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(One might think that letter writer Julie Quenemoen would think twice before debating economics with a CPA. But no, she dives right in without knowing if there are rocks below the surface. It wouldn't so bad if she entered the fray with something more than leftist talking points, but that's all she has to offer.
Frankly, I am embarrassed for her. First, Mr. Balyeat's column:
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Guest Column: Trick or treat: The $142 trillion-pound monster is back from the grave
Joe Balyeat, Guest Columnist The Bozeman Daily ChroniclePosted: Monday, September 30, 2013 12:15 am
Guest Column: Trick or treat: The $142 trillion-pound monster is back from the grave
As Halloween approaches, an old familiar monster rises from the grave like Freddy Krueger in “Nightmare on Elm Street.” But, unlike the famous fictional character, this beast is real and threatens to choke off our children's future, consigning our great grandchildren to lifetimes of bondage. The $142 trillion-pound monster in the room is America's mushrooming national debt, and the October surprise is that Congress must once again raise the debt limit only 6 months after raising it to $17.3 trillion.
Consider these alarming facts: the $17.3 trillion national debt employs Enron-style accounting and ignores government's major unfunded liabilities including Social Security, Medicare, and government pensions. As a practicing CPA, I assure you that private sector companies would be forced to include these obligations on their balance sheets. So, the true national debt including unfunded liabilities is really $142 trillion. $142 trillion divided amongst every single taxpayer in America is $1.25 million dollars each. If you thought your family was debt-free… surprise! You really owe $1.25 million for every taxpayer in your household.
As your young son or daughter enters the workforce, excited to start building their nest-egg, they're not starting from ground zero; they're starting with a 1,250,000-pound weight about their neck – an enormous burden dragging down America's economy and our children's future. Sadly, our generation elected spineless politicians who simply didn't have the backbone to say no to wasteful, excessive government spending.
On the bright side, Montana Rep. Steve Daines is co-sponsoring HJR 62, the “Stability, Security, and Fairness Resolution,” which would continue federal spending at current lower, sequestration levels and delay Obamacare (with its $1.8 trillion price tag) for one year. But HJR 62's chance of passing is below 50 percent, as our elected officials are by-and-large still asleep during this living nightmare. According to OECD data, America's deficit to GDP ratio was second worst worldwide in 2010 and 2011 and fourth worst in 2012. The World Economic Forum also ranked America's debt to GDP ratio as 140th out of 144 nations, fifth worst in the entire world!
Prior to 2009, historically 17 percent of federal government spending was deficit spending. Since 2009, a whopping 53 percent of government spending is now debt-financed deficit spending. The $3.5 trillion spent annually is almost $28,000/yr for every household in America. Is all this spending necessary, or have zombie-like politicians simply become so dollar-drunk and power-mesmerized that they've lost all self-control?
Consider these boondoggles:
$376 million in White House renovations, including construction of a temporary pseudo Oval Office for the president to use only temporarily while the regular Oval Office is being renovated.
U.S. Navy spent $681,387 on one “scientific” study confirming that men look taller, stronger, and manlier when carrying a firearm, $300,000 to conclude the first bird on earth was probably black-feathered, and almost a half-million to determine that unintelligent robots can't hold a baby's attention.
$188 million wasted by the TSA on 5,700 pieces of security equipment sitting unused in storage.
The IRS spent $4.1 Million on an extravagant conference for 2,600 IRS employees, including $50,000 for line-dancing and Star Trek parody videos, $135,350 for outside speakers, $64,000 in conference “swag” for the employees, free meals, cocktails, and hotel suite upgrades… Meanwhile, IRS discriminates against tea party groups that oppose this wasteful spending.
Is profligate spending by “Washington Gone Wild” enough to tank history's greatest economic engine – the American economy? Consider this: In roughly the same time period in which politicians ramped up deficit spending to more than half of the federal budget from 2008 to 2012, the median household income in America dropped 8.1 percent. That's $4,400 less income per household annually. In that same timespan, a 21 percent increase in number of Americans in poverty, a 70 percent increase in number of people on food stamps, and the median net worth of American families plunged 39 percent.
It's time America wakes up and realizes that excessive, wasteful government spending is seriously deteriorating our future economic stability. Stand up for our grandchildren's future; petition Washington for real spending cuts now that will eventually balance the federal budget.
Joe Balyeat is former chairman of the Montana Senate Business, Labor, and Economic Affairs Committee. He is the state Director for Americans For Prosperity-Montana.
The IRS spent $4.1 Million on an extravagant conference for 2,600 IRS employees, including $50,000 for line-dancing and Star Trek parody videos, $135,350 for outside speakers, $64,000 in conference “swag” for the employees, free meals, cocktails, and hotel suite upgrades… Meanwhile, IRS discriminates against tea party groups that oppose this wasteful spending.
Is profligate spending by “Washington Gone Wild” enough to tank history's greatest economic engine – the American economy? Consider this: In roughly the same time period in which politicians ramped up deficit spending to more than half of the federal budget from 2008 to 2012, the median household income in America dropped 8.1 percent. That's $4,400 less income per household annually. In that same timespan, a 21 percent increase in number of Americans in poverty, a 70 percent increase in number of people on food stamps, and the median net worth of American families plunged 39 percent.
It's time America wakes up and realizes that excessive, wasteful government spending is seriously deteriorating our future economic stability. Stand up for our grandchildren's future; petition Washington for real spending cuts now that will eventually balance the federal budget.
Joe Balyeat is former chairman of the Montana Senate Business, Labor, and Economic Affairs Committee. He is the state Director for Americans For Prosperity-Montana.
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Next, Julie Quenemoen's letter: In a recent op-ed, former state Sen. Joe Balyeat told us that what we should be frightened of this Halloween are unfunded liabilities like Social Security and Medicare. Really?
If he is, as he states, an award-winning CPA, he should know that Social Security and Medicare are not unfunded. (She can shout at the moon all day long about this, but simply saying it does not mean it is so. Here's where she goes astray. The Social Security Trust Fund is the receptacle for all revenues received. The government makes payment for all benefits, and the balance represents the "surplus."
If he is, as he states, an award-winning CPA, he should know that Social Security and Medicare are not unfunded. (She can shout at the moon all day long about this, but simply saying it does not mean it is so. Here's where she goes astray. The Social Security Trust Fund is the receptacle for all revenues received. The government makes payment for all benefits, and the balance represents the "surplus."
The surplus is used to purchase special Treasury Bonds that only the Treasury can redeem, and only the Trust Fund can purchase. A bond is a debt instrument. The Trust Fund gives money to the Treasury, and the Treasury issues bonds which are deposited into the Trust fund as an asset. The Treasury promises to pay it back plus interest. Therefore, the assets of the Trust Fund are nothing more than IOUs. There is no cash in the Fund.)
I paid in for many years with every single one of my paychecks. (Again, I am embarrassed for Ms. Quenemoen. She really believes that because money was taken out of her paychecks, somehow it means that money is sitting there somewhere waiting for her. This is simply not the case. She has no contractual right to "her" funds. In Fleming vs. Nestor, the Supreme Court specifically ruled this. From the decision: "TO ENGRAFT UPON THE SOCIAL SECURITY SYSTEM A CONCEPT OF "ACCRUED PROPERTY RIGHTS" WOULD DEPRIVE IT OF THE FLEXIBILITY AND BOLDNESS IN ADJUSTMENT TO EVER-CHANGING CONDITIONS WHICH IT DEMANDS AND WHICH CONGRESS PROBABLY HAD IN MIND WHEN IT EXPRESSLY RESERVED THE RIGHT TO ALTER, AMEND OR REPEAL ANY PROVISION OF THE ACT." So because Congress can decrease, discontinue, or increase benefits, the Court held that that no one has a right to benefits. Including Ms. Quenemoen.)
And, Social Security isn’t part of the federal budget, so why is it even a topic of discussion? (It appears that Ms. Quenemoen really believes that these budgetary and financing tricks are legitimate. As described above, the contents of the Trust Fund are removed, with IOUs being substituted. The proceeds are added to the General Fund and spent. Therefore, S.S. is most definitely part of the federal budget in the sense that when the bonds have to be repaid, the source of that money will be the federal budget. That is, you and me. We pay for it once when it's taken from our paychecks, and will pay for it again via taxes.)
I paid in for many years with every single one of my paychecks. (Again, I am embarrassed for Ms. Quenemoen. She really believes that because money was taken out of her paychecks, somehow it means that money is sitting there somewhere waiting for her. This is simply not the case. She has no contractual right to "her" funds. In Fleming vs. Nestor, the Supreme Court specifically ruled this. From the decision: "TO ENGRAFT UPON THE SOCIAL SECURITY SYSTEM A CONCEPT OF "ACCRUED PROPERTY RIGHTS" WOULD DEPRIVE IT OF THE FLEXIBILITY AND BOLDNESS IN ADJUSTMENT TO EVER-CHANGING CONDITIONS WHICH IT DEMANDS AND WHICH CONGRESS PROBABLY HAD IN MIND WHEN IT EXPRESSLY RESERVED THE RIGHT TO ALTER, AMEND OR REPEAL ANY PROVISION OF THE ACT." So because Congress can decrease, discontinue, or increase benefits, the Court held that that no one has a right to benefits. Including Ms. Quenemoen.)
And, Social Security isn’t part of the federal budget, so why is it even a topic of discussion? (It appears that Ms. Quenemoen really believes that these budgetary and financing tricks are legitimate. As described above, the contents of the Trust Fund are removed, with IOUs being substituted. The proceeds are added to the General Fund and spent. Therefore, S.S. is most definitely part of the federal budget in the sense that when the bonds have to be repaid, the source of that money will be the federal budget. That is, you and me. We pay for it once when it's taken from our paychecks, and will pay for it again via taxes.)
There is $2.7 trillion in the Social Security Trust Fund, information that is updated and analyzed by its trustees each year. (As previously mentioned, there is not $2.7 trillion in the SSTF. There is $2.7 trillion worth of those special Treasury Bonds.)
What’s the real problem, Joe? Is it that you are carrying water for the Heritage Foundation, and their PAC, Heritage Action? (Now Ms. Quenemoen turns personal for no apparent reason. Her snotty little insults are beneath reasoned discourse. Typical for a leftist, she assumes an air of superiority not justified by her actual command of the facts.)
These are the folks who wanted the government shutdown to last longer and warned members of Congress that a vote to end the shutdown would be held against them in upcoming elections. Seems like Heritage and those aligned with them — Joe’s organization, Americans for (the Koch Brothers’) Prosperity — would love to use the money in the Social Security Trust Fund to reduce the federal deficit (If only. As we have shown, the SSTF actually INCREASES the deficit. That money has been spent, and will still have to be paid back to redeem the bonds.)
so that corporations can retain their offshore tax breaks and keep tax rates low for millionaires and billionaires like the Koch brothers. (More leftist talking points that add a lot of heat, but no light. However, I'm actually quite surprised that she didn't include "Faux" news in her rant, or blame Bush.)
Social Security hasn’t added a dime to the federal budget or debt. (As we have learned, this is simply not true.)
It should not be discussed in these terms. We paid for it! We earned it! Hands off our Social Security! (That train has left the station, Ms. Quenemoen.)
And for that matter, Medicare, too!
Julie Quenemoen
Bozeman
(Because the SSTF contains nothing but bonds, the money to pay them back will come from the general fund. This means that it's an unfunded liability. SS is a shell game, a Ponzi scheme. It plays on the fears of our senior citizens in a completely reckless way. Joe Balyeat is exactly correct.)
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