Hey Candidates: Social Security is broken
Dr. Laurence Kotlikoff, economist at Boston University
August 12, 2015
As posted on www.usaponzi.com
This commentary provides a link to an article published Aug 8, 2015 in USAToday by Dr. Laurence Kotlikoff that supports my contention that the U.S. Government Fiscal Policy is a Ponzi scheme that is caused by the use of improper accounting.
In this article Dr. Kotlikoff assesses the U.S. Fiscal Gap (how much the U.S. Government has promised to spend compared to how much income it is expecting to receive) at $210 Trillion which is more than twice as large as www.usdebtclock.org indicates as "US Unfunded Liabilities (GAAP") of $97.3 Trillion. By either accounting methodology, Fiscal Gap or GAAP, the U.S. Government is spending and promising to spend a whole lot more than its income and deferring an ever increasing liability to the future U.S. taxpayer. This is what causes the U.S. Fiscal Policy to be a Ponzi scheme which I have named USAPonzi. I attempt to explain the difference between Fiscal Gap Accounting and GAAP Accounting in my commentary Fiscal Gap Accounting that also compares these methodologies with Cash Accounting which the U.S. Government is currently using and is the primary cause of USAPonzi.
The U.S. Government is running a massive Ponzi scheme (USAPonzi) that is supported by the use of a corrupt and fraudulent accounting system.
Dr Kotlikoff has been promoting the need for changing the financial accounting and planning of the U.S. Government for many years and has testified before Congress on multiple occasions explaining why our Fiscal Policy is broken and what he proposes that Congress should do to remedy this problem. Dr. Kotlikoff refers to our current Fiscal Policy as a "Take As You Go" system rather than a "Pay As You Go" system as the U.S. Government falsely claims.
Excerpt from Kotlikoff article
How did we get into such terrible fiscal shape? Simple. Our politicians, Republicans and Democrats alike, have spent the last six decades running a massive Ponzi scheme.
I call it "Take As You Go." Uncle Sam takes money from young workers, calls it taxes, and gives it to old people to spend. "But don't worry," Uncle Sam says. "When you're old, I'll pay you back in spades. I'll just hit up your kids. Oh, and if you don't mind, let's keep this to ourselves. I'm not putting these I.O.U.s to you on the books. It would make our official debt explode and we wouldn't want that."
All Ponzi schemes involve fraudulent accounting. Uncle Sam's deficit accounting is the mother of such fraud. And all Ponzi schemes end badly. America's will be no exception.
End of Excerpt from Kotlikoff article.
While Dr. Kotlikoff is taking the lead in promoting the need for the use of proper accounting by the U.S. Government, there are over 1000 economists, including 17 Nobel Laureates in Economics, that have endorsed his proposal for the Inform Act (www.theinformact.org) that would require the use of Fiscal Gap Accounting by the Federal Government.
See The Implosion of USAPonzi for what I predict will have to happen when USAPonzi implodes.
See The Distortions of USAPonzi for a discussion of some of the issues that USAPonzi is causing in the global economy.
The U.S. Government is operating USAPonzi;
"The Biggest Ponzi Scheme on the Planet"!!!!