The Social Security System is a Ponzi Scheme and is Already Broke

It amazes me to hear intelligent people in their 30′s and 40′s say that they don’t expect to receive any benefits from the Social Security System at retirement. If you are in that category then you also believe that it is a Ponzi scheme. My first question to you is, Why do you continue to pay into the system and not tell your Representative and Senators that you find that situation to be unacceptable?

Our government is not a charity. Our politicians wastes a ton of our tax money while guaranteeing themselves a fabulous retirement. Is it that you don’t know what to tell them? Return to this site regularly. Is it that you believe that you don’t have any power? Consider what happened to the Democrats on November 2, 2010.

Here are three principles to help guide your thinking:

a. There must be equality in the retirement system in this country. One segment of workers in this country should not be able to retire with 80% of an average of their last three years of income while the largest segment of retirees have to exist on a paltry Social Security check averaging about $1,100 per month.

b.  Everyone must have complete ownership of their retirement plan. The politicians actually own your Social Security benefits. That’s why they can increase your retirement age and tax your Social Security benefits. Also keep in mind that participation in the Social Security System is not mandatory. Several segment of workers, mostly union workers, in this country have never contributed to the Social Security System. Their unions have consistently fought against having their workers participate in such an archaic system.

c. All defined benefits plans  must be replaced by defined contribution plans for all public employees at all levels, including the politicians. If any one segment of workers in this society is guaranteed a retirement income then all workers should be guaranteed a retirement income.

This is a serious issue that directly affect your future. What do you think about these principles. Let me know.

Open your mind. You’re not always right.

An open mind means that you are willing to continue learning; that you are willing to change your points of view; and, that you don’t have all the answers.

Let’s face it. None of us have all the answers to any topic or issue. And, if it’s crucial to your health and your financial well-being, it is even more important to keep an open mind. If your life is perfect, you are financially secure, and your relationships are great, perhaps you don’t need to consider any other points of views. However, if you are like 99% of us, open-mindedness to new information may be just what you need.

Moreover, you don’t have to always be right. It’s okay for the other person to sometimes be right. Your self-esteem is not diminished when this happens. And, it just might preserve a worthwhile relationship.

I am aware of a long term relationship being allowed to fail simply because the other person couldn’t be wrong even on a trivial point. It is indicative of someone having a psychological block that need to be eliminated for his or her own good. You may be able to keep some relationships based on the dependency needs of the other person. However, a self-reliant person will ultimately find you as someone to distance from.

Should Obama Release the Pictures?

Image via Wikipedia

On the matter of should Obama release the pictures, I believe that he surprisingly got this one right. There is nothing to prove to the radical Islamists or to those who choose to believe in conspiracy theories.  As a former soldier, I respect what the Navy SEALs did and have no doubt whatsoever that Bin Laden is dead.

If the radical Islamists or the conspiracists want to believe that Bin Laden is alive, them let them go get him, put him on television, and let him address his believers. The burden of proof on is on them. As for me, I’m glad he’s gone and now let’s get the rest of the radical Islamists who want to kill us and in the next election, elect a President who has an answer for our economic problems. 

What do you think? 

Obama’s Oil Policy is the Cause of Our High Gas Prices

Image via Wikipedia

Let’s be clear it is Obama’s oil policy that is driving up gas prices at the pump.

When Obama came into office the gas prices at the pump were at a national average of $1.79 per gallon, now it’s at a national average of $3.90 per gallon. The price of oil per barrel then was $60 now its $118 per barrel. You may also recall that during his acceptance speech he said that in 10 years we would be off our dependence on foreign oil from the Middle East. After two years plus in office, it is clear that he has no plans to lead us in that direction. This was obviously empty rhetoric with no substance as was much of his campaign rhetoric. It is unfortunate that so many gullible people believed this nonsense or voted for him based on his color or personality. This should never be the basis for voting any politician into office.

The Right Policy to Drive Down Gas Prices

The oil policy that will immediately drive down the price of a barrel of oil $25 to $30 per barrel and consequently the prices at the pump would a policy that support drilling and the recovery of oil shale in all areas of the United States where there are known reserves. Furthermore, the policy should state that  while we will take in account reasonable environmental concerns, we will not be limited by irrational and ridiculous environmental concerns such as putting the “rights of animals” or the possibly of eliminating some species of animal or fish above the needs of human beings. And, finally the policy should state that we will not be concerned about water pollution while we have thousands of oil tankers bringing crude oil from other countries to our shores every day.

The Need to Drill Our Own Oil

It is estimated that we have 19 billion barrels of easily recoverable oil off the currently restricted Pacific and Atlantic coasts and the eastern Gulf of Mexico. Another 19 billion barrels of oil in the Chukchi Sea off the Alaskan coast is also restricted due to onerous regulations, such as acquiring air quality permits. In addition, another 10 billion barrels of oil also subjected to senseless restriction is the oil that lies beneath a few thousand acres in the Arctic National Wildlife refuge. These 10 billion barrels are equivalent to 16 years worth of imports from Saudi Arabia at the current rate. Or, another way of looking at it is that this is enough oil to fuel all the vehicles for 7.4 million households for 50 years.

The Need to Recover Our Own Oil

Now to shale oil. Oil shale is a fine-grained sedimentary rock containing a solid material (kerogen) that converts to liquid oil when heated. Since 1913, our government has known about the existence of shale oil. In fact, even before then the pioneers in covered wagons knew about shale. They found it going west in the 19^th century and used it for axle grease in their wagon wheels. So the end use of shale oil as petroleum took place long before the country was unified coast to coast.

Currently, the Department of the Interior and the Bureau of Land Management moderately estimate that there are 800 billion barrels of recoverable shale oil from shale in the Green River Formation which goes through Colorado, Utah and Wyoming.  This is three times greater than the known oil reserves of Saudi Arabia. When you total up our known reserves, it comes to 848 billion barrels of oil. Therefore, when you hear the President or any other politician or political pundit say that we have anything less than the 848 billion barrels of oil,  then you now know that they are either ignorant of this matter or are intentionally trying to mislead you for political reasons.

Do You Know the Difference Between a Defined Contribution and a Defined Benefit Retirement Plan?

Let’s take a brief look at the difference between a defined contribution and a defined benefit retirement plan.

As an example, in a defined contribution plan a certain agreed amount of money is taken from your paycheck on each pay period. Your employer may or may or match the amount. However, that amount is then placed into a 401k and allowed to build for your retirement. On the other hand, in a defined benefit plan, that same amount may be taken from your paycheck each pay period , but the difference is that in a 401k plan your benefits are not guaranteed, whereas in a defined benefit plan, your benefits are guaranteed.

Now, here is where the inequality begins. The majority of American citizens work in the private sector and after having a specific amount taken each pay period and put into a bankrupt Social Security System, often have the balance of their retirement money placed into a 401k without having their benefits guaranteed.  The American citizens who are politicians and those who work in the public sector have a majority of their retirement benefits guaranteed by other American citizens — with these benefits being an average of at least 2 to over 5 times better their fellow Americans.

This is the inequality that has to stop. The politicians must be told that this is not acceptable  and that if they don’t know what to do about it, we must tell them what to do about it.

Do you really accept this unfairness and inequality? More on this matter in my next post.

Your Thoughts?

No Rich People. No Middle Class

People who believes as Obama does are ideologically driven – not reality driven. The truth is that in a free market capitalistic society, people become rich because they provide provide goods or services that others are willing to buy.

While they are becoming rich, the middle class is growing because they are the ones who are being hired by the rich to produce the goods or services that the people are buying. Not only that, but this is a dynamic society where the middle class can rise into the class of the rich and the rich can fall into the middle class. Moreover, the the poor can become rich overnight. Consider the rap singers, the sport stars, or even the obscure inventor or writer working in isolation.

Obama and those like him, instead of criticizing the rich, especially when he is a multi-millionaire himself, ought to be focusing on creating the environment where everyone can become rich with ease.  An environment of  low taxes, minimum regulations, and significantly smaller government would give the impetus to economic growth and seriously spur business development and expansion. The employment rate will go down and more people will go from the middle call to the class of the rich.

Its time to tell our politicians how we want to be represented with even more gusto.

Forget the Politically Correct Nonsense. Men and Women are not Equal in the Military.

I often hear the so-called politically correct commentators and reporters on radio and television refer to men and women as if they occupy similar roles in the military and die at the same rate. Nothing could be farther from the truth.

Let’s be clear, women have never been in combat roles in the Marines and while women may occasionally fly an attack helicopter in the Army, they have never been in the infantry and on the front lines fighting.

Having been in the Army myself, in no way would I want to be engaging the enemy with a woman next to me.  When you’re fighting the enemy you do not need any distractions. You need a fellow soldier who could carry his own weight and someone who could carry you to safety should you get wounded.

From now on, these politically correct reporters and commentators should refer to our folks in the military as our “military personnel “or just our” fighting men”.  Once again women have never had roles equal to men in the military and it’s a disservice to our fighting men to speak as if women are equal to them and die in war at the same rate.

Now Here is a Dumb Housing Policy

It was sad and disappointing to see over 30,000 people line up on a hot and humid summer day in Georgia to get one of 13,000 Section 8 applications just to be able to get on a waiting list. It is my educated guess that among those 30,000 plus people who are registered voters that 99.9% of them voted for Obama. This is a reflection of a dumb housing policy. I doubt that this is the change they were looking for.

This is unfortunately the result of a dumb, misguided, and uninformed public housing policy. Currently the 30 year fixed interest rate is under 4.5%. That means that you can get a 30-year fixed rate mortgage on a $90,000 home for $456 per month. Compare that to renting a one bedroom apartment for $500 per month with no equity build-up, with no tax advantages, and with a landlord who can raise your rent every year.

The public housing policy that should be pursued is to get the government out of the way. Let housing prices fall to reflect the actual market value, let the free market set up the criteria that buyers have to meet as well as the structure to buy the mortgages in the secondary market, and let the losses and gains be that of those who choose to take the risk and participate in the free market.

In addition, the homes that the government owns by way of foreclosure should facilitate the process of allowing local non-profit organizations to gain title to these homes. The non -profit organizations can then set up a process whereby those in need of housing can acquire these homes on a rent to own basis.

Many of those who were waiting for the Section 8 applications can afford rent of $456 per month and would appreciate the opportunity to become homeowners. My advice to the Obama administration is to quit taking his supporters for granted. This silly euphoria is going to wear off soon and the people will see that the emperor has no clothes.

American is Not a Nation of Immigrants

It is clear that whenever a white person says that this is a nation of immigrants, he or she is either intentionally ignoring 12 percent of the population including the President’s wife he or she is just flat out ignorant. The ancestors of African-Americans did not immigrate to this country, they were forcibly brought here in chains and forced into slavery.

Are these individuals just ignorant of this nation’s history? Maybe so. Is this chapter in this nation’s history so disgraceful that these white individuals would like to ignore it. Maybe so. But, I will not let such a statement go unaddressed. This is a nation of people some of whom immigrated here and some of whom were brought here against their will and forced into slavery. Indeed, the people whose ancestors were brought here as slaves have ancestors who were here long before most white immigrants arrived to these shores.

Four Ways to Get the Federal Budget in Balance

My fundamental premise is that big government can’t solve any of our problems. Big government is the problem.

Here are four ways to begin getting this big government under control:
First, bring the salaries of government workers in line with those with similar education and experience in the private sector.
Second, change the retirement plans of all government workers from defined benefit plans to defined contribution plans. Their pension plans must be no different than those workers in the private sector.
Third, freeze all raises for government workers for the next three years and hire no new government workers during that time. Let natural attrition take its toll. When a worker retire, do not replace him or her. Either eliminate the position or use technology as a replacement.
Fourth, eliminate useless government agencies: the Department of Education, the Department of Energy, the Department of Labor, the Department of Housing and Urban Department, and the Department of Health and Human Services to begin with. According to our Constitution, the federal government is to exist to protect our life and rights as citizens. When its gets too large its has the opposite effect.

In a future post, I provide an estimate on the amount of money that can be saved and returned to us as taxpayers.

Let me know what you think of these steps.