Social Security is a Ponzi scam
He explain how Social Security is a Ponzi scheme and old people are cashing in. "In the retirement villages of Florida and Arizona, few residents could afford to have retired as early as they did, or to shop and travel as they do, without being able to rely on Social Security, Medicare, and other entitlements as a financial base." These monies are windfall profits paid for by future generations. "When speaking among themselves, politicians often refer to Social Security, for example, as the third rail of American politics: 'Touch it,' they say, 'and you die.' Tampering with the home mortgage deduction is equally, if not more, politically incorrect."
"Behind all the political sloganeering in support of entitlements lurks a darker reality -- one that most Americans privately suspect but still often want to deny. It's that middle-class America's binge on entitlements is as unsustainable as a welfare mother's crack habit. While Newt Gingrich has been busy trying to reinvent the orphanage, another Victorian idea is in even greater need of rehabilitation: middle-class thrift and self-reliance."
Once again the most perceptive critics of society are turning toward the values that were good in the nineteenth century and the twentieth has thrown out. He writes, "Thrift. In the 1870s, that most eminent Victorian and popular moralist Samuel Smiles became famous for his lively defense of what was then the orthodoxy of the striving middle-classes in both Europe and America. 'It is the savings of the individual which compose the wealth -- in other words, the well-being of every nation,' Smiles asserted in his relentless volume, simply entitled Thrift. 'On the other hand, it is the wastefulness of individuals that occasions the impoverishment of states. So it is that every thrifty person may be regarded as a public benefactor, and every thriftless person as a public enemy.' For Smiles, as for most other Americans of his era, individual thrift was not only a virtue in itself. Its widespread practice was considered a requisite of civilization and nation building. Americans who hope to attain or maintain middle-class status in the next century will have to adopt a similar thrift ethic."
He says that when the welfare state collapses people are going to "become more reliant on family ties" and return to being extended families. "The elderly will need the support of their adult children much more than they do today, and will find themselves in much greater need of maintaining proximity and usefulness to their adult children."
He says that Americans have to restore the work ethic. Life spans have increased and the age of retirement has decreased "leaving American workers free from labor for up to 30 percent to 40 percent of their adult life spans." He says the middle-class will be "forced to become more self-reliant" and "change their view of the proper relationship between government and the individual." People have to stop thinking they are victims. "Beginning in the last century, farmers saw themselves as victims of an industrial economy in which farm prices lagged behind rises in the cost of living, and so argued that they were entitled to crop subsidies. Senior citizens, particularly in the 1970s, saw themselves as victims of inflation and of a youth culture that denied their generational achievements, and so believed were entitled to generous Social Security pensions. Today beneficiaries of the home mortgage deduction claim they are owed this tax subsidy because they bought their homes on the assumption that it would always be available. And so it goes."
"As we shall see in this book, traces of the attitude can be found as far back as the days of Valley Forge, when General Washington's officers threatened to desert him if he didn't grant them half-pay pensions for life. The difference today is that ordinary citizens have developed a righteous sense of entitlement without ever having marched barefoot through the snow for their country. The process of corruption was so subtle and gradual that hardly anyone noticed it was occurring. Today understanding how and why the middle class became addicted to entitlements is essential to understanding our present predicament and what it will take to survive its consequences in the future."
Like this book, the author sees that America needs to restore the good values of the past that this century has thrown out. He writes, "It was a harsh code, but the bourgeoisie of the nineteenth and early twentieth centuries were convinced (correctly, it turned out, in the long run) that American greatness depended at the very least on middle- and working-class Americans not accepting benefits they had not earned." The turning point was the passage of the Social Security Act in 1935. He goes on to tell the story of how Senator Carl Curtis of Nebraska fought it, but everyone liked it including President Eisenhower. Senator Curtis spent 40 years in the senate and supported Father on his Watergate statement and represented America on Father's 60th birthday celebration in Korea and gave him a gift. Everyone saw Social Security as insurance when it was really a scam. He writes, "Both the politicians and the people had come to love this wonderful, seemingly harmless high provided by getting something for nothing." I don't have time to go into all the details he gives on the entitlements. His chapter called "Subsidizing Suburbia" on the home mortgage deduction is something no one thinks about. He says that the average person gets housing aid directly and indirectly and "his dependency on government can objectively rival that of many welfare mothers. And in many ways, the results of such an addiction are no less harmful."
Entitlements "erodes the bourgeois spirit in American life, creating in its place a mass of dependents who look to politicians to fulfill their expectations of the good life .... A nation saving less than 1 percent of its income, as the United States currently does, cannot expect to realize rapid increases in productivity. Moreover, if we have learned anything as a society in the last thirty years, it is that affluence is not automatic and that growth of the economy does not necessarily eliminate growth of the underclass, the national debt, or other compounding claims on the next generation's wealth."
"The ultimate solution to the crisis of the U.S. welfare state will be a cultural revolution among the American middle class that will elevate the prestige of such bourgeois values as thrift, work, and family .... Americans will have to rediscover the values that propelled the United States as an industrial power in the last century: they will have to reinvent themselves as sturdy, independent, and thrifty bourgeoisie."
"So pervasive has our debt-driven consumer culture become that it is next to impossible for any individual to see it for the dangerous addiction it is .... Why is the current culture unable to rediscover or reinvent the thrift ethos it so desperately needs to restore long-term prosperity? One reason is that thrift still has no champions." Unfortunately, he goes off the deep end and pushes for "the federal government" to "undertake a public education program about the importance of saving, similar in scope to the campaigns it has launched against smoking." He goes on to say the government should even force people to save as the Japanese government has done. He says many countries have "mandatory savings plans." You know where I stand about government. It's none of their business. He is not looking deeply enough at how to get people to do right. You do not do it with a gun to their head. He says, "Without coercion, tens of millions of Americans will fail to save adequately to finance their old age or prepare for other life contingencies." He's wrong. It would only make people less responsible.
He correctly says at the end of his book, "The demise of the middle-class welfare state will also foster another cultural change many Americans today say they yearn for: stronger families. In a world without Social Security and other middle-class subsidy programs, more and more stigma will attach to divorce, just as in Victorian times, because of the huge financial risks it will pose to all involved. Similarly, middle-class parents will once again have an extra and all-important incentive to invest their time, money and energy in the well-being of their children: they will need their children's gratitude and support in old age. For many Americans, saving up enough to be protected against all potential financial threats will be impossible. Thus, Americans will have more reason than ever to build strong family relationships and other mutual aid networks, just as pioneers on the prairie did. And like those pioneers, we will all be able to take pride in our independence from distant governments." He says "the pain of withdrawal will be excruciating, but every generation has its challenges." He says "we are all the beneficiaries of that discipline [thrift and industry] practiced by previous generations; our only burden is now to take up the same torch and to carry it into the twenty-first century."
The 19th century believed in individuals and communities taking responsibility for their lives. The 20th century believes that elites living thousands of miles away should guide them. The 19th century focused on the private, the intimate, the personal. The 20th century focus on the public, the bureaucracy, the impersonal. Father is into the 19th century, America is into the 20th. He is for decentralization; America is into centralization.
The Third Blessing is dominion over creation. In the ideal world everyone has adequate food, clothing and shelter. Satan works very hard to create a world where people live in hunger, rags and shacks. For decades an average of 40,000 children die of hunger and disease every single day. In America, millions of pets are fed better than millions of people in poor countries. The question is how do we organize the world so everyone and every pet eats good food every day forever. Father says he wants to end world hunger by having everyone live in international communities. I'll discuss some ideas on communities in chapter nine. The question is what is the blueprint for communities and nations.
Father is for capitalism. Don't believe me? Answer these questions. Is Father for entrepreneurs and decentralization, or is he for elites planning everyone's lives at headquarters? Let me say it another way. Is he for public schools or private schools? Let me say it in still another way. Is he most interested in what goes on in the grass roots little governments of people's homes where he says the man is the president, or is he more interested in bureaucratic big government playing Big Brother or Big Daddy?
Father has consistently been for decentralization. The core difference between capitalism and socialism is that capitalism is decentralized and socialism is centralized. Those who hate capitalism teach Satan's lie that capitalism is centralized because a few greedy billionaires take money from the poor and then go eat caviar on their yachts. Socialists, who think they are more sensitive, idealistic and spiritual, say the materialistic capitalists creates inequality and teach that we must force the rich to give to the poor. They are robin hoods fighting the evil rich in their lavish castles.
The problem gets down to the word "equality." Communists, socialists and feminists are obsessed with this word. They see capitalism as too messy, too dirty, too competitive. Competition disgusts them. They want gentle, warm, gooey cooperation. Capitalism scares them. It is too rough and tumble. It is too full of surprises. Socialists are neat freaks. They want everything to be in its place and predictable. They see most people as stupid and selfish and therefore in need of their wise guidance.
Father is spending billions helping those who are for decentralized economics and politics. And he wants to see the world organized into communities where people help each other locally. At one of his science conferences, Father gave Nobel prize winner of economics, Friedreich von Hayek, a check for $50,000. Hayek is one of my heros. I've been reading him for fifteen years now. I love this champion of capitalism and this great fighter of socialism.
Capitalism: the Unknown Ideal
Ayn Rand named a book Capitalism: the Unknown Ideal. She meant laissez-faire capitalism, not the mixed economy we have now. Capitalism is truly an unknown ideal to most people. Capitalism has been unjustly criticized for over a hundred years. Lately, there is beginning to be a turn around in the academic community toward appreciating it. Arthur Seldon's book Capitalism goes into this.
Hayek writes eloquently that this should be a treasured belief. Murray Rothbard writes, "Hayek has written that one of the great attractions of socialism has always been the continuing stress on its 'ideal' goal." Hayek writes, "We must make the building of a free society once more an intellectual adventure, a deed of courage. What we lack is a liberal Utopia (by liberal, Hayek is using the 19th century word for free enterprise)...a truly liberal radicalism...which is not too severely practical and which does not confine itself to what appears today as politically possible. We need intellectual leaders who are prepared to resist the blandishments of power and influence and who are willing to work for an ideal, however small may be the prospects of its early realization. They must be men who are willing to stick to principles and to fight for their full realization, however remote...Free trade and freedom of opportunity are ideals which still may rouse the imaginations of large numbers, but a mere 'reasonable freedom of trade' or a mere 'relaxation of controls' is neither intellectually respectable nor likely to inspire any enthusiasm. The main lesson which the true liberal must learn from the success of the socialists is that it was their courage to be Utopian which gained them the support of the intellectuals and thereby an influence on public opinion which is daily making possible what only recently seemed utterly remote."
Marx's written goal came true
When Marx wrote in The Communist Manifesto his goals, who would have thought they would have come true in America. He wrote the goal for substituting home school for public school. And 100 years later America does exactly what he wants. What was considered dangerously socialistic became years later"mainstream." He was crystal clear in his goals. Christians were vague. Socialists are dedicated and keep pushing their agenda and everyone gets tired of saying no and just gives in. Senator Rudman left the U.S. Senate after 12 years and wrote a book saying that if could do it over again he would have stood against his party and President Reagan when they increased the national debt. He is right that we must stand up for principles instead of just going along.
Hayek is right in that we must fight as the socialists fight for their beliefs. They are long range and chip away until they win. God's side is in a fog and thinks there is some truth to what they say and progressively accept their ideology. It's the story of the frog getting boiled and not knowing it until it is too late. Hayek is doing his best to teach America and the world the evil of socialism and few listen. Even conservatives will look at him and say he's too "extreme". Milton Friedman is respected in the Republican Party, but he is labeled "extreme". The UC is "extreme" in teaching an ideal world. We should be teaching "extreme" libertarian economics and not letting up till we win. Hayek says, "Unless we can make the philosophic foundations of a free society once more a living intellectual issue, and its implementation a task which challenges the ingenuity and imagination of our liveliest minds, the prospects of freedom are indeed dark. But if we can regain that belief in the power of ideas which was the mark of liberalism at its best, the battle is not lost."