10 billion per month. That's more than $300 million a day, Saturdays and Sundays included. Last year, fiscal 2000, it amounted to $94.4 billion, and this year the theft will be more than $115 billion unless serious unemployment puts a crimp in the government's Golden Goose.

Meanwhile, we wait to see if the Oligarchy is going to throw us a few crumbs from personal income tax overpayments. Money our new President tells us is "the people's money." And no one, least of all the Beltway Bandits profiting from their crafty scheme, questions or thinks about the enormous entitlement overcharges.

Sham Battles

It has been more than three years since President Clinton told us we must "fix the roof while the sun is shining." And what have we got? Nothing, zero, zip, zilch, nada, squat, that's what. All they've done is increase the age of full retirement and raise the ceiling about 15 percent, bringing in more money to plunder.

We've had all sorts of opinions from people and organizations who do not seem able to see the forest for the trees. Experts and specialists who wade into economic forecasts, actuarial data, and various theories that seem to complicate the issue. It's almost as though these reformers may not be such good hearts after all. Instead, they may be part of the smoke screen to keep the public unaware of the theft of their retirement and health care money.

To cite only a few examples, we've got the Concord Coalition recommending the full privatization of Social Security, both the Social Security Administration in Baltimore, Maryland and the trust fund established and held by the Washington borrowholics. The costs for replicating the SS Administration in the private sector are monstrous and totally unnecessary. There is probably no private organization that could duplicate present efficiency. In fact, recommending full privatization seems tantamount to a company dissatisfied with its ad agency hiring a new agency only to find the same people employed by the new agency.

On the other extreme, we've got politicians like Martin Sabo, a 23 year veteran of Congress, introducing a bill (H.R. 1320) to double the annual interest payments to the Social Security Trust Funds (Old Age and Disability trusts). Naturally, this increase would be paid in more bogus "special obligation" nonmarketable Treasury bonds that do nothing but plunge the American taxpayer further in debt. Since these bonds are passed out like candy from Santa Claus anyway, why don't we triple or quadruple interest payments so we'll be able to claim that Social Security is funded forever? They can add more anytime.

Mr. Sabo is one of the two representatives who voted against both "lock-box" bills. The last one, in 1999, passed the House by a vote of 420 to 2 ( Sabo and Jerrold Nadler dissenting) and was a bill to spend the Social Security and Medicare surpluses only to pay down the National Debt. This should be enough to warn anyone. What should move the public to DefCon-2 is the fact that Mr. Sabo is making his recommendation on the fear that once the government pays off all of its "available" national debt, it would eventually have to invest Social Security's surplus in the private sector. What a catastrophe.

Meanwhile, President Bush got a lot of election mileage out of an idea he borrowed from his father's days. Setting up "personal accounts" much like the government did in 1987 with its Thrift Savings Plan for federal employees. A system partially privatized to allow two million federal employees to invest in the stock market through Barclay Bank of Great Britain, and do so with matching funds from taxpayer money.

The trouble with this plan is that the amount of paperwork involved in forcing employers to report each of their people separately, and change options at will, would require dramatic rises in the price of consumer products and services to cover the additional accounting costs. It would create inflation. Companies in the private sector generally do not have the spare time bureaucrats apparently have to process this huge amount of paper work.

Imagine that you own or manage what the government considers a "small" company, less than 500 employees. You have been sending one single check every month to cover your end and employee deductions for 416 employees. Now, with private accounts in effect, you must report a portion of that tax money (16 percent of it) separately for each employee. A separate check or accounting for each of your employees, 416 separate reports. Anytime some of them want to switch from the stock market to municipal bonds, or visa-versa, you need another form report for each. And the government is going to "earmark" each of these separately on their end.

I could go on with all sorts of examples of schemes hatched by people and groups who either want to increase theft and extortion or want to reform Social Security in some rinky-dink way.

Meanwhile, the theft continues unabated. At the rate we're going, the national debt these pirates ran up in the last 20 years will be paid down with our retirement and health care money before the public has a chance to object.

One way to separate the inept reformers is whether they subscribe to the "baby-boomer" myth. If they seem to be buying into that fear story then they're probably part of the problem, maybe even working for the government, certainly not worth considering as meaningful research or having meaningful recommendations. The baby-boomer threat does not exist.

Real Reform

It would be a simple thing to reduce payroll taxes by 16 percent. However, we would never know whether Social Security might have been upgraded to something more than a supplemental retirement system. The "partial reserve" idea never really got a chance. It never got off the ground because it was stolen.

We could both stop the theft of Social Security's surplus and, at the same time, open the door to improvement by creating a real trust fund. Real trust funds are "lock-boxes" and the government has already demonstrated, by its Thrift Savings Plan, that it has the capability to do this. We could do the same thing with Social Security's surplus from this point forward.

The only requirement we would need would be that trustees be forbidden to invest in U.S. Treasury securities. No more owing ourselves or using our good money to create debt. From that point forward, there are all sorts of possibilities. And the cost is minimal.

One and all, current reform or privatization ideas seem to focus on the stock market. Since the New York Stock Exchange has never returned less than three percent, even in the Great Depression of the Thirties, this is certainly one of the places to invest large sums of money. But it isn't the only place.

Social Security's profits are enough to purchase its own seat on the exchange, eliminating commissions and making Social Security capable of investing for all other entitlements that might be set up the same way. We might even help farmers by investing in the commodities market. God knows, the farmers could use some innovations in price setting now jammed down their throats.

How about investments in property? Not just parks, preserves and national amusements, but mortgages. Social Security could probably hold most of the single family home mortgages in the country, and who would think of cheating or defaulting on their neighbors? Of course, it would be heavy competition to the banking industry and the politician's good old boys, but haven't they had a monopoly on the usury game long enough?

I'm not talking about socialism here. I'm talking about putting the American working person in direct competition with some of the major conglomerates in this country. Free enterprise. The "ma and pa" bank disappeared long ago.

Then there's loans to foreign countries, municipal state and city bonds without the double dealing exclusive to the District of Corruption. Long and short term contracts that actually are repaid and produce suitable annual interest.

In fact, there are so many investments other than thinking exclusively of the stock market. The possibilities make current investment talk look as though it's coming from a bunch of lunkheads. Possibly bureaucrats that have led an institutional life far too long.

And isn't diversity one of the operating principals of the large pension investment houses like TIA-CREF that already produce reliable returns with professional investors who could do the same thing with larger sums? Member economists like Milton Friedman don't tell these people where to put their retirement money.

It really gets down to who do you want to trust. Politicians that have already demonstrated their inability to handle our money, or trustees in the private sector that we could hang if they screw up. Done thoroughly, we might even give the selection to closed circuit computers with index programs that couldn't be influenced. Just feed in data and invest where the machines select and proportion. It might even be indexed to something simple like selecting and spreading stock investments by the number of employees in companies listed on the exchange. Gee, that might have the side effect of full employment and companies competing for each others people. What would unions do then?

All it takes is a real trust fund with real trustees. Get rid of the debit black holes the pirates want us to believe are something other than double taxation. In fact, just scratch all the nonmarketable bonds and start from scratch. The longer we wait, the more money we pour down the drain. More than $300 million a day currently being stolen isn't chicken feed.