Is Social Security a Ponzi Scheme?

Is Social Security a Ponzi Scheme?

Charles Ponzi became infamous for his Ponzi scheme.  All it amounted to was taking in money from folks for a non-existent investment and then paying back big returns (to the first investors) from the receipts of newer investors.  There never was any investment.  It worked great in the short term as the early investors made huge returns on their investments from the new money flowing in from others who wanted to get rich quick.  But ultimately the investors were bilked of their money.  More recently Bernie Madoff did the same thing, but on a much larger scale.

Perhaps you heard or read that Texas Governor Rick Perry called Social Security a Ponzi scheme during a Republican Presidential debate at the Reagan Library (the Gipper must have been smiling).  It was in reference to a quote lifted from his book, Fed Up!  The not so mainstream media and other self-serving comrades were gleeful.  After all, Social Security has been the untouchable “third rail” of American politics for decades.  Barry Goldwater was Mau-Maued with the charge that he was going to destroy Social Security and more recently, Congressman Paul Ryan has been the target of demagogues in the Democratic Party with the charge that he too wants to destroy Social Security.  Even Governor Romney stooped low to throw a little mud on the good Governor of Texas.

But mudslinging aside, is Social Security a Ponzi scheme?  Let’s go back to the beginning, shall we?  The Old-Age, Survivors, and Disability Insurance (OASDI) program, referred to as Social Security, was passed by Congress and signed by President Franklin D. Roosevelt into law in 1935.  It was promoted and indeed its name states that it is insurance.  So is it really insurance?  Would it pass muster of any state insurance regulator?

As it turns out, my father worked in the insurance industry for more than 20 years.  I’m certainly not an expert on insurance, but I did ask him a few questions over the years about how insurance works.  It seems that state regulations governing the operation of insurance companies are quite strict.  For example, Life Insurance Companies are strictly forbidden from simply paying off claims from incoming revenues from new policy holders.  They can’t operate like a Ponzi scheme.  They must maintain high financial reserves at all times so that all claims can be honored when they come due.  Reserve levels are audited on a regular basis to make absolutely certain that your policy will be paid in full when you die.

If executives of an insurance company were to dip into the reserve fund for their personal benefit or for any other reason that created a dangerous low balance in funds available, they could and would be guilty of fraud and would go to jail.  They would, in effect, be acting as Charles Ponzi did in the early 1900s and as Bernie Madoff did more recently.  Ponzi and Madoff went to jail.

Accordingly, since Social Security was sold as “insurance,” and in fact the official name is the Old-Age, Survivors, and Disability Insurance (OASDI) program, it seems only fair to judge whether or not it has been operated with insurance standards as they are applied to insurance companies.  Have sufficient financial reserves been maintained along with appropriate investments to ensure that those who contributed into the program will be paid a return from the funds they have “contributed”?  As an aside, the word “contributed” is not very appropriate in this case since in reality, no one contributes to Social Security, they are forced to pay into OASDI.  If you do not pay into Social Security or your employer fails to pay into Social Security, some men in uniforms with guns will come and cart you or your employer off to jail.  In reality, Social Security is just another tax levied by the big government crowd.

But back to the question as to whether Social Security has been operated as a legitimate insurance program that meets with insurance standards for financial reserves.  The answer is no for several reasons.  First, Congress has “borrowed” from the Social Security fund to pay for general expenses.  There is only an IOU in the Social Security account.  So, on that basis, members of Congress should be carted off to jail.  They have committed fraud, just as blatant as Ponzi and Madoff, but on a much, much larger scale.

Second, beneficiaries of Social Security were added as the program developed with the knowledge that the amount of their contributions would never justify the monthly benefit they would receive from the program.  You might say that Social Security is insolvent by design.  But, remember, those who drafted the legislation and the President who signed the legislation called it insurance, therefore they deserve to be held up to the standards required of for-profit insurance companies.  So, FDR should have been carted off to jail for insurance fraud, along with other Presidents who went along with the scheme.

But forgetting all the lies and hypocrisy of those who passed the legislation in the first place, is Social Security financially sound today?  Can it continue in its present form and provide the same level of benefits to young people who are forced to pay into it today for their future retirement?  The answer is yes if we are willing to substantially devalue the dollar through inflation.  In other words, if we make the dollar less valuable so that the money we pay to today’s seniors is less valuable, we might be able to raise taxes high enough to cover the cost of Social Security, but that would mean that Social Security was a lie in the first place.  And anyway, there is always a day of reckoning.

The fact is that Social Security’s underfunded liability is calculated in trillions of dollars.  That’s right, trillions of dollars.  Send some more Congressional Ponzi’s off to jail.  If this is not a blatant, in-your-face betrayal of the public trust, I don’t know what a betrayal is.  Not only are there no reserves, but last year Social Security payments exceeded Social Security taxes.  According to the Congressional Budget Office this trend will continue and accelerate as the Baby Boomer generation retires.  By 2037, retirees will only get about 76 cents back for every dollar that they put into Social Security unless dramatic changes are made.

In March of last year Senate Majority Leader Harry Reid said, “…they [Republicans] claim Social Security is headed for bankruptcy.  It’s not just an exaggeration that Social Security is headed for bankruptcy -- it is an outright lie.”  Well, I suppose Reid is right, Social Security is not headed for bankruptcy, it is already bankrupt.  Of course, he didn’t mean it that way.  Harry Reid is a man with great power and responsibility as a public servant and instead of dealing with the bankruptcy of Social Security the most he could manage was demagoguery.  Reid follows the Democratic play book—politics first, integrity second.

The jails would be bulging if we sent everyone who went along with the lie that Social Security is insurance.  But they can’t have it both ways.  Either it is insurance or it is just a Ponzi or Madoff scheme on a much bigger level. 

It is, of course, as Governor Rick Perry said, a Ponzi scheme, although considering the size and scope of the fraud, I’m not sure that’s fair to Charles Ponzi.  He was a piker, compared to the politicians who told us Social Security was insurance.

The issue is not whether Social Security is a Ponzi scheme, but how to stop the theft from today’s young people and give them a free market program that is truly self-funding and will allow them to get a better return on the funds they contribute.  Let’s be fair to those who created Social Security.  While some voted for the socialist plan with good intentions, those in leadership knew from the start that it wasn’t about retirement security, it was about gaining political power and control over the lives of Americans.  It was about the redistribution of income.  It was never insurance and they knew it.  Social Security was a fraud from the very beginning.  How do you say “Obamacare?”

We can’t, of course, tamper with the benefits being paid to those already on Social Security, nor with the benefits to be paid to those about to retire, but we do have a moral and ethical responsibility to give the young people of today a better free market option that does not include political power being invested in a few power hungry politicians and bureaucrats.

The 401(k) program has been a huge benefit to the workers of today and will, in most cases, provide retirement income four to five times that provided by Social Security.  While I favor phasing out Social Security in favor of more 401(k) and IRA type programs, I’d certainly go along with changing the current program to one in which workers establish personal retirement accounts that they own and that they direct investments from.  This would be a big step toward personal responsibility, less government and thus more individual freedom.

If we are to remain true to the vision of the Founders of this great Republic, we must look at all government laws and programs through the eyes of maximizing personal freedom and personal decision making.  Washington, D.C. does not have a monopoly on intelligence and certainly not on wisdom.  In fact, it’s too often an intellectual swamp compared to the common sense approach of the average American who lives within his or her means.

Let’s drain the swamp, shrink government, and thus maximize freedom and prosperity for all Americans.

Not Your Father’s Party

Not Your Father’s Party

The media and many not-too-informed folks complain about the inability of the Democrats and Republicans to get along and compromise.  They want everyone to get along and to “get something done.”  It’s not going to happen, and I think I can explain why, but it will take a bit of history to understand why this is true.

I grew up in Missouri and contrary to most folks in our neighborhood and town, we were conservative Republicans.  St. Joseph was a down-the-line Democratic bastion.  The mayor, the city council, the county council, the state representatives, and the state senators were all Democrats.  They were patriots, but Democrats.

Harry Truman grew up about 50 miles south of St. Joseph in the Kansas City area.  He was a part of the Prendergast machine, a very corrupt and powerful political organization.  Truman may have been a part of that machine, but as a US Senator, he was a red, white and blue American.  He fought in World War I and when the time came as President to decide whether or not to save millions of American and Japanese lives by dropping the atomic bomb and bring World War II to a swift conclusion, he did it.  Harry loved his country and would have given his life to defend her.

My father-in-law, W.H. Mitchem, was a Harry Truman Democrat, lots of people were.  He loved the feisty spirit of Truman and the fact that he had the courage to end World War II swiftly.  That was personal because my father-in-law was a proud United States Marine who fought at Guadalcanal.  He saw some terrible fighting there and in other parts of the Pacific Theater of WWII.  And, he might have died (along with hundreds of thousands, perhaps more than a million Americans) if Harry Truman had not had the courage to drop the bomb.  So supporting Harry Truman was personal for my father-in-law.  But as a son of Georgia, he grew up as an FDR, Harry Truman Democrat.

When Norman Thomas, who ran for President six times on the Socialist Party ticket, finally presided over the demise of the Socialist Party in the late 1950s, he said, “I no longer need to run as a Presidential candidate for the Socialist Party.  The Democrat Party has adopted our platform.”  And indeed that is
what happened.

1948 was a strange election year.  The Republicans nominated the choice of the Eastern Liberal Establishment, New York Governor, Thomas Dewey.  Dewey was a progressive, i.e. liberal Republican who could have been comfortable in either party.  Today we would call him a RINO—Republican In Name Only. 
An early front runner, Dewey lost to Truman in spite of a strange split in
the Democratic Party.

That year the Dixiecrats split off and ran Strom Thurmond, a war hero and Governor of South Carolina, as their candidate for President.  Theirs was a Jim Crow segregationist ticket.

But something much more important happened at the Democratic National Convention.  There was a delegate to the Convention from South Dakota, another war hero, George McGovern.  When Truman was nominated, McGovern, along with some other “prairie radicals,” split off and left the Democratic Party to support the Socialist candidate Norman Thomas.  McGovern and Thomas saw eye-to-eye on almost every issue.

After Truman won in a squeaker, McGovern came back into the Democratic Party with the goal of taking over the Party and making it into a political vehicle to carry the socialist cause in America.  McGovern was elected to the U.S. House of Representatives in 1956 and re-elected in 1958. After a failed bid for the U.S. Senate in 1960, he was elected to there in 1962 and served for several terms.

McGovern and others of his ilk were quite successful in moving the Truman
Democratic Party to the far left.  In fact, in 1972 he won the Democratic nomination for President of the United States.  Never before had someone on the far left of the political spectrum won the nomination of a major political party.  Political observers call McGovern’s defeat by Richard Nixon a political debacle, but it was far from it.  It was in many ways a great political triumph, just as Goldwater’s defeat in 1964 was a triumph for conservatives who took over the apparatus of the Republican Party and have held it ever since.  The 1972 election allowed the socialists and prairie radicals to seize the organizational apparatus of the Democratic Party.  They have never
surrendered it.

Ronald Reagan’s election in 1980 could not have happened without the Goldwater nomination and Barack Obama’s election in 2008 could not have happened without the McGovern nomination in 1972.  In both cases the financial base and the philosophical base of the Party changed hands.

Today’s Democratic Party is a far cry from the Party of Truman, Kennedy, and Johnson.  It gets much of its muscle and money from far left union bosses whose outlook is radically different than George Meany, the man who served as midwife to the creation of the AFL-CIO union.  Meany was a tough, but honest labor leader.  He knew politics and he knew how to wield power.  But George Meany was a patriotic American in every respect.  He drove the Communists and their far left travelers out of the union movement and he gave aid to union movements behind the Iron Curtain.  He was a ferocious anti-Communist.

In 1972, only one union, the far left National Education Association, supported the candidacy of George McGovern.  All the others either sat out the contest or endorsed Richard Nixon.  But when George Meany died in 1979 it paved the way for the far left to seize control of the American labor movement.  Today far left union bosses in both the public and private sphere provide manpower and hundreds of millions of dollars to the newly empowered radicals who have an iron grasp of the Democratic Party apparatus.

Today’s Democratic Party is no longer the Party of Harry Truman, John F. Kennedy and other patriotic Democrats like Senator Henry Jackson.  It is now the Party of the far left.  It is the Party who sees America as growing strong and prosperous by exploiting minorities and raping other countries of their natural resources.  It is a Party that loathes the thought of American Exceptionalism. 

Harry Truman, John F. Kennedy and scores of other patriotic Democratic leaders must be spinning in their graves.  Loyal Americans and staunch anti-Communists, these traditional Democrats would not have been welcome in the new Democratic Party.

To understand the dramatic difference between today’s Democratic Party and the Party of Truman and John Kennedy, you need to go no further than their Thanksgiving Day Proclamation and that of our current President, Barack Obama.

What follows is the first paragraph of President Truman’s 1950 Thanksgiving Day Proclamation…

            “In keeping with the custom established by our forefathers
            and hallowed by faithful observance throughout the years,
            it is fitting that once again at this season we set aside a day
            for giving thanks to God for the many blessings which He has
            bestowed upon us.  We are deeply grateful for the bounties of
            our soil, for the unequaled production of our mines and
            factories, and for all the vast resources of our beloved country,
            which have enabled our citizens to build a great civilization. 
            We are thankful for the enjoyment of our personal liberties and
            for the loyalty of our fellow Americans.”
Consider in contrast, this paragraph from the 2010 Thanksgiving Day Proclamation of President Obama…

            “What began as a harvest celebration between European
            settlers and indigenous communities nearly four centuries
            ago has become our cherished tradition of Thanksgiving. 
            This day's roots are intertwined with those of our Nation,
            and its history traces the American narrative.”

In fairness, President Obama’s Thanksgiving Day Declaration does make reference to President George Washington’s first Thanksgiving Day Declaration, “…we recall President George Washington, who proclaimed our first national day of public thanksgiving to be observed ‘by acknowledging with grateful hearts the many and signal favors of Almighty God’” but nowhere does the President make such an acknowledgement himself.  It’s more of a historic reference point than a continuum of the practice of all past Presidents to give thanks to God.  For instance, consider the Thanksgiving Day Declaration of President Franklin D. Roosevelt in 1933 as the Great Depression set in…

            “May we on that day in our churches and in our homes
            give humble thanks for the blessings bestowed upon us during
            the year past by Almighty God.  May we recall the courage
            of those who settled a wilderness, the vision of those who
            founded the Nation, the steadfastness of those who in every
            succeeding generation have fought to keep pure the ideal of
            equality of opportunity and hold clear the goal of mutual help
            in time of prosperity as in time of adversity.”
Or consider the first paragraph of the 1961 Thanksgiving Day Proclamation of President John F. Kennedy…

            “‘It is a good thing to give thanks unto the Lord.’  More than
            three centuries ago, the Pilgrims, after a year of hardship and
            peril, humbly and reverently set aside a special day upon which
            to give thanks to God for their preservation and for the good
            harvest from the virgin soil upon which they had labored.  Grave
            and unknown dangers remained. Yet by their faith and by their toil
            they had survived the rigors of the harsh New England winter.
            Hence they paused in their labors to give thanks for the blessings
            that had been bestowed upon them by Divine Providence.”
President Barack Obama exemplifies today’s Democratic Party, left of center, secular, and embarrassed by the prosperity and wealth that freedom and free markets have created.  The Democratic Party of 2011 has far more in common with the radicals of the French Revolution than it does with the founders of the American Revolution.

No wonder Ronald Reagan, and more recently, Texas Governor Rick Perry, have said that they didn’t leave the Democratic Party, the Democratic Party left them.  And indeed, that’s exactly what my patriotic father-in-law and most of his relatives did—they became Republicans because they could no longer recognize the new Democratic Party.  It was not, as they say, their Father’s Democratic Party.

With all its flaws, and they are many, there is today only one Party that remains faithful to the vision of the Founders and to the United States Constitution—the Republican Party—and too often even the Republicans get wobbly in their commitment to the Founders’ vision of a limited, Constitutional government.  Thank God for the Tea Party Republicans who are principled and uncompromising in their dedication to the US Constitution and to Founding principles.  They are the only hope for freedom for future generations of Americans.  May their vision and commitment to the United States as the land of the free and the home of the brave never waver.  These patriots are the friend of all Americans, but especially those in poverty, who seek to climb the ladder of opportunity and create a better world for themselves and their families.  Men and women who understand Founding principles are the sole hope of men, women and children of all races who seek to realize the American Dream. 

For nearly 150 years there were at least two political parties in the US that may have disagreed on many issues, but in no instance did they disagree on their love of the United States of America or their belief that it was the greatest nation on the face of the earth.  Sadly, that is no longer true today.  May God continue to bless America.

Solomon Asked For…

Solomon Asked For…

After Solomon became King of Israel, God appeared to him in a dream and offered to give him whatever he wanted.  Because Solomon wanted to be a great leader, he asked for…

…Intelligence.  He asked to be the most intelligent person in the world.  No, he didn’t ask to be the most intelligent person in the world.  He didn’t ask to have the highest IQ.  His goal wasn’t to be the smartest person in the room.  So what did he ask for?

Of course, Solomon asked to be the most educated person in the world, to have more knowledge than any other person.  No, Solomon didn’t ask to have more knowledge than anyone else.  He didn’t ask to be the most intelligent or the most educated person in the world.

Solomon asked for wisdom.  He asked for wisdom because he knew that was the most important attribute of a leader who was to effectively lead his people.  He wanted the gift of discernment so he could make wise decisions.  God was so pleased with Solomon’s request that he said, “I will give you a wise and discerning heart, so that there will never have been anyone like you, nor will there ever be.”  (1 Kings 3:12) 

The reign of Solomon was amazing.  It was the high point of the united nation of Israel.  The temple was constructed under the direction of Solomon to give glory to God.  And the people of Israel experienced prosperity as they had never seen it before.  Rulers and leaders from across the world came to learn from Solomon for his reputation as a leader stretched across the nations of that time.

Wisdom, the most treasured, most valued attribute of a leader, but exactly what is wisdom? 

Associate Justice of the United States Supreme Court, Sonia Sotomayor, once said (prior to her nomination and confirmation), “I would hope that a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion than a white male who hasn’t lived that life.”
Without debating the truth of that statement, how do you think Judge Sotomayor would define wise or wisdom?  She might talk about her experience as a Hispanic in a society where Hispanics are a minority.  Or, she might talk about her education and her role (at that time) as a college professor.  She would probably make sure you knew that she is very intelligent (as she is).  And somehow that would sum up her definition of wise or of wisdom.  But is intelligence or education or our personal experience the sum and total of wisdom?

Psalm 111:10a says, “The fear of the Lord is the beginning of wisdom.”  This doesn’t mean that God is not a loving God, but that to be in the presence of the Lord God Almighty is an awesome thing.  It is something that we cannot imagine.  The very thought of it makes our voice shaky and our knees tremble.  Imagine a mortal, cracked clay pot in the presence of the potter, the Creator.  Even great Old Testament leaders like Moses couldn’t look at the face of God or they would die.  To be in the presence of an all powerful and righteous God is a fearsome thing for a sinful, mortal human.  But that’s where we must begin if we are to gain true wisdom.

When we talk about “common sense,” or sometimes “horse sense,” we are talking about the application of Godly wisdom to our lives.  This doesn’t mean that only those who are Christians have access to common sense, but it does mean that those who study and trust in the Bible have direct access to common sense, to wisdom.

There’s a book I’m planning to read, one I’ve heard discussed on a couple of occasions.  It’s called, “I Didn’t Know That Comes From The Bible.”  It is apparently a compilation of hundreds, if not thousands of common sense expressions that we use every day, all of which come from the Bible.

And, of course, who can forget the Book of Proverbs, with some of the most practical suggestions for successful and satisfying living.  Just consider the first six verses of the first chapter…

            “The proverbs of Solomon, David’s son who was king of Israel,
            given to grasp wisdom and discipline, to understand deep thoughts,
            to acquire the discipline of wise behavior—righteousness and justice
            and fairness—to give insight to gullible people, to give knowledge
            and foresight to the young—a wise person will listen and continue
            to learn, and an understanding person will gain direction—to
            understand a proverb and a clever saying, the words of wise people
            and their riddles.”
There are 31 chapters in Proverbs and every chapter is chock-full of good, sound, wise advice, the kind you can count on to be true.  Just listen to a few samples of this Godly advice…

            “…do not forget my teachings, and keep my commands in mind,
            because they will bring you long life, good years, and peace.”—3:1

            “Consider the ant, you lazy bum.  Watch its ways, and become wise. 
            Although it has no overseer, officer, or ruler, in summertime it stores
            its food supply.  At harvest time it gathers its food.”—6:6-8

            “Treasures gained dishonestly profit no one, but righteousness
            rescues from death.  The Lord will not allow a righteous person
            to starve, but he intentionally ignores the desires of a wicked
            person.”—10:2-3

            “Integrity guides decent people, but hypocrisy leads treacherous
            people to ruin.”—11:3

            “Righteousness lifts up a nation, but sin is a disgrace in any
            society.”—14:34

            “A good name is more desirable than great wealth.  Respect is
            better than silver or gold.”—22:1

            “Do not brag about tomorrow because you do not know what
            another day will bring.”—27:1

            “Who can find a wife with a strong character?  She is worth far
            more than jewels.”—31:10

And then there are the Ten Commandments, words of God written directly on stone and brought down from Mount Sinai by Moses.  The first three Commandments are about God and tell us to put Him first, to not value things (idols) more than God, and to not use His name in vain.  The next seven tell us that it’s not smart or wise to lie, to steal, to commit adultery, to tell falsehoods about others, or to covet what others have.  We are also advised to give honor to our parents and to those in authority.

Of course, that’s not what the smart people of today tell us.  Wisdom is not in abundance in the United States as it was in the early days of our Republic.  We can no longer pray in the Public Square even though Benjamin Franklin counseled those stalemated on the creation of the US Constitution on July 28, 1787…

            “…if a sparrow cannot fall to the ground without his notice,
            is it probable that an empire can rise without his aid?  We have
            been assured, Sir, in the sacred writings, that “except the Lord
            build the House they labour in vain that build it.”   I firmly
            believe this; and I also believe that without his concurring aid
            we shall succeed in this political building no better, than the
            Builders of Babel: We shall be divided by our little partial local
            interests; our projects will be confounded, and we ourselves shall
            become a reproach and bye word down to future ages.  And what
            is worse, mankind may hereafter from this unfortunate instance,
            despair of establishing Governments by Human wisdom and leave
            it to chance, war and conquest.   I therefore beg leave to move-that
            henceforth prayers imploring the assistance of Heaven, and its
            blessings on our deliberations, be held in this Assembly every
            morning before we proceed to business.”
Yet today God is not invited to the 9/11 10th anniversary commemoration.  God has been kicked out of the classroom.  A former Vice President swears uncontrollably in public.  We’re told that lying is OK as long as it is done with good intentions.  We’re told by a sitting President that oral sex with an intern is not adultery.  Lies are told in public by the “right” people and the media doesn’t even call them to account.  A leading national party has made as their theme coveting the success and belongings and wealth of others (class warfare).  And, of course, children are led to believe that honoring your parents, especially your father, is optional.

Today there is much of talk about candidates for President and what grades they got in school.  I don’t care what grades they got in school.  I don’t care what their IQ is.  I don’t care about how many books they have read or even how much knowledge they have.  I care only about how truly wise they are.  It is wisdom that makes a great leader, not intelligence or vast knowledge.  Wisdom is what is too often missing in our leaders because they do not humble themselves before God.  Instead, they seek to be God. 

They seek not to serve, but to rule.  They seek not to expand the freedom of their fellow citizens, but to expand their power and control over their daily lives.  Wanting to be like God was the first sin.  And now we are all stuck with sin that corrupts all human beings.

Godly wisdom is what the Founders possessed.  They understood the fallen nature of man.  They knew that if given the opportunity, the most kind and gentle man could turn into a ferocious master.  They understood that it is not intelligence or knowledge that makes one man better than another.  All are capable of the most heinous acts if given the opportunity.  There are no better people, only fallen people.

            As it says in Romans 3:22b-23…

            “There is no difference between people.  Because all people have
             sinned, they have fallen short of God’s glory.”
This message of the fallen state of man starts in Genesis and is carried through the entire length of the Bible.  There’s no difference between this truth in the Old Testament and the New Testament.  Without God’s forgiveness there is no hope for us.  We are all fallen sinners.

That is the real wisdom of the Founders and it is still the wisdom that counts today.  That’s why the Founders sought to create a limited government with limited power.  They knew and understood that concentrated power, even in the hands of a seemingly benign and well-intentioned individual or individuals first leads to corruption, and then to oppression, and finally to tyranny.

When asked if folks who believed loony things were stupid, Bill Buckley replied something like this, “No, they aren’t stupid.  They are very smart.  It’s just that so much of what they believe to be true isn’t true.”

Bill Buckley understood the difference between wisdom and knowledge, wisdom and intelligence.

Prosperity begins with freedom.  Freedom begins with an understanding of the fallen state of man.  An understanding of the fallen state of man begins with faith in the God of the Bible, faith in Jesus Christ as our Savior from the sin that corrupts us.  This is the wisdom of our Founders.  May we be blessed with it again.

A Brilliant New Idea from President Obama

A Brilliant New Idea from President Obama

Liberals always think of themselves as, well, superior to other human beings.  They are the originators of great, new, revolutionary ideas.  That’s why I was so excited to hear about the centerpiece of the President’s plan to create jobs in the US.  And, I’m so happy that he hasn’t let stock market crashes and soaring unemployment numbers during the past three years distract him from creating Obamacare (a foolish socialist scheme that was never supported by 35% of Americans) instead of focusing on job creation. 

Of course, we’re very lucky that this President has so much hands-on experience in the marketplace and knows how jobs are created.  After all, he was a devout follower of Saul Alinsky, a college professor, a community organizer, a state senator and very briefly, a US Senator before he became President.  Well anyway, I’m sure he cares about creating jobs, and after all, caring is always more important than actually creating jobs.  Liberals are great at caring, although their caring rarely translates into real compassion that includes donating money and volunteering to actually help those in need.

But I’m getting off track.  I’m really so excited to hear of his new, amazing, innovative, creative, unprecedented idea to create new jobs.  Let’s see the centerpiece of his amazing new jobs creation idea is a stimulus, a big spending bill!  Wow!  Amazing!  How daring and innovative! 

Let’s see creating jobs via government spending programs (the hell with our current financial insolvency and the debt we are leaving to our children and grandchildren) has worked well so many times in the past.  Well, there was the FDR spending binge that caused the United States to be in a depression for eight years longer than the rest of the world.  And then there were all the other spending programs over the years that didn’t work. 

Obama, Reid and Pelosi have created the current economic mess because they do not understand economics.  Today the unemployment rate in the Black community is 16% and among Hispanics it is 11%.  This is all due to the wild government spending by the Democrats.  All of it!  They screwed those who gave them the strongest support.

Government spending has never created a net job.  It may have created more bureaucratic jobs, but government spending always destroys more jobs than it creates.  Thinking that government spending will get the US out of the Obama Great Recession is sheer lunacy.  It’s simplistic.  It’s sophomoric. 

But big spending is often good politics.  It sounds good to the uneducated.  But it is always destructive.  It’s just as destructive as a family that is financially underwater thinking that they can return to prosperity by going on a spending binge. 

Dollars represent labor and capital.  When that labor and capital is spent in the private sector to create consumer goods and services, it raises the standard of living of all Americans.  When that labor and capital is spent to hire more bureaucrats to create more regulations, it means a lower standard of living for all Americans.

Yes, we need infrastructure like highways and roads.  Yes, we need a court system.  Yes, we need a military.  These are necessary, essential, constitutional expenditures by government.  But every dollar spent on any government activity is a dollar that cannot be spent on consumer goods and services.  Remember, that dollar represents labor and capital.  Today, the government spending at the federal level takes nearly 25% of all dollars earned by those in the private sector.  That means the standard of living of all Americans is pushed lower by the government.

It’s worse than that because government bureaucrats issue rules and regulations that stymie the expansion and growth of business and drive up the cost of goods and services.  In short, government has been, is, and will always be a drag on the economy.

When liberals see jobs created by government spending, they do not see the jobs destroyed by diverting the value of labor and capital from investment in the free market to create real jobs—jobs that create consumer goods and services that raise the standard of living of every American. 

President Barack Obama and the Democrats in Congress (who held a super majority) inherited a mild recession.  Through their foolish policies that have been repeatedly tried and failed in the past, they have turned that mild recession into a great recession bordering on a plunge into a great depression.

The record is clear.  In 1980, Ronald Reagan inherited a terrible economy, many times worse than that inherited by the Obama-Reid-Pelosi troika.  Reagan cut tax rates 30% across the board and voilà, the economy came roaring back giving the United States the longest period of economic expansion in its history.  It worked for Kennedy and Coolidge and it worked for Reagan.

But why go with ideas that work?  Why not go back to old, failed schemes that are sure fire job killers.  Let’s spend our way into prosperity!

Liberals don’t learn from history.  After all, as Obama said, “We are the ones we have been waiting for!”  He would have been right at home with the leaders of the French Revolution in believing that they would create a utopia on earth.  Instead, like their imitators that followed—Hitler, Stalin, Mao, Pol Pot, Castro, et al.—they created a nightmare on earth.

Liberals are indeed the heir to the French Revolution.  Conservatives are the heir to the American Revolution.  Which shall we choose in 2012?

Three Simple Commonsense Things to Help the Economy

Three Simple Commonsense Things to Help the Economy

There are three easy things President Obama can do to spur the economy and they all will help significantly.  They are…

    1.    Tax Holiday.  Unlike even our socialist friends in Europe, the US
           taxes profits made in foreign nations.  They have, of course already
           been taxed by those governments.  Right now corporate earnings by
           American companies are taxed up to 35%.  So guess what, the money
           stays in Europe and Asia and Latin America and is reinvested in those
           countries.  A tax holiday, even of short duration, would bring home as
           much as $1trillion dollars and this time it wouldn’t be frittered away in
           government boondoggles and pork, but instead be used to invest right
           here in the USA.  Even some very far lefties like Chuck Schumer have
           come out in favor of such a tax holiday.  OK, Mr. President, you have
           clear, bipartisan support.  Just say the word.

    2.    Sell F-16s to Free China (Taiwan).  By treaty (the Taiwan Relations
           Act), the US is bound to sell Taiwan the weapons it needs to defend
           itself.  Taiwan seeks to purchase 66 new F-16 fighters to protect itself
           from an ever growing and more sophisticated Communist Chinese air
           force.  By helping Taiwan we will help avoid future military
           confrontations with the Chicoms because Taiwan will be strong enough
           to defend itself.  Perhaps more important at this particular time, this is a
           huge order that will generate jobs in Texas, Florida and Ohio, the latter
           two being states that Obama needs to carry in order to get re-elected. 
           So, as you can see, there is something in it personally for the President. 
           In support of this sale, the Wall Street Journal quotes a study by the
           Perryman Group that calculated the F-16 sale would generate more
           than 87,000 person-years of US employment, meaning roughly 16,000
           annual jobs.  It’s a clear win-win and it doesn’t take Congress to act. 
           Once the President signs off on it the deal is done.  Get out your pen,
           Mr. President.

    3.    Canadian Oil Pipeline.  A huge tar sands oil find in Alberta, Canada
           would not only significantly reduce US dependence on Middle East oil,
           but also dramatically boost the sick US economy.  There is already one
           pipeline running from that area of Canada into the US and this one
           would run to Port Arthur, Texas.  I have a particular personal interest
           in this oil pipeline because the first job I took out of college as a young
           engineer was with Gulf Oil Corporation in Port Arthur, Texas.  The find
           is huge and when up and running would supply more than 500,000
           barrels (42 gallons to a barrel of crude) of oil per day.  According to a
           report completed by Obama’s Energy Department, construction alone
           would infuse $7 billion into the US economy.  It would also push the
           cost of gasoline at the pump down, and move the US closer to energy
           independence.  The only problem is that the US State Department has
           placed a “hold” on construction, due to objections raised by the Obama
           Environmental Protection Agency.  The objections are that the oil
           is “dirty,” but frankly, with today’s technology, oil can be “scrubbed”
           to make it clean.  After all, the emissions of vehicles are already heavily
           regulated by the government.  As Secretary of State, Hillary Clinton
           just has to sign off and construction can begin, creating an estimated
           14,000 new, high paying jobs.  Grab you pen, Madam Secretary.

Lots of other steps can and should be taken immediately to save the US from the spending binge Obama took the US on in the first two years of his presidency.  We’re over the cliff and hanging on a twig, hoping that it won’t give way and plunge us into a deep financial canyon.
 
Signing off on US exploration and production of oil, encouraging the acquisition of oil and gas through fracking, cutting the rolls of federal employees by 10% and reducing the salaries of the other employees by 10% would also boost the economy.  Remember, for the first time in US history, government employees (who produce no consumer goods or services) are making more money than the folks who do produce those goods and services.  Every dollar paid to a government worker is a dollar that cannot and will not be invested in the economy creating productive jobs and increasing the supply and reducing the cost of consumer goods and services.

Even if you won’t do those commonsense things, Mr. President, how about just doing three simple things this week to put Americans back to work—a tax holiday on the foreign earnings of American companies, selling F-16 jet fighters to Taiwan, and signing off on the construction of a 1,900 mile oil pipeline construction project?

Why Do Liberals Hate the Tea Party?

Why Do Liberals Hate the Tea Party?

Racist, hostage takers, unbalanced, terrorists—these are just a few of the slanderous comments made by liberal writers, politicians, and talking heads on television.  What incites these comments by folks who piously advocate “a more civil society?”  What causes the President of the United States, who prattles on about being more kind and civil, to say that Tea Party Republicans have a “gun to our head.”  Whatever happened to the sweetness and light he was professing after the tragic shooting of Congresswoman Gabby Giffords in Arizona?  Does his background in Chicago politics always drive him backwards into saying thing like, “when they bring a knife to a fight, we bring a gun?”

Why the venom and the hatred?  Why did liberal union goons beat up Tea Party member, Kenneth Gladney, for passing out “Don’t Tread on Me” flags at Congressman Russ Carnahan’s town hall event in St. Louis?  And why did the Democrat prosecutor delay charging the perpetrators with a crime even though there were ample witnesses?

Why did Nancy Pelosi falsely assert that there were those at Tea Party rallies carrying swastikas?  Why, when there was no evidence that black congressmen were spit on and called racist names, did the national news media report such a lie?

Why the vitriolic language and the violence from liberals against the Tea Party and its followers? 
Why the effort by the mainstream media to portray the Tea Party members as uneducated, psychotic rubes by the media?

The answer to these questions is simply fear.

The left fears the Tea Party because, by and large, their members and followers are the most educated and informed members of the electorate to come on the scene in many years.  While the left is virtually ignorant of economics, Tea Party members have read The Road to Serfdom, by Nobel Prize winner in economics, Friedrich von Hayek.  This book, published in 1944, became a New York Times best seller in 2010 thanks to its popularity among Tea Party followers.  And the Spanish version of the book is also a big seller in Latin America.

But the Tea Party didn’t stop with reading and understanding free market economics.  They also bought and read copies of the United States Constitution.  The average Tea Party member knows more about what the Constitution says and means than the average member of the United States House of Representatives, a member of the United States Senate, and even our President who frets over the “negative guarantees in the Constitution.”  Oh, and I shouldn’t leave out the musings of the august news media, including one 27 year old wunderkind blogger, Ezra Klein, at The Washington Post, who shrugged off the US Constitution as meaningless because “the language is confusing and it’s more than 100 years old.”  Actually Ezra, it’s more than 200 years old and well, the Bible is thousands of years old.

But back to the Tea Party and people who aren’t confused by the language in old books.  Actually the Tea Party folks didn’t stop with reading The Road to Serfdom, and the US Constitution.  They also gobbled up copies of the Federalist Papers so that they could really understand what the Founders meant when they created this nation and signed onto the Declaration of Independence, the Constitution and the Bill of Rights.  Gee, Ezra, have you ever tried to understand the Constitution or have you ever read the Federalist Papers?

The depth of scholarship of the Tea Party movement became obvious during the many town hall meetings with Congressmen when Obamacare was being debated.  Congressmen who were supporters of the bill stumbled and fumbled and hemmed and hawed when asked pointed questions by their Tea Party constituents who knew far more than they did.

When Sarah Palin advised the Tea Party followers not to party yet like it was 1773, the self-styled members of the news media scoffed at her stupidity.  Didn’t she know that the Declaration of Independence was signed in 1776?  In doing so, they only exposed their lack of sophistication and education, apparently not connecting the dots and knowing that the Boston Tea Party took place in 1773, not 1776.  Duh!

In the Tea Party the liberal establishment and their mouthpieces in the news media have more than met their intellectual match. 

The new Tea Party members of Congress (God Bless them!) can’t be bought with earmarks that they helped to abolish.  They can’t be bought with committee assignments which they don’t care about.  They can’t be bought by withholding support for re-election because they don’t care about getting re-elected.  They have a unique concept of being in Congress—they see it as a public service, not a career!

But there’s more reason for the left to hate the Tea Party.

Members of the Tea Party are not only informed and principled.  The Tea Party is made up of millions of Independents who supported Obama the first time he ran for President and millions more of those who sat out the 2008 election because they liked neither Obama nor McCain (Obama light).  In other words, as the results of the 2010 election showed, the Tea Party represents the wave of the future in America.  It means a return to traditional American values, founding principles, and free market solutions to the great Obama recession.

Who are members of the Tea Party?  They are the guy and gal next door, your friends at work, those you see at church, and the folks who work hard for a living.  They are the ones who donate generously to help others, volunteer for local charities, and have good manners.  By and large Americans are kind, good natured, and generous even though that’s not the way they are seen by those on the left.  Tea Party members believe the United States of America is the greatest nation in the history of the world.  They see it as the bastion of hope and freedom for those who will pledge their allegiance and work hard to get ahead.  Tea Party folks believe in the American dream, they believe in God, and they feel responsible for preserving the legacy of freedom and individual responsibility that they inherited from their forefathers.

And, as the polls show, the Tea Party movement is made of folks from all walks of life and all faiths and backgrounds.  They are rich, poor and middle class.  They are brown and black and white and yellow.  They come from Chinese, Italian, German, English, Lebanese, French, Japanese, Mexican, Bolivian and all other backgrounds.  They have PhDs and high school degrees and everything in between.  They live in big cities and little hamlets.  They have many differences, but they have one important thing in common…they love the United States of America.

They don’t want to be ruled by a few men and women who call themselves liberals or progressives who think they know better how we should live than we do.  Tea Party members cherish freedom and justice and they hate slavery.  They act responsibly and expect that their fellow citizens do likewise.  They don’t want their government to tell them how to live, but they would willingly give up their life to preserve the America the Founders strived so hard to create.  In short, they are true American patriots.

The left hates the Tea Party because they fear the Tea Party.  If the truth be told, liberals really don’t believe in free speech, fairness, or anything else that might get in their way of gaining and keeping power.  The Tea Party is a direct threat to the left’s efforts to transform the United States of America into a European Socialist State.  The Tea Party stands in the liberals’ way of making the United States a second rate power.  They seek a nation that is no more prosperous, no better, no more powerful than any other nation on earth.  It is their distorted definition of justice.  Liberals applaud when Obama bows and scrapes before foreign dictators because they honestly believe that our nation is a bad nation.  It is the source of all the problems and injustice and poverty in the world. 

Yes, I admit it is a bizarre view that denies reality, but it is the view of most of those in America who call themselves liberals (or more recently, progressives, as if a skunk would smell any different by a different name).

I’m thankful for the Tea Party.  It represents all that is good and right about America.  It is a movement the Founders of America would have been proud to have been associated with.  It is in the greatest of American traditions and follows in the steps of those who laid the foundation of our republic.

God bless the Tea Party.  God bless the United States of America.

Jobs, Make Believe and America’s Future

Jobs, Make Believe and America’s Future
There’s a wonderful song in the musical Show Boat called “Only Make Believe.”  It’s a romantic song about a man and a woman who meet for the first time and are instantly smitten with each other.  Show Boat, by the way, was considered to be the first musical on Broadway.  It contained wonderful songs by Jerome Kern and paved the way for Rogers and Hammerstein, Lerner and Lowe and many other magical musicals that followed.  Show Boat, financed in part by the legendary Florence Zigfield, ushered in the golden era of Broadway.
  
I thought of that song, “Only Make Believe”, this morning when I was driving to work.  It’s fun to make believe, but when it comes to jobs, playing make believe that government can create jobs is dangerous, especially for the young people in our society who are struggling to establish themselves in these trying economic times. 

How many times have you heard a talking head on TV ask “What is Obama doing to create jobs?”  Or how many times have you heard Obama say, “I am doing my best to create jobs.”  Such nonsense!

Obama and government can’t create jobs, at least jobs that create goods and services.  The only jobs Obama or government can create are jobs that create a drag on the economy.  When they expand government or bail out irresponsibly run state governments, they only kill jobs that create goods and services.  They only drive up the cost of items that you and I need to live our daily lives.

When government restricts exploration and drilling for oil or blocks construction of a pipeline from Canada (as the State Department is now doing) that will supply cheap, abundant oil, they lower your standard of living.  When they subsidize non-marketplace concepts like wind and solar power, they make electricity more expensive and again lower your standard of living.

When Obama expands government and hires tens of thousands of new workers to manage the bureaucracy, they hurt you.  The money these folks are paid comes from the pocket of America’s workers and employers who build refrigerators, iPhones, automobiles, and provide your daily services.  They are a burden to our economy and again lower your standard of living.

Every new dollar in taxation taken by the government, every dollar expended in deficit spending hurts you.  Every regulation that drives up the cost of oil, light bulbs, cars, food, etc. makes your life more challenging and difficult.

As Ronald Reagan famously said, “Government is not the solution, government is the problem.”  Indeed.

Yes, we need infrastructure like highways and courts to handle legal matters and a military to keep our dangerous enemies at bay.  These are all necessary evils, but every dollar we spend, even on these necessary items, represents labor and capital that cannot be spent on improving your personal standard of living.

That’s why there is only one thing government can do to create jobs and get our economy healthy and moving again and that is to GET OUT OF THE WAY.  Government is an obstacle to your personal economic well being.  They take dollars, trillions of them, right out of your pocket. 

The direct result of restraining the exploration, production, and transportation of oil are higher gasoline prices, higher grocery prices, higher cost of clothing, higher cost of building materials, and a higher cost of all services that depend on gasoline or diesel to get to your home or place of business.

Under Obama, the price of gasoline has more than doubled.  That’s just the beginning.  The goal of “Only Make Believe” liberals is to raise the price to more than $8.00 a gallon and force you into small, dangerous cars.

The goal of high housing costs is to force you and your family into a cluster of apartments and condos in big cities.  Their view is that you live too good and because Americans live well, others are poor.  Everything is a zero sum game for liberals.

There is a widespread economic ignorance in America.  Liberals live in “Only Make Believe” land.  Everything is luck or an accident or happenstance.  Individual freedom is overrated and is the cause of hardship for those at the bottom of the economic ladder.  Many liberals are smart, but in their convoluted mind they simply deny reality.  They live in a land of make believe.  They must be very frustrated individuals.

Sadly, they have sold their economic silliness to millions of Americans through the public education system.  Their embrace of government as the solution to all problems makes as much sense as believing in Harvey the rabbit.

And under the leadership of what they have previously characterized as “Perhaps the smartest man to ever be President” they have taken our economy over the cliff, not just driven it into the ditch.  The Revolutionary War was the greatest challenge of our Founders.  Would the war succeed and Americans be free to pursue happiness?  Would they be free of government restraint to succeed or fail as their efforts and the blessings of God allowed?  Would they all be hung on the gallows?  It was a close contest with the outcome in doubt until the end, but the God of our Fathers blessed them with victory, freedom and peace.

Thomas Jefferson reputedly said that slavery was the “fatal flaw” of the Constitution.  Little did he appreciate as the great abolitionist, Frederick Douglass discovered, the United States Constitution held the key to freedom for all Americans, especially those who were enslaved.  Slavery was incompatible with values and principles of individual freedom established in the Constitution.  The continuation of this horrific practice created permanent instability that had to be resolved.  Either the United States would be free or it would be slave.  There was no middle ground.  The Civil War tore apart the nation, putting brother against brother and son against father.  But in the end, Americans came down on the side of freedom for all Americans.  The Civil War was the great challenge of the 1800s.

In the 20th century, dictatorships arose around the globe threatening peace and the advance of freedom.  Hitler in Germany, Stalin in Russia, and Mao in China (early favorites of many liberals, especially the great liberal writer, Walter Lippman) presented direct threats to freedom around the globe and in the United States.  Americans, wisely cautious about unnecessarily entering any military conflict, were finally forced into World War II and provided the tipping point necessary to defeat Hitler.  However, while liberals played make believe that Stalin and Mao were agrarian reformers, conservatives led the battle to defeat the world-wide threat of communism and thanks to Ronald Reagan, they succeeded.

So what are the great threats that you and I and our children will face in the 21st century?  Well, the threat from radical Islam is the most obvious and clearly liberals are not up to the task.  Once again they want to play make believe when it comes to terrorists.  Their muddled thinking keeps them from confronting this great threat.  The second threat to America is the attack from within to undermine traditional American values and the wisdom of the Founders.  This is an immediate threat that must be overcome if America is to survive as the bastion freedom, hope, and opportunity in the world.

The Democratic Party and the national news media have been captured by the radical left.  This is not the party of patriots like Harry Truman and John F. Kennedy, this is a party of men and women who do not like the United States of America.  They are not proud to be Americans.  They only see the failures of America, not its triumphs. 

In their land of make believe, they will destroy everything good about our nation.  They don’t understand freedom and free markets, they sneer at them.  They love more regulations and taxes.  They love power.  They believe they are wiser and smarter than you are.  They confuse intelligence and education with wisdom.
They pose a great threat to America as we have known it.  They would kick away the ladder of opportunity for the ambitions and hardworking poor of America and deny them access to the American dream (which they do not believe in).  They want to punish Americans for living so well and being so prosperous.

They seek a new economic reality of less for all Americans, less jobs, less prosperity, less freedom, less hope for the future.  They have a sad, cruel outlook based on the same sort of utopian make believe philosophy that drives the creation of dictatorships and authoritarian states.  They are more comfortable in the presence of Hugo Chavez and Fidel Castro than they are in the company of hard working, decent, law abiding Americans who love their country.

I feel sorry for them.  They are misguided and confused.  They are off track.  But in 2012, they must be sent down to total defeat through the democratic process of national elections.  Their alien philosophy must be rejected by the American people.  You and I must stand firm and tall, as did those who fought for freedom in the Revolutionary War, the Civil War, World War II, and in the fight to defeat Communism.  Indeed, now is the time for you and I to resolve that we will not stand by idly and let those who do not believe in limited government and freedom destroy this nation for our children and grandchildren.  We must work and donate money as we have never done before to rid our nation of this threat so that our children and grandchildren and those that come after them may enjoy the blessings of freedom as you and I have.  May God bless our efforts.