Posts Tagged social security

An Open Letter To Our Youth

By Karl Denninger debt slave

This week you are no doubt off school and enjoying your friends and freedom from studies.  In a few short days, however, you will return to your classrooms and once again engage in what is your job — learning enough to hopefully be able to become independent on or near your 18th birthday.

Last night Congress engaged in its latest version of fraud upon the public.  Congress lied to America with flowery speeches about how our government has an obligation to come to the aid of those people in need, how unemployment must be extended and how the rich should “pay their fair share.”  Our President then got on television in the middle of the night and pontificated about how we had once again been saved from economic calamity but that he would not “debate” whether Congress would pay the bills that it had already contracted for, referring to the debt ceiling which, incidentally, we exceeded two days prior.

If you have a checking account you know that if you overdraw it you will be fined by your bank by $30 or so for each offense, which can make that $5 Latte at Starbucks a $35 Latte in an instant.

What President Obama is doing right now to avoid that is literally stealing the money in federal government employee retirement funds and replacing those funds with an IOU.  It is exactly identical to your parents going into your piggy bank and taking all the money, replacing it with an IOU for the cash with which they then go to the bar and spend on hookers and booze, hoping you don’t notice that the money is gone and that they can replace it before you decide you’d like to use it on something else like a movie, a dress, an iTunes card or some shoes.

America’s “formal” federal debt is over $16 trillion.  That sounds like an impossible amount of money, but it in fact it amounts to $52,131 per person in this country, including you.  Those of you who are not yet 18 have voted for exactly zero of this debt, yet our government asserts that you are obligated to pay it for various things that the government has already spent it on.  Some of those things include ships, combat aircraft, guns and other elements of protection that one can argue have made you safer.

But the fact of the matter is that America has not faced an actual threat of invasion — or war we did not start ourselves — since 1941.  All of you were born after that date; as such every bit of this warfare was undertaken in your name and with a promise to pay by you attached yet you neither consented or benefited from it.

Likewise, older geezers (that would include me) have been promised government benefits such as Social Security and Medicare.  We paid into these programs for years.  But at the same time we also voted for people who already spent the money we paid in on other things, much as you might spend the money from your piggy bank.  Having done that, and gotten the benefit from it, we now are demanding that we also get to spend the money again when we retire or get older.

But you can’t spend money that’s already been spent.  So what we’ve done is told you, our youth, that you must pay back that which we stole.  In this case, when we add in those promises, your personal debt is not $52,131 (climbing by the minute) it’s $184,298 — and climbing every minute.

Again, you have received no benefit from any of these funds that were “spent forward” nor will you ever receive any benefit from them now or in the future.  You also never consented, since you cannot vote.  What’s worse is that your children — the next generation and beyond, who will come if and when you find a suitable partner and choose to have children — will be saddled with an ever-increasing amount of this debt.

To explain to you how crazy this is ten years ago, in 2000, your personal share of the Federal debt was $20,503.  In the last ten years while you were going to school I, your mother, your grandparents and everyone around you who were 18 or older blew over $32,000 of your money that you do not yet have and yet we propose to force you to pay that money, plus interest, to the government in the future.  Worse, we’ve far more than doubled the political promises that led to the $184,298 up above — your total including those promises ten years ago was closer to $50,000.

More than ten years ago while you were crawling around on your parents’ floor over the holidays I had a conversation with my father as my daughter was doing likewise.  He was prattling on about how he was owed Medicare, Social Security and all of these other benefits because he had paid into those programs and “deserved” them.  I explained patiently to him that he had already voted to spend the money that he had paid in on other things, and it was gone.

What he was now insisting on was that the little girl crawling on his floor, his grand daughter, be literally enslaved to pay for that which he believed he was entitled to have despite his own personal support of and votes for spending those monies on other things.

That conversation did not end well.

I, and a few other adults in this nation, have steadfastly refused to support any political entity that believes it can spend someone else’s money.  I will vote for those programs that I wish to have funded but I insist that they be funded out today’s tax revenues.  That is, whatever I want government to do for me I must be willing to pay for.

The truth is that as long as the government runs a deficit it is adding to the amount of money it believes it can force you, those who are too young to resist, to pay — without your consent.

I am in the minority; most of your parents and virtually all of your grandparents have demanded for years that they be able to obtain things from the government they are unwilling to pay for.  They do this by insisting that more and more debt be taken on, which is exactly identical to taxing the money but not collecting it.

Who gets to pay, if the taxed money is not collected?

Why you do, you see, which is why that number up there keeps going up.

My message to you today as the youth of this country is simple:

You have no obligation to pay one penny of that money.


Not now, not today, not tomorrow, not ever.

Nor do your not-yet-conceived and born children.

There is one exception to this — if you reach the age of 18 and you, through your political actions, including those so simple as voting, choose to support politicians who promise you benefits that they cannot fund with today’s taxes — that is, they promise to spend based on debt.

If you take such an action, even once, then you will have retroactively consented to every single dime of that $180,000+ that they claim you owe today, plus however much more is accumulated, because you will have joined the group of Americans who of their own free will have subjected themselves to servitude.  You will have consented, because you will have joined your parents and grandparents who believe they can have things they won’t pay for.  In that case every single dime of that debt will be confirmed from a moral and ethical standpoint as yours.

The Constitution of the United States prohibits slavery; Abraham Lincoln signed the Emancipation Proclamation and on December 6th, 1865 the 13th Amendment became law.  It reads:

Section 1. Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.

Section 2. Congress shall have power to enforce this article by appropriate legislation.

You have committed no crime.  You thus cannot be compelled to either slavery or involuntary servitude.  And until your 18th birthday, you cannot lawfully consent to servitude.  It is only upon your 18th birthday that you can consent.

So I say to you today, that it is your right to stand as American Citizens, irrespective of your age who have not yet consented, and say in a loud, clear voice:


You should and indeed must say it to your parents.  You should and indeed must say it in your schools.  You should and indeed must pass this letter around to your friends and others in your class and those who you associate and hang out with.  And you must say this every day, in a louder and more-cohesive voice — today, tomorrow, the next day and every day thereafter, until we the “old geezers”, realize that you’re serious.

We, the “old geezers”, never had the right to try to force you to pay $180,000 of your money that you would earn tomorrow, an amount that has almost tripled in the last ten years and will triple again if you don’t put your foot down and demand it stop.

There is only one way to make sure it stops, and that is to make very clear to everyone the following:


You must say it, and you must mean it.  You must convince all those around you, especially the adults around you, that you mean it.  

You must do it now, because if you don’t, or worse you take any act that confirms that you’re ok with that $180,000 in debt that was forced upon you then you will be forced to pay not only that but the hundreds of thousands more that will be added over the next decades. 

If you do convince our leaders and we the “old geezers” that you won’t pay then the banks and other institutions that make possible this accumulation of debt will stop doing so, as they will stop believing they can force you to pay.  This will in turn force a national conversation on what we want from our government and what we’re willing to pay in taxes, aligning one with the other.

The fact is that neither I or the government can force you to pay.  They can try to convince you to pay, they can try to guilt you into paying for “Dear old Dad” or “Dear old Grandma”, and they can attempt to obtain your retroactive consent by bribing you with shiny gifts like iPhones and fancy cars, but Dear Old Dad and Granny already spent the money and we all know we we did so.

So today I implore you to pass around this letter to your friends.  Talk about it among you.  Post it up on Facebook, Twitter and elsewhere. Discuss the fact that our government and your parents think you’re going to pay over $180,000 and rising rapidly, more than doubling over the last ten years, so that us older folks can have our cake and eat it too.  So we can spend money twice, three, four times, and then force you, the children of this nation, to cover our selfishness and outrageous conduct.

You must put your foot down.  You must say I WILL NOT PAY in a loud, clear, singular voice.

You must do so because to make clear that you will not pay, and to cause those who think you will to realize you will not, is the least-painful option — and the path we are on today, if you do not act, leads to some very dark places for you and your children to come. 

If you fail to do this now then in the future you will face an even-more awful set of choices — the choice to be a slave or to revolt using violence.  When you are unable to support yourself and your family as the debt that has been put upon you cannot be paid down while leaving you with enough to keep a roof over your head and food on your table, your options will dwindle to living in squalor or choosing to take up arms and engage in violence.

Please understand that as things are today your “debt” will grow from $184,298 today to about $1.8 million per person within the next 30 years.  This is a mathematical fact; it is what an 8% growth in debt, which is roughly the historical average over the last few decades, leads to 30 years from now.

You have no hope of paying $1.8 million per person and neither do the children you may bring into the world in the future.

This is a set of choices that nobody wants to see come, and yet it is coming.  It will come in your lifetime.  If you do not stop what is going on today by saying I WILL NOT PAY in a loud, clear, singular voice it is mathematically certain to come before your children reach adulthood.

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55 Facts About Debt And Government Finances That Every American Voter Should Know

(Michael Snyder)  The future of the United States of America is being systematically destroyed by our politicians, but unfortunately most Americans don’t really grasp exactly what is happening.  30 years ago, our national debt had just crossed the one trillion dollar mark.  Just recently, it crossed the 16 trillion dollar mark.

Prior to every election, politicians from both parties swear up and down that they will do something about our exploding debt, but it never happens.  Once again this year, our politicians are making all kinds of grand promises about getting U.S. government finances under control.

But they are also promising all kinds of new plans and programs which are going to cost a lot more money on top of what we are already spending.  For the average American, all of this can be incredibly confusing.  That is why I have put together a list of facts about the debt and U.S. government finances below.

These are things that every voter should know.  The federal government is stealing more than a trillion dollars a year from our children and our grandchildren, and they are spending that money in some of the most foolish ways that you could ever imagine.  We have accumulated the largest mountain of debt in the history of the world, but our politicians just can’t help themselves – they appear to be absolutely addicted to spending money.

If we continue on the path that we are currently on, our entire financial system and our entire economy will be destroyed by all of this debt.  Time is running out and urgent action is needed to address this crisis.

Many of our founding fathers attempted to warn us about the dangers of government debt.  For example, Thomas Jefferson once said the following

I wish it were possible to obtain a single amendment to our Constitution. I would be willing to depend on that alone for the reduction of the administration of our government to the genuine principles of its Constitution; I mean an additional article, taking from the federal government the power of borrowing.

Where would we be today if such an amendment had been added to our Constitution?

How much brighter would our future be if the federal government had been forced to only spend what it took in all these years?

Those are very good questions.

The following are 55 facts about the debt and U.S. government finances that every American voter should know….

#1 While Barack Obama has been president, the U.S. government has spent about 11 dollars for every 7 dollars of revenue that it has actually brought in.

#2 During the fiscal year that just ended, the U.S. government took in 2.449 trillion dollars but it spent 3.538 trillion dollars.

#3 During fiscal year 2011, over a trillion dollars of government money was spent on 83 different welfare programs, and those numbers do not even include Social Security or Medicare.

#4 Over the past four years, welfare spending has increased by 32 percent.  In inflation-adjusted dollars, spending on those programs has risen by 378 percent over the past 30 years.  At this point, more than 100 million Americans are enrolled in at least one welfare program run by the federal government.  Once again, these figures do not even include Social Security or Medicare.

#5 Over the past year, the number of Americans getting a free cell phone from the federal government has grown by 43 percent.  Now more than 16 million Americans are enjoying what has come to be known as an “Obamaphone”.

#6 When Barack Obama first entered the White House, about 32 million Americans were on food stamps.  Now, nearly 47 million Americans are on food stamps.  And this has happened during what Obama refers to as “an economic recovery”.

#7 The U.S. government recently spent 27 million dollars on pottery classes in Morocco.

#8 The U.S. Department of Agriculture recently spent $300,000 to encourage Americans to eat caviar at a time when more families than ever are having a really hard time just trying to put any food on the table at all.

#9 During 2012, the National Science Foundation spent $516,000 to support the creation of a video game called “Prom Week”, which apparently simulates “all the social interactions of the event.

#10 The U.S. Department of Agriculture gave the largest snack food maker in the world (PepsiCo Inc.) a total of 1.3 million dollars in corporate welfare that was used to help build “a Greek yogurt factory in New York.

#11 The National Science Foundation recently gave researchers at Purdue University $350,000.  They used part of that money to help fund a study that discovered that if golfers imagine that a hole is bigger it will help them with their putting.

#12 If you can believe it, $10,000 from the federal government was actually used to purchase talking urinal cakes up in Michigan.

#13 The National Science Foundation recently gave a whopping $697,177 to a New York City-based theater company to produce a musical about climate change.

#14 The National Institutes of Health recently gave $666,905 to a group of researchers that is studying the benefits of watching reruns on television.

#15 The National Science Foundation has given 1.2 million dollars to a team of “scientists” that is spending part of that money on a study that is seeking to determine whether elderly Americans would benefit from playing World of Warcraft or not.

#16 The National Institutes of Health recently gave $548,731 to a team of researchers that concluded that those that drink heavily in their thirties also tend to feel more immature.

#17 The National Science Foundation recently spent $30,000 on a study to determine if “gaydar” actually exists.  This is the conclusion that the researchers reached at the end of the study….

“Gaydar is indeed real and… its accuracy is driven by sensitivity to individual facial features”

#18 Back in 2011, the National Institutes of Health spent $592,527 on a study that sought to figure out once and for all why chimpanzees throw poop.

#19 The U.S. government spends more on the military than China, Russia, Japan, India, and the rest of NATO combined.  In fact, the United States accounts for 41.0% of all military spending on the planet.  China is next with only 8.2%.

#20 In a previous article, I noted that close to 500,000 federal employees now make at least $100,000 a year.

#21 In 2006, only 12 percent of all federal workers made $100,000 or more per year.  Now, approximately 22 percent of all federal workers do.

#22 If you can believe it, there are 77,000 federal workers that make more than the governors of their own states do.

#23 During 2010, the average federal employee in the Washington D.C. area received total compensation worth more than $126,000.

#24 The U.S. Department of Defense had just nine civilians earning $170,000 or more back in 2005.  When Barack Obama became president, the U.S. Department of Defense had 214 civilians earning $170,000 or more.  By June 2010, the U.S. Department of Defense had 994 civilians earning $170,000 or more.

#25 During 2010, compensation for federal employees came to a grand total of approximately 447 billion dollars.

#26 If you can believe it, close to 15,000 retired federal employees are currently collecting federal pensions for life worth at least $100,000 annually.  That list includes such names as Newt Gingrich, Bob Dole, Trent Lott, Dick Gephardt and Dick Cheney.

#27 During 2010, the federal government spent $33,387 on the hair care needs of U.S. Senators.

#28 During 2010, U.S. Senators pulled $72,370 out of the “Senate Restaurant Fund”.

#29 During 2010, an average of $4,005,900 of U.S. taxpayer money was spent on “personal” and “office” expenses per Senator.

#30 In 2013, 3.7 million dollars will be spent to support the lavish lifestyles of former presidents such as George W. Bush and Bill Clinton.

#31 During 2011, the federal government spent a total of 1.4 BILLION dollars just on the Obamas.

#32 When you combine all federal government spending, all state government spending and all local government spending, it comes to approximately 41 percent of U.S. GDP.  But don’t worry, all of our politicians insist that this is not socialism.

#33 As I have written about previously, less than 30 percent of all Americans lived in a home where at least one person received financial assistance from the federal government back in 1983.  Today, that number is sitting at an all-time high of 49 percent.

#34 Back in 1990, the federal government accounted for just 32 percent of all health care spending in America.  This year, it is being projected that the federal government will account for more than 50 percent of all health care spending in the United States.

#35 The number of Americans on Medicaid soared from 34 million in 2000 to 54 million in 2011, and it is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.

#36 In one of my previous articles, I discussed how it is being projected that the number of Americans on Medicare will grow from 50.7 million in 2012 to 73.2 million in 2025.

#37 If you can believe it, Medicare is facing unfunded liabilities of more than 38 trillion dollars over the next 75 years.  That comes to approximately $328,404 for each and every household in the United States.

#38 In the United States today, more than 61 million Americans receive some form of Social Security benefits.  By 2035, that number is projected to soar to a whopping 91 million.

#39 Overall, the Social Security system is facing a 134 trillion dollar shortfall over the next 75 years.

#40 When Barack Obama first took office, the U.S. national debt was about 10.6 trillion dollars.  Now it is about 16.2 trillion dollars.  That is an increase of 5.6 trillion dollars in less than 4 years.

#41 The federal government has now run a budget deficit of more than a trillion dollars for four years in a row.

#42 If right this moment you went out and started spending one dollar every single second, it would take you more than 31,000 years to spend one trillion dollars.

#43 If you were alive when Jesus Christ was born and you spent one million dollars every single day since that point, you still would not have spent one trillion dollars by now.

#44 Some suggest that “taxing the rich” is the answer.  Well, if Bill Gates gave every single penny of his entire fortune to the U.S. government, it would only cover the U.S. budget deficit for 15 days.

#45 If the federal government used GAAP accounting standards like publicly traded corporations do, the real federal budget deficit for 2011 would have been 5 trillion dollars instead of 1.3 trillion dollars.

#46 The United States already has more government debt per capita than Greece, Portugal, Italy, Ireland or Spain does.

#47 At this point, the United States government is responsible for more than a third of all the government debt in the entire world.

#48 The amount of U.S. government debt held by foreigners is about 5 times larger than it was just a decade ago.

#49 Between 2007 and 2010, U.S. GDP grew by only 4.26%, but the U.S. national debt soared by 61% during that same time period.

#50 The U.S. national debt is now more than 37 times larger than it was when Richard Nixon took us off the gold standard.

#51 The U.S. national debt is now more than 5000 times larger than it was when the Federal Reserve was first created.

#52 The U.S. national debt jumped more on the very first day of fiscal year 2013 than it did from 1776 to 1941 combined.

#53 Historically, the interest rate on 10 year U.S. Treasuries has averaged 6.68 percent.  If the average interest rate on U.S. government debt rose to that level today, the U.S. government would find itself spending more than a trillion dollars per year just on interest on the national debt.

#54 A recently revised IMF policy paper entitled “An Analysis of U.S. Fiscal and Generational Imbalances: Who Will Pay and How?” projects that U.S. government debt will rise to about 400 percent of GDP by the year 2050.

#55 Boston University economist Laurence Kotlikoff is warning that the U.S. government is facing a gigantic tsunami of unfunded liabilities in the coming years that we are counting on our children and our grandchildren to pay.  Kotlikoff speaks of a “fiscal gap” which he defines as “the present value difference between projected future spending and revenue”.  His calculations have led him to the conclusion that the federal government is facing a fiscal gap of 222 trillion dollars in the years ahead.

Please share this article with as many people as you can.  Time is running out to fix these problems.

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