No cash involved. None of this interest was paid in real money or anything equitable. It was all paid by depositing more bogus “special obligation” nonmarketable funny money bonds in entitlement accounts like the Social Security Trust Fund, Medicare and the Highway Trust Funds.

Real interest money, taken from the Treasury’s General Fund of individual income and corporate taxes, was paid to the “Public” side of the national debt. This was paid at the annual average rate of 6.489 percent. Based on the thousands of contracts made with investors buying Treasury securities over the years on the open market. Tons of legitimate borrowing or non-theft.

Current balances for fiscal 2000 are as follows:

..................................Federal Debt.....................................Public Debt
.................................$2.629 trillion....................................$3.405 trillion

Taken from the U.S. Treasury Monthly Statement of the Public Debt of the United States, September 30, 2000, the close of the fiscal year.

The “Federal” Debt

Federal. A word falsely implying that the government is going to take care of replacing money stolen from entitlements like Social Security and that the public doesn’t have to worry about it. What Alan Greenspeak calls "intradepartmental holdings" because the money goes from entitlements to discretionary budget items.

The place where promissory notes are passed out like candy from Santa Claus. Where these notes just keep piling up in trust funds, adding to the national debt. A debt that went up $18 billion last year, despite what you hear otherwise.

You can verify this at http://www.publicdebt.treas.gov/opd/opdpenny.htm the U.S. Treasury’s Bureau of Public Debt web site. It’s at the bottom, under “prior fiscal years.”

These promissory notes function like chits or markers from the Mafia. They don’t cost the government a cent. And they don’t cost taxpayers anything either, until the day of reckoning.

Someday, in the future, this Federal part of the national debt will be paid-off with money from the Treasury’s General Fund of your income tax receipts just like the other side of the debt will be paid by you or your children.

When it happens, it’s double taxation plain and simple. The public paid this entitlement money in the first place. Congress and the Administration stole it to use elsewhere, depositing markers in phony trust funds. When cashed-in, the public pays again, with interest added.

It has already happened several times, but never in highly visible amounts of more than $5 billion or so. It happened a couple of years ago when the Department of Transportation claimed that they needed everything in the Highway Trust Fund in order to repair Interstate Highways. The next year, the DOT redeemed $5 billion worth of these notes and Congress blew its stack.

Congressmen hate the fact that some of the annual tax money they intend to spend elsewhere must go to redeeming these markers. Within months, they raised the tax on gasoline four cents to keep it from happening again. The pirates can act very quickly when it’s to their advantage.

The same thing happened when Medicare had to draw $3 billion in markers from its trust fund. Congress started crying about how Medicare was going under, failing. They still do it, even though it was later found that unscrupulous doctors had been double billing Medicare to the tune of about $22 billion and that was why the annual budget was short temporarilly. The Medicare Trust Fund now holds $249 billion in bogus bonds replacing stolen funds and went up $17 billion last year.

The big crisis will occur when trust funds like the Social Security and the Medicare Trust Funds must be cashed-in, in any significant amount.

The Social Security Trust Fund

The largest of the 164 trust funds managed by the U.S. Government, the Social Security Trust Fund went from $864 billion to $1.016 trillion last year. That’s an increase of $152.2 billion in one year. All in phony bonds or UOUs because the real cash was illegally spent elsewhere.

Of that increase, $57.5 billion was interest paid by simply handing the mistrust fund more bogus bonds. Interest paid at the mark of the beast last year, or 6.666 percent. A figure the U.S. Treasury determines using a five year model of interest paid legitimate investors on the other “Public” side of the debt.

The balance of $94.4 billion was extra “surplus” payment 141 million American workers paid in additional unnecessary FICA taxes. Money that Social Security didn’t need because it had enough to make all of its commitments to the currently retired and disabled. Already capable of delivering these benefits right on time and at a cost of less than one percent of its operating budget.

The threat is that a fictitious bunch of "baby-boomers" are looming on the horizon. While the truth is that the Great Depression babies now retiring were less than half as many births from the Thirties decade than the preceding decade of the "Roaring Twenties." Half as many that have been carrying Social Security for years without breaking a sweat. While the few extra baby-boomers only brought things back to normal. A number closer to 7 million than 76 million.

The federal government lies about almost everything having to do with the national debt and entitlement rip-offs.

Not the worst of it

Last year, the total debt held by the “Federal” side of the national debt rose $215 billion. While the “Public” side of the national debt, the side paying real cash interest to investors, went down by $240 billion.

This is due entirely to a money laundering operation that began in 1998 transferring debt from one credit card to another. The true Clinton legacy, following a plan laid out and backed by Alan Greenspan, Chairman of the Federal Reserve.

The $25 billion difference between these two sides, or the one-for-one transfer of credit from one credit card to the other, is explained by the fact that $87 billion in excess income tax money was also used to pay down the “Public” side of the debt as well as the difference in interest payments. All during fiscal 2000.

In short, for every extra dollar you pay in FICA taxes, the government saves six and a half cents by throwing your money against the expensive (to them) side of the national debt. Isn’t that a simply wonderful use of your retirement money???

With supreme arrogance, these Beltway Bandits then tell you that they might pass part of this six cent savings back to you. Not all of it, mind you. That’s why I have elsewhere referred to this as four cents on the dollar.