The Biggest Ponzi Scheme on the Planet-The U.S. Government
"American Economic Exceptionalism Explained"                     USAPonzi                                      by John W. White   Mar 29, 2013

Criminal, Manufacturing, or Service Economy?
Apr 15, 2015
As Posted on www.usaponzi.com


Over the last several decades the U.S. Economy has experienced a rather significant shift from a manufacturing economy to a service economy as is described in this commentary: "The Shift from Manufacturing to Service Economy".  As of 2010, this transition had caused 86% of our work force to be employed in service oriented jobs.  I contend that manufacturing in the United States has become less and less competitive with other parts of the Planet primarily due to the cost of labor.  The cost of labor in the U.S. has gone up because it has to compete, especially at entry level jobs, with the value of the irrational and unaffordable social benefits offered by the U.S. Government.   We have come to rationalize this loss of the manufacturing sector economic activity by telling ourselves that we are just transitioning to a service economy.


However I contend that the most effective and the most dominate sector of our U.S. economy is the U.S. Government and its criminal activity of creating counterfeit money out of "thin air".  On this website I refer to this as USAPonzi, a massive Ponzi scheme created by overspending, overcommitting, and undertaxing that has deferred financial liabilities of $101.4 Trillion to the future U.S. taxpayer.  These deferred financial liabilities are the sum of our Debt of $18.1 Trillion and our Unfunded Liabilities of $83.3 Trillion.  The future U.S. taxpayer 
can never pay these liabilities so the U.S. Government is distributing massive amounts of counterfeit money to essentially everyone in the U.S. as social benefits, government pay, and unpaid taxes and charging it on the credit card of the future U.S. taxpayer.  While all current U.S. residents benefit from this Ponzi scheme, the ruling class (Government employees and related Government businesses) and especially the upper class gain the most benefit from this scheme and in the long run the Common Man is getting cheated (see Cheating the Common Man!).


With the current fiscal policy, everyone in the U.S. appears to win except the poor future U.S. taxpayer who now owes $101.4 Trillion and this amount owed is increasing by $17.8 Billion every day.  What other sector of our economy can match that kind of productivity?  The U.S. Government is producing $17.8 Billion of counterfeit money a day and nobody has to lift a finger; we just have to not tell the rest of the Planet about this fraud and corruption.


This is a Ponzi scheme created by promising that the future U.S. taxpayer will eventually pay all of our bills but at some point somebody with some clout and integrity will call "bullshit" and this Ponzi scheme will come to an abrupt end.   Until the U.S. Government starts using honest accounting and commits to a balanced GAAP basis budget the U.S. Government will continue to distribute an ever increasing amount of counterfeit money to U.S. citizens and businesses.  Nobody in the U.S. Government or in U.S. Business wants to stop this gravy train so the U.S. Government fraud that I have named USAPonzi continues to operate.  Warren Buffett has known about this fraud for at least 40 years but since he has been getting filthy rich with this scheme even Warren Buffett is willing to keep quiet about it and let the Ponzi scheme continue.  I estimate that this fraud has given Warren Buffett $57 Billion of counterfeit money, 90% of his current wealth, since FY1969 (see Buffett makes $10 Million a day on Government corruption!).


The U.S. Government and the U.S. Business world are both filled with people that are willing to go along with this criminal activity so that they can live prosperous and even opulent lifestyles.  This is a sad state of affairs for the United States of America, supposedly the shining light of integrity and equality for the entire Planet.


Bottom line is that criminal activity, printing and distributing counterfeit money, is easier and more productive than either making stuff or providing a service.


The discussion that economists are having about whether we can have a successful and robust economy without a healthy manufacturing sector is a moot point until we clean up the criminal activity in the U.S. Government.  We have got to introduce sanity into our accounting system to be able to tell what social benefit promises are affordable and to determine the true cost and value of labor.  Right now, way to much of our population is living on social benefit promises that are irrational and unaffordable and are being paid for with counterfeit money.   Creating jobs is really hard, when not having a job appears to be more valuable having a job.  It is also demoralizing to the Common Man when the ruling class and the upper class are being dramatically over compensated by this U.S. Government fraud.   Corrupt and fraudulent accounting causes severe distortion to our economy and to our financial system.


The current fiscal policy of the U.S. Government is creating counterfeit money ($17.8 Billion a day) out of "thin air" and handing it out to essentially everyone by paying unaffordable social benefits, overpaying the U.S. Government employees and related businesses, and dramatically undertaxing the U. S. upper class.  This fiscal policy, if continued, will create an infinite amount of counterfeit money, an infinite amount of public liabilities, and an infinite amount of apparent but artificial private net worth.


We are living in a Ponzi Economy!


We are living in a Criminal Economy!


I contend that it is a criminal act for the U.S. Government to promise the U.S. citizens that if they will pay Social Security and Healthcare taxes to the U.S. Government, the U.S. Government will in return pay Social Security and Medicare benefits to the U.S. Citizens during their elder years only to have the U.S. Government use that collected tax revenue to overpay itself thereby putting the participating U.S. citizens at crisis level financial risk.


I contend that it is a criminal act for the U.S. Government to promise the U.S. citizens that if they will pay Social Security and Healthcare taxes to the U.S. Government the U.S. Government will in return pay Social Security and Medicare benefits to the U.S. Citizens during their elder years only to have the U.S. Government not properly fund these promises so that the U.S. Government can overpay itself and its related businesses causing many people within the U.S. Government and related businesses to be very prosperous and even rich while putting the participating U.S. citizens at crisis level financial risk.


I contend that it is a criminal act for the U.S. Government to promise the U.S. citizens that if they will pay Social Security and Healthcare taxes to the U.S. Government, the U.S. Government will in return pay Social Security and Medicare benefits to the U.S. Citizens during their elder years only to have the U.S. Government not properly fund these promises so that the U.S. Government can covertly undertax the upper class citizens and businesses causing many people within the upper class to appear to be super prosperous and super rich while putting the participating U.S. citizens at crisis level financial risk.


I contend that it is a criminal act for the U.S. Government to use Cash Accounting to report and assess its financial condition rather than the proper GAAP (accrual) Accounting thereby not clearly disclosing to the U.S. citizens and the world the financial obligations that the U.S. Government is accumulating by not properly funding the social benefit promises to U.S. citizens thereby
putting many U.S. citizens at crisis level financial risk.


I contend that it is a criminal act for the U.S. Government to use Cash Accounting to report and assess its financial condition rather than the proper GAAP (accrual) Accounting thereby not clearly disclosing to the U.S. citizens and the world the financial obligations that the U.S. Government is accumulating in order to overpay the Government employees and Government related businesses causing many people within the U.S. Government and related businesses to become very prosperous and even rich while putting many U.S. citizens at crisis level financial risk.


I contend that it is a criminal act for the U.S. Government to use Cash Accounting to report and assess its financial condition rather than the proper GAAP (accrual) Accounting thereby not clearly disclosing to the U.S. citizens and the world the financial obligations that the U.S. Government is accumulating in order to covertly undertax the upper class citizens and businesses causing many people and businesses within the upper class to become super prosperous and super rich while putting many U.S. citizens at crisis level financial risk.


I contend that the U.S. Government is using a corrupt and fraudulent fiscal policy to dramatically favor the ruling class and the upper class while cheating the Common Man to the point that many in the middle and lower classes will soon be in dire financial straits when it becomes evident that the U.S. Government cannot borrow enough money to pay the social benefit promises the U.S. Government has made.
 $101.4 Trillion of public liabilities that is growing by $17.8 Billion a day is a lot of counterfeit money.


This means that as of April 1, 2015 according to my estimate of our public liabilities ($101.4 Trillion), 88.2% of the private net worth of U.S. citizens and businesses, estimated by the Federal Reserve Bank to be $114.9 Trillion, is counterfeit money produced by U.S. Government fraud. 


www.usdebtclock.org is now reporting our Unfunded Liabilities on a GAAP basis and their estimate of public liabilities (counterfeit money) as a percent of U.S. private net worth is even higher than mine.

                                                                USAPonzi    www.usdebtclock.org 
                                                               Apr 1, 2015          Apr 15, 2015
Private Net Worth                                       $114.9T              $115.2T
Debt                                                              $18.1T                $18.2T
Unfunded Liabilities                                      $83.3T                $95.8T
Public Liabilities/Counterfeit Money         $101.4T              $114.0T
Counterfeit Money % Private Net Worth     88.2%                 99.0%


The corrupt and fraudulent fiscal policy of the U.S. Government is just trying to make us feel rich and prosperous by creating counterfeit money out of "thin air".   The U.S. Government is simply creating artificial Private Net Worth by assuming Public Liabilities.  This is being done with smoke and mirrors and a corrupt and fraudulent fiscal policy.


Liars and Cheaters


This is being done by the Liars and Cheaters in Washington DC.   This is being endorsed (not being exposed) by the Liars and Cheaters in U.S. Business, Wall Street, and the U.S. upper class because they are living prosperous even opulent lifestyles and getting filthy rich with counterfeit money.   When you appear to be getting filthy rich on U.S. Government fraud, apparently you are willing to let the U.S. Government fraud continue.   And the U.S. Government is bribing the Common Man to stay quiet about this fraud by borrowing enough money to pay for the irrational and unaffordable social benefit promises it has made.   That is the way Ponzi schemes work, the perpetrator/operator will go to great lengths to come up with the money to pay the promised returns to the early participants so the late participants will stay invested in the program.


Author's Note: The research and analysis on this website has been based on data from www.shadowstats.com since mid 2013 and I continue to use that data source for the sake of continuity but I feel that the www.usdebtclock.org source is likely more accurate than my estimates plus it provides a realtime estimate of the key information.  The primary difference between these two sets of numbers is the discount rate used for the present value calculations.


Co-mingling of Funds


The co-mingling of funds that was introduced with the
"Unified Budget" in FY1969, along with the continued use of Cash Accounting, has provided the opportunity for the U.S. Government to choose who it will favor with our fiscal policy and it has clearly chosen to favor the ruling class by overpaying them and to favor the upper class by undertaxing them over the middle and lower classes by not funding the social benefit promises.  At the same time, by not using an accounting system that properly assesses the affordablity of U.S. Government spending and committing, the U.S. Government is dramatically overspending, overcommitting, and undertaxing thereby causing all U.S. citizens and businesses to appear to be much richer and more prosperous than we really are (see Americans think we are richer and more prosperous).  That is the nature of a Ponzi scheme.


USAPonzi is "The Biggest Ponzi Scheme on the Planet"!

 

USAPonzi has created a Criminal Economy!