- Last month, I participated in the annual gathering of
the Federation for American Immigration Reform (FAIR www.fairus.org)
in Washington, DC. Former Colorado Governor Lamm was a keynote speaker
giving us a STARTLING speech.
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- His national leadership in the immigration debate illustrates
his far-reaching understanding of our greatest dilemma in the early years
of the 21st century. Every social ill emanates from too many poorly
educated, low-income people flooding into the United States beyond
our capacity to sustain them or ourselves.
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- U.S. National Bankruptcy Possible?
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- Few Americans understand the Faustian dilemma awaiting
their children with the federal deficit now at $8.7 trillion. Although
Bill Clinton left office with a balanced budget, and precious little national
debt Mr. Bush raised the federal debt level to nearly $10 trillion
in seven short years.
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- On an individual level, if you earned $50,000.00 a year,
but ran up your credit card debt to $500,000.00 a year, how would you pay
for your financial liability? Answer: you couldn't. Bankruptcy
becomes your only option. However, what happens when an entire country
bankrupts?
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- The dollar's value falls world-wide. Our annual
trade deficit exceeds $700 billion. Our manufacturing base vanishes
with millions of U.S. jobs outsourced overseas. Our government must
borrow $2 billion each and every day to keep our economy afloat. Unbeknownst
to most Americans, their tax dollars pay in excess of $400 million daily
to pay the interest on the federal debt.
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- The greatest embezzlement in all of history
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- Governor Lamm said, "I have participated in the
greatest embezzlement in all of history. In my seventy plus years,
I have never seen such a perfect crime.
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- "Like most other master criminals, I am heady with
success and feel a need to brag. I kid you not never
before has one group appropriated as much money that belonged to another
group in the history of crime.
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- "The victims, while they are increasingly suspicious,
still do not know they have been had. It was literally and figuratively
as easy as taking candy out of the mouths of babies."
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- To pull off a giant embezzlement, you need a naive patsy
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- Lamm continued, "Here is how we did it. The
first rule of embezzlement is to find some naive patsy. We sensed
forty years ago the younger generation was not paying enough attention
to public policy, so we quietly found ways to maintain our lifestyle and
charge it to the next generation and their children.
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- "While those of you under 45 were preoccupied with
other things, my generation dumped the largest load of debt on you that
history has ever seen and found ways to maintain our lifestyles on
your credit cards.
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- "A good scam needs a compassionate come-on. In
our case, we developed a new phrase: "poor elderly." To
this day, most Americans do not understand that this is actually two words,
and that "poor" no longer adequately describes the elderly as
a class.
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- Ponzi scheme to benefit the oldsters!
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- "Next, we devised a number of systems that allowed
us to charge our retirement to the next generation of Americans, who will
wake up to find they are on the losing side of a Ponzi scheme," Lamm
said. "Like all good con artists, we relied on "trust."
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- Trust fund; to benefit both Medicare and Social Security!
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- "We told them there was a "trust" fund
for both Social Security and Medicare," Lamm said. "Of course,
this was a lie. There is no "trust" fund, in the normal
sense of the word, because we take this month's Social Security taxes from
today's workers and pay them to today's elderly. Then, we tell today's
workers not to worry the money is being held "in trust."
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- But, there is no trust fund!
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- "In actual fact, they would be no better off if
the fund was invested in confederate war bonds," Lamm said. "The
trust fund is a sham because it only contains IOU's that tomorrow's generation
of workers will have to pay off themselves.
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- "They will have to pay for both our retirement and
a good part their own. We succeeded in taking money from poor workers
in St. Paul and sent it to wealthy retirees in St. Petersburg, FL
and no one was the wiser."
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- The perfect embezzlement maximizes its take.
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- "We soon found there was money left over after paying
the Social Security funds to today's elderly, and we did not want to stop
half way," Lamm said. "What self-respecting crook would
leave money lying in the bank vault after a robbery?"
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- Clever scheme; consolidated budget.
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- "We completed the job by something called the "consolidated
budget," Lamm said. "This allowed us to quietly take the
Social Security funds left over -- to reduce our taxes by spending the
money on current government services. Under the "consolidated
budget," we could legally "borrow" the money in the "trust
fund" left over every year, and spend it on current government services;
thereby, reducing our yearly taxes. Virtually every year for the
last 40 years, we understated the yearly deficit and understated the total
federal debt.
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- U.S. $50,000,000,000,000 National Debt today, including
interest
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- "Even though the official federal debt is approximately
$9.5 trillion, the amount actually passed on to the next generation is
closer to $50 trillion."
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- My generation master embezzlers!
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- "The entire scheme was done with clever accounting
gimmicks, which allowed us to minimize our taxes and maximize our spending
while we passed the bill on to the next generation," Lamm said. "Like
many victims of a crime, by the time they figure it out I (older
generation) will be long gone. I have completely and totally spent
the Social Security Trust Fund and left nothing in trust, absolutely nothing,
for today's workers to pay future obligations.
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- "They will have to either raise their taxes substantially,
or dramatically reduce their benefits under the system. They have
no other practical alternatives.
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- The true perfect crime only works once.
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- "Every dime spent on the war in Iraq we put on our
kid's credit cards," Lamm said. "Every dime of Katrina
and Rita hurricane recovery we put "off-budget" and thus left
it to our children to pay.
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- "Then we voted ourselves a substantial tax-cut,
the only tax cut during a war in our national history. If anyone quoted
Milton Friedman, "If you cut taxes without cutting spending, you are
not cutting taxes, you are deferring them to your children," we would
quickly say we were 'stimulating the economy' and change the subject."
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- Eventually, the next generation will wake up to the magnitude
of the fraud.
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- "They will recognize they are working long hours
(or two jobs) and make less working than I make in retirement," Lamm
said. "Yet, every month they transfer money to me to pay for
my health benefits. I have plans for that also. When they start
to blow the whistle, I will say with shock and horror, 'You can't start
an intergenerational war.' I will tell them about how hard I fought
for this country.
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- "I will shame them by accusing them of breaking
the "generational compact," neatly covering the fact that it
was my generation who "broke" the compact by leaving them an
unsustainable and insolvent system."
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- Like any successful crook, I cover all my bases.
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- "When health care costs became a larger factor in
our budgets, we found a system to subsidize our health care costs at the
expense of following generations. We called it Medicare," Lamm
said. "The average senior who turned 65 in year-2000 got back
$4 from today's workers for every $1 that he/she paid into the system.
Seven short years later, today's retiree receives on the average
a $100,000 subsidy toward his health care costs from a system that
is slated to go broke not far into this 21 st century."
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- The story does not end there.
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- "My generation screwed up the savings and loan industry,"
Lamm said. "What did we do to get out of it? We issued
thirty-year bonds! Why should I pay for my mistakes when there is
a gullible generation right behind me? Will I be here in 30 years?
No. Will you? I leave it to my kids to pay off. My
wife and I bought our first house in 1963 for $11,900. Our first
mortgage payments were $49 a month because we had a V.A. loan subsidized
by the federal government."
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- Everyone in my generation could buy his or her own home.
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- "It is estimated that thirty percent of the current
workers below age thirty will never be able to own their own houses,"
Lamm said. "I get more money in housing allowance every year
from the federal government than the poorest American. I get to deduct
my mortgage interest and real estate taxes, which is worth to someone in
my income bracket more than the cash equivalent that any poor person in
this state receives for housing. Ditto health benefits.
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- "By not taxing my health insurance paid for by my
employer, I also receive more health benefits from the federal government
than most poor children on Medicaid. I have recently passed Medicare
Part-D to help pay for my prescriptions."
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- The Crime of the Century
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- As Lamm explained, "It's the crime of the century."
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- Richard D. Lamm is co-director of the Institute for Public
Policy Studies at the University of Denver, and the former three-term governor
of Colorado, from 1975 to 1987. His latest book: "Brave New
World of Health Care."
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- © 2007 Frosty Wooldridge - All Rights Reserved
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