We have less than six years before Social Security is insolvent. That’s less than one senatorial term. One tragic consequence will be the impact on roughly 50% of married and 75% of unmarried retirees who depend on it for the bulk of their income.

Additionally, the stress placed on our federal budget due to unfunded mandates including Social Security, Medicare, Medicaid, Affordable Care and interest will have a dire effect on the future of America.

The immediate cost to retirees under current law will be a 22% reduction in Social Security benefits. The impact of all unfunded mandates on the budget is even more draconian.

Total annual federal revenue is roughly equal to our annual mandated expenditures. That means that most or all other government expenditures, including defense, education, transportation, health, Homeland Security, courts, FBI, agriculture, public lands, monuments and national parks must be funded through borrowing, resulting in ever-increasing and unsustainable debt.

Another consequence of this insolvency will be a downgrading of our national credit rating, which will further raise our interest costs, exacerbating the situation. Some corporations already have higher credit ratings than the U.S. government.

What is the reaction to these twin catastrophes? Virtually nothing. The editorial pages and nightly news are nearly silent, and current office holders and candidates are not addressing these issues.

We the people are not holding our leaders’ feet to the fire. Shame on all of us. It has been about 16 years since President George W. Bush made the last significant, but unsuccessful initiative to reform the system.

Time is of the essence, yet we continue to squander that time, while corrections to the system could move it toward sustainability. Many have thrown their hands in the air in surrender even though there are a number of reforms that could make the system sustainable over the next 75 years and perhaps even over the more distant horizon — two key time frames used to measure sustainability. The Social Security actuaries have judged these and other combinations capable of this result.

Structural problems:

• “Pay-as-you-go,” coupled with a declining ratio of workers to retirees, creates a Ponzi scheme.
• Longevity increases are resulting in larger outflows than anticipated.
• Initial benefit levels are rising faster than revenues and inflation.
• Cost of living adjustments are rising faster than real inflation.
• Investable “surpluses” are declining. These will ultimately disappear as well as the earnings on these investments. Note: Raising taxes 20-plus times has not solved the structural problems.
  

Suggested solutions:

• Index retirement benefits to longevity.
• Calculate initial benefit levels using the Consumer Price Index rather than wage increase.
• Calculate cost of living adjustments based on the more accurate inflation index, Chained Consumer Price Index, rather than traditional Consumer Price Index.
• Move away from “pay-as-you-go” toward a system that funds each retiree’s benefits from his own contributions. One way to do this is through a contributory add-on system of personal savings accounts.
• Additional investable surplus must be created, probably by liberalizing investment choices in a manner like your 401(k) option.
  

Jeffry Gundlach, the “Bond King,” pointed out in a TV interview that we used to worry about our grandchildren, but now must worry about ourselves. And because unfunded mandates are growing, they are gradually squeezing out other government expenditures. As a result, some have described our government as becoming an insurance company with an army.

Our current national debt plus unfunded mandates over the 75-year period amounts to $1.3 million per 2025 taxpayer. That is my definition of draconian.

By electing officials who looked primarily at short-term, easier and partisan issues, we got what we voted for — bad governance of mandates. If this is to change, we must demand candidates and officials who will also solve major, long-term problems like Social Security. That is our challenge and responsibility if we are to avoid the pending national disaster.

Scot Wallace, an Oakley resident, graduated from Cal Poly San Luis Obispo with a degree in ag economics. He had a long business career in agribusiness, was a vice president/general manager, board member and entrepreneur. He is a former Republican Party precinct chair, legislative chair, regional chair, county and state delegate, and a three-time campaign manager for a past state legislator.

The post Too quietly, the clock ticks down on Social Security’s solvency appeared first on Park Record.

People’s memories are short and our experience even shorter in the context of history. History is our long-term memory of events and lessons learned, which can keep us from repeating our mistakes.

This only works if we learn, remember and don’t ignore these lessons. We shouldn’t have to reinvent the wheel.  

We seem to be ignoring some of these lessons, and risk unwanted consequences like world war, dictatorship, slower and distorted economic growth, or even worldwide depression. 

Here are some lessons learned that we Americans seem to be ignoring:

Appeasement: The Munich Agreement allowed Hitler to invade the former Czechoslovakia with impunity. This has widely been cited as an example of appeasement. The hope was that non-involvement would prevent escalation which could lead to wider war. It did not prevent World War II, and many think it may have incentivized Hitler to believe he could expand war without penalty. We now seem to be appeasing Russia in the Ukraine and elsewhere. China is watching.

Isolationism:  The United States and some of our future allies watched while Germany overran Europe and northern Africa and drove Britain off the continent at Dunkirk, requiring D-Day at great risk and loss of human life to regain a foothold. The same theme took place in the Pacific. War was not prevented while the total cost to the U.S. and our allies was much higher, particularly in blood.  We used to sing, “Remember Pearl Harbor.” We now should remember isolationism resulting in D-Day, the Battle of the Bulge, Iwo Jima, and the Battle of Midway. Civilian populations suffered as well.

Rules-Based, Cooperative World Order:  Much of the leadup to the two world wars resulted from chaos due to a lack of a rules-based world order and ambitions of dictators and emperors. After World War II, a major move to correct this problem took place, resulting in the creation of institutions, agreements and efforts to find solutions short of war. These included NATO, SEATO, NAFTA, the U.N., WTO, WHO, Geneva Convention, the START Treaty, open seas and a general agreement not to use nuclear weapons.

Despite the reality that this framework has served us well, our government is taking the lead in dismantling it, returning us to a more pre-World War II disorder of everyone for himself.

Some of this trend includes the following:

(1) Our leaders are discounting the need for collective security to counter our adversaries, including China, North Korea, Russia and much of the Muslim world whose combined area, population, economy and nuclear capability are immense. Yet we claim we can “go it alone” despite running low on weapons to fight a much smaller war in Iran.

(2) We are alienating our friends with territorial expansion threats, neocolonial efforts to control oil and strategic metals such as rare earths, and with needless insults, coercive methods of negotiation, and gunboat diplomacy.

(3) We see efforts to challenge the authority of states, courts and the legislature and concentrating power in the presidency.

(4) Antisemitism, racism and class warfare are on the march (remember Jesse Owens in the Germany Olympics, Auschwitz, the Russian progroms, and entire classes executed by the red Chinese) as the stage is being set to invade Cuba.

Tariffs (Really Price, Quality and Availability Control): These were judged as major factors in causing the Great Depression (Smoot-Hawley tariffs) and harmful when Nixon invoked price controls. Tariffs are being used as an end run around the constitutional grant of revenue and spending powers to Congress, not the president.

The other issue is the effort by the government to gain equity in the ownership of private enterprise at the expense of private sector stockholders whose investment will be diluted.

We used to call this socialism, but suddenly it is considered conservatism.

Expansionism is being justified on the grounds of national security and the president as the commander-in-chief, an extension of the traditional grant of power. It diminishes the post World War II dissolution of colonial empires and ignores the morality of sovereignty, both popular and national. The U.S., Russia, China and much of the Muslim world are engaged in these practices.

Trade: Free trade raised all boats, even in China. Free is, of course, a relative term. We are now reverting to protectionism, mercantilism and even neocolonialism such as controlling Venezuelan oil. Further control is being levered by export control, which is or may be used for raising money from donations from those very companies for funding ballrooms, campaign purposes, or legal defense funds. Sounds like “pay for play.”

First Principles were born in the crucible of the Revolutionary War and the rejection of the divine right of kings, and canonized this spirit in the preamble of the Constitution as follows:

We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.

The Bill of Rights, women’s right to vote, the end of slavery, and expanding civil rights mark key advances in the march toward a more perfect union. Free speech and the “blessings of liberty” imply that “we the people” establish our culture, not the government.

Many historians believe our constitution is one of man’s crowning achievements. Let’s not forget these ideals and accomplishments. Above all, let’s secure and maintain blessings of liberty for ourselves and our posterity.

When we view the overall pattern, we see consequential lessons forgotten, which can doom history to repeat itself. Part of this memory loss is adopting authoritarian techniques that can result in a more dictatorial government. Confrontation is on the rise, while cooperation is declining.

Let us not forget nor abandon fealty to our first principles and the Constitution, while maintaining a government of laws, not a single dominant personality. From this comes national pride, admiration from the world, and the blessings of liberty.

Scot Wallace, an Oakley resident, graduated from Cal Poly San Luis Obispo with a degree in ag economics. He had a long business career in agribusiness, was a vice president, general manager, board member and entrepreneur. He is a former Republican Party precinct chair, legislative chair, regional state chair, county delegate, and a three-time campaign manager for a past state legislator. 

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In this era of mass communication the truth is often strained to the limit with yes or no, time restrictions, non-critical thinking, victimization vs. self-responsibility, favoring passion over reason, win-win disbelief, win at all costs, propaganda, censorship, intimidation and advocacy.

We excuse lies, bad ideas, distortions and misbehavior with illogical bromides such as:

• What he meant to say was…
• Yeah, but they did the same thing.
• Everybody does it.
• It’s just business, politics, love, war ….
• It’s just rhetoric.
• It’s a negotiation tactic.
• It was meant to be a joke.

The quest for truth is restricted by human-imposed limitations such as statutes of limitations, rules of evidence, length of editorial letters, attention spans, Robert’s Rules of Order, threats of lawsuits, and more.

Ultimately, knowledge or lack of it is the greatest restriction. The quest for truth is a principled enterprise, not a platitude-driven effort. This essay hopes to explore truth, honesty, and integrity, because, in my opinion, character counts.

Truth includes positives, negatives, and neutrals, while advocacy edits out the ones which don’t support their viewpoint and are therefore less than truthful.

Advocacy may be an honest presentation of only part of the facts or evidence.

Unfortunately, truth is on the decline, while advocacy is increasing in many areas such as law, politics, business, medicine, media, science, and education.

The legal system tends to tell us what we can or can’t legally do, with significant indifference to what we should do. Consequently, we often use the fact that an action is not prohibited as justification for that action, even though it may not necessarily be appropriate. This is an attempt to equate what we can do with what we should do.

The meaning of innocent is distorted when a not guilty verdict is rendered. The same is true when implying exoneration when the expiration of the statutes of limitation is involved.

The legal system promulgates statements like “free speech zones” when the Constitution’s intent is to define that area as the U.S. as a whole.

The oath “Tell the truth, the whole truth, and nothing but the truth” may not achieve its goal of the whole truth. To give a yes or no answer often requires an incomplete or incorrect answer. Rules sometimes prohibit evidence.

Perhaps the oath should resemble the following: Honestly tell the truth, the whole truth, and nothing but the truth as you are permitted and understand it.

Advocacy can detract from an honest effort to achieve truth, and procedure can usurp justice. And we sometimes convict and punish the innocent because we place time and procedural limits on the quest for truth.

Definitions

Fact: A data point, event, or status which is generally accepted; i.e., it is raining in Kamas.

Belief: Something thought to be correct, true or will happen based on some facts, logic, hope or indoctrination. It may or may not be true; i.e., there is a heaven.

Lie: An intentional deception, based on a known false premise or falsehood. The opposite of truth; i.e., I always tell the truth.

Misinformation: Stating false, largely false or misleading information. The intent can be to deceive,or due to ignorance or indoctrination; i.e., the sun revolves around the Earth.
Opinion: An acceptable expression of belief, even though it may not be true. An intentionally false opinion is misinformation, not an opinion; i.e., abortion is evil.
Truth according to Webster: Sincerity, genuineness, honesty. The quality of being in accordance with experience, facts, and reality. Actual existence. Reality.

Veracity as applied to persons or to their utterances connotes habitual adherence to the truth.

My definition of truth and some thoughts: A conclusion which is logical, fact-based, objective, reflects reality and broad enough to include relevant information. An absolutely correct or accurate conclusion, devoid of evasive qualification or bias, within limits of current knowledge; i.e., the Earth revolves around the sun.

Because truth implies perfection, constraints including knowledge, time, space, rules, focus, and communication skills make it difficult to achieve. Perhaps it is more a quest or goal, not an achievement.

If so, we need to be thinking about honesty, which is more of an intent rather than actually achieving pure truth. Otherwise, it becomes truth as we understand it,rather than as it actually is. Such a view is too subjective and incomplete.

Truth may be more than the sum of its supporting facts. If a man likes a woman’s looks, personality, humor, honesty, intelligence and cooking, he may love her. Yet he may not love another woman with the same characteristics even though he admires her.

Webster lists experience among the building blocks of truth. I agree but consider it part of reality.

Ray Dalio points out that experience is limited to our conscious lifespan. I would add perspective. The extent of experience can be extended by knowledge of the experience of others, as well as science, economics, history and civics.

As responsible beings, we must diversify our information sources, think through matters of truth, and demand honesty. We must not excuse or accept less.

Perhaps honesty, not truth, is the best we can achieve. Above all, a sense of right and wrong is essential if we are to be people of integrity.

Scot Wallace is an Oakley resident.

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