Who voted for this?

To the Editors:

After six years of increasingly disastrous war in Iraq, American voters felt ready for change and hoped for the war’s end – these sentiments created space for Obama and led to his election. But with Congress voting recently to spend $96 billion taxpayer dollars on increasing war in Afghanistan, for a political, economic and diplomatic quagmire, they’re right back in the Bush era with an administration rushing into billions spent on failed policies.

To no surprise, disapproval ratings for military efforts in Afghanistan are rapidly rising: in a USA TODAY/Gallup Poll earlier this spring, 42 percent of respondents said the United States made “a mistake” in sending military forces to Afghanistan, up from 30 percent in February. Seven years ago, 6 percent of respondents called the war “a mistake.”

Many members of Congress and military authorities disapprove too, and have urged much-needed additional time to debate Afghan strategy before voting on the supplemental. The Congressional Progressive Caucus, through a series of hearings of the past several weeks with U.S., Afghan and Pakistan military advisers, concluded that the supplemental “exacerbates” failed strategies by funding predominately the military ($84 billion) with only $10 billion for economic development, institution building, local community funding and skills training. Gen. Petraeus’ has outlined a counter-insurgency doctrine of 80 percent non-military and 20 percent military, and told the Associated Press earlier this year that “you don’t kill or capture your way out of an industrial-strength insurgency.”

Obama announced in February his increased support for regional diplomacy and economic aid to Pakistan and Afghanistan – those must become the cornerstones of U.S. policy there, to support national Afghan institutions, development of local markets, the creation of job and job-assistance programs, and rebuilding of infrastructure. They signal change, progress and hope, just what Americans still want.

– Ron Speegle, via e-mail

Social insecurity

Dear Editors,

Bernard Madoff, the “investor” responsible for bilking thousands of people out of approximately $65 billion over a period of 20 years, won’t be living large off other people’s earnings anytime soon: “The disgraced financier blamed for what is believed to be the largest Ponzi scheme in history arrived Tues., July 14, at a federal prison in North Carolina to begin a 150-year sentence in a cell with two bunk beds, a toilet and a sink.” (Martha Waggoner, Associated Press.)

Charles Ponzi, for those who don’t know, was an Italian-born immigrant who managed, through an arbitrage scheme involving the supposed redemption of postal international reply coupons (IRCs), to hustle thousands of investors out of several million dollars. Based in Boston by the late 19-teens, Ponzi promised 50 percent payoffs on investments in 45 days or 100 percent returns in 90 days.

Never actually investing the monies he received, however, his payoffs were made possible solely by the infusion of cash from new dupes being sucked into the con. By August of 1920, with the Boston Post and Massachusetts state officials hot on his heels, his racket finally collapsed: six Boston banks bit the dust as a result, and his investors were lucky to get 30 cents on the dollar. Ponzi himself eventually served seven years in the Massachusetts state penitentiary, and any such kind of pyramid-style hoax has been called a “Ponzi scheme” ever since.

Madoff and his hedge-fund hustling, of course, make Ponzi’s IRC hanky-panky look like the work of a two-bit piker, even after adjusting for inflation. If you buy into the bilge about Madoff being the architect of the “largest Ponzi scheme in history,” however, you are seriously mistaken. Another Ponzi scheme is being run on the citizens of this country that absolutely dwarfs Madoff’s shenanigans: Social Security.

One of the biggest myths in the United States today is that Social Security functions as a “trust fund” or “retirement plan.” Sorry, that is a misnomer at best: trust funds and retirement plans involve the investment of capital for profit, and Social Security does no such thing. Like any other Ponzi scheme, it is made possible solely by the infusion of cash from new dupes being sucked into the con, euphemistically known as the “pay-as-you-go” system.

As William Shipman notes: “In common usage, a trust fund is an estate of money and securities held in trust for its beneficiaries. The Social Security Trust Fund is quite different. It is an accounting of the difference between tax and benefit flows. When taxes exceed benefits, the federal government lends itself the excess in return for an interest-paying bond, an IOU that it issues to itself. The government then spends its new funds on unrelated projects such as bridge repairs, defense or food stamps. The funds are not invested for the benefit of present or future retirees.” (“Retiring With Dignity: Social Security Vs. Private Markets,” Cato Institute, 1995.)

And, as the pyramid grows ever taller and wider with thanks to the aging Baby Boomer population, the “pay” part of that formula experiences a sharp increase as well: the original Social Security tax of 1935, at 2 percent, has now mushroomed to 12.4 percent. What “service” are we receiving for our “investment?”

According to the Social Security Administration’s own calculator, an individual born in 1984, 25 years old this year, who makes $50,000 per year and retires at age 65 in 2049, can expect to receive a whopping $1,529 per month (today’s dollars).

What would that yield be on a true investment? That same 12.4 percent of $50,000 ($6,200), compounded yearly at 8 percent for 40 years, generates a retirement amount of $1.73 million. Still think you’re getting value for your money?

The Social Security pyramid scheme, however, enjoys a couple of major advantages that neither Ponzi nor Madoff had available to them: while those scammers had to rely on their abilities to sweet-talk their marks into voluntarily handing over their

Both Ponzi and Madoff would have dreamed of such a guarantee of income. Could you imagine the hue and cry you’d be hearing if either of them had been able to pull it off? At the Social Security Administration, however, it is “business” as usual.

– Bradley Harrington, via e-mail

County Road Meditation

The dog and I head north

Down to the mailbox.

Sunshine, the clover in flower

Humming with bees,

A meadowlark on the naked clothesline

Singing its mating trill,

Just a whisper of a cloud in the blue,

And just then, I was thinking about how it all could be.

Each soul finding something to do that is kind,

That is helpful,

Selfless,

For a fellow human being, a stranger or nature.

Just one beatitude manifested.

Imagine the changes that could occur.

Love is the fulcrum that balances the journey

Between birth and death.  

It has always been that way.

It is the same love a dog has for its owner,

A bee for the clover,

A bird for the breeze,

And a person for his better nature.

– Burt Baldwin, Ignacio