Tuesday, September 28, 2010

Fraud and the Fraudulent Fruadsters That Defraud

The world is awash in fraud.

North Korea’s Kim Jun Il just promoted both his own sister and 20-something year old son to the rank of generals (“four star” for the sister) in what’s reported to be preparation of the dictator’s transition of power to his heir apparent.

Raul, brother of Fidel has been dictating over Cuba for a while now.

Dyanastic power at the top of these large “peoples” movements?… what a fraud… good luck with that fools.

They get what they deserve.

Here in the U.S. we had Fannie, Freddie, FHA, the Federal Home Loan banks and a host of other federal initiatives to make homeownership more affordable and accessible for all.

Billed as “democratizing” access to homeownership through subsidized (“insured”) and highly financialized debt markets, these long trending scams worked to lower the bar to the point that virtually anyone could get their piece of the American dream…. at least temporarily.

Of course, this fraud went the way they all do eventually collapsing and resulting in huge collateral damage, millions of foreclosures, bad debts, skyrocketing unemployment and a global economy in shambles.

But we pay taxes for a slew of social services… the “social safety net”, as it’s called… that many in Washington (and elsewhere) proudly declare work to guard Americans against the hazards and vicissitudes of life.

At over 55% of the federal budget (Social Security, Medicaid, Medicare, federal extended unemployment insurance, food stamps, disability, section 8 housing, etc. etc. etc.) or $1.95 trillion (that’s roughly $6,450 that could simply be given to every man, woman and child… or $25,800 for a typical family of four… more than half the US real median household income!), you would figure that this size net would cover quite a number of vicissitudes… yet… what’s covered are fairly common hazards… temporary loss of employment, getting old, over-spending, not earning enough.

These aren’t the worst hazards I can imagine someone randomly encountering in their life, yet these are the ones that most of us encounter most of the time so they drive votes.

The elites in Washington merely dole out prescriptions for the public’s most popular dilemmas not the really hard, difficult or distressing ones.

Washington is a fraud.

Suppose the endgame for most of these policies runs similar to that of the Fannie Freddie debacle… that is, far larger distress coming from the unintended consequences created by government meddling then from the actual problems government elites were trying to “solve” in the first place… Wouldn’t the government have swindled it's citizens?

Shouldn’t you feel defrauded as a taxpayer when you are asked to backstop eons of bad policy ideas, many of which you are mostly powerless to amend, may never be able to gain benefit from or like Fannie-Freddie, have already caused you direct financial distress?