Today is 61 days until election day. Today we'll start to discuss who is lying, or who is fudging on the truth in this election.

If you remember we discussed (I did) the fact that the Democrats over the last fifty or so years have insisted that government's role in our lives should be expanded to increase a number of things that the Republicans do not believe our government has the right to involve itself in. and we discussed how many of those things are socio-economic based programs that require participation--- in the form of taxes to be paid--- by the working public.

Immediate examples that come to everyone's mind would be Social Security and Medicare. Here is a great place to start because these two programs, we all know about, encompass not only the good things about social programs run by the government and also the bad things about anything the government chooses to get involved in. They also embody how the general public can be misled and confused about what is happening to the truth when politicians speak about similar programs.

To begin with both Social Security and Medicare were designed as social programs that would be self sustaining based on the fact that every working person would be responsible for contributing a certain amount of their income, which would be withheld from their paychecks and/or from the profits of every business. When they were initiated, back in the nineteen-thirties and forties, the ratio of workers to retired persons eligible for the programs was approximately thirty to thirty-three people working to one person eligible for retirement. So far, so-good.

Unfortunately, there developed two things that changed the picture within a time frame of a few years. First, because of the second world war, 1) the returning soldiers from the war, making up for about four years time away from home, created a baby-boom (the children of which are just now beginning to swell the ranks of retirees) the baby-boomers as they are called have decreased the ratio of people working to the people retiring to approximately three to one. So there are far fewer people to pay for social security and medicare.

But that is only part of the problem. 2) Somewhere along the line the Congress--- our elected lawmakers--- got the idea of raiding the Social Security and Medicare trust funds for money they needed to pay for other debts the government owed. They got in the habit of putting in IOU's for those dollars they used for other debts from these trust funds. So much so that both trusts are void of any actual funds, only a large stack of IOU's.

Can you see the problem? This is what you hear referred to as unfunded-liabilities. A fancy name for debts of amounts we now owe for which there are no funds. These amounts can only be calculated based on charts and algorithms for things that might or might not represent debts from programs run by the government for which there are only guesses as to what the dollar amounts of debt actually are. To make it much worse is the fact that Social Security and Medicare are no longer the only programs funded in this manner. Almost all new programs the government undertakes have some form of unfunded-liability attached to it. Some of it is the fact that most payments come out of what is the general fund of payments received from revenues owed the government. But in recent years--- how many nobody is quite sure--- the government has taken to borrowing funds to meet payments. We are now borrowing forty cents of every dollar we spend as a government. I believe you can see where this leads. You cannot keep borrowing money to pay debts without eventually creating an enormous problem for yourself. If you are a large government the problem does not get better, it can get gigantically worse. These are problems that keep government economists and mathematics geniuses in very high demand.

Without placing any blame it would be an understatement to point out that this is a huge problem for any new Congressman or Senator of the US government. How in the world can you tell your brand new constituents what you just found out is the truth. You can believe every lawmaker most likely begins his new job with a few little white lies to avoid pulling his hair out dealing with the truth. And the problem doesn't get any better for them.

But that does lead to to some interesting thoughts about where blaming problems can be the basis for dirty political fighting. Some of which can also be truthful.

Okay so where do we go from here?

Well, hopefully you can now understand that the Democrats are the socio-economists, based largely on what is called the Keynesian-economics system of direct government involvement in the market. Barack Obama, whether you see him as a socialist to Marxist type or as extreme as a National Socialist from the pre-wwII German and Hitler era does believe that the government must involve itself in the country's economic policies. The Republicans believe there should be as little government interference in the economy as possible.

After all, as they see it, almost every surge in positive, profitable economies have occurred with little or no interference from the government, with the exception of not raising taxes as the Democrats insist, particularly in the American experiment. This battle has been raging between the Progressives and the Conservatives, Democrats and Republicans, since before the turn of the twentieth century.

Democratic lore maintains that Franklin D. Roosevelt led us out of the great depression with his infrastructure rebuilding programs, unfortunately there is much evidence to say rather, that we came out of the depression by the activity and business production of the second World War that carried into the post war era of business rebuilding, and the defense industry.

Part 3, tomorrow, will dig a little deeper.

D. Kenneth Ross