Must Read: Social Security Trust Fund Fraud May Become Bush's Watergate

[cthrumatrix]

Social Security Trust Fund Fraud May Become Bush's Watergate,
Suggests Author of 'The Looting of Social Security'

(snip).......

The Social Security surplus generated by the 1983 payroll tax increase was supposed to be used to pay down the public debt. This would have been accomplished by purchasing regular marketable Treasury bonds in the financial markets. If this had been done, the trust fund would contain real assets and it would be able to pay full benefits until 2042. However, Smith maintains that President George H.W. Bush began using the money as if it were general revenue, and non-marketable special issue government securities were issued. Smith says that President Clinton continued this practice, so every cent of the Social Security surplus that flowed in under both Bush Senior and Clinton was spent. This misuse of Social Security funds became a major campaign issue in 2000, and both George W. Bush and Al Gore pledged to end the looting. President Bush repeatedly promised not to touch the Social Security money. Finally, in his first State of the Union address, delivered on February 27, 2001, Bush said, "To make sure the retirement savings of America's seniors are not diverted to any other program, my budget protects all $2.6 trillion of the Social Security surplus for Social Security, and for Social Security alone."

In casting their votes in the 2000 election, the American people, whether they voted for Gore or for Bush, were voting for a candidate who had solemnly pledged repeatedly that no Social Security money would be used for non-Social Security purposes. Smith argues that George W. Bush violated both that pledge and federal law when he spent every dollar of the $509 billion in Social Security surplus that was generated during his first term. "He continues to violate his pledge, and the law, each and every day as he spends the approximately $400 million in Social Security surplus that becomes available on a daily basis," said Smith.

Smith argues that the Bush privatization proposal is a Trojan horse to distract attention away from the looting of Social Security money. According to Smith, "Bush and Greenspan know that the government will face a major financial crisis beginning in 2018 when Social Security begins to run deficits, and the public discovers that there is nothing of value in the trust fund." Smith believes that "given the fact that Bush acknowledged the looting problem during the 2000 campaign, and made a solemn promise to the American people to end the practice, his misuse of Social Security money is a serious breach of the public trust," and Smith suggests that historians may refer to Bush's misuse of Social Security funds as "Bush's Watergate."



http://biz.yahoo.com/prnews/050201/fltu022_1.html

this was on another thread...read very carefully...ALL of the above politicians should be held ACCOUNTABLE

[cthrumatrix]

1. people- read this - this is a breach of duty by our Presidents !!!

[enough]

2. Yes, it could be his Watergate,

IF the media or the democrats would hold him accountable. In the current climate, I doubt it.

Very interesting and important article -- thanks for posting this.

[cthrumatrix]

4. this deserves a major Media Blast !!!!!!!!!!!!!!! what do you think ?

[EVDebs]

3. That's strange, the "$2.6 Trillion SS surplus" Bush spoke of in 2001

is almost as much as the DoD's missing $2.3 Trillion that they cannot account for ! Hmmmm. Can you find the pea under the walnut shell ?

See CBS News' "War on Waste" Jan 29,2002 http://www.cbsnews.com/stories/2002/01/29/eveningnews/main325985.shtml

"According to some estimates we cannot track $2.3 trillion in transactions," Rumsfeld admitted."

And BTW, Bush started office with a surplus let's not forget, not a deficit.

[cthrumatrix]

5. great find .... this derserves an "Independent Special Counsel"

Our tax dollars have been "looted".

These Presidents, much like a trustee for any 401k plan, have a "fiduciary liability" when they are investing OUR MONEY with an "implied guarantee".


This has to be explored.

Any lawyers here???????????

[EVDebs]

6. I don't know what "kick" means on DU but somebody better get

a moderator or DU staffer to get this info out there ASAP, know what I mean Vern ?

[Cleita]

7. Strange that white collar crimes would stick to Bush, but

not war crimes. Yet, I'm all for what will get him impeached and forced to resign.

[cthrumatrix]

8. I'm not sure what would stick .... keep this kicked so the right people

can see this.

[midnight armadillo]

9. If I had a nickel...

If I had a nickel for every scandal that's passed by that should have taken down BushCo but didn't over the last several years, I'd be able to retire without SS and live like a king!

[ynksnewyork2]

11. isn't that the truth!

[Stirk]

10. So THAT'S why they're always talking about a 2018 "crisis".

That's when we'll all discover that the account has been robbed.

[realFedUp]

12. www.dailyhowler.com on NYT piece today

http://www.dailyhowler.com

DON’T ASK, DON’T TELL! Can we “save SS” without private accounts? The New York Times buries a bombshell: // link // print // previous // next //

FRIDAY, FEBRUARY 4, 2005

DON’T ASK, DON’T TELL: Good grief! As everyone knows, the SS trustees project a $3.7 trillion funding shortfall over the next 75 years. And ever since his 2000 run for the White House, George Bush has said that this “crisis” can only be solved by the use of “personal retirement accounts” (and yes, that was the term he used, even during Campaign 2000). But what other changes to the current system might wipe out that funding shortfall? In this morning’s New York Times, Edmund Andrews offers a bombshell:

ANDREWS (2/4/05): Some Republicans have even gone so far as to suggest the one approach Mr. Bush did not mention in his speech, raising the ceiling on income subject to payroll taxes, which is now about $90,000 a year. The idea appeals to some politicians because only about 6 percent of Americans earn more than $90,000 a year. Imposing Social Security taxes on incomes of up to $200,000 would come close to eliminating the entire <$3.7 trillion> deficit.
Good grief! What a bombshell! If Andrews is right, raising the ceiling to 200K would virtually solve the whole problem! And make no mistake: Few Americans have ever heard such a thing. Almost surely, Andrews’ editors placed this news where Times readers could barely miss it!

[PROGRESSIVE1]

13. thanks

[porkrind]

27. kick!

ANDREWS (2/4/05): Some Republicans have even gone so far as to suggest the one approach Mr. Bush did not mention in his speech, raising the ceiling on income subject to payroll taxes, which is now about $90,000 a year. The idea appeals to some politicians because only about 6 percent of Americans earn more than $90,000 a year. Imposing Social Security taxes on incomes of up to $200,000 would come close to eliminating the entire <$3.7 trillion> deficit.
Good grief! What a bombshell! If Andrews is right, raising the ceiling to 200K would virtually solve the whole problem! And make no mistake: Few Americans have ever heard such a thing. Almost surely, Andrews’ editors placed this news where Times readers could barely miss it!

Thanks for the excerpt! I think this is a great idea. Of course * hasn't mentioned it, because he needs to protect the rich, and the voters would pick this solution in a heartbeat. Rich slackers. :puke:

[tom_paine]

14. Tiberius Bunnypants* Bushler will have no Watergate, I am afraid

Amerika would have to be a Free Nation with a Strong System of Checks and Balances as well as a Free, Independant Press for that to happen.

Oh, and trustworthy, relatively untampered voting systems, too.

Unfortunately, it has not one of theose things.

Not one.

[cthrumatrix]

17. he might is we massively write to our senators and congressmen

[tom_paine]

18. Has that worked with any of his other frauds?

And Hitler could have been stopped by being hit with a banana cream pie in the face.

I am sorry, because I shouldn't discourage people from working within the System, because I might be wrong.

Certainly I followed that advice by working and donating my ass off in 2004, for all the good it did against Nazi-style propaganda, Soviet-style media, Free-Market Stalinist-type Front Groups, and Imperial Roman atrophying of the Old Republic's Checks and balances.

Like bringing boxing gloves to a gunfight. Even IF (and that's one goddamned BIG IF) the 2000, 2002, and 2004 "elections" were on the up and up, it just means that future historians will ponder the New BushPutinist Totalitarianism as we pondered the old Nazi Totalitarianism back when America was free.

"Everything Hitler did was legal."

Yes. Just so. As it was before, it is now. Advertsiing, marketing, and psychomanipulative Public Relations are the steel which has forged our chains.

Anyway, my point is: If Amerika was still free, perhaps that would work.

I hope I am wrong, but I do not think writing a letter is going to stop Hitler, Stalin, Bush, Ferd Marcos, Baby Doc, Idi Amin, Pinochet, Saddam, or any of the other Leaders who belong to that Family of Totalitarian Tyrants.

[SnoopDog]

15. Just where does all of *our* money go?

The military gets $400 BILLION a year - for what? They could not even put armor on vehicles and our soldiers. Where does are money go? Overseas? In whose pockets?

What do we Americans get? Absolutely nothing... We work our a$$'s of, pay our taxes, and poof - its gone.

Every day I am getting more pissed off. They are and we are allowing our country and the world to be pissed away (global warming - its real).

Our government, our elected officials, are supposed to protect us. We are called Team USA and they are throwing us to the wolves. They are looting our treasury, polluting our air, water, and food, cutting down all our forests, ruining our lands, killing our animals, not educating our children, not implementing safe and clean energy, not implementing start of the art transportation systems... the list goes on.

Since our wonderful government reads all of our communications - this one is special for them...

Our government has been taken over by foreign operatives. There mission is obviously to destroy America. We all better wake up.

[cthrumatrix]

16. this is a good place to start....we need an INVESTIGATION

IF this is true.... they should be behind bars.

[tom_paine]

19. Sure, but exactly WHO will investigate

The Busheviks at ReichsJustice?

Their friends in the Party-Loyal Sub-<edia, or the bullied, lazy and cowardly Corporate TV Pravda?

Remember, a nation is only as good as the people in it.

Unfortunately, Imperial Amerika is now largely populated with Stormtroopers and Good Germans and not much else in between.

We are the most disgraceful generation of Americans that ever lived. 70 years ago, we were the Greatest Generation who beat Hitler.

Now, we are in the same family with those who allowed Hitler into power.

[SnoopDog]

21. Investigate...?

I see only two options:

1. Somehow democracy will prevail - it would be up to us, the people

2. This rise of fascism in the USA will be conquered by other countries.


The world will not permit another Hitler.

[tom_paine]

22. But it WILL permit another Roman Empire of Caeser

(you know, and I think the world would permit another Hitler, too, now that you mention it)

This thing isn't over yet, hell LIHOP #2 and Phase Two of the Transformation have not yet even begun.

Imperial Amerika could still wind up as bad in it's own way as Nazi Germany or the Soviet Union.

Or it could follow the Imperial Roman model (which actually, would be realtively "good", as Tyranny goes).

[NewJeffCT]

20. The money does go somewhere

Halliburton, CACI, etc.

[xpat]

23. This is pure malarky

Look, the trust fund is T-notes. Pure and simple. You can buy them, so can the Chinese. There's something fishy about this article. If anyone can substantiate that there is something different about the debt instruments in the trust fund that makes them unredeemable, show us.

Now, there is a real problem, but it has nothing in particular to do with SS as such. The problem is that we are simultaneously cutting taxes and running up huge budget deficits. That means that there are more and more T-notes out there demanding their piece of the action. A lot of them actually are in China. Unless we raise taxes, and start paying down incurred debts, the government will have an increasingly difficult time maintaining solvency.

[BlkDragon]

24. Hmm

Most people already know this. What the Fed. Government has been doing for the last 20 years or so is giving the US treasury IOUs for the surplus in the SS taxes. It then uses this surplus to pay for current expenses. Everybody remember Clinton's surplus? Well, it actually wasn't a surplus at all. For the first time in many years, the budget was balanced and the surplus was SS tax money.

So when you hear about 3:1 workers in the future it's mularkey. The real problem is that the Congress, both R and D, have been using the surplus to finance current spending. Thereby, ripping my generation off from the last 20 years.

It's really too bad to b/c legislation in 1983 (Congress created the SS "trust") would have fixed this looming problem if it had simply paid off the national debt. We're basically mortgaged out (i.e. treasury bonds) and we shouldn't be.

[xpat]

25. Let's look at this thing a bit closer

You say, "It then uses this surplus to pay for current expenses."

Of course it does! If there were no deficit, there would be no need for the government to borrow to pay for current expenses. OTOH, if there were no deficit, Soc. Sec. could not invest the surplus pay roll tax in government debt instruments.

So which do you want? No deficit and nowhere to salt away payroll tax surpluses, or a deficit sufficient to provide an investment vehicle for future SS outlays?

The surplus has to be invested somewhere or it devalues absolutely with inflation. Historically, very few investments have been as secure as US government debt. Without it, we might have had to buy Enron stock.

When all is said and done, part of our taxes go to servicing federal debt. I think the figure is currently about 10%, but some industrious person could check that and correct me. When SS starts redeeming it's share of the debt instruments, taxes will cover the cost, just as they do now. If we are smart and think of our children's future, we will stop increasing the deficit now and raise taxes to buy down the debt that has been accumulating for decades.

[BlkDragon]

26. Sure

Yeah of course. There's no disagreement here. I was just pointing out the fact that the government has been using the surplus SS tax for current expenses.

So when you hear a Republican say there is no trust fund, they are technically correct. The US has been borrowing from itself. The "trust fund" dollars will have to come from general revenue. I always smile when I hear Rs "worry" about this b/c in essencse they are telling the rest of the world that US securities are risky.

[BuyingThyme]

28. Watergate will be Bush's Watergate