What We Now Know
Week of 10/3/06
IN THIS ISSUE
Bankrupt over Pensions
What a Preedickamink
False-Flag Operations, Part II
Reader Feedback
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Bankrupt over Pensions
By Shannara Johnson
As we have mentioned numerous times in this publication, finances don’t look
too rosy in the good old US of A—especially when you are one of the baby boomers
approaching retirement.
In 1950, there were seven people of working age (20-65) for every retiree in
the U.S., today there are still almost five. But by 2030, that ratio will fall
to less than 3 to 1. Fewer and fewer employees are available to pay for pension
benefits. (In Japan, the situation is even worse: by mid-century, the
workers-to-retirees ratio will be just over 1 to 1.)
“At companies across the country, workers are watching their pensions
dwindle,” stated a 2005 MSN Money article listing the top 20 most underfunded
pension plans.
The list reads like a Who’s Who of corporate America: Ford (-$12.31B), Exxon
Mobil (-$11.5B), General Motors (-$7.53B), IBM (-$7.38B), Delta Air Lines
(-$5.3B), Lockheed Martin (-$4.88B), Delphi (-$3.98B), Boeing (-$3.8B), and so
forth. (For the complete list,
click here and scroll
down.)
As a result, many corporations have been freezing their pension plans,
meaning that the employees covered by the plan stop earning some or all of the
benefits from the point of the freeze forward. While such a freeze doesn’t
negate pension credits already earned, the effects can be disastrous
nonetheless.
How disastrous, shows a real-life example from a Washington Post article:
Sean Schuback, a 33-year-old Verizon worker and employed there for 15 years
received the news that his pension plan would be frozen. “In an instant,
Schuback. . . saw the $469,286 pension payout he was told he would receive by
working another 15 years sliced to $245,494, where it would stay no matter how
many more years he put in.”
If Schuback retires at 65 and lives another 20 years (which is the average),
his $245,494 will give him $1,023 a month. If he makes it to age 95, that’s $682
a month. Not much to live on, especially considering that those dollars will
have been hugely depreciated by inflation by then.
Yet retirement experts would say he’s one of the lucky ones, because the
amount he gets is more than six times the average, $40,000, most people in their
thirties have saved, according to the non-profit Employee Benefit Research
Institute (EBRI). And more and more employees get no pensions from their
companies at all.
States, counties and municipalities, too, are increasingly struggling with
their pension liabilities. Many have invested money in hedge funds in the hopes
of higher-than-average returns to fill the gap, but unforeseen events in the
stock market—or any of the other clever-by-half schemes hedge funds chase after
in the quest for high performance fees—can have dire consequences.
San Diego County made headlines last week because it saw $87 million of its
pension monies vanish in the crash of the Amaranth hedge fund, which lost 65% of
its assets—over $6 billion—in a natural gas bet gone awry. The county retirement
association had invested $175 million with Amaranth, which had touted itself as
a “multi-strategy fund with adequate risk control.” In the same game, a New
Jersey pension fund for state employees was relieved of up to $16 million.
And small-town America is no better off than the big cities. As an example,
in 2000 the town of Ormond Beach, FL, paid $448,000 to run its employee pension
program. This year, they need over $2.1 million just to keep the program afloat.
“Cities have nearly gone bankrupt because of pensions,” Mayor Fred Costello told
the Daytona Beach News Journal Online.
However, it’s not just the pensions themselves that are weighing states,
counties and municipalities down—it’s also the future health care costs for the
elderly. Last week, the Associated Press reported that “In California, half the
state’s employees have reached retirement age or will become eligible to retire
within a decade. . . According to the California Department of Personnel
Administration, a fully vested state employee who lives for 20 years after
retirement could receive nearly $500,000 in benefits outside their pension.”
And 20 years is a conservative estimate since nowadays, you have a good
chance of living into your nineties. As a recent PBS report said, “For the first
time in American history, the ‘old old’—those over 85—are now the
fastest-growing segment of the U.S. population.”
***
If you are an American who is not yet retired, the chances of you living a
comfortable life in your old age are rapidly decreasing. U.S. paper—dollars and
stocks—will continue to lose its value, and commodities will see a boom…
potentially one like we’ve never seen before.
This is the time to accumulate gold and silver (as the more saving-savvy
populations of India and China already do) and let the emerging commodities bull
market work for you.
Doug Casey’s Gold Stock Companion provides gentle guidance on the stocks of
producing and near-producing gold companies that greatly outperform gold bullion
in a bull market, but don’t suffer the same high risk and volatility of
earlier-stage resource stocks.
If you are interested in the profit potential of gold to boost your
portfolio, you owe it to yourself to check out the Gold Stock Companion today.
Learn more here.
**********************************************
What a Preedickamink
By Doug Hornig
That’s what Popeye would surely say: “What a preedickamink!”
All those years of pouring spinach down his gullet in order to build a strong
body, and now he’d be hard pressed to find a supply.
The culprit is, of course, that old devil, the Escherichia coli bacterium. It
seems like every time there’s a nationwide brouhaha over contaminated food, E.
coli is at the center of it, and that’s certainly the case here. Since August
25, when the first case of illness was reported, anti-spinach fever—promoted by
the government and fed by the sensation-seeking media—has risen to a near
hysterical pitch.
By mid-September, the FDA had cleared the supermarkets of all bagged fresh
spinach after some 150 infections and one death that could be attributed to the
“outbreak” of E. coli-related illness.
Dire warnings were issued, among others from Robert Brackett—director of the
FDA's Center for Food Safety and Nutrition—who stressed the importance of
stopping the bacterium at its source. “If you wash it, it is not going to get
rid of it,” he said.
Placing his job at the very pinnacle of stewardship of the public safety
(though struggling with his syntax), Dr. Andrew von Eschenbach, the FDA's acting
commissioner proclaimed that, “We need to strive to do even better so even one
life is not lost.”
With many frightened citizens vowing never to touch spinach again, there has
even been talk in Washington about a permanent ban on all bagged, fresh-picked,
triple-washed greens.
Our regular readers will be aware, however, that we are eternally skeptical
when the government says it is doing something for our own good, and so we
decided to take a closer look at the spinach fear that has suddenly gripped the
land. Was it justified, or was it an overreaction engineered, once again, by
those zealous guardians of our welfare down in D.C.?
Well, you be the judge.
There are several important aspects of the story to keep in mind. First of
all, hundreds of strains of E. coli bacteria already reside in your gut. In
fact, you wouldn’t have intestinal health without them. They’re the good guys.
Unfortunately, they have a handful of cousins that can cause foodborne
illnesses, and one—O157:H7—that is particularly toxic, and is responsible for
most of the serious medical conditions associated with the bacterium.
Even if you do ingest the nasty O157:H7, however, you won’t automatically get
sick. As our old friend, nutritional consultant Jon Barron put it, “those with
healthy populations of beneficial bacteria in their intestinal tracts are
virtually immune to problems. There is simply no room for ingested E. coli to
take root, colonize, and multiply—not to mention the fact that the beneficial
bacteria gobble up any stray E. coli they encounter. In other words, the
outbreak has less to do with contaminated food than it does with the epidemic of
compromised immune systems and intestinal tracts.”
This is why, even when we ingest O157:H7-contaminated food, the resultant
illness will probably be self-limiting. The vast majority of those exposed are
either unaffected, or have minor problems that clear up in one to three days.
Only in about 5% of all cases is there severe poisoning.
Thus, if you don’t take care of yourself, you’re more likely to fall ill and
run a greater risk of complications. Not a great surprise. And equally
unsurprising is the behavior of government, which has been handed a golden
opportunity to educate people about the importance of gastrointestinal health.
Instead, our bureaucrats choose to disrupt the food business, bankrupting
farmers along the way, all in a futile attempt to eliminate O157:H7 from the
retail world.
Naturally, we are not advocating that contaminated food shouldn’t be pulled
from stores. It should. We’re just adding some perspective to the Great Spinach
Flap of ’06. Here’s some more: each year, E. coli poisoning causes 73,000 cases
of serious illness and about 60 deaths. Yes, the proverbial bolt of lightning is
more likely to take your life than this tiny animalcule; and yes, 150 cases/1
death is a tiny percentage of the whole.
There’s also another thing worth considering, the question of who benefits.
From the Union of Concerned Scientists’ Food and Environment website we learn
that, “Most infections of E. coli O157:H7 come from eating undercooked,
contaminated ground beef. Meat becomes contaminated in the slaughterhouse, and
the bacteria are easily spread when meat is ground in the processing plant.
Studies have shown that about half the cattle in feedlots carry this pathogen
during summer months.” Worse yet, because of the willy-nilly use of antibiotics
among modern herds, the strain borne by beef cattle is increasingly
antibiotic-resistant.
Now the target of the spinach purge has been organically raised produce, at a
time when it is claiming a bourgeoning segment of the market. Conventional
growers, as well as the powerful beef industry, have plenty of friends in
Washington. Since large agribusinesses have a vested interest in maintaining
their own market share, while meat processors would rather we knew as little as
possible about where our hamburger comes from, having organic vegetables
transformed into a villain is welcome news to both.
So, is this an instance of a government on its toes, keeping us safe, or yet
another overprotective effort by the nanny state? As we said, you decide.
**********************************************
False-Flag Operations, Part II
By Shannara Johnson
Toothpaste. Bottled Water. Shampoo. Baby formula. All things that are deemed
too dangerous to bring on board of an airplane now. Or to be exact, since August
10, when British authorities foiled a terror plot by Islamic extremists to blow
up ten planes on the way from London to the U.S.
The official story goes like this: According to the British and U.S.
governments, the suspected hijackers were going to use TATP—triacetone
triperoxide—to bomb themselves and thousands of airline passengers to kingdom
come.
TATP is an explosive that can purportedly be made from some rather
inconspicuous liquid components, such as drain cleaner, hair dye and paint
thinner, which the terrorists wanted to smuggle on board in simple drink bottles
and mix them together in the lavatories to create a cocktail from hell.
But critics of the official story—among them Thomas C. Greene from the
British The Register—believe that the official version of the events is hogwash.
No terrorist with even an ounce of brains, he says, would try to make TATP in an
airplane toilet… because it is virtually impossible.
Here is Greene’s “Mixing Explosives 101,” the step-by-step instructions for
wannabe terrorists.
“Take your hydrogen peroxide, acetone, and sulfuric acid, measure them very
carefully, and put them into drinks bottles for convenient smuggling onto a
plane. It’s all right to mix the peroxide and acetone in one container, so long
as it remains cool. Don’t forget to bring several frozen gel-packs […], a
thermometer, a large beaker, a stirring rod, and a medicine dropper. You’re
going to need them.
“It’s best to fly first class and order Champagne. The bucket full of ice
water, which the airline ought to supply, might possibly be adequate […] to get
you through the cookery without starting a fire in the lavvie.”
“Once the plane is over the ocean,” Greene advises, “very discreetly bring
all of your gear into the toilet. […] Once your kit is in place, put a beaker
containing the peroxide/acetone mixture into the ice water bath (Champagne
bucket) and start adding the acid, drop by drop, while stirring constantly.
Watch the reaction temperature carefully. The mixture will heat, and if it gets
too hot, you’ll end up with a weak explosive. In fact, if it gets really hot,
you’ll get a premature explosion possibly sufficient to kill you, but probably
no one else.”
Chemists say the fumes while making TATP are so overpowering that anything
but a lab-quality air evacuation system will not do—let alone a tiny airplane
lavatory. And after carefully stirring the components together, the mix would
have to stand for at least 24 hours (or more) at a temperature of between 33 and
50 degrees Fahrenheit. Too hot and instead of TATP, diperoxide is formed, which
is too unstable to work with. Too cold and there is no reaction at all.
What about just taking the needed precursors, dump them all together in an
airplane toilet bowl and let the stuff fizzle until it explodes?
“Indeed, the mixture will heat rapidly as TATP begins to form,” says Greene,
“and it will soon explode. But this won’t happen with much force, because little
TATP will have formed by the time the explosion occurs.”
Chemistry professor Jimmie C. Oxley from the University of Rhode Island
confirms that merely putting the components together would create “a violent
reaction,” but not a detonation.
So, to sum it up, the best a terrorist attempting to create TATP in an
airplane lavatory could do is suffocate or blow himself up, with little to no
damage to the toilet or the airplane itself.
Then how about bringing the TATP pre-made and ready to use on board? Equally
impractical, say experts, because the explosive is as unstable as nitroglycerin,
making it more than likely that a terrorist would blast himself to smithereens
before he’d ever set foot on a plane.
Impossible chemistry experiments aside, there are other clues that the London
terror plot was nothing but a clever smoke-and-mirrors game of the British and
U.S. governments—potentially to raise dwindling approval rates by a few
percentage points.
Not only that the “informant” in Pakistan, who allegedly gave up the
conspirators, was a man wanted in the UK for being suspected of having murdered
his uncle. It also seems strange that not one of the purported bombers had a
plane ticket. None of them had made a bomb. Stranger yet, some of them didn’t
even have passports.
But why let reality get in the way of a good story?
[Ed. Note: Latest news reports say the terror suspects won’t be brought to
trial until 2008. Which ensures that the general public will have forgotten
about it by then…]
Give us your opinion at
feedback@caseyresearch.com.
**********************************************
Reader Feedback
A few selected reader responses to “False-Flag Operations, Part I”:
I find it amazing not that one-third of the country believes the
government was behind 9/11, but that one-third of this country believes the
government is capable of pulling it off. The problem with a 9/11-size conspiracy
is that too many people have to be in on it. Without relying on guilty
consciences, it’s hard to believe that at least a few these folks wouldn’t have
tried to profit off this, either through rewards, books, etc. Certainly, money
and ego would have led at least a few of these conspirators to reveal
themselves. After all, people acting in their own self-benefit aren’t unheard
of, the real hijackers did what they did for the promise of 72 brown-eyed
virgins and the “glory” of striking the US in the name of Allah.
(Bill A.)
***
Thanks for your articles. I always enjoy them and appreciate that you put
this out. Regarding your False Flag Part I article and your statement that "you
are not in this camp," if you mean you aren’t suspect yet of the official story
about what happened on 9/11/2001, I urge you to do some research (if you haven’t
already). A good place to start is at http://www.911truth.org. There is so much
disinformation regarding the "official story", so many blatant lies,
inaccuracies and suspicious actions by our government, that someone with an open
and unbiased look would have to see that the official story can't possibly be
true.
(Bridget D.)
***
Conspiracy theorists have long been trying to prove the government's
responsibility in past attacks in the United States. […] Much like the Kennedy
assassination, if there was a conspiracy, it would have surfaced by now. The
reason? The human element. People in general cannot keep secrets and an
operation like the attack on Pearl Harbor, the Kennedy Assassination and the
9/11 attacks, three of the most shocking events in recent history that span
roughly 3 generations, would have sprung a leak by now. […]
The bottom line is that outside of the borders of the United States lies a
lot of hatred, jealousy and resentment towards the way of life we lead in this
country. The primary influence on the "young adults" Shannara Johnson speaks of
are the very people that fuel conspiracies with their liberal teachings; the
professors and educators in universities. As a "young adult" at one time as we
all have been, I am sure that many of us have been in this situation before, but
only after really opening our eyes to what is around us can we truly understand.
The last time this country was pressured into conforming to the thoughts of the
"young adults" was during Vietnam and that was not a good time for this country.
We had servicemen who were treated as the bane of society when they were putting
their lives out on the line every day to defend the right of the "young adults"
to question their actions.
(John W.P., Sr. Recruiter)
***
At my age, 81, and with military service during WWII and the Korean War, I
no longer believe anything coming from the cesspool within the beltway down on
the Potomac River. In your essay, False-Flag Operations, Part I, you missed an
important operation which affected my life, that of the operation known as Pearl
Harbor.
Your attention is directed to a book ( 2001 ), "Day of Deceit" by Robert
Stinnett, publisher Touchstone, where Stinnett makes a case that FDR engineered
Pearl Harbor by provoking the Japanese to attack. He used FOIA to obtain
previously restricted documents from the government archives to build his case.
(Boris D.)
***
And another few emails regarding “Drowning in Deficits”:
Your latest 2 lead articles are exactly what I've been concerned about for
our country. Great coverage. I had lunch with David Walker, mentioned in your
article, and he confirms that the government, even if we believe the numbers, is
way out of balance. He indicates that the numbers aren't reliable enough to pass
a corporation's audit.
Keep up the great work!
(Bud C.)
***
I'm quite sure the information from Congressman Jim Cooper (D-Tenn.) is
nothing new. I find the timing kinda funny. A Democrat, with a major slam dunk
on a Republican administration in an election year and going into the
presidential campaign season. And publishing for the whole world to see. Great
idea! Let the world know that the US of A isn't worth the paper the money is
printed on. I'm sure if we look back at previous U.S. Financial Reports released
by the Treasury Department from previous administrations, we'll see the same
smoke and mirrors. I'm sure the "budget surplus" of the Clinton administration
was really just a smaller deficit than we currently have. According to the 1998
U.S. Financial Report, "In fiscal 1998, there was a budget surplus of $69.2
billion. The excess of net cost over revenue figure contained in these financial
statements for fiscal 1998 is $133.8 billion." So the Clinton administration,
known for bringing happy times and a budget surplus, misrepresented the US
financial state, too.
Honesty in the budget is needed, no matter who is in the White House.
Fiscal responsibility is a must. Households and corporations can't survive doing
what our government does. What would it take to get us back on the gold
standard? All our currency backed by something tangible. Bring back the good old
days of Fort Knox!
(Greg C.)
**********************************************
End Quote
"Government is the entertainment division of the military-industrial complex."
--Frank Zappa (1940 – 1993), American singer, guitarist, composer, film
director and satirist
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The What We Now Know Team
Short bios of this week’s contributors:
Shannara Johnson is the Managing Editor of What We Now Know. With over
20 years of writing experience, she spends her time researching and writing
about the most fascinating, controversial, and pressing topics of our time for
WWNK readers.
Doug Hornig is the author of nine books whose work has also appeared
in Business Week, Playboy, and more. As a veteran journalist and a contributing
editor to What We Now Know, he has been writing on a broad range of subjects,
including complex issues like the U.S. health care crisis and the Social
Security debate.
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