Why not raise the cap on earnings taxed for the federal pension program?
Because there is no problem with the amount of money flowing into the fund. The GOON’s (Greedy Old Obstreperous Nabobs) argument that pension contributions should be passed through Wall Street to generate a bigger return on investment is bogus. It’s not bogus because the size of returns isn’t guaranteed or increases from speculation, like winnings from gambling aren’t real. It’s bogus because the object of laundering more money through Wall Street is to bribe the financial class.
You see, Congress has set up this convoluted system of passing dollars through the Federal Reserve and subsidiary banks so the financial engineers can get a cut of every dollar spent before it flows back into the Treasury to be appropriated by Congress directly for public purposes.
This charade or pretense that dollars aren’t really public assets has to be maintained so Congress can claim, like Pontius Pilate, to have clean hands when the people they are elected to serve end up being deprived.
It’s telling that it was a Democratic Senator (Dick Durbin) who said “the banks own the place.” “Passing the buck” is not just a metaphor. It’s what Congress did when it set up the quasi-private Federal Reserve Banks to funnel money from the Treasury to the financial community so they could lend it back to the Treasury for Congress to spend.
Congress is tasked with the obligation to manage the currency in Article I, Section 8 of the Constitution. The ostensible rationale for inserting the Federal Reserve Bank into the distribution process was/is that Congress could not be trusted to spend prudently and equitably. So, the solution to untrustworthy stewards was to insert their unelected, unprincipled gambling friends into the process.
When revenues are collected directly into the pension fund and then distributed to individuals directly that cuts both the Congress and the banksters out of the loop. Ditto for when the Department of Education makes student loans directly and then forgives them when graduates go into desired professions, such as medecine and teaching where such people are particularly needed.
The quantity of money is not important (except to those who have none). What really counts is where the currency flows and whether or not it flows. Money is like water. A drought is bad, but so is a flood. Letting Wall Street play spigot is also bad.
