A comment thread on a recent DollarCollapse post reflects a debate that’s pretty widespread these days:
eugene August 1, 2011 at 6:17 pm
The thing that fascinated me the most was the media supported “sale” of Social Security/Medicare as an immediate problem that is destroying the country. While Social Security/Medicare are an issue that needs to be dealt with, it is not what is being portrayed at all. And the lack of understanding at high levels that made it even more fascinating. Routinely, I read columns reflecting this type of thinking.I rely on Social Security/Medicare as do millions of other Americans. I am watching a system I paid into for a lifetime bastardized without a whimper. I will live with increases far less than inflation and an ever decreasing income. I will live with cuts in Medicare that will, definitely, impact my life.
But then I keep reminding myself that enormous numbers of Americans can’t read/write and have difficulty understanding the simplest of issues. And the truly interesting thing is how many well educated people marched through the educational system dutifully memorizing whatever and never learned to think or comprehend much of anything. Huge percentages of college graduates never read another book. For me this is the scariest thing of all. This makes vast segments of the masses extremely easy to manipulate at will. Not long ago, I wrote a comment on a blog and received a criticism stating health care is a social program. How one twists their head around that concept is beyond me.
Most of all, I wish the Tea Partiers well. While it is a vengeful thought, I wish them many misfortunes in life. Maybe, but I’m not sure, they will reflect a bit. But then, listening to them, I not sure the processes necessary for reflection exist. More than one old person has died just as much a fanatic as when young.
Robbie Rob August 1, 2011 at 7:47 pm
Good thing you were responsible and have your private savings to fall back on. Huh? You didn’t? Nothing? Really? So, now young workers need to be deprived of an opportunity to save for their own future because they have to pay for yours? You support politicians who will do your thieving for you so you don’t have to soil your hands. No doubt you have gotten back far more than you paid in (average is 3X), so that excuse doesn’t fly.paper is poverty August 1, 2011 at 8:14 pm
Right, because young workers would absolutely and without fail take that extra payroll money and sock it away in a savings account… sure they would. And thousands upon thousands of retired Tea Partiers diligently send their Social Security checks back to the government every month, rather than accept funds taken from their fellow taxpayers. Uh huh.Open your eyes to who really has the money and power in this country and stop attacking your neighbors. We are all the “little people” to the elites, you, me, and Eugene. As long as their divide and conquer propaganda succeeds, as it’s succeeding with you, the plutocrats are safe to continue their plundering (which is on a much, much bigger scale).
GenX August 3, 2011 at 12:55 am
What younger workers do with their money is no one’s business but their own. There are large numbers of younger workers that can read and write and can understand simple and complex issues. Many understand that there is no chance in hell that they will ever collect a single cent from SS or Medicare. They understand whatever they have or will put into the system will be squandered and wasted by the politicians for the benefit of the older vote. I know more than a few that have gone underground to some degree and get paid in cash. No sense paying into a ponzi scheme when you’re the last one in.eugene August 3, 2011 at 1:07 am
To Robbie Rob
The average worker contributes 345,000 towards Social Security and receives 417,000 in return. Now you can play your silly games with 3x which sounds like some BS anti Social Security garbage. And you can play games with 345K in and 417K out. Unless of course you’re of the ability to calculate the interest gained on a lifetime of contributions. It is people like you that are contributing to the destruction of the only retirement millions of low paid workers will ever have.For your information, Social Security is sound until 2037. I am 70 yrs old so will be long gone. I paid my way buddy so shut up
paper is poverty August 3, 2011 at 4:11 am
I agree which much of what you’re saying. What I objected to was the implication that if it weren’t for the payroll tax, young workers would be saving enough to insure themselves a comfortable retirement. That betrays an ignorance of how many young workers are unemployed (highest since just after WWII) and how many are living hand to mouth, scraping by between paychecks. Maybe Robbie Rob can’t name a half dozen young (or young-ish) workers coming down to their last $15 between paychecks, but I can. Wages have been going down ever since we went off the gold standard and the money printing started, plus the globalists have been disastrously successful at sending American production elsewhere. Those are (a couple of) the big forces that are making younger people’s paychecks inadequate… it’s not the grandparents down the street. But hey, if you’re the guys who’ve been stealing the wealth, there’s nothing better than bitterness between generations… god forbid the little people ever get a sense of solidarity.
A few thoughts:
The inter-generational debate over entitlements is, in tone and substance, a lot like the one between taxpayers and public sector workers over pensions. In each case we’ve made promises that we can’t keep, and both sides — the program recipients who worked hard and followed the rules, and taxpayers who can’t afford to pay any more — are victims here. Of course the people who spent lifetimes building up specific benefits deserve those benefits. And of course taxpayers deserve to keep what they earn.
The problem is that we never had the money in the first place. It was always a con. And now, as with every successful con, the perpetrators are long gone and the marks are left to suffer.
The criminals in this story are the politicians, union leaders, and activists who made unrealistic promises, benefitted from being seen as magnanimous and “progressive”, and who retired long before their promises came due. And of course the bankers who took over the financial system and made debt a way of life.
The tools of the con are finally coming to light: fiat currency that makes it unnecessary for government to prioritize or set limits; fraudulent accounting that allows governments at all levels to hide the unfunded liabilities building up in entitlements and pensions; corporate rules that enable huge executive bonuses for shifting jobs overseas; and a media that’s in on the game and reluctant to uncover and publicize the truth.
So now we’re broke. There isn’t enough wealth to go around, and good people who should be allies are left to fight over scraps of the life they should have had. The guys who ran Citigroup and Merrill Lynch into the ground, or presided over Treasury and the Fed during the greatest credit bubble in human history aren’t worried about their retirements or their taxes because they walked away with all the money anyone could ever want. The con, in other words, went off without a hitch.
26 thoughts on "The Con Went Off Without A Hitch"
Paul – couldn’t agree with you more. Politicians continue to give themselves more time to wring every ouce of wealth from americans since we are so busy argueing over who is right and who is wrong… great distraction to keep the focus off the true problems that ALL politicians are NOT addressing ( perhaps with the exception of ron paul ).
People need to wake up!!!
Someone above said their neighbors would rather discuss brittiany spears than the fed, more great distractions… or is just that most americans can’t face reality or are they truely unable to comprehend the pickle we are in.
not only does the bleak outlook on the US sadden me, but also the ease in which politicians can “play” the american people. THey do work for us, they should answer to us!
Why does no one speak about how this all got started? In the 80’s the Reagan administration gutted the the social security trust fund and moved that money into the general fund to present the appearance of a more balanced budjet. That money was never replaced. IOU’s were left in the trust fund and were never repaid. No one has ever been held accountable. Did any one of us give permission for our government to do this with our TRUST fund? Why don’t we wise up and quit blaming each other: exactly what they want us to do, and unite to demand accountability from those who did this to us ALL? Are we the morons they are playing us for? Is there any spine left in any of us? Have we lost all ability for critical thinking? For instance: at what point are we willing to stand up together and say NO MORE? Think TSA private body part touching for 6 year old girls and 95 year old grandmothers suffering from cancer, think warrantless no knock home invasions. When do we grow a pair and quit snivveling and fighting each other like the little kindergardener’s they are playing us for? When is enough enough?
In a system based on fiat currency there is no reason why we have to let people starve, struggle in their old age or die because they cant afford medicines. The primary need in a fiat based system is to keep people working. So you cant all be millionaires or no one would farm, build manaufacture etc.
So all this BS is simply to keep you divided and fighting amongst yourselves while your masters plan for your future in thier world.
I am conflicted about the current situation. In a certain sense the average American deserves what he is going to get – complete debasement of his currency, default on all “social contracts” such as social security, vast loss of wealth and loss of freedom. Most of my neighbors are ill informed and would rather know something about Brittany Spears rather than about the Federal Reserve. At some point if things really start to get bad most Americans will not want to hear it because the implications are too dire and too frightening. However, I am an immigrant and have traveled the world and I am certain that if there is one country on the face of this earth where the people can rise up and correct the situation it is the USA and the USA only. If America goes under and transforms to a totalitarian socialist place then there will not be many places left where you will want to live – it will be sort of a modern era “dark ages”
How can 6.5 billion be conned by a group of murdering, pimps whose numbers are less than the population of Texas that paper, gold, petroleum or electronics are more valuable than the sweat producing them or the real resources of clean water, air and untainted digestibles of each persons choice that was the real fuel of humanity’s ascent? You can’t. It is actually called capitulation and is defined as such: noun; giving in. Here are some synonyms; accedence, bowing, buckling, conceding, giving up, knuckling under, relenting, resignation, submission, succumbing, surrender, yielding. Now here are some antonyms; disobedience, noncompliance, disbelief, strike, protest, courageous, fortitude, the right path, the golden rule, community resistance.
I have made my choice and see that many of you have too. Those of you residing in dense population zones. It would help if you would carry your last request with you; burial or cremation. The non-porous, injection molded, portable trashcans were designed with you, your families and pets bodily fluids in mind… or didn’t you notice?
If it wasn’t planned would the money printers have wasted the ink to produce the monumental Guide Stones in Georgia, USA during the 80’s? The number they engraved for population is not more than 500,000,000 worldwide and leave room for nature, leave room for nature. The underground bases constructed will be where they hide before releasing the biological that will kill all, but them. That’s what I recognize as the current pattern of implementation and intent. The targets for euthanasia will be anyone over the age of 25 with scattered survival pockets in the above 25 year range and death pockets in those under 25. Their actuaries counted the beans/beings and we are at critical resource disintegration. The dirty bombs will be small in percussion and grand in viral mutation.
The reason 1918 is the forgotten year in important historical fact is because it’s coming around again. Silent history is usually the most ominous because it was perpetuated at the demands of the ruling class regardless of risk and it’s outcome was unspeakable; because of its productivity.
Patriarchs from the days of the early 20th century when “the death” was patented made their heirs and successors promise to keep the genie bottled until all of their earthly departures had occurred and the risk of complete species annihilation had been reduced to less than a factor of 5%; remember we had already surpassed their number of 500,000,000 back then so the necessity had already declared itself. Remember their anthem; Necessity is the motherfucker of all our inventions to kill; most of you. The arks for family continuity had to be created through counterfeiting the slaves wages and completed before resources breached regenerative response from over harvesting. The D.U.M.B bases are complete and resource stocks are crashing faster than the Dow and the 911 Commissions Report.
We have arrived. Let the bleeding begin.
From the article….
“The criminals in this story are the politicians, union leaders, and activists”
This statement completely ignores the primary culprit, or should I say the primary and specific action that has taken us to the brink of destruction.
Lobbyists primarily from banking, real estate, agriculture, defense, energy, and telecommunications spent the last thirty years descending on DC like a swarm of locusts.
There are thirty thousand plus lobbyists in DC now and what have they done?
Quite simple actually. They have punched so many holes in the tax code for the wealthy and profitable that our tax code as it stands right now is like a one cubic foot chunk of Swiss cheese that weighs two ounces. IT’S ALL HOLES!
Tax loopholes or dodges, cheats, etc… siphon off close to one trillion dollars per year in back room acquired gifts for those who already have everything.
Drop the corporate tax rate, flatten the tax code, and close EVERY SINGLE fraudulent loophole put in their by the sell-outs in Washington.
It is the fraud in the tax code that is bankrupting this country, plain and simple.
Fix it and seventy five percent of our problems disappear instantly.
Then go in and fix Medicare and Medicaid, and leave Social Security alone. This whole national conversation is ridiculous as it stands right now.
IT’S THE LOOPHOLES!
How did they get away with it, without a peep from the public. They used something that was familiar to us all. “CREDIT RATING”. The countries credit rating would be hurt and affect us all. This is something we all know and feel, this made up system that runs as all in the same direction, like sheep. Because we live our lives trying to protect our rating, this thing is always just over our shoulder and they know we will all be understanding to our countries credit rating. That is how they pulled it off without a peep. Fear! and shame on you, people for allowing and perpetuating such a system. I stopped paying my cards and have been winning cases. I am two for two.
The next great con will be the IRA’s and 401k’s. I know they are already having congressional meetings on how to get their hands on those. I could see the writing on the wall more than 15 years ago that this would be a trap when I saw them silently ad an extra tax on those withdrawing more that x amount of dollars per month on the 401K’s. I promptly got out. Also I really love the folks that regurgitate the the government chant that social security is sound until 2037. Show me the money.
love one another.
One word that applies to all ponzies: clawback.
You write: “people who spent lifetimes building up specific benefits deserve those benefits”. Bullshit. Don’t try to tell us that the AARP and all its members didn’t know that they were participating in and encouraging the ponzi. This is as pathetic as the whining from “eugene”. He doesn’t give a rats ass for anyone else as long as he keeps getting his ponzi benefits, just like the public union employees in Vallejo Ca, Jefferson county, and church falls RI.
I have to agree w/ ConH. We all know this is a classic Ponzi scheme. Those who are the first in, reap the greatest returns. Those that are in last, get screwed. I don’t see much difference between these entitlement programs and Bernie Madoff, expect that I had a choice with Bernie to not participate. To myself and others in my age group/demographic we may as well throw the FICA $ on the floor and set it on fire; same return.
You’re forgetting that the government’s been running a pretty good con here too. In 1982 a then relatively unknown Alan Greenspan chaired a committee appointed to “save” Social Security.
Well of course old Al “Capone” Greenspan and the rest of his gang came up with the conclusion that taxes had to be raised, and assured everyone that this was going to keep the system solvent until long after the baby boomers retired. Ever since you’re employer has had to send in 13% of your salary to support the Ponzi. They say he pays half and you pay half, but come on. Where do you think the half that your employer is paying comes from? It’s money that otherwise would have been available for something else – like pay increases.
Around the same time the government declared that it was free money day for the upper tax brackets, and defunded itself. And following closely on that happy day, they started “borrowing” money out of the Social Security Trust fund.
You figure it out.
One thing not mentioned yet….if you die one day before your sixty sixth birthday and you are not married or have any children…the government keeps it all..This ain’t no retirement program. This is a welfare state Ponzi scheme and there just aren’t enough new suckers in the program.
Pete-o
If I were cynical I’d say that gives the government an incentive to try to get as many of us as possible to die as soon as possible – if at all practical before that magic 66th birthday. If I were cynically paranoid I’d say that was part of what GMO foods, apartame, fructose, and the new “health care” bill were all about. Run them into the ground and ruin their health beginning at an early age, then kill em off before they start trying to dip into the till and get some of the money we stole from them back
The Con Went Off Without a Hitch nails it. I remember when I was young an oz of pot was $15, but inflated rather rapidly. Still though, it was a bargain. I had gone out to So California working in and out of construction labor jobs and lived like a beach bum hippie getting high and hookin-up with a number of floozie hippie girls. Living the carefree irresponsible life of getting high and looking for the next lay was, for the most part, fantastic, inspite of some frustrations of innactive time. Came back and found a pretty decent job and stayed with it for 32 yrs and retired with a decent pension three yrs ago. Back in those days, it didnt matter if you were a high school drop out, or merely a high school education and maybe tried the college thing for a couple of years. Jobs were there. I never realized what I had in that job,nothing special about it I figured. Especially when I would experience a sense of aggravation from a feeling of social snobbery from someone because they had more, or had a better job than I did. I would fall into the trap of feeling like I wanted more than this job. I hated going to work and doing the same boring thing everyday. Although that job afforded me the boring, routine, out-of-touch with everything except for what I saw on the TV lifestyle I had, and a bunch of money with nothing to do with it, it tore up my knees and hips over time. Basically I had to retire because of that.
When Ronald Reagan came to office with his such a wonderful communication skills, I saw a change in everybody like unbelievable. I was getting Holden Caulfield syndrome. Everybody was becoming this disdainful ultra-conservative snob — wannabe. I thought I had lived in dreamland in those hippie dayz in So Cal. But this, what I was seeing on an entire cultural scale was everybody being lulled into a dreamland, and an ugly one, a sickening one. It was like — a phenomenon! It was like watching everbody go coo coo for coco puffs, or have a big mack attack at the same time. I even lost my desire to get laid I couldn’t stand it so much. Then I’ll never forget that 1984 superbowl apple commercial that came out. At the time I thought that that’s exactly the way everybody seems to be becoming.
I got to say Im pretty amazed at what changes Ive seen. Not in a good way. It seems that what’s going on today has been in the works for quite a while. There’s no point in keeping America. They’re the ones that created it, and they’re the ones that can destroy it — which is what they’re doing. All the rest of us were just along for the ride. I grew up in a unique time and place is the way I look at it. But it’s becoming very clear that they can wipe out what I worked for for 32 yrs with the swipe of a pen. And they’re doing that. I expect them to go all the way too, because what I think is mine, isn’t really mine. It never was. It was only there because of them. Them? Master rulers, power elites, internationalists bankers – Ive heard them be referred to as. They go back a long way and are refined in there craft.
“When Ronald Reagan came to office with his such a wonderful communication skills, I saw a change in everybody like unbelievable. I was getting Holden Caulfield syndrome. Everybody was becoming this disdainful ultra-conservative snob — wannabe. I thought I had lived in dreamland in those hippie dayz in So Cal. But this, what I was seeing on an entire cultural scale was everybody being lulled into a dreamland, and an ugly one, a sickening one. It was like — a phenomenon! It was like watching everbody go coo coo for coco puffs, or have a big mack attack at the same time. I even lost my desire to get laid I couldn’t stand it so much. Then I’ll never forget that 1984 superbowl apple commercial that came out. At the time I thought that that’s exactly the way everybody seems to be becoming.”
I was in my late twenties then, going to university, and I saw the same thing.
There was a definite cultural shift that began during Reagan’s term, at least in some places, and which eventually spread throughout the nation.
I’m not attributing to Reagan necessarily – though it would be easy to make that inference – only remarking that there was a definite, perceivable, and material shift towards the adulation of wealth during his presidency. It amazes me that I see others comment on this so infrequently, because it was such a complete reversal from attitudes which were prevalent in the late 60s and early 70s, when people disdained conspicuous consumption and overt displays of wealth. It wasn’t unknown for people with money to do stupid things, and give most of it away to some cause – there were actually causes back then – things people believed in not because they entailed any personal gain, but because they represented some ideal that they believed in.
But that all changed. We all started running on the hamster wheel to acquire as much as we could – and it DIDN’T MATTER HOW YOU GOT IT.
Sometimes I think if people would notice that, then this downshift might actually turn out to be a bit of a relief.
But it seems to have completely escaped most people’s notice. I’m not sure whether they just never noticed or whether they’ve been successfully indoctrinated to remember the past differently. Then of course there are millions who never knew, and they believe whatever they’re told by the universal educational font television, and almost infallibly the people who recount that period represent as the time when things went awry and people became self indulgent, narcissistic, indulgent, and set on the path to selfish and insatiable self aggrandizement that is today the national conciousness, to all appearances.
what is often left out of the conversation about the public sector contracts is that somebody neogtiated them. The meme that Mish likes to push is that unions are all thieves. SOmebody negotiated it, and they are equally culpable, but in the end, they will never be responsible.
We the people are sliding into the abyss of a third world country and nothing will improve……jobs will come back after everyone is dependent upon the Government for everything……..but it will be slave labor and if you don’t work you won’t eat……..and the talking heads on CNBC know it…….CUBA here we come
Stop whining and start weaponing, you stupid wimp.
I’m in the school that thinks that demographics is the primary driver in this case, same as what has been playing out in Japan for the last 20 years. When ever you have a massive bulge in your population, you will have a massive deflationary crash, when that over sized generation matures. Or you could have a hyper inflationary outcome, the actual case, if your central bank decides to fight the deflation with freshly printed fiat.
The main problem is that wealth cannot be stored on a macro level. You, as an individual, can buy gold, the DOW, real estate, bonds, etc. and store your wealth, assuming you make good choices. But on a macro level, any attempt to move huge blocks of money into an asset class just creates unsustainable bubbles.
The best way for a society to preserve its wealth is to maintain it’s infrastructure, educational institutions, be at peace with its neighbors, obligate its central bank, by constitutional amendment if necessary, to prick (pun intended) asset bubbles early in their development, etc. We have failed in most of these areas.
At this point, it would be better to have a controlled default, with bank holidays and other safeguards, while we hold another constitutional convention and start over from scratch, including a new currency, perhaps gold backed. The present system isn’t fixable.
The U.S> has been morphed into communism-fascism rule by Regulations, based on broad many subject “Laws”. The foreign owned bankers and their lawyers have created this situation. Treason from within = the fiat money Trojan Horse, ( federal reserve gang = Rule by a politico-religious group) The solution = indictments. Moe, the Judicial Department, should be impeached for treason since 1913. Curly, the federal reserve, must be impeached as co-conspirators to 9-11. WWI, WWII, WOD, Korean War, transfer of industry to their BABY = Communist Chine, etc. OK Congress lets see you DO YOUR Constitutional Duty. Set up the Hearings for Crimes Against Humanity, NOW!!
Great points, succinctly stated. Loved your book as well.
I don’t even think the problem is politicians. It is statistically unlikely that bad people randomly get elected each election. The problem is that power corrupts. This is true of dictatorships and democracies. In the case of democracy, it is the voters who get corrupt. Countries rise and fall and always have.
It is sad to see, but it is inevitable. The culprits are human nature and time. The last domino keeping the whole thing up is faith in the dollar. Now all we can do is sit back and see how many years of trillion dollar deficits it takes to destroy it.
your comment assumes that ‘random people get elected.’ But it is people who run for office, who game the system, who have the money to pay for campaign ads and so forth who get elected. Not random at all. I would not say that power corrupts so much as Power draws corrupt men. And Power inflames the innate corruption there. But if a really honest man comes to power, he cannot be corrupted. I’m not a fanatic for the man, but Ron Paul seems to have that uncorruptable quality. (I actually disagree on his free market cheerleading approach, but I don’t demand total agreement with a candidate. I just want him to be true to his principles and have those principles be meritorious.)
Great commentary, John, as usual. I’ve been following your work for years, and I always appreciate your perspective to help refine my own. You have great skill in discerning and articulating the important elements of an issue from within the background ocean of distraction and noise.