I received a respectful email from a reader who asked about Washington’s response to the fiscal cliff:
With all this talk of going off the cliff and how not to…
Why is it that instead of spending billions of dollars for bailouts and giving billions to other countries…wouldn’t it be [better] to start bailing out Medicare and Social Security first?…
We the working class contributed to [them]. Once they get [our] money back into [them] they can figure out how to adjust it for the future [and] not penalize everyone [by hiking] the age to collect?…
Thanks for reading this even if you don’t answer.
I wrote her back that I would respond here, and now I’m stuck! How do I tackle this in such a short space (I try to limit my comments to 300 or so words – more than that, I’ve found, and people will move on)?
I have a few thoughts. First, the bailouts went to the banks and financial institutions because they are more important to the elite than Social Security and Medicare. They dare not let their precious money center banks fail. That’s the primary goal of the Federal Reserve, to protect bankers from the consequences of their bad behavior.
Secondly, you’re right that Washington has borrowed your money from your Social Security account and spent it elsewhere. What’s left is a pile of IOUs that will have to be redeemed by the government in the future. In fact, since Social Security is already in deficit, the government is being forced to redeem some of them right now just to keep making payments to current Social Security beneficiaries. But, as Harry Reid says, there’s a huge pile of those IOUs still in the account so we won’t have to worry about running out of them for many years!
Thirdly, I think you’re asking about priorities and how one would spend the government’s revenues in a sane and sensible world? Given that we don’t have such a world, then we can only dream of what things would look like if we did.
For one brief shining moment, the world was reasonably sane and sensible, the time that would allow the miraculous creation of the Declaration of Independence, to wit:
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are Life, Liberty, and the Pursuit of Happiness – that to secure these rights, governments are instituted among men…
From there the founders created the Constitution which attempted (and succeeded, for a while) to secure those rights by limiting severely the power of the national government to a few enumerated ones.
Here’s the bad news: none of those limited enumerated powers included Social Security or Medicare or bailouts or the Federal Reserve. These are all manifestations of ignoring the Constitution and its limitations by insiders who now use the national government to promote their own ends which, sadly, are vastly different from making sure that Social Security and Medicare is solvent.
I don’t know if this helps. I hope so. In order to restore sanity we must go back to binding down the government from mischief by rebuilding the chains of the Constitution. That’s where the effort begins.
I’m way over my limit. Thanks for writing.
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