Subject: FOOD FOR THOUGHT !
"I predict future happiness for Americans, if they can prevent the government from wasting the labors of the people under the pretense of taking care of them."
" Thomas Jefferson <http://www.goodreads.com/author/show/1673.Thomas_ Jefferson> "
Why did Bernie Madoff go to prison? To make it simple, he talked people into investing with him. Trouble was, he didn't invest their money. As time rolled on he simply took the money from the new investors to pay off the old investors. Finally there were too many old investors and not enough money from new investors coming in to keep the payments going.
Next thing you know Madoff is one of the most hated men in America and he is off to jail.
Some of you know this. But not enough of you.. Madoff did to his investors what the government has been doing to us for over 70 years with Social Security. There is no meaningful difference between the two schemes, except that one was operated by a private individual who is now in jail, and the other is operated by politicians who enjoy perks, privileges and status in spite of their actions.
Do you need a side-by-side comparison here? Well here's a nifty little chart.BERNIE MADOFFM-Takes money from investors with the promise that the money will be invested and made available to them later.
SOCIAL SECURITY
SS-Takes money from wage earners with the promise that the money will be invested in a "Trust Fund" (Lock Box) and made available later.
M-Instead of investing the money Madoff spends it on nice homes in the Hamptons and yachts
SS-Instead of depositing money in a Trust Fund the politicians transfer it to the General Revenue Fund and use it for general spending and vote buying.
M-When the time comes to pay the investors back Madoff simply uses some of the new funds from newer investors to pay back the older investors.
SS-When benefits for older investors become due the politicians pay them with money taken from younger and newer wage earners to pay the older geezers.
M-When Madoff's scheme is discovered all hell breaks loose. New investors won't give him any more cash.
SS-When Social Security runs out of money the politicians try to force the taxpayers to send them some more; or they cancel S/S to all those who paid into it.Bernie Madoff is in jail.
Politicians remain in Washington .. with fat medical and retirement benefits.
'The taxpayer: That's someone who works for the federal government but doesn't have to take the civil service examination.' ~ Ronald Reagan
"If you put the federal government in charge of the Sahara Desert , in five
years there’d be a shortage of sand.” ~ Milton Friedman
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8 comments:
Thomas Jefferson? I don't think I've heard of him. Should he be in the history books?
Lies. Damn fucking lies.
Social Security is probably the best government program in the history of the country. Its lifted tens of millions of seniors out of poverty. Its deficit neutral. And the money DOES get saved. It gets invested into the safest of all investments: US government bonds.
For everyone who says that the IOU's are worthless, please do something for me: go to your safe or bank deposit box. Take out all the government savings bonds you may have collected over the years. Then burn them. Because according to you, they are fucking worthless.
Or better yet, send them to me. I'll pay 1 cent on the dollar for them, plus postage. Which you should take, because apparently I'm paying money for "worthless" things.
"If you put the federal government in charge of the Sahara Desert , in five
years there’d be a shortage of sand.”
Well its a good thing we don't leave things like preservation and conservation to the government. Those dummies could never run something like a hypothetical "national park" or "national forest". Good thing we have the ever reliable free market to take care of our landscapes....
David Koch or the Scaifes or Pete Peterson paid a rightwing hack to write this piece of propoganda to SCARE the scaredy-cat wingnuts.
Make no mistake, the rightwing, which includes Obama (imo), desires nothing more or less than to gut Soc Sec, in order that the wealthy zillionaires can rip off the US "small people" who paid their hard-earned money in Soc Sec.
Soc Sec is in FINE shape financially. IF there are any issues with it, the simple solution is to raise the income cap on the pay deduction for it (which is incredibly regressive anyway).
Wait for Obama's Jan 25 2011 State of the Union Address. My prediction: he will talk about how Soc Sec needs to be gutted because of US debt. This is a bald-faced lie.
Propoganda like this is currently being pumped out to the wingnuts in order to soften them up to "take it" in terms of giving up their hard-earned Soc Sec savings. Don't believe me? Listen to RushGlennSarah talk about how Soc Sec is *welfare* and an *entitlement.* It's NOT. You and I *paid into* Soc Sec; it is your money & my money; and US citizens should get it back.
Beware, though. It is simply not just Republicans who are trying to rip off the Soc Sec that you and I paid into. Democrats are trying to do so as well. Don't say I didn't warn you. Read around the blogs, esp firedoglake.
Madoff has a lot more in common with Wall Street than with the government. And despite the constant 30-year propaganda campaign that SS is about to collapse--the government is still paying. Wall Street would love to get their mitts on all that Social Security money.
I'll add that quoting the thoroughly discredited Milton Friedman wins you no points intellectually.
Friedman's Trickle Down doctrine was embraced by conservatives (both Democrat and GOP) as the ultimate in capitalism. That whooshing sound you heard in the 80's was the dismantling of industry, the outsourcing of American jobs to essentially overseas slave labor, and the steady erosion of the middle class.
Where the conservatives went horribly wrong (as they typically do) was that they advocated "free" markets, rather than "fair" markets. Because guess what? There will ALWAYS be countries that will exploit a disenfranchised working class at the expense of a decent standard of living. America will always lose that battle and we end up spiraling down to their level.
That's why there's this little thing called tariffs. They worked once, although now I'm afraid that it would be a case of closing the barn door after all the horses ran off.
Thanks Milton. I hope you enjoy shoveling coal in Hell. I hear that's where they stick the newbies.
The difference is that Social Security has been an incredibly effective program. Sure there are issues with its long-term solvency and the like, but these issues only arise because of right-wingers who would rather let the whole thing collapse and save on taxes for the rich than, you know, actually take steps to make sure that it will run forever.
Social Security is probably the best government program in the history of the country.
Really?
Here's a financial accounting lesson for you.
I just did a brief analysis of my contributions to SS and Medicare. From 1973-2011, I have paid in $193,483 to SS and $70,729 to Medicare between my and my employer's contributions. My status for 80% of those payments has been self employed, so I actually paid both sides of the equation.
I could have invested those monies into a personal account similar to an IRA or 401K and at an annual yield of 6%, I would now have (present value) $580K in to SS and $195K in to Medicare. 6% is very conservative as there are plenty of mutual funds that have been around since 1973 and have averaged 10% or greater over that same period of time. Whole life insurance averages 6% for that period of time.
Extrapolating that account out to age 66 and 8 months (the current SS "full" retirement age), at 6%, that account has a future value of $1.2M for SS and $408K for Medicare assuming that I stop working now. If I continue to work until age 66 and 8 months and earn $15 per hour ($30K/yr), my hypothetical account is worth $1.5M for SS and $488K for Medicare.
At that point in time, assuming that I move the whole shebang into bonds at 4%, I could receive an annual payment of $98K ($8K/month) from the SS amount and $32K ($2.6K/month)from the Medicare amount until I reach age 91 (not likely). Social security represents that I can receive a benefit of $2.2K/month or about $26K/year for all of my contributions (assuming that it doesn't go bankrupt before I die). I'm also pretty sure that $32K/yr could purchase a sweet medical insurance plan.
So in effect, SS has robbed me of $72K/yr in potential retirement income and Medicare has provided me with a medical policy worth about $7K/yr when I could purchase that same policy in the private insurance market and have $25K/yr left over.
As proven here, the federal government is, in effect, using SS and Medicare to provide a massive money re-distribution scheme. NOT the "best government program in the history of the government" from my perspective.
In addition, I already donate 10% of my income, and 5% of my time, to charities that deliver 90% (less than 10% overhead) or greater to those in need. I'll bet that the effective delivery rate of overhead for the federal government is well over 40%.
I could have invested those monies into a personal account similar to an IRA or 401K and at an annual yield of 6%
And if you only need money when the stock market is booming, it sounds like quite a deal.
Incidentally, magically consistent rate of return from the unstable market was the big warning sign that Madoff was a fraud.
Medicare has provided me with a medical policy worth about $7K/yr when I could purchase that same policy in the private insurance market and have $25K/yr left over
I really don't think you've priced out what comprehensive medical insurance in the US costs when you're 65+.
I'll bet that the effective delivery rate of overhead for the federal government is well over 40%.
No. The costs you talk about are "administrative overhead." For a private insurer, that cost can vary between about 7%-26% (depending on whether the policy is for you alone/a small company/a big company). For Medicare,
administrative overhead is about 2%.
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