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Is the Federal debt a criminal enterprise, enabled by a criminal syndicate? Read on before you pass judgment.
Correspondent Doug laid out a compelling case that the Federal debt is fundamnentally a criminal scam, operated by the criminal syndicate of the Treasury and the Federal Reserve:
The Federal Reserve is a criminal syndicate buying debt that the government eagerly creates and sells for spending money that dumps the debt on us civilians. What perplexes me is that the scam is so simple and all the intellectuals either don't get it or are handcuffed by mega-corporate media owners.
The scam in simple terms:Thank you, Doug, for explaining the criminal nature of the Federal Debt and the agencies and Fed that enable and enforce it. As we know, the Federal budget (and the "supplemental appropriations" that add hundreds of billions of dollars in "off-budget" spending) is consolidated. In other words, the government doesn't specify that taxes collected paid for X spending and that the remaining Y spending is paid by borrowing money via selling Treasury bonds, so what spending is "paid by debt" is a politically charged assessment.
1. Uncle Sam borrows money from The Fed, China, oil exporters, Bank of England, etc. by selling Treasury bonds
2. You are responsible for the bonds, i.e. IOU
3. Uncle Sam collects taxes and pays the bondholder
4. The debt is breaking us; life will not be the same in the years to come
Uncle Sam borrows all its spending money from the non-government Fed and others, and spends only borrowed dollars raised from exchanging bonds for dollars as a debt plus interest on your back.
Uncle Sam collects income taxes and funnels the money to the holders of these criminal Treasury bonds.
The Fed/Treasury is an evil axis defunding you and me: the debt is $14.5 trillion; this is our debt, not the government's debt. The government does not generally earn money; we do. Therefore every criminal debt certificate (Treasury bond) the Treasury exchanges for cash is a debt on you and me--a promise to pay for which citizens are responsible to pay, IOUs in simple terms. If the government printed the money instead of the criminal Fed, there would be no debt.
Uncle Sam borrows bucks and you become automatically indentured to pay back the bond and pay the vig! How is this not a criminal enterprise? If you go to a loan shark, at least you get to have the money in your hand and can spend it before you have to repay the loan and pay the vig!
What the ballooning debt actually funds depends on the political convictions and agenda of the commentator, along with what constitutes "waste" in Federal spending. Some attribute the Federal deficit/borrowing to Medicare, others to hot wars and the Military-Industrial Complex, and still others to the endless bail-outs of financial Elites.
The common-sense perspective is to compare the circa 2000-01 $2.1 trillion annual Federal budgets of the pre-Global War on Terror (GWOT) and multi-trillion dollar bail-outs of banks/financial Elites with today's $3.8 trillion annual budget (not counting all the political hot-potato spending hidden in "supplemental appropriations" to keep it out of the scrutinized budget). Since inflation was officially low for most of the decade, this vast increase in Federal spending cannot be explained as inflation; adjusted into real dollars (adjusted for inflation), it is still 40% pre-war, pre-bail-out levels.
Yes, Medicare spending is rising at 6%-7% annually, regardless of which political party is in power, and Social Security spending is outsripping the system's tax revenue income. But clearly, a National Security State with few if any meaningful restraints on its spending (no "anti-terrorist" dictatorship shall go unrewarded/unfunded, etc.) or influence has added trillions in spending with little oversight or accountability.
The same can be said of the endless trillions squandered bailing out the banks and related financial Elites, including the quasi-Federal agencies (Fannie Mae and Freddy Mac) that funded the criminal enterprise known as the housing bubble/bust.
If the majority of the additional Federal spending was in fact squandered to boost the revenues, earnings and political influence of Elites, fiefdoms and special interests, then the taxpaying citizenry footing the bill did not receive any measurable benefit from all this additional debt. As Doug observed, the taxpayers are in effect borrowing vast sums from the loan sharks and not even getting to spend the money on themselves: the money was squandered on Elites, supposedly on behalf of the taxpayers, who must pay interest (i.e. the vig, "vigorish") on the fast-rising debt.
As Doug asked: how is this not a criminal enterprise?
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There are several points of criminality pointed to, but they are not explicitly named, nor are their origins tracked down.
And the most important unexplored area is: Why are we allowed to borrow all this money?
If you only made enough money to pay back the interest on your loans, never paid down the principle, and continued to ask for more loans, would you be able to get those loans? Would it be ethical for a bank to lend more money to someone in that financial position?
The only reason the US can continue to borrow is because there are still people willing to buy US debt. It is still considered a "good investment." The banks seem totally disinterested in exerting any form of ethical restraint in this process. After all, whose decision is it to loan the money? The bank's or the borrower's? The borrower decides to ask for a loan. But the bank decides whether or not to make that loan.
The next subject to take up regarding bankers is the "fractional reserve" lending system. Most commentators treat this as a big "so what." But what is it, really? It's a gamble that banks take to increase their profits. You might even call it dishonest.
If a banker has $1,000 on hand, he will loan out almost all of it, say $900, gambling that his depositors will never all come and withdraw their deposits at the same time. Though he tells all of his depositors that their money is "safe" this is not really true. He has loaned out about 90% of it. He doesn't really have that money any more. But he can make lots of money on interest payments from the loans he made!
So this US spending spree has been promoted by the bankers, who profit from it. And they have been doing this every time the US needed money, starting with the Revolutionary War.
They could tell the government any time, like they tell many of us, "sorry, we can't lend you any more money until you pay back what you've already borrowed." But they never will, unless the American people do something to change the way the game is played.