Based on facts.
We had intended to make our 130th posting our last, basically because no one else appeared to even care. We, the two of us here on the hill, have passed our 75th and 80ieth anniversaries of our birthdates and, even though that isn't old, being ignored tends to be depressing. We were, and still are, concerned for the future of the country we have defended, in one way or another, for so many years
Before we shut down our computer and go back to our reading, puzzles and working in the flowers there are a few points we wish to restate.
Our politicans, all sides, are no longer just blowing smoke but are now consciously attempting to deceive us all.
(1)-One of the most frequent statements heard on television, by politicians and parroted by newscasters is that; "You can't balance the budget without doing something about entitlements" meaning Social Security and Medicare. Another is; "Entitlements are the biggest drivers of our National Debt". Both are wrong because of a law, passed in 1990, which states that Social Security and Medicare are not to be counted as part of the budget submitted by the President but was to be paid out of the Social Security and Medicare Trust Funds which are funded by the FICA (payroll) taxes.Surplus money from the payroll tax is invested in Special Government Securities which can be redeemed as needed to pay retiree benefits. That time has come and therein lies the problem. How do they tell the American people that they have used their hard earned savings as, what amounts to, a high stakes slush fund. (More on that later).
(2)-Let's see if we have this right. After months of gridlock and infighting in Washington, D.C. our upright and outstanding Government took us to the brink -- no, not default on our debts -- of a partial shutdown of services, with the implied threat of the withholding of Social Security checks, military pay and Medicare benefits before they finally agreed on a bill raising the Government's debt ceiling along with a minimal cut in Congressional spending.
With the, so called, budget cuts being, as they say, backloaded in order to delay the majority until after the 2016 election there will be no real savings. Even if, when it is finally all over, that Super Committee of Congressmen agrees to a 2.5 trillion dollar cut in spending over the next 10 years and it is passed into law, the Treasury Department will have to borrow about the same amount in the same 10 years in order to redeem the IOUs in the Social Security and Medicare Trust Funds. That is the excess funds payed into the Trust Funds by FICA over the years. Now, partly because of the 2 percentage points cut from the payroll tax last December, asked for by President Obama, while extending the Bush era tax cuts, the time has come to begin redeeming those IOUs which means that there will be no cut in our deficit or National debt. If we stay this course our National debt will rise from near 15 trillion dollars to over 20 trillion dollars - nearer 25 trillion dollars. Do we want that for our children and grand children?
(3)- This country, our United States of America, has reached or are fast approaching the point written about by the Frenchman "Alex de Toqueville" in his book published about 1840 as a study of the American People and their Political Institutions.He wrote; "America will be a great country until the people learn that they can vote themselves money from the Public Treasury, after that it will be a war of all against all with each person striving to get the greatest amount of free money possible." (Previously posted Feb. 27, 2011) Are we there yet or how long have we been there?
Unless something changes our minds this will be our last posting. With that in mind, thanks for your time and input. - William
Saturday, August 13, 2011
Monday, August 8, 2011
Why Bother
Nobody else cares?
We began trying to write in this blog about nineteen months ago and this will be our one hundred and thirtieth posting. During that same period we have written about that many or more letters and e-mails to our congress persons and various news outlets which includes newspapers and television with very little results with either. Several times we have talked about quitting because it appears that, with one exception, nobody else cares. This posting will probably consist of dates, titles and brief discription of earlier postings.
May 15, 2010 - "What Is This World Coming To (Will History Repeat itself)" This posting concerns the destruction of the Twin Towers of The World Trade Center on September 11, 2001 by terrorist, later identified as Moslems (Islamic) and members of Al Qaeda and the bloody beginning of Islam about fourteen hundred years ago.
Nov. 24,2010 - "Wake Up America (And smell the Manure)" Was about how elected and unelected officials in Washington have spent all the Social Security and Medicare Trust Fund money and are now desperately trying to divert our attention away from their little secrets. There is nothing left in those funds except IOUs.
Jan. 16, 2011 - "Wrong Tax Cut (It adds to the deficit.)" We tried to point out how the cutting of two percentage points off the FICA (payroll) taxes would only further weaken Social Security and Medicare. That means they reach the break even point much sooner and will have to redeem more of the IOUs sooner thereby adding to the National debt.
Jan. 30, 2011 - "The Golden Horn of Plenty (Now running dry)" This was our way of explainig how the money from the payroll taxes came into the Social Security and Medicare Trust Fund but there was a hole in it leading directly to the United States Treasury where it was exchanged for those IOUs and the money (we believe illegally) was spent as part of the budget.
Mar. 3, 2011 - "The Budget (Where to Cut.) Is our feeble attempt to set down a guideline as to where to start trying to balance the budget with part of it being the changing of our tax codes so as to get rid of the IRS.
June 5, 2011 - "Misrepresentation Thru Misinformation (More of the same)" We used this column to try explaining the Social Security and Medicare Trust Funds and how many people, politicians and newspeople, use misinformation to convince the general public that we, retirees, are at fault for our debt problems.
June 15,2011 - "Reforming Social Security (And especially Medicare)" We agree that Social Security and Medicare should be reformed in order for them to survive for future generations and the quicker, the better. Last December, during the debate on extending the Bush era tax cuts President Obama asked for, and got, a two percentage point cut in the FICA (payroll) tax. That will cause Social Security and Medicare to begin redeeming the IOUs in the Trust Fund much sooner in order to pay current benefits.
July 21,2011 - "The Saga Continues (As the Ditch returns)" This column started as a letter to one of our local newspapers shortly after the election in 2006 and was updated after the 2008 election by adding "and the debacle of 2008". It is a critical look at our political system.
During the first few days of this month (August) we have already sent out several e-mails to various newspapers and televisions newspeople but with little response. We can't understand why there was so much surprise expressed when the credit rating agency "Standard and Poor's" downgraded the United States Credit from AAA to AA+. The whole world was warned that it probably would happen if the President and Congress didn't reach a deal to cut our spending much more than they actually agreed on. The following e-mail touches on that subject;
Friday August 5, 2011,
"Neil,
For sure we need a Balanced Budget Amendment. Although Social Security and Medicare are not a part of the budget you, and most politicians, insist that it is. If Congress eventually passes a $2.5 trillion cut in spending over the next ten years, it will only cover the amount Treasury will have to borrow to redeem the IOUs in The Social Security/Medicare Trust Fund in order to pay retiree benefits. I believe that adds up to a fat zero as far as cutting the deficit goes. Thanks,"
This same e-mail was forwarded August 7,2011 to;
Gerri,
This e-mail was sent to Neil Cavuto before our credit rating was cut but he didn't seem to care. Maybe you can understand it better. Thanks,
Not having anything else to do we sent this e-mail, a few hours ago, to Gerri Willis on Fox Business News;
"Gerri,
A few minutes ago you were on Shepard Smith's program and proved that you are intelligent enough to understand why the budget wasn't cut enough to keep Standard and Poor's from downgrading our credit rating. With the reduction of the FICA (payroll) tax by two percentage points there is less money flowing into the Social Security/Medicare Trust Funds, with less money going in, Treasury will have to borrow more to redeem IOUs in the trust funds so as to pay current retiree benefits. The amount of borrowing to supplement those trust funds will be more than is scheduled to be cut from the budget this year leading to more deficit and higher National debt. Over the next ten years Treasury will have to borrow as much or more to buy back those IOUs than will be cut in other spending resulting in higher and higher National debt. In ten years our debt will be well over twenty trillion dollars. If you can prove me wrong, have at it but if not, admit it."
We are now waiting to see if there will be any response from any of the e-mails but not holding our breath. From here on our hill, thanks for your time and input. Stay tuned,- William
We began trying to write in this blog about nineteen months ago and this will be our one hundred and thirtieth posting. During that same period we have written about that many or more letters and e-mails to our congress persons and various news outlets which includes newspapers and television with very little results with either. Several times we have talked about quitting because it appears that, with one exception, nobody else cares. This posting will probably consist of dates, titles and brief discription of earlier postings.
May 15, 2010 - "What Is This World Coming To (Will History Repeat itself)" This posting concerns the destruction of the Twin Towers of The World Trade Center on September 11, 2001 by terrorist, later identified as Moslems (Islamic) and members of Al Qaeda and the bloody beginning of Islam about fourteen hundred years ago.
Nov. 24,2010 - "Wake Up America (And smell the Manure)" Was about how elected and unelected officials in Washington have spent all the Social Security and Medicare Trust Fund money and are now desperately trying to divert our attention away from their little secrets. There is nothing left in those funds except IOUs.
Jan. 16, 2011 - "Wrong Tax Cut (It adds to the deficit.)" We tried to point out how the cutting of two percentage points off the FICA (payroll) taxes would only further weaken Social Security and Medicare. That means they reach the break even point much sooner and will have to redeem more of the IOUs sooner thereby adding to the National debt.
Jan. 30, 2011 - "The Golden Horn of Plenty (Now running dry)" This was our way of explainig how the money from the payroll taxes came into the Social Security and Medicare Trust Fund but there was a hole in it leading directly to the United States Treasury where it was exchanged for those IOUs and the money (we believe illegally) was spent as part of the budget.
Mar. 3, 2011 - "The Budget (Where to Cut.) Is our feeble attempt to set down a guideline as to where to start trying to balance the budget with part of it being the changing of our tax codes so as to get rid of the IRS.
June 5, 2011 - "Misrepresentation Thru Misinformation (More of the same)" We used this column to try explaining the Social Security and Medicare Trust Funds and how many people, politicians and newspeople, use misinformation to convince the general public that we, retirees, are at fault for our debt problems.
June 15,2011 - "Reforming Social Security (And especially Medicare)" We agree that Social Security and Medicare should be reformed in order for them to survive for future generations and the quicker, the better. Last December, during the debate on extending the Bush era tax cuts President Obama asked for, and got, a two percentage point cut in the FICA (payroll) tax. That will cause Social Security and Medicare to begin redeeming the IOUs in the Trust Fund much sooner in order to pay current benefits.
July 21,2011 - "The Saga Continues (As the Ditch returns)" This column started as a letter to one of our local newspapers shortly after the election in 2006 and was updated after the 2008 election by adding "and the debacle of 2008". It is a critical look at our political system.
During the first few days of this month (August) we have already sent out several e-mails to various newspapers and televisions newspeople but with little response. We can't understand why there was so much surprise expressed when the credit rating agency "Standard and Poor's" downgraded the United States Credit from AAA to AA+. The whole world was warned that it probably would happen if the President and Congress didn't reach a deal to cut our spending much more than they actually agreed on. The following e-mail touches on that subject;
Friday August 5, 2011,
"Neil,
For sure we need a Balanced Budget Amendment. Although Social Security and Medicare are not a part of the budget you, and most politicians, insist that it is. If Congress eventually passes a $2.5 trillion cut in spending over the next ten years, it will only cover the amount Treasury will have to borrow to redeem the IOUs in The Social Security/Medicare Trust Fund in order to pay retiree benefits. I believe that adds up to a fat zero as far as cutting the deficit goes. Thanks,"
This same e-mail was forwarded August 7,2011 to;
Gerri,
This e-mail was sent to Neil Cavuto before our credit rating was cut but he didn't seem to care. Maybe you can understand it better. Thanks,
Not having anything else to do we sent this e-mail, a few hours ago, to Gerri Willis on Fox Business News;
"Gerri,
A few minutes ago you were on Shepard Smith's program and proved that you are intelligent enough to understand why the budget wasn't cut enough to keep Standard and Poor's from downgrading our credit rating. With the reduction of the FICA (payroll) tax by two percentage points there is less money flowing into the Social Security/Medicare Trust Funds, with less money going in, Treasury will have to borrow more to redeem IOUs in the trust funds so as to pay current retiree benefits. The amount of borrowing to supplement those trust funds will be more than is scheduled to be cut from the budget this year leading to more deficit and higher National debt. Over the next ten years Treasury will have to borrow as much or more to buy back those IOUs than will be cut in other spending resulting in higher and higher National debt. In ten years our debt will be well over twenty trillion dollars. If you can prove me wrong, have at it but if not, admit it."
We are now waiting to see if there will be any response from any of the e-mails but not holding our breath. From here on our hill, thanks for your time and input. Stay tuned,- William
Tuesday, August 2, 2011
Whatever Happened
To Our Debt Ceiling?
The Social Security and Medicare Trust Funds probably would have shown a small surplus, or at least broken even, this year but for the two percentage points reduction in the FICA (payroll)tax which was tacked on to the bill extending the President Bush era tax cuts at the request of President Obama. It is the FICA tax money which funds the Social Security and Medicare Trust Funds which, in turn, pays the retiree benefits. Now, beginning this year, our Treasury Department will be forced to borrow more and more money to redeem more and more IOUs from the Trust Funds in order to pay those benefits over the next ten years. That borrowing will amount to approximately $2.5 trillion. Does that sound familiar? That is almost exactly what the Debt Ceiling Bill proposes to cut from our budget (spending) over the same period of time. It appears that their intention is to cut other spending enough to cover the extra borrowing needed to redeem those IOUs representing the money (borrowed?) already spent from the Social Security/Medicare Trust Funds. (Check earlier postings on that subject) To us, not being economist, that adds up to a flat zero on all counts. Otherwise worthless.
And now to all the talk about taxes, especially on big Corporations and some millionaires and billionairs. Who could possibly feel sorry for those, so called, "fat cats" and not want their taxes raised? We have never been fans of highly paid athletes and Corporation CEOs etc., but the taking of their income by raising taxes will hurt the very poorest people the most. It has been proven, remember the "Stimulus Package", that the private sector can create jobs at a fraction of the cost to our Federal Government. For ever four jobs lost by the private sector because of higher taxes the public sector (Governments) can probably create about one job and most likely that would be in the government. Aside from that, major Corporations are not privately owned but have millions of stockholders. Every dollar lost to higher taxes will be passed on to those stockholders, which includes not only individuals but Retirement Fund of all kinds, from some of the smaller companies all the way up through the Federal Government. Individuals who collect dividends, many of them retired, from stock in big companies such as General Electric, big oil companies etc., probably will be subject to the paying of income taxes on those dividends. Revenue lost to the higher taxes on "Big Business" will result in lower income and less taxes paid by stockholders. Who can best handle the money? If you believe that President Obama and Congress can spend your money better than you can then you should let your choice be known or if you believe you can do better you should also let your views be known.
As for General Electric and probably others, not paying any income taxes in this country, raising the income tax rates probably won't change that. It will take a major overhaul of our taxing system to close the loopholes that allow special breaks to certain Corporations. We should scrap the income tax and Internal Revenue System and replace them with a fairer and simpler tax. What do you think?
To us,the most puzzling part of the budget cut proposal is the ten or twelve member panel which will attempt to come up with further cuts in spending. If they can't agree on a plan or if both Houses of Congress doesn't vote for their plan then there is to be an automatic trigger which will force across the board cuts but will do more cutting in defense and medicare. What kind of democracy allows twelve people to decide what programs will be cut and by how much?
Thanks for your time and input. Stay tuned. - William
The Social Security and Medicare Trust Funds probably would have shown a small surplus, or at least broken even, this year but for the two percentage points reduction in the FICA (payroll)tax which was tacked on to the bill extending the President Bush era tax cuts at the request of President Obama. It is the FICA tax money which funds the Social Security and Medicare Trust Funds which, in turn, pays the retiree benefits. Now, beginning this year, our Treasury Department will be forced to borrow more and more money to redeem more and more IOUs from the Trust Funds in order to pay those benefits over the next ten years. That borrowing will amount to approximately $2.5 trillion. Does that sound familiar? That is almost exactly what the Debt Ceiling Bill proposes to cut from our budget (spending) over the same period of time. It appears that their intention is to cut other spending enough to cover the extra borrowing needed to redeem those IOUs representing the money (borrowed?) already spent from the Social Security/Medicare Trust Funds. (Check earlier postings on that subject) To us, not being economist, that adds up to a flat zero on all counts. Otherwise worthless.
And now to all the talk about taxes, especially on big Corporations and some millionaires and billionairs. Who could possibly feel sorry for those, so called, "fat cats" and not want their taxes raised? We have never been fans of highly paid athletes and Corporation CEOs etc., but the taking of their income by raising taxes will hurt the very poorest people the most. It has been proven, remember the "Stimulus Package", that the private sector can create jobs at a fraction of the cost to our Federal Government. For ever four jobs lost by the private sector because of higher taxes the public sector (Governments) can probably create about one job and most likely that would be in the government. Aside from that, major Corporations are not privately owned but have millions of stockholders. Every dollar lost to higher taxes will be passed on to those stockholders, which includes not only individuals but Retirement Fund of all kinds, from some of the smaller companies all the way up through the Federal Government. Individuals who collect dividends, many of them retired, from stock in big companies such as General Electric, big oil companies etc., probably will be subject to the paying of income taxes on those dividends. Revenue lost to the higher taxes on "Big Business" will result in lower income and less taxes paid by stockholders. Who can best handle the money? If you believe that President Obama and Congress can spend your money better than you can then you should let your choice be known or if you believe you can do better you should also let your views be known.
As for General Electric and probably others, not paying any income taxes in this country, raising the income tax rates probably won't change that. It will take a major overhaul of our taxing system to close the loopholes that allow special breaks to certain Corporations. We should scrap the income tax and Internal Revenue System and replace them with a fairer and simpler tax. What do you think?
To us,the most puzzling part of the budget cut proposal is the ten or twelve member panel which will attempt to come up with further cuts in spending. If they can't agree on a plan or if both Houses of Congress doesn't vote for their plan then there is to be an automatic trigger which will force across the board cuts but will do more cutting in defense and medicare. What kind of democracy allows twelve people to decide what programs will be cut and by how much?
Thanks for your time and input. Stay tuned. - William
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