Posted On: Tuesday - July 31st 2018 11:59AM MST
In Topics:   History  Global Financial Stupidity  US Feral Government  The Future  Socialism/Communism  Inflation
Last Wednesday, Peak Stupidity, in a quick overview, discussed the Social Security Scam. I admitted that it's not that this now-massive program was intended to be a scam from the beginnning, just a typical Socialists' stupid idea. Things change though and even honest promises from people in government mean nothing in the long run. Unfortunately, Social Security is a program that IS meant for the long run, as far as individual lifetimes go. SS has turned into an unsound (to put it nicely) financial plan, due to good and bad changes in demographics, as described in Part 1, so I'll continue on from there.
For the next few paragraphs, the reader is pretty much expected to lay his head on the desk and drool, as a student in Mr. Ben Stein's Ferris Buehler's Day Off econ class. If it helps, by all means do so. ;-}. You, if you have worked on the books a single day in your life, have a Social Security account. Yeah, that's right, this money that the Feral Gov. is forcibly extracting from you and your employer ( ~ 7% EACH party, of your income through over $100K) is said to be in your account. OK, let me stop this laughing before I can't even write ... I'm starting to drool here too.
Let's back up some. Anyone who's not completely naive will know that his money even in a simple bank account or CD is really not exactly sitting in something that people envision as an account. I.E. your 1850 bucks sitting in that checking account is not really in a cubby with your name, "P.S. Reader" written on a sticker. No, there's really no such thing as "your money" at the bank. They have enough cash to give you all of the amount your statement calls "your balance" from their general cash fund (so long as all your friends don't come the same day for theirs too!). Really, your money that is gaining you that wonderful 0.31% (but keep that minimum balance) yearly, is being lent out to people at 4 - 20% in turn - oh, one of those people might just be you! Haha, yeah, I'll have to revisit the FED-controlled interest scam along with inflation soon, as it's sure been a while ... going off the subject ... must ... try ... to get ... grip on the .... [/Econ-Prof. Kirk]
Though your money has never been in a specific place, before the late 1990's the accounting of American's forced retirement savings via the SS program, keyed to you via your NO-IT'S-NOT-AN-ID-NUMBER SS number, was kept separate from the general budget of the US Feral Government. Well beyond those later years of the BJ Clinton administration, the program still ran in the black, due to the baby-boomer bulge in paying workers, as described in Part 1. That was part of the enticement, in fact, to change things. The government continually-expanding deficits could be minimized, even erased (for one year I think it was) on paper by lumping in all SS money with the general budget. It sure made the Clinton administration look like a downright frugal, responsible bunch, not seen since Silent Calvin Coolidge That's how it's been ever since, and of course, the budget deficits, hence total debt (at this point ~ $21,000,000,000,000) has been reaching for the sky, nonetheless. Look under the Global Financial Stupidity topic key for lots more on that. SS being in the black until 2009 or so helped the deficits look better, but not anymore. It's an accounting trick, either way.
"Trust" fund, heh, heh! Sure, that's the ticket. A nice conservative accountant with green eye-shades is taking care of all your money with one of those books with all those lines, and lately has even gotten on the computer using LOTUS 123. It's all right ... uhhh .... there. Don't you remember getting a statement every year, until the Feral Government ran out of money for that ... hey, that's not a good sign, is it?
We can blame the Socialists and the imbeciles who voted for them and anyone else in government we want for the problems coming. Many of us are not responsible for the future of SS, having tried to vote out the irresponsible ones through the years. "I didn't vote for this." "I'd have put my money in better investments if I'd had a choice.", and "I've paid in so much money over they years, so I deserve what's coming to me, anyway." are all decent points. However, one should still be responsible for one's self, and what I'd reply to all that is:
Yes, it's at this point a mandatory Ponzi scheme. Lots of us wanted no part in this. No matter what, though, YOU DON'T TRUST BIG ORANIZATIONS, ESPECIALLY THE GOVERNMENT! You just don't. What I'm getting at is, you should not run your life as if this money will just be there for you as promised. Anyone who COUNTS ON the SS money as supporting his retirement is a being irresponsible. I don't mean hope for, as some extra expected, but not essential, cash. You have every reason to be mad at getting scammed by SS, with a terrible return compared to how you could have invested that money over the years, but still should only blame yourself if you did not prepare otherwise. Over the years, did you not look at this beast of a Feral Gov't, and think, "yeah, I just don't think I can trust it with my future"?
I am not saying that you will just see "CLOSED" signs on the offices, and no checks will come in the near future. It's not going to go down like that. Small cuts will be made in various ways, inflation will be always said to be miniscule by the BLS, and that latter point is important, because it will go down more like this: "Yes, sir, you will get your $1575 monthly just like your statements have always said." It's just that rent will be $1800 for a 500 sq-ft apartment, Big Mac meals cost $27.99, and even cat food prices may make it just as well you can't afford an exterminator for the rats. The insidious tax of inflation always help governments NOMINALLY pay their debts, but sometimes you've got to get that hyper-turbo-inflation to make it work. In the meantime, the BLS government statisticians will present some nice low numbers, so that your checks don't index enough to screw up the plan.
This is just one leg ot the "triad", lets call it, of support for old people living well-off lives. As discussed 2 weeks back here on the Peak Stupidity blog, between the SS scam coming to a bad end, the FED-controlled near-elimination of interest on safe investments, and corporate near-elimination of anything resembling the pensions of old, we have reached "Peak Rich Old People". We all need to get ready for what's coming.