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In this article we argue that the coming collapse of social security is one reason politicians want to take your guns. We depict a violent scenario. The ideas expressed here are controversial. Not everyone in the pro-liberty camp, or indeed within JPFO, agrees on the details.
Some readers might think we’re being alarmist. Some might be confident that government will always be able to anticipate, avert, or at least soften any collapse of the social security system. Others might believe the American people would see a collapse coming and adjust themselves, however painfully, to the reality without violent outbreaks, bank closures, or martial law.
Our aim is to stimulate people to think seriously about the possibilities and to work to prevent the worst from happening. Social Security seems poised to implode. Will that implosion bring down our liberties as well? Will desperate governments (who’ve constructed a house of cards built on "entitlements") use this as an excuse to confiscate your firearms?
We invite readers to comment on any aspect of this article. Please click here to send your feedback or any ideas you have about the issues raised in the article.
For another look at the Social Security issue, please see Wrong Questions on Social Security Light by Ed Henry.
A bomb is ticking.
The bomb wasn’t built by terrorists. The bomb was built by government.
The bomb is made up of one part social welfare programs and one part demographics -- but that combination is more dangerous than TNT or ANFO.
We’re talking about the coming collapse of social security.
You’ve heard it’s going to happen --- that in 2012 or 2016 or 2038 or some other ever-shifting date the U.S. social security system will run out of money. You might think that, as the time approaches, the government will pull off one more "fix," as it has in the past, averting catastrophe. But here’s something you probably haven’t heard before:
The coming collapse of social security is one major reason they want to take your guns.
Simply put, people in power don’t want the peasants to have pitchforks on the day everyone learns the lords have looted the storehouse.
When there’s nothing left for the old, the disabled, and the dependent except lies and hunger, people are going to panic.
Some will take to the streets in terror at facing deprivation. Some will rise up in rage. The desperate may include ordinary, non-political people, reacting only to hunger or fear. Left-wingers (who traditionally think of government as the solution, not the problem) may rise up in rage at having been betrayed. Punks may take to the streets in the sheer exuberance of smashing things. Criminals may seize the moment to rob and kill with impunity. Many ordinary men and women may take up arms solely to protect their homes and businesses against rioters. And finally, some political groups may decide that the chaos gives them a perfect opportunity to change the government -- perhaps violently.
In other words, the chaos that follows the collapse of social security (or, for that matter, any economic disaster) may be both widespread and complex in its origins.
Guns and gun owners will be blamed.
Whatever else happens, however, one thing is virtually certain: The government will fear "the usual suspects" -- gun owners -- and will blame them, and their guns, for causing or escalating the violence.
Already, various measures like the Model Emergency Health Powers Act, currently being considered in 34 state legislatures, authorize officials to seize firearms during ill-defined crises. How much more will governments do when they have reason to know, perhaps years in advance, that chaos is coming?
This is the All-American version of a global crisis.
The push to take firearms out of all non-governmental hands is worldwide. Sweeping gun bans have been implemented in countries that are very much like the U.S., specifically Britain and Australia. The U.N. is driving a global effort to remove firearms from the hands of everyone but government agents and official military forces.
The social security crisis is also worldwide. Virtually every developed nation has both a fragile social security system and an aging population. Many have a host of other growing financial problems -- increasing debt, bankruptcies, falling corporate profits, and more -- that could combine to make any social security crisis even deeper and more dangerous.
Combine these fragile situations with problems in the so-called developing nations, and the social security crisis even has the potential to bring on global war. The sidebar, "The Global Crisis of Social Security," touches on international aspects of the crisis. In this main article we focus on the United States. But as you read, keep in mind that disarmament, a social security crisis, and financial and social instability may go hand in hand worldwide.
We know a lot of readers will scoff at the idea that there’s any connection between social security and the effort to take guns out of ordinary peoples’ hands. We know this article is as explosive, in its way, as the ticking social security bomb. In a sense, this article is an explosive with a long fuse whose impact won’t be felt for some time.
So the best way to predict the future -- especially when it comes to what government will do -- is examine the past.
How the social security time bomb was built.
When the U.S. social security retirement system was implemented in the late 1930s, nearly half of potential recipients died before collecting even a single check. According to the Social Security Administration’s own figures, the support ratio -- the number of people paying in vs. the number receiving payments -- was 159:1 in 1940, 42:1 in 1945, and still a tolerable - but rapidly falling 17:1 in 1950.1 Now, people are not only living longer, they’re having fewer children to pay into the system. Even with the influx of women into the workforce, the support ratio is down to 3.4:1, according to the 2001 Report of the President’s Commission to Strengthen Social Security.2
And the ratio is still falling. As CPA Bruce Bell put it, "Demographically, Baby Boomers are the huge bulge in the belly of the python." The social security python won’t be able to digest us all.
Even at 159:1, social security was a broken system -- because it was a fraudulent one. It is quite simply what Ronald Reagan called it: "An intergenerational Ponzi scheme." It is, and always was, a scam in which government rewards one generation off the labor of the next, all the while making glowing -- and fake -- claims about how the sound and stable the system really is.
Though Americans were deliberately led for decades to believe they had personal retirement accounts awaiting them, in fact no such accounts ever existed. Social Security worked exactly like any other pyramid or Ponzi scheme. The checks received by the first recipients came straight out of the pockets of younger "investors." Those younger people, who believed their money had gone into personal accounts, were in turn paid out of the next generation’s pockets.
People outside of government who operate such schemes are arrested and sent to prison.
At first, the amount paid into the system exceeded the amount being paid to beneficiaries. This is the origin of the famous "social security trust fund" that politicians need to "protect" every few years. Each time they claim that their new "reforms" (usually involving raising your payroll taxes and/or tinkering with the age at which recipients can receive benefits) have ensured the "soundness" of the system for the future. However, this too is an illusion. The "trust fund" contains only government bonds -- IOUs from the federal government to the federal government. In essence, the government has been "borrowing" against the trust fund to finance deficits.
Again, it would be illegal (as well as incautious) for any private company to fund its pension plan by issuing bonds to itself. Employers can, and do, go to prison for exactly that.
How the social security time bomb will explode.
Sometime in the next several decades, two problems will strike:
First, the bankruptcy of the system will reach the point where there won’t be anything to pay out and there won’t be any politically tolerable or economically feasible "fix." Second, millions will realize, belatedly, that Ronald Reagan’s assessment was right: The system was always a fraud.
For a while the federal government will continue to shore up the broken system, raising social security taxes again, tinkering with benefit levels and eligibility, fudging cost of living allowances, and shifting a bigger part of the tax burden to employers (where workers still essentially pay the tax, but because they don’t see it coming out of their paychecks, might believe that some "greedy business" is forced to pay).
When exhausted workers and businesses finally can’t give any more and the outraged senior-citizen’s lobby won’t tolerate benefit cuts, governments will try various other "moderate measures."
"Moderate" measures and failed fixes
In some of its "moderate" attempts to fix the unfixable, the U.S. federal government might:
Another, particularly cruel measure might be to place a special tax on medicines and doctors’ services, with the proceeds supposedly going to "save" social security. Although this will be presented as "reasonable," in fact it will have the effect of making medical care unaffordable to many elderly people, who will then die younger -- lessening the drain on the social security system. The government might outright ration medical care, as called for in the infamous Hillarycare plan. Bureaucrats could simply declare anyone over 70 to be "non-viable" and therefore entitled to lower levels of service. The effect would be the same; early deaths, and fewer social security payments.
The Ponzi scheme finally collapses.
Many of the above-described moves are obvious short- term measures which would eventually raise the ire of the social security lobby. All would invariably drain the resources and patience of the average American worker.
But then, American workers have learned over the decades to endure almost any tax, any bureaucratic regulation, any emergency measure, any lie, any gradual reduction of their freedom or their income. Most have no real concept of freedom or sound economic policy, and in fact believe that whatever government does is intended "for our own good." They are conditioned to be extraordinarily docile and accepting.
What will be different this time? Several things.
First, with any crooked financial scheme, you eventually reach the point where you’ve done everything you can to keep the marks from finding out. You’ve borrowed all you can borrow. You’ve moved as many funds from one box of IOUs to another box of IOUs as often as you possibly can to disguise and avert the coming catastrophe. One day, there are simply too many balls in the air for even the most skilled financial juggler to handle. The slightest slip -- a recession, a national catastrophe that sucks away the country’s resources, a vast tax-resistance or tax reduction movement -- and the scheme crashes down. The Ponzi "investors" go unpaid.
While governments can draw on more resources than any corporate Enron or freelance con artist (neither of which, after all, can simply tax you to get more money), eventually, things fall apart.
Chaos reigns; desperate government grows ruthless.
Thirty-nine million social security recipients are out of luck -- and many of these are helpless people, too old and ill to get jobs and with no family to turn to. Medicare goes down the tubes. The government tries to keep the system alive by paying some benefits to some people. But chaos reigns as millions compete for the ever-dwindling pot.
Hospitals and long-term care facilities, which get huge portions of their income from these programs, suddenly can’t meet payroll, or perhaps even pay their electric bills. Senior centers close, private medical clinics lay off employees, every kind of business right down to the local supermarket suffers as millions no longer have the cash to make purchases or pay their bills.
The able-bodied elderly try to find jobs. But there are no jobs to be had. Young workers, also suffering from the recession, may not immediately blame the Nanny State that nurtured them. But they certainly do blame and resent old people for having scammed away what was rightfully theirs. Even workers who are still employed -- and still, of course, paying social security taxes! -- know they’ll never see a dime of their money. They’ve suspected that for years. But now harsh reality sets in. Now it’s not a matter of cynical, theoretical, belief. Now it’s an icy cold fact. Now they’re suffering and they could use some of the tens of thousands of dollars that have been taken from them. But it isn’t there and it never will be.
Recession deepens. As the job market squeezes down, women are driven out of the workplace, both by the economic collapse and by the need to care for parents and grandparents who’ve been shut out of care centers.
Millions are out of work. And those millions are angry. Desperate.
The government can’t offer its usual pacifier -- money. It hasn’t got any more. And if it chooses to try to "solve" the crisis by cranking up the printing presses, the U.S. will soon look like Weimar Germany, where people pushed wheelbarrows full of useless Deutschmarks to the store to buy a loaf of bread.
The foundation for civil war?
Looting and violence break out, first in the inner cities, then around closed factories, on college campuses, and beyond. Some people are truly desperate. Others, feeling outraged and cheated, just want to take what they’re "entitled" to -- or take anything they can grab in an immoral world, a world gone mad.
National Guard troops are deployed on American streets. The Marines, SEALs, and Delta Force soldiers, who’ve been practicing urban warfare in U.S. cities for years3 go to war on Americans. Tanks prowl. Tear gas, rubber bullets, and sophisticated new weapons such as the Marines’ Active Denial Technology -- a long-range "pain ray" --control mobs. But the mobs are still angry, still looking for a target. The mobs are bigger than overtaxed troops can handle.
Meanwhile, in Washington, the government desperately tries to find political solutions to the chaos.
While Congress dithers, postures, and gradually passes a raft of rights-robbing "emergency measures" that make the post September 11 USA-Patriot Act look like the work of Thomas Jefferson, the president and the executive branch swiftly take charge. Franklin Roosevelt did it in 1933, when he rapidly declared bank holidays (because people were demanding their money in gold and the banks didn’t have enough on hand to pay depositors). He closed banks, specifically forbade them to pay out any gold or silver, then made his declaration "legal" in Congress in the span of a single day.4 (Today, presidents don’t feel the same need to get permission of the people’s representatives when imposing emergency measures.)
Government goes into the bunker. Bureaucrats take over. The people be damned.
Using the power already declared in Executive Order 12919, the president takes control over all "critical infrastructure," including ports, industry, health and welfare facilities, natural resources, financial institutions, telephone networks, water systems, power- generation facilities, fuel-delivery systems, and computer networks -- including those that are privately owned.
Using this and other executive orders issued by Presidents Ford, Reagan, Clinton, and George W. Bush (which in turn amend or supercede similar emergency orders issued by Presidents Kennedy and Nixon) the government seizes control of all U.S. media, from television and newspapers to the Internet. Using Presidential Decision Directive 63, the government monitors all private communications, including the Internet, in search of troublemakers and "domestic terrorists." (Via the National Security Agency’s Echelon system, the FBI’s Carnivore, and even newer and more draconian systems, the government is already doing this; the effort will be stepped up. With Carnivore, the FBI may actually have the capability of shutting down the Internet or large parts of it in an "emergency" by blocking communications at ISP level.)
It takes all food resources and farm production and forbids all "food hoarding" -- a restriction enforced by raids on Mormon households and dwellings of suspected "survivalists." It seizes all forms of transportation, including any private cars it wishes to take. It takes over hospitals, schools, and pharmaceutical companies.
The government also seizes control over wages, salaries, credit, and the flow of money in all U.S. financial institutions in a desperate attempt to stop the financial hemorrhage.
In the meantime it shifts large masses of the population out of the trouble zones, perhaps to some of the many deactivated U.S. military bases, and takes control of "essential" businesses, churches, synagogues, and mosques.
But most drastic of all, still using the power already established by executive order, the federal government places civilians into forced labor. It isn’t the vast mobs of the unemployed who are drafted, but the skilled workers, the very ones most likely to have maintained some level of stability during the chaos. Because these, after all, are the workers who can best plan the programs, build the prisons, administer the offices, and distribute the rationed resources for the long emergency ahead. So while these Americans become indentured servants of the government, the private businesses they were helping hold together slide further into the growing financial abyss, creating even more chaos.
And still the government does more, takes more. Whatever can’t be covered by some other specific executive order can come under the umbrella of EO 12919, which gives the president authority to seize and allocate everything from construction materials to your shoes.
Longstanding plans exist for just such "emergencies."
Do you think this is farfetched? But every one of the emergency measures we described -- and more -- is already authorized under federal law -- although not authorized by the Constitution or the Bill of Rights.
If the federal government wasn’t interested in taking the emergency measures we describe, why implement the executive orders and presidential decision directives in the first place?
Emergency orders currently in force include, in addition to 12919, 11921, 12656, 13228, and 13231. The trend toward creating vast emergency federal powers by decree dates at least to John Kennedy, who issued a raft of such orders during the Cold War. (You may read recent executive orders and look up the topics of all modern EOs by going to the National Archives and Records Administration’s Table of Executive Orders .)
These orders and directives represent a long-term vision by multiple administrations from both establishment political parties of America in chaos -- and a long-term fear of what the American people might do in a crisis.
Although all these "emergency measures" are being taken to "re-establish order and ensure security," it’s not your security they’re protecting. Here’s a telling fact: For many years, 98 percent of all money spent on civil defense has gone, not to build shelters or stock foods or medicines for the people, but to protect government employees and assets. Despite warm, fuzzy public relations claims, the main function of FEMA isn’t to help citizens through emergencies; it’s to ensure "continuity of government." Continuity of government -- but not American representative government! -- was a plan we also saw in operation when we learned, in February 2002, that a "shadow government" of unelected bureaucrats had been sequestered in bunkers for months, waiting to rule the United States in the event that elected officials couldn’t do their jobs.
In what way could any unelected bureaucracy possibly be the legitimate government of the American republic? It can’t be. But even an allegedly "conservative" Republican president, following an emergency plan established decades ago, believes it can. How much worse might things be with an even more ruthless politician in office?
(If you’re tempted to dismiss the scenario we describe, remember that for decades "right-wing nuts" were scoffed at for claiming that the federal government had a series of bunkers and plans for an emergency "shadow government." Few believed them, though their claim was absolutely true. It also took years for people to stop laughing at rumors of urban combat exercises being waged in U.S. cities -- complete with black helicopters. But this, too, was fact.)
When they come for your guns.
When, in all this chaos, do you suppose the government comes for your guns?
If all works out as they prefer (from the halls of Congress, to the cubbyhole offices of the Bureau of Alcohol Tobacco and Fireams, to the echoing chambers of the United Nations), they won’t have to. They’ll have banned and confiscated them long before you get a chance to present a danger to them or to protect yourself, your family, or your business against desperate mobs.
As with so many other moves to make us dependent on (and harmless to) government, a general firearms ban isn’t likely to happen all at once, nor is a confiscation likely to be carried out in most cases by jackbooted soldiers. In fact, it probably won’t even be called a ban or confiscation. And most people -- probably even most gun owners -- won’t even realize that’s what’s going on.
Let’s look at a possible scenario.
In a short period, well before the social security system collapses, criminals or madmen commit several heinous acts of slaughter. One man goes up in a tower, but this time he shoots 78 people. A gang of teenage boys on Prozac, Zoloft, or Ritalin shoots up a school, but this time the death toll is in the multi-dozens. Three or four such incidents happen in a month. Or on a single day, glassy-eyed men show up in nine big shopping malls around the country and open fire on Christmas shoppers, killing and wounding hundreds, mostly women and children.
The mall shooters might be foreign terrorists. But whoever they are, the anti-gun establishment, which has been awaiting exactly such acts of slaughter, will crank into renewed action. The public, seeing gore and misery on the evening news, hearing the Big Lie repeated again and again - - "guns cause violence" -- will clammor for the government to make them safe from every gun owner -- from you and me.
Remember that isolated but horrific slaughters were all it took to virtually ban firearms in Britain and Australia in the late 1990s (and, as Australia’s prime minister put it, to prompt offivials to try to eliminate the entire gun culture -- something the anti-freedom crowd would regard as an act of genocide if it were directed at any group other than gun owners). The U.S. is more resistant. Even the most "moderate" gun-rights activists would fight hard against an outright ban.
A gun ban that isn’t.
So we won’t have a ban. We’ll just have "reasonable" laws requiring us to keep the guns we do own at secure facilities operated by the National Rifle Association (a compromise that would be brokered by the NRA and loudly touted by them as a the only means of saving us from more draconian legislation).
Or we won’t have a ban. We’ll just have to pay a $1,500 annual tax on each firearm we own, and a 10,000 percent tax on every box of ammunition we buy (that exact tax proposal having once been introduced in the U.S. Senate by former Sen. Daniel Patrick Moynihan.) Or we’ll have to buy a $2,500 "arsenal license," renewable only at the pleasure of the ATF. Perhaps these taxes will even be put toward the good and noble purpose of "saving the social security system."
You can run, but you can’t hide.
No, we won’t have a ban. And of course, we won’t have registration -- other than every state’s record of concealed carry permit holders. Other than the ATF’s computerized records of 4473 firearm purchase forms. Other than the FBI’s instant-check records (which, it will be revealed, they destroyed as required by law -- but just happened to keep complete, permanent backup copies of). We won’t have registration, other than the records on citizens who’ve complied with future licensing laws or laws requiring registration of every purchase of ammunition.
If you’ve ever shopped at a gun store using a check or credit card, if you’re a customer of Cabelas or a subscriber to Guns and Ammo, if you drive a pickup truck, have a hunting license, buy camouflage gear, or have a neighbor who’s spotted anything gun-related in your house, you can count on a visit from the ATF, the local police, or perhaps even a special federal "health and safety team" created by Congress to deal with the growing "public health crisis of gun violence." These teams will make sure your guns are properly stored off-premises, and properly taxed. If they’re not, you’ll go to prison for years under various "sentence enhancements" for using guns during commission of a crime. The crime, of course, would be your failure to pay the tax or store your weapons at the NRA facility.
But don’t worry. Your firearms won’t actually be banned. And if you’re a law-abiding citizen, paying your taxes and handing grandpa;s old carbine over to the NRA for storage, your firearms won’t be confiscated, either.
You just won’t have them when the crisis hits.
Not so far fetched.
Having seen decades of emergency orders enacted and re- enacted, reasserting the federal government’s unconstitutional control over every aspect of life - including plans for slave labor and relocation camps, we should not doubt what the government could, ultimately, do.
Having watched the Brady bill go from a "reasonable measure" against handguns to a check on purchases of every type of firearm ... having watched as the law forbidding any record keeping on gun buyers somehow turned into records being kept for 180 days ... having experienced arbitrary bans of firearms based solely on appearance (bans so vague and badly written few gun owners have any idea whether their weapons are legal or not) ... having watched Congress covertly re-instate the school-zone gun ban after the Supreme Court decreed it unconstitutional ,,, having stood by as innocent gun owners around the country have had their firearms seized because of misdemeanors they may have committed 30 years earlier … can anyone doubt that the type of sneaky, politically brokered gun ban we described is possible -- even likely?
Uncle Sam’s financial ruthlessness
Let’s also not forget that the United States has seen plenty of "emergency" government controls in its past -- and its present.
In fact, in recent years, Americans have become accustomed to living every day with many things that, in Lincoln’s or even Roosevelt’s era, would have been considered barely acceptable even as dire "emergency measures." Consider airport body searches, no-knock midnight raids, civil asset forfeiture, random highway checkpoints, fiat currency, de-facto national ID cards, FBI purchasing dossiers on ordinary Americans, and a host of other impositions that are now simply normal life to us. We are being conditioned to obey orders and submit unprotestingly to government fiat rule.
Clearly, "emergency" executive orders, "homeland security" measures, and the like are written with draconian control in mind -- not control of foreign invaders, but control of the American public. Clearly, our own government seriously fears what the American people might do in troubled times. And clearly, the predictable breakdown of social security is a likely candidate to bring about that chaos.
Armed Americans, in such times, have the ability to protect their homes and businesses against looters and violent rioters. They have the ability to operate as local militias to keep order in communities. They have the ability -- which the George W. Bush administration has consistently refused to recognize -- to help protect the country against acts of terrorism or foreign invasion. They could, in short, do everything an armed people has historically been expected to do for itself and its country in times of trouble.
But this is not the way the Charles Schumers, Kofi Annans, Barbara Boxers, Hillary Clintons, and Sarah Bradys of the world see us. Unfortunately, it’s also not the way the George Bushes, Tom Ridges, or John Ashcrofts of the world see us.
While these two groups of people may be far apart in their rhetoric, they are united in their distrust of ordinary armed citizens. (Note that the Bush administration has not only failed to restore a single part of our lost Second Amendment rights, but has gone on record as opposing even something as mild as allowing pilots to go armed in airplane cockpits -- even after the House of Representatives approved the idea.)7
They see us not as potential protectors, but as potential rioters in the streets, as a rabble who would be shooting back at their soldiers, at their unelected "shadow" dictators, and at their "emergency management" troops in times of crisis. They see us as potential overthrowers of the bureaucratic, military, unconstitutional order they would impose upon us.
It is for this reason that they must ultimately take our guns. And it is for this reason that we must adamantly keep the tools of free men and women.
Those tools include firearms. But they also include our mindset and our independence. We must never, ever forget that without the Second Amendment, there is no Bill of Rights. The Second is the guardian of all the other freedoms ensured by the Bill of Rights and historically enjoyed by Americans. Withou , rants can do anything they wish to us and we are powerless to stop them.
We must keep ourselves alert (remembering how quickly crisis can descend, even in times that appear peaceful and prosperous). We must try to awaken our sleeping neighbors. We must try to wean ourselves and our families from dependence on the all-pervasive nanny state. We should do the best we can to prepare ourselves financially for the future, independent of government handouts and Ponzi schemes. We must do everything within our personal power to bring back the Bill of Rights now and in the wake of a government-caused calamity.
Governments can’t risk facing an armed citizenry on the day their promises fail.
But we can’t risk being dependent on a government that cheats us, then disarms us to avoid the consequences of its actions.
To read about the potential global impact of the social security crisis read our sidebar article, "The Global Crisis of Social Security."
If you want to see a blueprint of what America could be like with a Bill of Rights culture, read Hope, the novel that shows what a genuinely freedom-loving president would do for the U.S. Order Hope for just $14.95 (shipping and handling included -- 10% more in Canada) and receive two of JPFO’s famous "Gran’pa Jack" educational booklets: Gran’pa Jack #2: "Can You Get a Fair Trial in America?" and Gran’pa Jack #5: "The United Nations is Killing Your Freedoms,!" a $6.00 value, free when you order Hope (http://www.jpfo.org/filegen-a-m/hope.htm)
If you want to understand the ultimate progression of "gun control," read Death by "Gun Control": The Human Cost of Victim Disarmament by Aaron Zelman and Richard W. Stevens. It begins with "reasonable measures" to control the unruly; it ends in the death of a thousand cuts - and millions of disarmed citizens. Order Death by "Gun Control" for just $16.95 (shipping and handling included -- 10% more in Canada) and receive Gran’pa Jack #6: "Will ’Gun Control’ Make You Safer," and Gran’pa Jack #7:"Do Gun Prohibitionists Have a Mental Problem?" (a total $6.00 value, free when you order Death by "Gun Control" today. (http://www.jpfo.org/filegen-a-m/deathgc.htm)
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The Global Crisis of Social Security
In "Can the Second Amendment and Social Security Coexist?" we looked at the situation only in the U.S. But in fact, the social security crisis is larger and far more dangerous than that.
The social security crises is global. Virtually every country has a social security system. Nearly all the industrialized nations face the same aging crisis the U.S. does. Many of them face mounting debt, unstable currencies, and other dangerous financial problems, as well.
If social security is a time bomb, then there are actually dozens of bombs, planted throughout the big, industrialized countries. The one that goes off in the United States will be a little different than the one that goes off in Germany, Japan, England, or France. Each will explode at its own time. But as they go, the chain reaction will be catastrophic -- and scarcely a government on this earth is going to want guns in the hands of peasants who might "destabilize" an already perilous situation.
But even that isn’t the ultimate danger.
Social security, two "population bulges," and global destabilization.
While developed countries face aging populations and a coming social security crisis, the so-called developing countries -- including the highly volatile Arab world, Mexico, and Indonesia (the fourth most populous country in the world after the China, India, and the U.S., and not known for its political stability) -- are heading for a population bulge the opposite of ours. While we’re aging, they’re producing hundreds of millions of children.
At the same time, their economies are stagnating. Even where an economy appears strong, often the riches are going into the coffers of the elite, while the average person barely ekes by, worse off than his father or grandfather was. Young people are growing up angry, unemployed, and without hope. (This is a bigger factor in the rise of Muslim fundamentalism than most journalists ever mention.)
Who shall live and who shall die?
You don’t have to look far beyond today’s headlines to glimpse the potential chaos that could result from this. For instance, according to Dr. Daniel Goure, deputy director of the International Security Program at the Center for Strategic and International Studies, the average age of a Palestinian is 14, the average age of an Israeli, 28. Those angry young rock throwers you see on television are the vanguard of a global trend.
According to Dr. Goure’s report, "International Security and the Aging Crisis," at the very same time these conflicting population dynamics are setting the stage for worldwide instability, the military capabilities of the Western nations are decaying.8
Soon, it will come to a choice between putting money into the military and struggling to keep money flowing to "unproductive" old people. A possible scenario goes like this:
What do you think happens next?
If the Center for Strategic and International Studies is correct, down comes not only the U.S. house of cards, but a global house of cards. And with it, perhaps, comes war.
War could come as it came to us on September 11, 2001, when men desperate to the point of fanaticism struck murderously. Or it could come as Western governments "wag the dog" -- making war to divert citizens’ attention from domestic problems and turn citizens’ growing skepticism and discontent into "my country right or wrong" jingoism. Both motives for war could strike at once.
Worldwide instability: If the dominoes fall.
Perhaps what we’ve spelled out is a worst-case scenario. But even if you merely look to the more limited economic crises that have struck countries in recent years and how governments have responded to them, what you see isn’t pretty.
As we write this, Argentina has most recently been in the news. Just before Christmas, 2001, with its currency drastically overvalued, taxes soaring, and employment burgeoning to depression levels, Argentina collapsed into chaos that, toppled a president, killed 28 people, sent millions out on a general strike (blocking highways and disrupting transportation), and brought the country to the brink of civil war. Among other moves the government made: freezing all bank accounts and trying to force citizens to make every transaction (including such small things as the purchase of a newspaper) using traceable bank debit cards.9
All that happened just 10 years after the country had seemed to be headed for renewed economic health after earlier years of inflation and recession.
When Argentina ultimately defaulted in $155 billion in debt, according to Martin Weiss’ Safe Money Report, it was the world’s biggest default. And yet, "Brazil’s debt is twice as large as Argentina’s. Columbia’s is $38 billion with unemployment close to 17 percent. Venezuela suffers from the same kind of overvalued currency, the same kind of recession, and the same potential for an explosive public uprising. Japan, Indonesia, Thailand, Hong Kong, Singapore, and the Philippines are sinking fast. ... All suffer from ailments that are similar to Argentina’s"10
Earlier in 2001, Zimbabwe astonished world business and financial markets when it decreed that 75 percent of all export income must be paid directly into its central bank -- on the very thin excuse of paying the costs of its offshore embassies. The move, according to The Financial Times in a February 10 article, "foreshadowed devaluation of the Zimbabwe dollar as well as the imposition of selective currency controls."11
In Sao Paulo Brazil, we can see a direct example of how a bloated retirement system can lead to public chaos. While everyday life in most of the rest of the civilized world has been becoming less violent, violence in Brazil, and Sao Paulo, in particular, grew throughout the 1990s. When Jose Vicente da Silva and Norman Gall looked into the causes, they found what they termed "perverse incentives" -- that is, "devices of law and custom rewarding behavior that undermines the stated purpose of institutions." For example, in 1999 when they conducted their study, nearly two-fifths of the budget of Sao Paulo’s Department of Public Security went not to public safety, but into police pensions. In the military police alone, they found 14,000 retired first sergeants and only 1,400 active ones, 1,000 retired colonels and only 53 in service. The result was not only fewer law- enforcement agents on the street, but a perception of "parasitism, impunity, and bureaucratic privilege." Extending the police problem into other areas of government, they concluded, "[W]e can understand why Brazil suffers recurrent fiscal and currency crises."12
In 1999, Ecuador, like Argentina, suffered a financial crisis that led to chaos in the streets. Inflation hit 50 percent, the national currency lost a quarter of its value in a single week, and a nationwide strike forced the resignation of the board of directors of Ecuador’s central bank. Police arrested hundreds of people and dispersed crowds of protestors with tear gas.
Ecuador’s president Jamil Mahuad also responded by closing all the nation’s banks and announcing a plan to jail tax evaders and impose new taxes on the "rich." In an Associated Press article, Mahuad was quoted as saying that Ecuador’s better off citizens should accept the duty to pay more taxes and "give thanks to God that they have to money to do it." Mahuad also proposed to restrict the amount of money that people could withdraw from their bank accounts, increase the sales tax from 10 percent to 15 percent, and nearly double the price of a gallon of gasoline as an "emergency measure."13
No crystal ball can give a perfect glimpse of the future -- and certainly not on a global scale. But the signs on instability are everywhere. And so are the signs that governments will take the most ruthless measures, including disarmament of their populations (an effort the United Nations has been spearheading for years) to protect themselves against their own citizens.
1. "Ratio of Social Security Covered Workers to Beneficiaries: Calendar Years 1940-2000" (found at http://www.ssa.gov/history/ratios.html ). We have rounded to the nearest whole number. One reason for the rapid drop in the ratio has been expansion of coverage. Originally, only the workers themselves received benefits. Later, widows and widowers of workers, the disabled, and other categories of recipients were added.
2. Found at http://www.csss.gov/reports/Report-Interim.pdf.
3. See Bresnahan, David M. "The Marines Land in Atlanta." WorldNetDaily.com, August 16, 2000 (found at http://wnd.com/news/article.asp?ARTICLE_ID=13198). For background and commentary see Willson, S. Brian. "Domestic Counterterrorist Trainings: A Dangerous Trend" (found at http://www.brianwillson.com/awolcounter.html ).
4. See The Federal Reserve Bank’s "Closed for the Holiday" at http://www.bos.frb.org/education/pdf/closed.pdf.
5. Laxton, Edward. The Famine Ships: The Irish Exodus to America, Henry Holt and Company, 1996. Pg. 81.
6. Items in this list through 1971 are from a speech by Mark Nestmann, "What Bush’s Declaration of National Emergency Means to Your Wealth," and are based on various sources, including The Emergency Financial Controls Report by Robert H. Meier and Eric-Charles Banfield.
7. For our view on the Bush administration’s homeland security gap, see "An Open Letter to President George W. Bush, " February 3, 2002 (found at http://www.jpfo.org/alert20020208.htm ). The House passed its version of the Aviation Security bill (H.R. 3150) on November 1, 2001. It contained a provision for allowing trained pilots to carry firearms on airliners. The Senate equivalent bill did not.
7. Goure, Dr. Daniel. "International Security and the Aging Crisis: A White Paper on Defense for the Global Aging Initiative." Center for Strategic and International Studies, Washington, D.C., 2000.
8. "Argentina in cash chaos: Government orders use of debit cards over currency." Knight Ridder newspapers, December 6, 2001. Read about the Argentina debacle.
9. Weiss, Martin. Safe Money Report, January 2002.
10. "Zimbabwe in New Exchange Controls." Financial Times (UK), February 10, 2001 (found at http://www.mdczimbabwe.com/archivemat/other/econ/fintimesuk010210.htm ).
11. da Silva, Jose Vicente and Gall, Norman. "Perverse Incentives and Public Security: The Police." Braudel Paper No. 21, 1999 (found at http://www.braudel.org.br/paping21.htm).
12. Cisternas, Carlos. "Ecuador Faces Harsh Economic Measures." Associated Press, March 11, 1999 (found at http://www.washingtonpost.com/wp-srv/inatl/daily/march 99/ecuasor12.htm)