As we noted, the U.S Social Security system has been sending millions of taxpayer dollars to former Nazis, including death-camp guards and members of the SS. Congress has responded with the No Social Security for Nazis Act. The Social Security Administration has also dished out some $30 million to at least 1,546 dead people, and carried on some of these payments to the dead for 20 years. But while enriching the dead and handing out money to Nazis, the system has been punishing American retirees for the crime of working.
Those who take Social Security at 62 get lower payments not likely to meet their needs. They can still work, but Social Security imposes an income limit of only $15,480. If retirees exceed that amount, the government reduces their benefits $1 for every $2 they earn, a tax of 50 percent. At full retirement age the government lets Social Security recipients earn $41,400, and docks the retirees $1 for every $3 dollars they earn, a tax of 33 percent. After the full retirement age the income limit disappears, but that does not help those who take Social Security at 62 and are trying to survive in a weak economy.
This federal poverty enforcement does not apply to all Americans. Those in the Federal Employees Retirement System (FERS) can retire at the age of 55, a full seven years earlier than Social Security allows. By all indications, they are not subject to income restrictions and the government even helps early federal retirees get more money through a secretive Special Retirement Supplement (SRS) “designed to help bridge the money gap for certain FERS who retire before age 62.” SRS “will supplement your missing Social Security income until you reach age 62.”
For privileged federal workers this is a Dream Act guaranteed to keep the ruling class far ahead of the masses. The double standards do not disturb the Obama administration, which shows no interest in the liberation of American retirees. Meanwhile, Congress is investigating weather Carolyn Colvin, President Obama’s nominee for Social Security boss, directed SS employees to withhold a report about a dysfunctional $300 million computer system for processing disability claims.
Last year, we featured the first of three fun videos put together by BankruptingAmerica, which was inspired by the television comedy The Office. Set in the Department of Every Bureaucratic Transaction (or D.E.B.T.), the videos provide a funny take on how the government’s bureaucrats cope with having to spend every cent they’ve been authorized to spend by law by the end of the federal government’s fiscal year, or else have to have their budget to spend cut in the next year.
Since BankruptingAmerica was still rolling out their web series’ episodes when we introduced it last year, we thought it might be fun to group them all together, starting with revisiting the first episode. Enjoy!
If you think about it, these videos explain quite a lot about how the U.S. government really works....
Seldom does government waste, fraud, and abuse emerge in the kind of three-legged race Americans recently witnessed on C-SPAN as Obamacare architect Jonathan Gruber teamed with Centers for Medicare and Medicaid Services boss Marilyn Tavenner to enlighten congressional watchdogs on the subtleties of Obamacare.
In riveting testimony, Gruber confirmed that Obamacare was sold on a fraudulent basis, so the Congressional Budget Office would not score it as a tax. Gruber recast his statements about stupid and economically ignorant voters as glib comments intended to make himself look smarter. Federal and state governments had paid him millions of taxpayer dollars to fake out politicians and voters, but Gruber, an MIT economist, couldn’t recall the amount he had bagged from taxpayers, not even a ballpark figure. For the Obama administration, that was money well spent, but with Obamacare a complete bust, it all amounts to waste for the American public.
CMS boss Tavenner said it was a “mistake” to inflate the Obamacare numbers by including those on dental plans. She served up boilerplate ad copy to Obamacare acolytes but, like Gruber, she proved agnostic on critical points. She could not say, for example, how many federal workers had signed on. In the hearing, Wyoming Rep. Cynthia Lummis said she and her husband did sign up, but the system then told them they were not covered. Lummis’s husband then skipped a critical test and subsequently died of a heart attack. So Obamacare emerged as potentially fatal abuse, as well as institutionalized waste and fraud.
On many points the criticisms from the oversight committee were detailed and devastating. That is good for viewers but bad for an opaque administration whose media manipulations include the bullying of C-SPAN, as Sharyl Attkisson outlined in Stonewalled. The hearing also exposed ample government incompetence, but Obamacare holds no monopoly on that. As we noted, on Tavenner’s watch CMS has been paying out benefits to dead people.
We’re always on the watch for neat and visual ways to describe the U.S. federal government’s spending and debt problems, which is why we were really impressed by the work that the Heritage Foundation’s Romina Boccia, John Fleming, and Spencer Woody put together to visualize just how much money is involved in human terms. Here’s one example from many:
The really funny thing is that the stack of $308,800 worth of cash representing the amount of U.S. national debt per family would be on top of the median family’s own debts, like for their mortgage ($115,000), student loans ($16,000), credit cards ($2,300), et cetera!
Next week, the Federal Reserve is expected to send a clear signal that it will end its policy of holding short-term U.S. interest rates low sooner rather than later. Here’s coverage from the Wall Street Journal:
Federal Reserve officials are seriously considering an important shift in tone at their policy meeting next week: dropping an assurance that short-term interest rates will stay near zero for a “considerable time” as they look more confidently toward rate increases around the middle of next year.
Senior officials have hinted lately that they’re looking at dropping this closely watched interest-rate signal, which many market participants take as a sign rates won’t go up for at least six months.
“It’s clearer that we’re closer to getting rid of that than we were a few months ago,” Fed Vice Chairman Stanley Fischer said in an interview with The Wall Street Journal last week. New York Fed President William Dudley has avoided using the “considerable time” phrase in recent speeches and instead said the Fed should be “patient” before raising rates.
The Fed has been running simulations on how fast and how much it is likely to increase the U.S. interest rates it controls. The chart below shows the results of their simulations.
In this chart, the green curve for the 2014 simulation, based on the Fed’s most recently run simulations, represents what the Fed today would believe is the most desirable future trajectory for interest rates, which would have interest rates begin rising immediately and very rapidly from near 0% to 4% in the next three years before stabilizing a bit below that level.
However, the blue trajectory for the Fed’s 2012 simulation can be considered to represent the path the Fed will most likely take in hiking interest rates, based on statements made by Fed Chair Janet Yellen and other senior officials. Here, we see interest rates begin rising from near 0% in mid-2015 to a peak near 5% over the next five years before stabilizing.
These interest rates matter for the U.S. national debt because of how it is structured. Over the next five years, over 72% of the public debt that has been issued by the U.S. government will mature and have to be rolled over at much higher interest rates than they are today.
And that means that the portion of the federal government’s annual budget that goes toward paying the net interest on the national debt to the nation’s lenders will increase dramatically if the Fed executes its plan to increase interest rates. The Mercatus Center’s chart below shows how that fits in to the federal government’s projected spending over the next 10 years.
Veronique de Rugy describes the Congressional Budget Office’s projections for the net interest that must be paid on the national debt, and spells out the bottom line:
Spending on net interest payments constitutes the largest single categorical increase. In 2013, interest payments equaled roughly $221 billion. CBO projects that interest payments will steadily grow at an average annual rate of 11 percent to $722 billion by 2024, a 227 percent increase.
These charts show that the federal government will not be able to provide the same level of services without significant reforms to entitlement programs that drive the bulk of spending and compound future interest payments on the federal debt.
And now you know why!
Some taxpayers remain unaware that government-employee unions run the state of California, but the evidence is not hard to find. Sure enough, Joshua Pechthalt, president of the California Federation of Teachers, fired the first salvo to make a temporary tax hike permanent. “Proposition 30 is the best thing to happen to public education and the economy in California in a generation,” the union boss rhapsodizes. Not only is there more money for “public education,” that is, teacher salaries, but “the state economy and budget have improved.” Nobody is fleeing the state, and happy days are here again. “Contrary to the anti-tax and anti-government rhetoric popular in some quarters, Proposition 30 is working, and has provided a road map for other states.” Therefore, “it is imperative that the state Legislature and the governor act to make it permanent.”
Not so fast, responded Jon Coupal of the Howard Jarvis Taxpayers Association: “For those who don’t remember, Proposition 30, titled the Temporary Taxes to Save Education Act, imposed the highest income tax rate in America. It also bumped up the sales tax—a tax that hits the lower and middle classes particularly hard—to tops in the nation.” California’s unemployment rate is “third-highest in the nation,” its supplemental poverty ranking is the “worst in the country,” and statistics show that “upper income individuals are fleeing the state in response to high taxes.” And as Coupal notes, nobody know how many stuck around on the grounds that the temporary tax hikes would expire. Coupal also finds “compelling evidence that California today would be enjoying a bigger slice of the national economic recovery had we not passed Proposition 30 at all.”
This all makes sense, but the surge for permanence has precedent. In the 1970s, Californians voted for a temporary Coastal Commission. Under governor Jerry Brown, legislators quickly made it permanent. Current governor Jerry Brown recently signed legislation that gives the powerful, unelected Commission the power to bypass the courts and impose fines directly.
Taxpayers will find the same ruling-class ruse at work with Proposition 30. Pechthalt wants the governor and legislators to make the call, not the voters. They might vote down permanent higher taxes, as they did with Proposition 13, and the ruling class won’t stand for that. So Jerry Brown and the new crop of legislators will likely take their marching orders from a union boss, not the people.
As we have noted, Covered California is the Golden State’s wholly owned subsidiary of Obamacare and similarly dysfunctional, insecure, and wasteful. Even so, some people managed to sign up, the largest group ages 55 to 64. Now, according to Emily Bazar of the Center for Health Reporting, many are finding it impossible to leave. Enrollees secured the tax credits available under Covered California, but when they turn 65 and go on Medicare they become ineligible for those same tax credits. As Bazar explains, “you will owe money to the government if you keep getting the credits after Medicare begins.” That could be $1,000 a month.
Bazar advised people to cancel their Covered California plan. Unfortunately, she explains, “I’ve heard from Californians and insurance agents across the state who have tried mightily—and failed—to do just that. Instead, their premiums just keep on coming.” One reader had been trying since August and says “This is a NIGHTMARE!” One insurance agent found that “terminating coverage with Covered California has proven impossible.”
Bazar learned that Covered California controls eligibility and cancellation of its health plans, “which means plans must wait for direction from the agency before terminating coverage.” They have not done so, likely because that would lower the numbers of people Covered California can claim are enrolled. People can simply stop paying their premiums, but they still face a “grace period” of 90 days, and that method of cancellation reflects badly on the individuals themselves.
Covered California blames a “programming problem” with the agency’s troubled $454 million computer system. So it’s all just another glitch. Those wishing to cancel should contact Covered California. “How helpful,” says Bazar, “That’s exactly what these consumers tried to do.” So here’s the deal.
Those consumers couldn’t keep the plans they like before Obamacare. Now they have to keep the Covered California plan they don’t like and need to cancel. A statist scheme stripped individuals of their freedom to choose, so no surprise that it should throw up a Berlin Wall to keep those people captive. Doubtless, it will soon be leaving sick people to get well on their own or just drop dead.
The U.S. Postal Service has been in increasingly severe fiscal trouble for years. With Americans increasingly turning to electronic communication services, and despite postage prices that have risen at double the rate of inflation since the end of World War I, the U.S. Postal Service (USPS) is increasingly finding it difficult to remain financially viable.
So, in an apparent effort to make itself technologically relevant, the USPS has developed an augmented reality app for smartphones. Popular Mechanics‘ Carl Franzen explains how the Post Office is hoping its new app will convince today’s smartphone users to visit any of the USPS’ 156,000 mail collection boxes:
I found a surprise when I checked my mailbox today (for the first time in at least a week): a pamphlet from the US Postal Service advertising various holiday services, among them a free new augmented reality app for iPhone and Android. The acronym-heavy USPS AR app, released earlier this week, is supposed to let you scan any of the USPS’s iconic blue collection boxes in your neighborhoods using your smartphone’s camera. The app should then display holiday-themed “tips, tricks and entertainment” on top of the mailbox in your smartphone’s camera view.
It’s a simple demonstration of augmented reality’s potential: layering digital information over real-world objects in ways that add context or provide richer experiences. But to keep itself relevant in the digital age, the USPS needed to go further than this first attempt, which is little more than a greeting card.
If that sounds pretty useless, that’s because it is. There’s even a video of the app in action:
With execution like that, is it any wonder that the U.S. Postal Service has cost U.S. taxpayers over $47 billion since June 2006, the last time it operated in the black for more than a single quarter? And even then, only after hiking postage rates?
This column has provided much evidence that government has institutionalized waste, fraud and abuse. None is more chilling than what former CBS television journalist Sharyl Attkisson describes in her new book, Stonewalled: My Fight for Truth Against the Forces of Obstruction, Intimidation, and Harassment in Obama’s Washington. Unlike most of what emerges from the old-line establishment media, her reports on the Benghazi scandal were at odds with Obama administration propaganda that a video caused the death of four Americans, including ambassador Christopher Stephens.
Attkisson describes writing on her computer when it is suddenly taken over and material starts to disappear. She has the presence of mind to grab her phone and take a video. Experts conclude that her computer has been infiltrated by means of spyware proprietary to government agencies such as the CIA, FBI and NSA, now conducting surveillance against all Americans. She also finds the intruders planted classified information on her computer. That adds “the possible threat of criminal prosecution” to the author’s list of delay, denial, obstruction, intimidation, retaliation, bullying, and surveillance from the government. The supposedly transparent Obama administration has transformed U.S. intelligence and law enforcement agencies into a Stasi deployed against Americans. The author notes that federal snoops knew about the Boston Marathon bombers but did nothing. But when it comes to a persistent journalist, they take action to intimidate and silence.
Stonewalled also notes the waste from the government public-relations hacks who “thinks they personally own your tax dollars.” She finds teams of “taxpayer funded media and communications specialist” including 1200 at the USDA. A White House hack named Dag Vega even tries to strong-arm C-SPAN. For their part, the old-line media tend to believe that government is always benevolent, and they tend to recycle what the government hands them on everything from “Fast and Furious” to Obamacare. As the author notes, CBS removed from her story the information that HUD’s own inspector general had found $3.5 billion in waste and fraud at the federal agency in a single year. CBS bosses also deleted a fraud case in the same story. Attkisson doesn’t work at CBS any more, and the nation is much better off as a result.
We had projected that it would be around December 9 when the total public debt outstanding of the U.S. government would reach $18 trillion.
We were wrong. It reached that number eight days early. ZeroHedge marks the infamous occasion:
Last week, total US debt was a meager $17,963,753,617,957.26. Two days later, as updated today, on Black Friday, total outstanding US public debt just hit a new historic level which probably would be better associated with a red color: as of the last work day of November, total US public debt just surpassed $18 trillion for the first time, or $18,005,549,328,561.45 to be precise, of which debt held by the public rose to $12,922,681,725,432.94, an increase of $32 billion in one day.
It also means that total US debt to nominal GDP as of Sept 30, which was $17.555 trillion, is now 103%. Keep in mind this GDP number was artificially increased by about half a trillion dollars a year ago thanks to the “benefit” of R&D and intangibles. Without said definitional change, debt/GDP would now be about 106%.
It also means that total US debt has increased by 70% under Obama, from $10.625 trillion on January 21, 2009 to $18.005 trillion most recently.
You can keep track of how much the national debt grows each day at the U.S. Treasury Department’s Debt to the Penny website.