Category archives: Legislation

Why Elections Matter

by Rob Schwarzwalder

April 13, 2011

In 2009, Barack Obama appointed then-Kansas Gov. Kathleen Sebelius to be Secretary of Health and Human Services. This was a troubling pick for conservatives, given her support for abortion-on-demand and support from abortion giant Planned Parenthood. As an advocate for federal funding of abortion, abortifacient drugs and embryonic stem cell research, among other things, Sec. Sebelius has justified these concerns.

Yet there is a significant bright side to Sec. Sebelius’ departure from Topeka: Former Senator Sam Brownback, a champion for life, is now Governor of Kansas. And what a difference that has made.

Yesterday, Gov. Brownback signed legislation that “strictly limits abortions after 22 weeks based on the fact that fetuses can feel pain beginning after the 21st week of pregnancy” and another measure, “the Abortion Reporting Accuracy and Parental Rights Act,” which “requires minors who seek abortions to obtain consent from both parents and places certain prohibitions on late-term and partial birth abortions.”

Kathleen Sebelius would have fought these bills from their introduction. Sam Brownback not only signed but celebrated them.

To those who say that Christians should withdraw from political engagement and concentrate on private acts of charity or work solely with church or ministry groups, consider Sam Brownback and his allies in the Kansas Legislature. Were these bills the final word in the battle for life? No. They are part of a larger legislative mosaic that is building, gradually but steadily, a culture where the personhood of the unborn child increasingly is being recognized in law and in the American conscience. For the children whose lives will be saved through these measures, they are nothing less than critical.

Does political engagement bring complete resolution of every problem? No. But political action can make a decisive, if incremental, difference in a host of areas — most importantly those involving the sanctity of life, the dignity of marriage, and the centrality of religious liberty to American public life.

Elections matter. Just ask Sam Brownback.

Deficit Deception: Don’t Bank on Social Security: A Primer in the Manifest Phoniness of the Social Security System

by Rob Schwarzwalder

April 12, 2011

According to the Congressional Budget Office (CBO), the fiscal year 2010 deficit was $1.3 trillion. If the roughly $700 billion from Social Security had been kept in its own so-called Trust Fund and, as a result, subtracted from federal general revenues, the deficit would have been more than $2 trillion.

Instead, as economics writer James Pethokoukis observes, monies supposedly dedicated to Social Security are used as part of a fiduciary shell game” to “mask the true depth of the budget deficit.

How can Social Security and the federal government get away with this?

To answer that, a few foundational facts are needed.

For one thing, there is no Social Security Trust Fund. The Fund is an accounting device that’s used to hide the true size of the federal deficit.

The monies collected from taxpayers are, in an act of accounting sleight-of-hand, put into the Trust Fund for about a millisecond and are then replaced by “special-issue securities,” Treasury notes that the Social Security Administration (SSA) itself admits are “available only to the trust funds.”

In other words, the federal government takes money out of Social Security to pay for all kinds of things, including payments to retirees. It issues itself Treasury bonds to repay its loan from the Social Security Trust Fund but they are bonds only Social Security itself can buy. This is known, in stuffy bureaucracy-speak, as an intragovernmental loan.

SSA itself clarifies, “Tax income is deposited on a daily basis and is invested in ‘special-issue’ securities. The cash exchanged for the securities goes into the general fund of the Treasury and is indistinguishable from other cash in the general fund.” Invested, indeed keep reading.

So, the money that the federal treasury siphons-out of the erstwhile “trust fund goes to cover general revenues of all kinds: From the common federal budget pot, the monies are used to pay for freeway projects in Iowa and aircraft carriers to U.S. Postal System delivery trucks. Oh, yes, and payments to Social Security recipients, or beneficiaries, as well.

Here’s how Stephen Ohlemacher of the Associated Press explains it:

The money in the trust funds has been spent over the years to help fund other government programs. In return, the Treasury Department issued bonds to Social Security, which earn interest and are backed by the government, just like bonds sold in public debt markets. When Social Security runs a deficit, it redeems its bonds with the Treasury Department to cover the red ink. But Treasury gets the money to pay Social Security the same places the government gets all its money: either from taxes and other revenues or by borrowing it. Last year, the government borrowed 37 cents of every dollar it spent. This year it’s borrowing 43 cents of every dollar.”

The interest earned is merely a designed percentage payment Uncle Sam adds onto the amount of the loan derived not from any kind of profitable investment itself, but from the printing presses of the federal treasury. The interest is merely added out of fiat-drenched thin air.

Why does the government do this? Very simply: If Social Security designated funds - the money that comes out of all of our paychecks to pay Social Security income to seniors were not used for general revenue, the deficit would be shown to be even more gigantic than it is, as noted above.

How much money are we talking about? As indicated in the first graph of this piece, the CBO says that Social Security contributed $706 billion to the federal budget in FY 2010. Thats about one-fifth of the total budget.

Some argue that since beneficiaries are getting paid, whats the big deal?

Last year, the pay-out total to retirees was $41 billion more than what was taken in through Social Security taxes. For the first time in roughly 30 years, the SSA ran a deficit one larger, in itself, that all but a handful of the countries in the world.

Second, the false assurance that the trust funds dollars are invested is a lie pure and simple. This investment is actually nothing more than a credit slip that says, in as many words, that the money will be put back in by the Treasury with a certain percentage of interest, interest not derived from anywhere but balance side of a phony federal ledger.

Third, were the money actually invested in interest-bearing accounts, using historic rates of return, the SSA would not be facing the historic crisis it faces in the next quarter-century. Consider: Over the course of its history, the stock market with all the dips, depressions, recessions, wars, etc. we have faced has had an inflation adjusted return of between six and seven percent.

Given the monies poured into the Social Security system since its inception in the 1930s, such a return would have prevented the current, and future, profound shortfalls we are facing.

Fourth, and perhaps most ominously, is the dearth of workers who pay into the system. That number has shrunk from 16 employees per beneficiary to slightly under 3 workers per beneficiary today. As Americas population ages, that ratio will shrink, to our profound fiscal danger, more and more.

Charles Krauthammer notes that should the debt continue to build like a throbbing volcano, the full faith and credit of the federal government wont mean much and not just Social Security, but the whole economy, will be at grave risk:

In judging the creditworthiness of the United States, the world doesnt care what the left hand owes the right. Its all one entity. It cares only what that one entity owes the world … (W)hat would happen to financial markets if the Treasury stopped honoring the special issue bonds in the Social Security trust fund? A lot of angry grumbling at home for sure. But externally? Nothing. This default would simply be the Treasury telling the Social Security Administration that henceforth it would have to fend for itself in covering its annual shortfall.

The other alternative: Treasury tells SSA no such thing and simply pays back, using not real assets but accredited and/or printed monies from Treasurys printing presses, what it owes SSA: The money will, at some point, stop holding much, if any, value. At that point, the world will care a lot, because it will indicate the Weimar-esque quality of the U.S. greenback.

There are a number of ways to correct the problem before Social Security runs completely out of money in about 26 years.

Former FRC scholar and current Howard Center director Alan Carlson argues convincingly, as Americans have more children, we will remedy at least much of the crisis by having more workers to pay into the Social Security system itself. House Speaker John Boehner and others argue for raising the full retirement age from 65 to, say 67 or even 70, which more accurately reflects growing longevity and work patterns and would save large amounts annually.

House Budget Committee Chairman Paul Ryan is among the leading advocates of allowing younger income-earners to invest at least a graduated/growing portion of their Social Security dollars into private retirement accounts, not unlike the federal employees Thrift Savings Plan (TSP).

This could be done directly, from the employees paycheck, and be directed into one or more of several fund-types managed independently, just as TSP funds are.

What is clear is that the current system is neither sustainable nor honest. While no one expects President Obama to advance the reforms necessary, the next President should.

If Social Security is not just to survive but refrain from being a fiscal anvil around the national neck, the next President must.

Formerly chief of staff to two Members of Congress and a presidential appointee in the George W. Bush Administration, Schwarzwalder is senior vice-president of the Family Research Council.

Legislative Wake-up Call in the States

by Cynthia Hill

April 14, 2010

If you think legislation on the federal level has gone haywire, take a minute to check out whats going on in state governments through FRCs State Legislation Tracker. The present 38 issue profiles currently track 7469 bills of concern. A breakdown of the results (listed below) provides a telling glimpse into the “state of the states” and the subsequent health of our nation. That the top five profiles include domestic violence (2146), gambling (1346), divorce reform (827), and pornography (728 total, 325 dedicated to child pornography alone) should be a serious wake-up call for all Americans.

Whether or not current liberals and progressives approve, Americas Founders understood from historical perspective that their new government must be rooted in Judeo-Christian tenets. Nothing less resilient and enduring could contribute the ongoing stability required for individuals, families and national industry to flourish in the long term. The following contemporary indicators mandate that we re-examine those pro-family factors that precipitated Americas success, and work aggressively at the state and local level to re-introduce and re-implement them.

Numbers of bills (see here a drill-down on each issue):

  • Abortion - Fetal Pain 5
  • Abortion - Parental Notification - 38
  • Abortion - Ultrasound Bills - 60
  • Abortion Alternatives - Pregnancy Care Centers -18
  • Adoption - By Traditional Family - 551
  • Adoption - By Unmarried or Same-Sex Couples - 44
  • Bathroom Bills - Gender Expression & Same-Sex Issues - 185
  • Conscience Regulations - 4
  • Cord Blood - 62
  • DADT - Military Repeal of ‘Don’t Ask Don’t Tell’ - 13
  • DOMA - Defense of Marriage Act - 2
  • Domestic Violence - 2146
  • Eminent Domain - 1340
  • ENDA - Employment Non-Discrimination Act - 3
  • Gambling - 1346
  • Hate Crimes - 27
  • Health Care - States’ Response to Obamacare - 176
  • Homeschool - 341
  • Human Cloning - 149
  • Human Eggs - 8
  • Human Trafficking - 255
  • Jessica’s Law - 5
  • Life Issues - 23
  • Marriage - Divorce Reform - 877
  • Marriage - Marriage Protection Amendments -12
  • Pornography: Child - 325
  • Pornography: General - 403
  • Public Education: Bullying Bills - General - 28
  • Public Education: Bullying Bills - Pro-Homosexual Agenda - 41
  • Public Education: Discrimination Free Zones - 1
  • Public Education: Sex Education - 7
  • Religious Liberty - 29
  • Reproductive Health - 9
  • Same-Sex Marriage - 493
  • Sexual Predators - 60
  • Statutory Rape - 69
  • Stem Cell Research - Adult - 17
  • Stem Cell Research - Embryonic - 37

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