Ruling & Upper Classes Lie to & Cheat Middle & Lower Classes
Feb 12, 2015
As Posted on www.usaponzi.com
The U.S. Government (the Ruling Class) is operating a massive ($100 Trillion and growing exponentially) Ponzi scheme (USAPonzi) because of two issues with the current Fiscal Policy:
1) the U.S. Government is using a corrupt and fraudulent accounting system by using Cash Accounting rather than the appropriate GAAP Accounting (Generally Accepted Accounting Principles).
2) the U.S. Government is spending much more, on a cash basis, than the U.S. taxpayer is paying in taxes.
Corrupt and Fraudulent Accounting System
The U.S. Government (the Ruling Class) is using Cash Accounting as opposed to the appropriate GAAP Accounting and as a result for the last 46 years has not been taxing the Upper Class to fund the social benefit promises that the U.S. Government has made to the U.S. citizenry, primarily to the Middle and Lower Class citizens. The Ruling Class is lying to the U.S. citizenry by promising to pay social benefits that are unaffordable but not funding these social benefit promises. The Ruling Class has made $87.4 Trillion of future social benefit promises but has not funded one penny of these future promises. By not funding these social benefit promises, the Ruling Class has cheated the Middle and Lower Classes out of $87.4 Trillion and has given the Upper Class $87.4 Trillion. This undertaxing of the Upper Class is what creates our Unfunded Liabilities.
The U.S. Government (the Ruling Class) is also spending much more than the U.S. taxpayer is paying in taxes incurring debt of $18.1 Trillion. The Ruling Class is paying themselves and the direct and indirect employees of the U.S. Government much more than the U.S. Taxpayer can afford even as the Government chooses to not fund the social benefit promises to the Middle and Lower Classes. Many of the people in the Ruling Class are living an opulent lifestyle while many of the people in the Middle and Lower Classes are headed toward financial devastation because the U.S. Government is not funding these social benefit promises.
The Ruling Class has overpaid themselves and their direct and indirect employees and businesses by $18.1 Trillion. As a result, many of the people in the Ruling Class and in U.S. Government related businesses are living opulent lifestyles.
The Ruling Class has undertaxed the Upper Class by $100.4 Trillion. As a result, the people in the Upper Class are living opulent and super opulent lifestyes and have become wealthy and even super wealthy with this counterfeit money.
The Ruling Class has cheated the Middle and Lower Classes by $87.4 Trillion. As a result, many of the people in the Middle and Lower Classes are headed toward financial devastation because the Ruling Class made social benefit promises that it had no intention of honoring. After having been lied to and cheated by the Ruling Class, the Middle and Lower Classes then have to watch helplessly while the Ruling Class and the Upper Class live these opulent and super opulent lifestyles that have been created by USAPonzi.
The Ruling Class and the Upper Class are conspiring together
The Ruling Class has been operating this corrupt and fraudulent Fiscal Policy since FY1969 and everyone in the Upper Class has chosen to not expose this fraud that dramatically overpays the Ruling Class, dramatically undertaxes the Upper Class, and dramatically cheats the Middle and Lower Classes.
The Ruling Class claims that this deficit spending is necessary to stimulate the struggling U.S. economy. The fact is that the ONLY reason that the U.S. economy is performing as well as it is right now, is due to USAPonzi and its GAAP basis Deficit spending that I estimate to be $6.5 Trillion in FY2015. U.S. GDP is overstated by nearly 2X because of USAPonzi.
I am convinced that most of the people in the Upper Class know that the Ruling Class is lying to and cheating the Middle and Lower Classes, but they are willing to go along with this corrupt and fraudulent Fiscal Policy because it is providing them with an opulent lifestyle and it is making them rich.
The Ruling Class and the Upper Class are conspiring together to continue a corrupt and fraudulent Fiscal Policy, introduced by Lyndon Baines Johnson in FY1969, that dramatically overpays the Ruling Class and makes the Upper Class super wealthy with counterfeit money while cheating the Middle and Lower Classes.
Counterfeit Money ($100.4 Trillion)
The fiscal policy of the U.S. Government, by using fraudulent accounting and overspending on a cash basis, has undertaxed the Upper Class by $100.4 Trillion thereby creating $100.4 Trillion of counterfeit money. By undertaxing the Upper Class, these financial liabilities are passed forward to the future U.S. taxpayer who can never pay these liabilities making this $100.4 Trillion counterfeit money. This Fiscal Policy has created a classic Ponzi scheme (USAPonzi) by overpromising returns to investors and U.S. citizens and using the prospect of ever increasing tax revenue from the future U.S. taxpayer to pay current investors and citizens.
By undertaxing the Upper Class, thereby creating dramatic GAAP basis deficit spending, the Ruling Class has created $100.4 Trillion of counterfeit money out of "thin air" at the expense of the Middle and Lower Classes and giving this counterfeit money to the Upper Class while overpaying the people in or related to the Ruling Class.
U.S. Private Net Worth
As of Feb 1, 2015, the Federal Reserve Bank estimates that the Private Net Worth of all U.S. Citizens, Corporations, and Small Businesses was $111.2 Trillion (source www.usdebtclock.org). I contend that 90% of the U.S. Private Net Worth is counterfeit money that was created by undertaxing the U.S. Citizens by $100.4 Trillion producing our GAAP Obligation (Debt + Unfunded Liabilites) of that same amount. Therefore I predict that 90% of the U.S. Private Net Worth will evaporate when USAPonzi implodes. The current U.S. Fiscal Policy is creating Private Net Worth by assuming public liabilities.
This situation can only be resolved by the U.S. Government adopting GAAP Accounting and committing to a nominally balanced GAAP basis budget. This will ensure an equitable and sustainable Fiscal Policy.
How does the U.S. Government escape from this Ponzi scheme that, if continued, will create infinite public debt and infinite private net worth? I think that some global authority like the United Nations or the IMF or the G20 should establish a rule like the European Union has established for all of its member countries that would require that countries use GAAP Accounting (or equivalent), maintain a GAAP deficit of no more than a 2-3% of GDP, and maintain a GAAP Obligation of less than 60-70% of GDP. Our GAAP deficit is currently 37% of GDP ($6.5T/$17.7T=0.367) and our GAAP Obligation is currently 567% of GDP ($100.4T/$17.7T=5.67).
But one must also realize that our current GDP of $17.7 Trillion is also overstated by nearly 2X because of our current GAAP basis deficit spending of $6.5 Trillion so the "real" ratioes are nominally 2X higher than what I calculate above.
Ponzi schemes can be really fun for the early investors but there is HELL TO PAY when a Ponzi scheme implodes! We have already had the fun part of USAPonzi!
The Bottom Line
But the bottom line is that by "lying to and cheating" the Middle and Lower Classes for the last 46 years, the Ruling and Upper Classes have had most of the fun. They have made sure that the Ruling Class and the Upper Class could live an opulent lifestyle with counterfeit money. They have made sure that many of the Upper Class could appear to be filthy rich with counterfeit money. They have made sure that the stock market would skyrocket with counterfeit money! They have made sure that they could dramatically widened the "wealth gap" between the haves and the havenots with counterfeit money! And they have virtually assured that many of the Middle and Lower Classes people are headed toward financial devastation by not honoring the Ruling Class promises to pay Social Security, healthcare, and other social benefits to the common man and the underprivileged!
Any darn fool on the street can look filthy rich by printing counterfeit money but they would quickly get arrested and thrown in jail by the same U.S. Government that is printing $17.8 Billion of counterfeit money every day. The Ruling Class is printing mountains of this counterfeit money ($100.4 Trillion so far) and giving it to themselves and their best friends, the Upper Class, by stealing it from the common man and the underprivileged, the Middle and Lower Class U.S. citizens. The Ruling Class and the Upper Class have been getting their counterfeit money steadily over the last 46 years but most of the Middle and Lower Class U.S. citizens will not find out that they have been cheated until USAPonzi implodes. But by then it will be too late!!!