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THE FED'S NEW HUMAN CAPITAL
PART 3 of 3

 

 

 

By Jon Christian Ryter

May 16, 2007

NewsWithViews.com

Here's the catastrophic reality. Subtract some 10+ million potential taxpayers per decade from the American landscape and then add all of the baby boomers born between 1945 to 1950 who will begin to qualify for benefits in 2010. Can you see a crisis unfolding? Could that be why the White House is frantically searching for taxpayers? If Bush, or whomever follows him to the Oval Office, can't find at least 15 million new middle-class taxpayers quickly, the baby boomers who begin to retire in 2017 will have the shortest pensions on record because, with the Medicare deficits that will build even faster than the Social Security shortfalls, Social Security—and the Fed—will collapse about 2039.

When you listen to the liberals whose political ancestors from the Great Society looted the Social Security Trust Fund and drained it to finance the Welfare Generation, you'll find they're still treating a vault full of IOUs like they were real money. Three point three trillion dollars of real money. Politicians talk about this money like it's real because, when it was taken from our paychecks it was real. Politicians live in an abstract make-believe world in which reality is what they say it is. In their world, they can spend money and still have it. That's a little bit like having your cake and eating it, too.

Think of the Social Security Fund as your own personal savings account. Let's pretend that, say, 43 years ago you decided to start building a retirement fund. You decided to invest 5% of your net income each payday, and placed it into a long-term, interest-bearing savings account. Let's imagine that somewhere down the road through time you used some of that money to put your children through college. Then you used some of the money to take a cruise or an exotic vacation. Fortunately you had money available when you had to put a new roof on the house and, later, new siding and thermal pane windows. Each time you "borrowed" from your retirement, you wrote yourself an IOU because, after all, you intended to replace the money you moved from savings into your checking account for life's little emergencies. One day you realized you had squandered your nest egg. The savings account was empty. Not only was all of the principle gone, but the interest on those savings that would have have provided comfort from worry was gone, too.

Not deterred, because you had diligently written down all of the money you borrowed from your retirement fund, you pretended the money was still in the bank because you were convinced that before you retired you'd manage to put it back. Only, when you reached age 65, or 70, or 72 or 75, all of your pockets were empty. There was no money.

Uncle Sam's Ponzi scheme

That is precisely the dilemma facing the federal government. Their pockets are empty. There is no money. Yet, when you listen to them talk about the Social Security Trust Fund, most will confidently state there is currently a $2.5 trillion surplus in the fund. They say that because most of them have seen the IOUs. In point of fact, when Social Security checks are issued, the funds that cover them comes from the current FICA payments. Today, Social Security taxes still exceed social security spending. But that will change in 2012. Think of Social Security as the government's own Ponzi scheme—which it is. If the promoters of Social Security were private entrepreneurs instead of the US government, they would be arrested and jailed for fraud. In a Ponzi scheme, recipients are paid from the contributions of other investors. Ponzi schemes will always goes bankrupt because eventually the sheer number of recipients will outstrip the ability of the investors to cover the promised payments.

That's what has happened to Social Security. If the pantry at the Fed wasn't already bare, making Social Security payments wouldn't be all that hard since the bureaucracy would simply transfer money from the Fed to the Treasury to cover the Social Security IOU. Uncle Sam's dilemma comes from its difficulty in generating money to cover the anticipated Social Security shortfalls that will bankrupt not only the Social Security and Medicare systems in 2039 but the Federal Reserve as well. Images of post-WWI Germany and that nation's struggle with hyperinflation come to mind. When governments print money without debt collateral, inflation happens. When too much fiat money is printed, hyperinflation will result.

Using alien human capital to save the economy

When the Social Security-Medicare bubble bursts between 2039 and 2050—even if politicians attempt to patch the program by reducing benefits, increasing taxes or advancing full benefits retirement age to 80—the US economy will collapse. When it happens it will trigger a Depression of such magnitude that the domino affect will swallow the economies of all the industrialized nations, bankrupting all of the world's central banks and erasing the wealth of 90% of the world's population. Only those who have converted their assets into readily accessible forms of portable wealth—gold, silver, diamonds, other precious metals or stones, or stored commodities—will survive financially.

This is the fiscal Armageddon Bush is attempting to avert. To divert economic disaster, Bush must accomplish two things before leaving office. First, he must change the nature of Social Security by removing temptation from the grasp of tax-and-spend politicians by keeping the taxpayers retirement funds out of their reach by allowing workers to invest what would otherwise be taxed as OASI into private investment accounts. This will protect those coming into the work force. Second, Bush needs to find enough new adult taxpayers—15 to 20 million of them—to infuse the Social Security Trust Fund with the money it needs to become solvent. Those new taxpayers are currently the nation's undesirable illegal aliens. The government claims there are between 8 and 11 million of them. In point of fact, there are between 15 and 20 illegal aliens in the United States at this time.

This is the human capital America will be forced to adopt to remail solvent. Like it or not, the illegals that gather around 7-Eleven or other convenience store chains each morning waiting for building construction foremen to happen by for coffee and hire them as day laborers will be tomorrow's next door neighbor in hundreds of cities and towns in the United States as they are granted amnesty from deportation.

The American people need to understand that there is no free ride. The problem of unwanted illegals being legalized exists today for several reasons. We must all share the blame for the problem because we are all guilty of causing it. We were either part of the problem, or we refused to be part of the solution. The problem is threefold: [1] We elected, or allowed to be elected, candidates for public office whose political views included globalism. [2] We either supported the right of women to kill their unborn babies, were neutral to the notion and did nothing, or knew that baby-killing under any name was wrong but refused to get involved. We are the most guilty since we created the environment that now mandates that we accept—against our will—the undesired human capital of other countries because we do not have enough native born human capital to keep our economy alive. [3] Most of all, we have allowed America's Fortune 500 companies to shut down factories and move millions of jobs out of the United States and into the third world without penalty or retribution. Granted, we—or rather 42.9% of us (and the 19% that voted for Ross Perot in 1992)—are responsible for NAFTA and the jobs drain because we elected Bill and Hillary Clinton and Al Gore, Jr. Granted, we didn't know that was the primary piece of legislation on Clinton's plate when he was campaigning for the White House.

When NAFTA was debated, it was clear it was a jobs-drain treaty not a job-creation treaty. We let it happen because we didn't stop it. How do you stop it? You fire politicians. You recall them, and you impeach them. And, whenever you can, you throw them in prison. But most of all, you simply refuse to buy any product not made entirely in the United States. If American corporations can't sell goods they make in China or Mexico, they will stop making products in China or Mexico. If the only goods American citizens will buy are those made in the United States, we will force those companies to return their factories to this country. Because, for the moment, the United States still buys more consumer products than all of the other nations of the world combined. We need to boycott all products made elsewhere in the world. It will entail hardship on our part. We will pay more for products made here. But, that is the only way to save America from the utopians who are attempting to create world government. There will be no NAFTA corridor slicing the United States in half since goods transported from Mexico will have no retail store destinations in this country. The North American Union will be an idea that cannot be achieved in our lifestimes.

We allowed our misfortune to happen through political apathy. We let approximately 25 to 50 million real jobs slip across our borders since 1994. We allowed the lives of as many as 67 million potential consumers and taxpayers to be erased by standing idly by in the early 1960s when the Rockefeller Foundation launched its global campaign to convince all of the world that people were the problem, and that by eliminating enough of them, the world would be a better place for the rest of us.

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But, they were wrong. People weren't the problem—politicians in the pockets of the ultra-rich are the problem. Its too late to go back and undo the damage our apathy caused during the past five decades, but we can fix the root cause of those problems. We need to start recalling and/or impeaching Congressmen and Senators. Then we need to create amnesty legislation that also protects America and the American human capital from the global profiteers. For part 1 and 2 click below.

Click here for part -----> 1, 2, 3,

© 2007 Jon C. Ryter - All Rights Reserved

[Read "Whatever Happened to America?"]

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Jon Christian Ryter is the pseudonym of a former newspaper reporter with the Parkersburg, WV Sentinel. He authored a syndicated newspaper column, Answers From The Bible, from the mid-1970s until 1985. Answers From The Bible was read weekly in many suburban markets in the United States.

Today, Jon is an advertising executive with the Washington Times. His website, www.jonchristianryter.com has helped him establish a network of mid-to senior-level Washington insiders who now provide him with a steady stream of material for use both in his books and in the investigative reports that are found on his website.

E-Mail: BAFFauthor@aol.com


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When you listen to the liberals whose political ancestors from the Great Society looted the Social Security Trust Fund and drained it to finance the Welfare Generation, you'll find they're still treating a vault full of IOUs like they were real money.