Year: 2011

by Smitty

Angley at Big Peace links an Air Force times article about overhauling military pay.

This writer is both a fiscal conservative and a military retiree, so I am torn over the issue, but this article is not about advocating for anything. Instead, I will make a prediction. Military members will accept whatever retirement overhaul the DoD and Congress make, and they will do it without grumbling. The United States military member is the ultimate public-sector employee, but unlike public-sector unionized employees who recently have faced pay and benefit cuts, military members will not stage mass protests, legislative sit-ins, and self-indulgent pity parties. 

I got into a lengthy discussion with an Air Force Major of about a dozen years active duty the other evening. While holding the corresponding Navy rank, I’ve spent half my twenty years in the Reserve. He was adamant that he get the full pension when he retires. “They can’t take that away,” he said.
Fine, I countered, but here we are, sitting in Afghanistan, willing to make the ultimate sacrifice if necessary. Why is the wallet so dear? I allowed that, if losing my Reserve retirement (which I explicitly do not include in retirement planning) was necessary to preserve the long-term economic health of the country, then the Reserve retirement is not too important. Whatever I do receive will essentially be a discount on my income taxes, anyway.
Now, that is a subjective assessment. In no way am I speaking for anyone be little ol’ me. Veterans who are wounded, or survivors of those who paid ultimately, will be completely protected, I hope.
Nevertheless, my purpose in sacrificing some amount of liberty, especially in the form of time, is to defend and expand liberty. I hope the people of Afghanistan experience some net increase in liberty as a result of the efforts here. And I hope that I will enjoy increased economic liberty at home. It makes no sense for any retirement system, military or otherwise, to crash the U.S. economy. Those of us who can should consider cheerfully stepping up and make the necessary sacrifices. Won’t be my first short haircut, if it comes to that.
Hopefully that godforsaken Social Security system will get whacked, too, anti-liberty beast that it is.

by Smitty

I would argue that the effect of the imperial Federal government over the last century has been to de-legitimize itself:

The CBO calls this approach “fair-value” accounting because it treats the federal government’s actions just like the actions of any other market participant, taking into account the market risk of guaranteeing a mortgage.

Typically, federal accounting does not do this because it is argued that because the government can print its own money, its risk is zero.

The CBO says that even though the government can print money – technically by issuing Treasury bonds – this merely transfers the risk to the taxpayer, who will eventually have to pay off the bonds issued by the government.

The government has to operate off of a reality-based economy. Sure, it can wink at reality, and has. But look at the habit that has been formed:

“As of March 31, 2011, the GSEs reported a fair-value deficit of approximately $187 billion,” the CBO report stated. “Adding to that the $130 billion in net payments already received from the Treasury implies a fair-value cost to the government of about $317 billion in obligations incurred through March 2011.”

Whoever wins in 2012 had better drive for more integrity than has been seen from previous administrations. Also, the people have to demand that integrity.
Fannie and Freddie should be among the first two casualties in a bloodless, anti-recreational-bureaucracy pogrom. Their existence flies in the face of the 10th Amendment; let the states sort out the housing for their citizens as required.
While not the sufficient, load shedding this particular bit of federal over-reach is necessary to restoring federal legitimacy. Also, coherent accounting.