By using Cash accounting, the U.S. Government is ignoring the financial liabilities for the social benefit promises that it has made to U.S. citizens. For the last 46 years, the U.S. Government has not collected the tax revenue necessary to pay for the social benefit promises that it has made and as a result the U.S. Government had the following financial obligations as of Dec 1, 2014:
Debt borrowed from the public $12.9 Trillion
Debt borrowed from social benefit trust fund $5.1 Trillion
Unfunded Liabilities for social benefits $81.3 Trillion
GAAP Obligation $99.3 Trillion
GAAP Obligation=Debt + Unfunded Liabilities
If the U.S. Government was serious about paying the social benefits that it has promised, it should have $86.4 Trillion in the social benefit trust fund since the U.S. Government has borrowed and spent the $5.1 Trillion that has been paid into the social benefit trust fund and has under funded the social benefit trust fund by $81.3 Trillion.
This means that the U.S. Government cannot keep its promises to the underprivileged because it has not taxed the prosperous U.S. citizens and U.S. businesses enough pay for these promises. By not taxing the rich citizens and businesses it has made them appear to be 8 times richer than they would be if the U.S. Government was properly accounting for and taxing for the social benefit promises that the U.S. Government has made (see Why the Stock Market is Overvalued!).
By using a corrupt and fraudulent accounting system and by overspending its cash budget, the U.S. Government is
making the rich appear 8 times richer than they really are,
overpaying the direct and indirect government employees,
and cheating the underprivileged by not funding the social benefit promises.
The people in Washington, the people on Wall Street, the rich, and the famous (sometimes called the 1%ers) all love this corrupt and fraudulent accounting system since it is making them appear to be very, very rich (by $99.3 Trillion) but the people on main street, especially the underprivileged, are getting cheated (by $86.4 Trillion).
Let me say that again. The current U.S. Government fiscal policy has undertaxed the rich by $99.3 Trillion making them $99.3 Trillion richer and has short changed the underprivileged by $86.4 Trillion meaning that there is no way the U.S. Government can fulfill the current social benefit promises!
The U.S. Government is systematically taking from the poor and giving to the rich.
By undertaxing the U.S. citizens and U.S. businesses, the U.S. Government has introduced $99.3 Trillion of counterfeit money into the U.S. and global economy. (see The $100 Trillion Counterfeit Money Machine).
The U.S. Citizenry must demand that the U.S. Government adopt GAAP Accounting and a balanced GAAP basis budget so that the U.S. Government can keep its social benefit promises and so that the U.S. Government starts operating with a fair, equitable, and sustainable fiscal policy.
Because of the current fiscal policy, the U.S. Government is running a classic Ponzi Scheme (USAPonzi) by promising to pay returns (social benefits) that far exceed its ability to pay for them and covering this up with corrupt and fraudulent accounting. The U.S. Government is doing exactly what Bernie Madoff and the executives at Enron did; just on a scale that is 2000 times bigger than either of these frauds, making the fiscal policy of the U.S. Government
"The Biggest Ponzi Scheme on the Planet."
LBJ was the scoundrel that set up this Ponzi Scheme but the Washington establishment, the business community, and investing community have all willingly gone along with the scheme since it made them all very rich.
The U.S Government is corrupt and fraudulent because it is using fraudulent accounting practices just as did Bernie Madoff and the executives at Enron to make themselves rich. The U.S. Government was quick to act against this use of improper accounting techniques by the private sector but they welcome it when it is making them and the prosperous U.S. citizens and U.S. businesses very, very rich.
The Washington establishment is lying to the U.S. citizenry by telling them that the U.S. Government will take care of them by granting them social benefits but instead of collecting the taxes to pay for these promises the U.S. Government is undertaxing the prosperous U.S. citizens and businesses to make them very, very rich.
The U.S. business community and the U.S. investing community fully embrace this use of corrupt and fraudulent accounting because it is making them very, very rich while cheating the common man and especially the underprivileged. The rich and the powerful are getting very, very rich and therefore no one in the business community or in the investing community will step forward and expose this Government conspiracy/fraud.
The U.S. citizenry must demand that the U.S. Government adopt GAAP Accounting and a balanced GAAP basis budget so that the U.S. Government stops grossly overspending, overcommiting and undertaxing; and starts taking up for the common man and the underprivileged by actually funding the social benefit commitments that the U.S. Government has made. The future social benefit commitments will have to be less than the current commitments but we have got to require that the U.S. Government start taking care of the general populous rather than just taking care of themselves and their rich friends as they are doing with the current fiscal policy.
GAAP Accounting and a balanced GAAP basis Budget is the first step toward fairness and sustainability.
See www.usaponzi.com for more information about this Ponzi scheme.