Reflections From Behind The Iron Curtain

Inside Communism – Personal Rights (Must Read)

2008-07-12T15:27:00.000-07:00

Everybody knows the Communism does not work. Socialism is communism in disguise. I always asked myself, why there is such a strong socialist undercurrent in this country of USA?

The following is an insight into the inner workings of a communist society. Statements and stories are not necessarily listed in any order; just thoughts from my personal experience.

Personal Rights

There are no rights. No litigation against the state is possible. The state is never wrong. No litigation against an individual would ever occur; nobody had any money to be collected from.

Individuals were simply “imprisoned” in their homes, city, county and ultimately, country boundaries – the armed guard borders. Dictatorship of the proletarians as claimed by the communist doctrine turned into the dictatorship over the proletarians.

My biological father left my mother, when I was three years old, to join the communist party. Five years later, he became an important communist leader in charge with a large territory. Few years after that he was sent to a labor camp where he spent years, not as a leader, as a convict. When he was released he was a broken man. He died at an early age.

My uncle, who was a hotel manager, was arrested as he got off the train coming home. He showed up two years later and nobody knew where he was all this time.

One of my schoolmate’s father was arrested when my freind was only five. After 15 years, when my schoolmate was 20, his father showed up at the door of their residence. All these years his family didn’t know anything about his whereabouts.

A friend of my family, a medical doctor, run into some political problems with the government. His practice license as well as his driving license were suspended. He had to take a labor job, but most upsetting was the fact that he owned a motorcycle he could not use, nor could he sell it. People did not have the money to buy it.

The father of one of my childhood friends, was a taxi driver who owned his cab, a 1938 Cadillac. When the communism system took over, the government suspended his license as an operator as well as the registration license for his cab. He had his automobile sitting in his garage for more that 15 years. He could not drive it, nor could he sell it.

During my teenage years I was involved in competitive athletics: bicycle, skiing and speed ice skating. At the age of 19 I qualified for the national team (bicycling), training for the 1964 Tokyo summer Olympics. During training, the team participated in international races, mostly held in Eastern European countries. My country refused to issue me a passport and I was dropped from the team. I never found out why, in spite of repeated requests at all levels of government.

In the above cases, none of the individuals committed any crimes against the state. The only thing they did, they spoke against the government or were critical of it. I could never find out from them the actual charges. Of course if you were too nosy, you could end up in jail yourself. Everybody was numb and did not want to talk about it.

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Computer Security

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The Government at Work. It steals you blindly if it can

2008-06-21T23:44:00.000-07:00

The Government at Work. It steals you blindly if it can

Take a look at my recent telephone bill, period ending May 28. I had not made a single telephone call using the land line during this pay period. My basic service is 10.94 and my bill is 20.68. That represents almost 90% in taxes and surcharges going to the government from a service I don’t even use.

Tr Cojoc

May 28 Telephone bill – AT&T

During the month of May I had not made a single telephone call using the land line.

Here is my bill:

Monthly Service

1. Residence Flat Rate Service 10.94

2. Caller ID Selective Blocking 0.00

Total Monthly Service 10.94

Surcharges and Other Fees

3. Federal Subscriber Line Charge 4.40

4. Rate Surcharge .26

5. State Regulatory Fee .02

6. Federal Universal Service Fee .49

Total Surcharges and Other Fees 5.17

Total Plans and Services 16.89

Government Fees and Taxes

7. CA High Cost Fund Surcharge – A .01

8. CA High Cost Fund-B and CA Advanced Svc Fund .06

9. California Teleconnect Fund Surcharge .01

10. Universal Lifeline Telephone Service Surcharge .13

11. CA Relay Service and Communications Devices Fund .02

12. 9-1-1 Emergency System .06

13. Federal .49

Total Government Fees and Taxes .78

AT&T Long Distance

Monthly Service Charges

1. OneRate Natn 10 Cent 2.00

Total Service Charges 2.00

Surcharges and Other Fees

2 Carrier Cost Recovery Fee 1.49

3. Fed Universal Service Fund .27

Total Surcharges and Other Fees 1.76

Government Fees and Taxes

4. CA High Cost Fund B and CA Advanced Svc Fund .01

5. CA State Emergency Telephone Users (911) Tax .01

6. CA Teleconnect Fund (0.13%) .00

7. CA Universal Lifeline Tel. Service Fund .01

Total Government Fees and Taxes .03

Total AT&T Long Distance 3.79

Total Current Charges 16.89 + 3.79 = 20.68

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Oil Prices and Congress

2008-06-21T17:33:00.000-07:00

I watched the congress and the senate hearings, interrogating the oil industry’s executives, treating them as culprits or worse as criminals guilty of making profits on the back of the regular, poor consumer having to pay a “high” price for gasoline. It reminded me the old communist system I escaped 49 years ago. The communists would have condemned and executed the culprits, the executives.

Of course this is the United States of America, and is not that easy for politicians to eliminate people they don’t like. Believe me, if they could, they would.

The most ridiculous statement was from congresswoman Maxine Waters, stating from the podium of the House of Representative, that the government might have to nationalize the oil industry. How arrogant, or rather stupid that statement can be?

If you think congresswoman Waters is an aberration, think again, she is not. The liberal congress is opening an investigation on “oil futures speculators”.

Futures market has been around for long time. It has served the free trading commerce environment flawlessly for hundreds of years. Japan had a futures trading system for rice going back to 1750.

Communist system eliminated free trade and credit. Under communism, if you wanted to buy a motorcycle, you had to save the money, deposited in the bank to pay in full, and once you had the full amount, you were allowed to place your name on the waiting list that might take a year or more to take delivery of your motorcycle.

If it was left to the Maxine Waters of the world, we would have to deposit money into a gasoline account and wait with a coupon at a gas station to get our two gallon allocation.

Of course, I am exaggerating, but maybe not.

Futures speculators are the most honest of the bunch; they are using their own money to make a quick buck. Most of them, 95% loose money in the process. Hillary’s $1,000 investment in futures returning $100,000 was a bogus gain; it was a payout. It was impossible. A $10,000 investment could have returned $100k if everything was right. However, a $10K investment could have resulted in a $100k LOSS just as easily.

Futures trading background

In 1878, a central dealing facility was opened in Chicago, where farmers and dealers could deal in ‘spot’ grain, and immediately deliver their wheat crop for a cash settlement. Futures trading evolved as farmers and dealers committed to buying and selling future exchanges of the commodity. For example, a dealer would agree to buy 5,000 bushels of a specified quality of wheat from the farmer in June the following year, for a specified price. The farmer knew how much he would be paid in advance, and the dealer knew his costs.

The most valuable service provided by speculators: PRICE of Commodity

Light oil crude futures, February 2008 with delivery in August, were trading around $90. Any buyer of crude oil, planning delivery in August, 2008 paid $90 for a barrel of oil. Today, June 2008, you can’t get any future delivery contract at below $130.

Take a look at the chart below:

Light Crude Oil

The speculators’ reading: Congress is not going to do anything good to help alleviate the problem. Secondly, you are on your own and you will pay these high and even higher prices for the near future.

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Manufacturing Jobs Go To Were They Are Welcomed

2008-06-08T17:42:00.000-07:00

Manufacturing Jobs Go To Were They Are Welcomed

I worked in the electronics industry in various management positions expanding over 35 years.

In the early seventies, design and manufacturing of anything electronics was done in the USA. I worked for a manufacturer of hand-held calculators as an electronics designer. This company was based in New Jersey and it manufactured everything in New Jersey. Sears was their largest customer.

In mid-seventies, while working for another company, we set up a manufacturing plant in Mexico, across the border in Nogales. Many American companies did the same. Some of them are still operating there today. The same happened in Canada. The business environment was helpful and friendly, and of course the manufacturing cost was lower than in the USA.

By mid-nineties, the Mexican government started imposing all sorts of restrictions and regulations. A large number of companies shut down and left. The same happened in Canada.

Note: I had a customer in Canada who was doing a failure analysis of our products. I had to go and validate the failures and document it. I was told: “Do not bring even a screwdriver with you from USA to Canada. The customs will turn you back”. Canada was trying to protect their jobs.

In the mid-eighties I was working for an electronics company in Southern California. This company was a pioneer in communication electronic devices. It had a factory already and it needed to expand. The company invested in equipment and buildings.

By the time everything was installed and functioning, the manufacturing facility was not compliant anymore under the fast changing air quality regulations in the state of California. The new regulations forced the company to sell its facilities and move its manufacturing to Singapore and Malaysia. The company is still in business today but there is no manufacturing in this country.

Recently I was doing some consulting work for an industrial representative, representing a circuit board manufacturer in Southern California. (Circuit boards are the electronic components going into everything: cars, airplanes, refrigerators, washing machines, dryers, televisions, you name it. Everything we use.) It is impossible to open a facility like this in Southern California today due to stringent air standards. The company was a very small prototype facility. Circuit board manufacturing requires the use of certain chemicals for soldering and cleaning. There was a permanent government inspector sitting in a government owned van monitoring the air quality around this facility (every day, 8 hours/day).

Made In China Is A Misnomer

The term “Made” implies creation, design and manufacturing of a certain item. That is not what is happening with products labeled “Made in China”.

I worked for a very large electronics Taiwanese company. The company had engineering and manufacturing facilities in Taiwan. At the time, this company was the 4^th largest Taiwanese company trading on the Taipei exchange, 4 billion USD. It supplied a key component required by every computer. Their top customers were Compaq, Dell, IBM and Hewlett Packard.

In the mid-nineties, the Communist China opened for business big time. It was a strategic move on China’s part. Make the country business friendly and everybody will come. And they did.

Here is the story:

The Chinese government, in the nineties, started building manufacturing facilities (concrete walls, no equipment) along the southern border, close to Hong Kong. Hong Kong was a big port and easily accessible from mainland.

Foreign manufacturing companies were provided, by the Chinese Government, manufacturing space and labor. Every factory had a built-in dormitory for workers.

Business tax liabilities to the Chinese government were forfeited for the first three years.

Business operators would bring in and install the equipment necessary, bring in part kits, and within days the Chinese government would deliver anywhere from 200 to 300 laborers to the designated facilities at pennies per hour per laborer.

If the business was slow, or it had to deal with cancellations, the operators would close down the facility for a period of time, and the Chinese government handled the labor force, transparent to the business. The government would just find new jobs for the workers and moved them practically over night. There was no obligation on operator’s side and no liability.

My employer had a pilot plant and used three independent contractors which maintained mirror manufacturing facilities as a back-up, or assigned to a specific account. This was a very large manufacturing operation. Shipping hundreds of thousands of assembled computer subsystems to the USA and Europe per month was not unusual. The Chinese government provided low level labor only. All managers and engineers were foreigners from the country of origin running the plants.

Nothing was designed in China, the material, components or parts had to be imported, management and quality control was performed by the foreign operators and the bulk of the profits were also kept by the foreign operators.

While working for this company, we had an office in Huston Texas, where Compaq computer was based. The company was interested in opening a small support and manufacturing facility in Mexico, across the border from Brownsville, TX. Mexican government made this venture quite unattractive. They demanded a minimum wage, six months severance, and many other benefits for the workers. Compared with China, it was not worth it. They would rather communicate through FAX machine and air ship product to Huston from China. It was cheaper.

Special Remarks

From an engineering aspect, this product was very simple to design. However, manufacturing it, was a different story. It could not be automated. The product contained more than 300 components, and most of them had to be assembled by hand. The quality expected by their customers was very high. This $20 dollar product required 350 manual workers. The material accounted for 75% of the cost. Labor accounted for 10%. Overhead and profit shared the remaining 10%.

Competitive Issues

When every business has equal access to this kind of environment, there is no choice, but to join in. If they don’t, they will be out of business in no time.

I am sure, by now, the labor cost is probably higher. It is all relative. USA is not even trying to entice the lost manufacturing to come back. It is the new paradigm, Service Economy. We will see how long the service economy will be able to feed the society.

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Communism Landed In Eastern Europe, Un-Announced and Un-Invited

2008-05-02T23:31:00.001-07:00

How communism works

Socialism is Communism in disguise. Give the socialists the police power of government and you have Communism.

Communism has done more damage to humanity than the World War II and is still doing it. Just look at Africa and now Venezuela, not to mention Cuba.

I was born in 1941, in Rumania, right in the middle of the war. I escaped communism in 1969, arrived in the United States in 1970 and became US citizen in 1976. I grew up under communism till I could not bear it. I was 28 years old when I left. I am retired. Now I have time for reflection.

In 1947 King Michael “abdicated’ and was sent into exile. The communist party, with the help of Soviet Union was immediately installed.

The dictatorship of proletariat was running the country. Within few months, the newly empowered government, nationalized (confiscated) all sizeable private properties: Factories, big buildings, big homes and large land holdings used for farming.

In short order, everything became the property of the “people”. As a matter of fact, that includes the people. Proletarians owned the people.

Displaced people were relegated to some small residences to make room for the newly empowered “Leaders of the People”, the party functionaries.

Compassionate Communists

My father had a small business employing two people. His equipment was confiscated and the business closed. He was placed as a worker with one of the large companies, now owned by the “people”, or rather the state.

My grandfather was a farmer. He owned few parcel of land in the foothills and the house he built. He had two dairy cows, a pig, and for commercial use, 300 heads of sheep. The government confiscated his herd of sheep and one of his parcels on a hilly land with a good size orchard. In return, the government employed him, on a small salary, to run the orchard he previously owned. He had no choice, but to accept it.

Fiscal Reform – Communist Style

After the war, the inflation was out of control. After taking over the responsibility of feeding the “people”, the communist government faced the problem of setting prices and salaries.

The communists are equalitarian. No-one can have more than the rest. Here is how they did it:

The government printed new currency and made the old currency worthless. I was 9 years old. Over night, everything was really cheap. What used to be 10,000 lei, now it was only 10 lei.

What I did not know at the time, was that the government provided every family with just 1,200 lei in exchange, regardless of how much money anyone had in the previous currency. All cash owned by individuals just disappeared over night. Individual bank accounts were closed and credit disappeared. Everyone had a new start, and equally poor: 1.200 lei period.

All this reallocation of wealth, created a lot of resentment and the communists couldn’t allow any enemies to be around. The communist leadership considered anyone not supporting communism as an enemy of the state and had to be controlled and monitored very closely. The borders were closed and the police was employed in full force to register every individual by issuing ID cards. This was just a short term solution. A policeman was assigned to each residential sector. He was in charge with inspecting each private residence. He would enter the residence any time he wished, looked around and left. The long term solution was through full employment.

Full Employment – Communist Style

The communist regime assured full employment. In fact, it was against the law not to work, except for the disabled and housewives raising children.

Here is how they did it:

Immediately after taking control of the government, the communists had to control the individuals: where they lived, where they worked and so on. The main purpose was to monitor and eliminate the “enemy of the state”.

They issued individual ID cards resembling a small passport with personal information, place of residence, and pages for police notes.

Most towns were deemed by the government as “closed towns” to nonresidents.

People needed a special dispensation or approval from the government to even apply for a job in those towns. Companies would not accept a job application if you were not a resident.

Each individual had a personal file maintained by the employer. When you moved, your personal file was transferred to your new employer. You never had access to your personal file.

It was against the law not work. The government assumed, absent private enterprise, that you must steal from the government to make a living, unless you were employed by the government.

The next key element in population control was education.

Free Education – Communist Style

High level education was provided for “free” by the communist government. Educating the population was very important for the communist doctrine. Communist expected to develop a society free of worries for its individuals.

Here is how the free education worked:

Upon graduating high school, the students had only two options: get admitted at high level education institution (there were no colleges) or get drafted in the army for two years. The stakes were very high and competition for the best schools was fierce. The admission exams required a range of extensive written and oral tests, lasting several days. Only the very top performers were admitted, based on the number of seats available at that particular school. In 1962, for instance, the medical school had 350 seats available and 5,000 to 10,000 applicants. Technical schools were a bit easier to get into but not by much.

Upon graduation, the degreed students were provided immediate employment by the state. Various ministries provided a list of job opening matching the number of graduates from a particular school. The placement was managed by the education ministry. In the order of highest scores, students picked up their job offering in front of a ministry commission. The graduates could not opt out of the list. It was mandatory to take those assignments, even if you had to move hundreds of miles away from a desired location. This was a contractual forced agreement for at least five years.

As I mentioned earlier, even if another job was available elsewhere and the employer wanted it you, your present employer had to approve the move (release you from the contract).

The problem here, most of the highly educated hated their jobs, especially the doctors sent to some remote villages for five years.

Economic Impact

The economic impact was immediate. The food just disappeared. No milk, no meat and even the black bread had to be rationed. You needed a coupon to buy a loaf of bread. Even during the war, there was more food available. This state of affairs lasted for many years. It got better for a while, and then it got worse again. At one point, people were happy when they could find chicken feet on the market. And that was after 15 years of communism.

Small farmers, with their lots turned into collective farms did not feel compelled to work their previously owned lots for pennies. Many were arrested. The communists did not know how to run the farms, and at harvest time there weren’t enough helping hands to collect and distribute the crop. They employed the army and the school students as volunteers. I was one of them.

In the fifties, the communist leadership decided to undertake a major construction project. It was a bypass of the Danube river delta, to shorten the distance to the Black Sea. Reputable engineers, deemed it unfeasible due to potential flooding of a large area south of the delta. The party leaders found some engineers willing to do the work. This was a massive undertaking requiring large number of laborers. The communists turned this construction project into a labor camp.

After few years, the canal came close to the Black Sea and everyone realized that it was a technology blunder. The communist leadership promptly stopped the project, had a brief trial and executed the top project management. The ruins of this boondoggle is still there today.

Communists are paranoid

Communists closed the borders to keep their own people in. Anyone caught at the border, trying to escape, was arrested and all his rights suspended.

There were no roadmaps available to be purchased.

The military manufacturing plants were built inside the mountains with a front manufacturing name, making bicycles for instance.

The fall of communism has been attributed to President Ronald Regan by taking a strong stand against communism and calling it The Evil Empire, which it was. However, the collapse of the Soviet Union was due to common sense of the new and educated leaders who could not bear to lie and mislead their own people and the world community.

Communism collapsed on its own from top down. There was no one to support it.

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Feel Good Laws Hurt Everybody

2008-05-02T22:01:00.000-07:00

Do-Gooders Never Did Anything Good

Just today, I heard in the news that a woman had a car accident because she was holding a cat in her lap. Within two day, a Sacramento lawmaker introduced legislation to make it unlawful for people to hold cats in their lap while driving. How stupid is that?

Take the Americans with Disability Act, signed by Nixon, a Republican, in 1973.

Nixon years were interesting. Being a Republican, Nixon tried to appease or rather get his political enemy to like him. He almost succeeded, if it wasn’t for Watergate. The three-day war in the Middle East triggered an oil shortage. He aggravated it by placing price controls on gasoline and oil. Would you believe it, he taxed old oil higher and new oil lower. All of this was a big mess that hurt America. In his mind, this was supposed to encourage new oil exploration. His executive order, within weeks created artificial shortages of fuel. You had to wait for hours to get to the pump. It didn’t do anything to correct the prices.

To add insult to the injury, he put a limit on wage increases of 5% per year, to curb inflation. He limited your earnings potential.

Nixon’s actions were so typical liberal. Had he had the power of a totalitarian dictator, he would have turned this country communist in no time. The Democrat Liberals loved him so much, that there was a bill in congress at the time, to amend the Constitution to allow Nixon to run for a third term.

The Americans with Disability Act on its face makes sense. Help the disabled by providing facilities to make it easier to access public buildings and businesses. A closer parking spot and a ramp if the disabled was on a wheelchair.

This feel-good law, over the years, has turned into a monstrosity.

I work part time for an architectural/construction printing company. I deliver construction prints. There is a large construction site with heavy earth moving equipment, a lot a gravel, and a small patch of temporary pavement right in front of two large construction trailers. These two trailers have a two-spot parking space for disabled and a long ramp. This is ridiculous. No one in these trailers could remember any handicapped person ever visiting the site.

I saw a large distribution center (a warehouse) with a huge loading dock. Only trucks could even get to the dock. On the side, there were several parking spots for disabled. How many disabled people drive to this kind of dock is a mystery to me.

In a well publicized case in California, a woman in the wheelchair sued Squaw Valley Ski resort for not providing accommodations for the handicapped. She wanted to have access to the mid-station accessible only by gondola to watch people skating on a small ice skating ring. The mid-station was built to be the base for skiers while using the lifts to get to higher elevations and ski back to the station. It has a nice restaurant were the skiers can eat and rest between runs. The ice skating ring was built mostly for children who were not ready to ski yet.

Lately, it’s been reported in the local papers, that litigation attorneys are hiring handicapped people in wheelchairs and go around targeting small businesses for compliance. If they find an inch worth of violation, they threaten to sue in exchange for a payback.

This is public robbery and the Government, is the enabler.

One of the most intrusive laws is The Fair Housing Act enacted in 1968. It was intended to eliminate discriminations of all sorts. It was a good intended act.

Look at it today. It comes very close to confiscating your property. It dictates what you can do with your private property, personal or rental.

There was a case in the news recently. A resident of Newport Beach placed an add, something like this: “One bedroom apartment fully equipped with an office and Internet connection. Perfect for a professional couple”.

A self-appointed policing agency, paid by the government, called the owner and told him that the add violated the Fair Housing Act because “professional couple” implied that he did not want any kids in the rental. He took his case to the city and the city agreed that there was no violation. However, the city told him to pay $4,000 and all charges will be dropped although he was in no violation.

Do you think this law protects discrimination? Last time I applied for rental, I had to provide a background check report, credit report, earnings proof, etc. etc. Think about how idiotic this law is. Furthermore, it’s been on the books since 1968 and nobody complained about it. Maybe it’s the time to do it.

The potential of abuse of such a law is endless.

Communism had a simple solution: It confiscated your property.

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Liberalism Is About Empty Promises And No Deliveries

2008-05-01T22:22:00.000-07:00

One year after settling in New York as an immigrant (legal, mind you), I applied and was accepted at Columbia University, Graduate Program evening classes. This was a three credit class. Each point of credit cost was $110. My salary at the time was $135 per week. I figured, it was well worth it and I could afford it.

My course was in computer programming. The home-work required writing computer programs and submitting them to my professor. The only way I could test my programs was at the university using their terminals. Although the class was held only once a week, I spent every evening at the university, in the computer room, to learn and get my program right.

The year was 1972. The students took over the Mathematics building due to something happening in Venezuela. Columbia University closed the computer building for safety reasons. For six weeks I could not do my homework. This was my first exposure to the liberalism in America. Columbia University couldn’t care less about me learning.

Columbia University, like most universities, had an internal employment program that paid a little bit of money and allowed you to attend day classes. When I applied, I was told the positions were only available to minorities and I did not qualify because, and I quote: “there are not enough of you”, whatever that means. Figure this thing out. I thought liberalism was about helping people in need.

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Better feel safe than sorry.

Rent Control – Affordable Housing

2008-04-28T18:29:00.000-07:00

How The Communist Soviet Union Solved It

Or Did They?

When I arrived in the United States, my city of choice was New York City. I found it incredibly beautiful and exciting. Within two week I found a job in my profession and a small studio in Queens. It was a nice, clean apartment building. I didn’t have any furniture and very little money. The building manager took me down in the cellar, where I found just about everything I needed as a temporary setup for my studio. It only cost me $35. My starting salary was $135 per week and the rent was $126 per month. This was my first experience as a new emigrant with no financial means to star a new life.

The year was 1970. Immediately, I said to myself: What A Great Country America Is!

This was a rent controlled area in Queens and it helped me greatly. I lived there for three years. My rent stayed the same while my salary was getting better. During this time, I found a better job in New Jersey. I commuted for six months driving across George Washington Bridge every day. I would take Throghs Neck Bridge and head up North through Bronx. Along the freeway, I could see these tall, wide apartment buildings totally gutted. No windows and no tenants. I could not make anything of it. I just wandered.

Years later, while visiting New York, I drove by my old building in Queens where I lived. The street was a mess. There were damaged cars parked on the street and the building had several broken windows. The small shops, around the corner were boarded up. It was quite depressing to see the place that gave me a foothold in this country just 10 years earlier. The building was still a rent controlled building. I must have been just lucky in my timing. I certainly wouldn’t have moved there at this time at any price. Even if it was free.

When the Government imposes limits on what the private property owners can do, it is just a matter of time for the property to loose all its value.

Communism, the flag bearer Soviet Union under Stalin had an answer to affordable housing.

When communism took over the huge territory that became known as Soviet Union (11 time zones), had to deal with 200+ languages and 50 plus countries, which they attached without asking for permission.

If you don’t understand the concept of communism, here is a simple answer: Soviet Union Communism was Lenin and Stalin. After Lenin died, it was just Stalin. Just one person, Stalin, had absolute power. He ruled with an iron fist.

Stalin had a major problem in his hands: Integration or rather control of all these nationalities. He solved it by locating trustworthy Russian educated talent in high paying jobs and offered them very affordable housing throughout the country.

In 1968, while working for the airline, I had a job assignment in Tashkent, Uzbekistan in Soviet Union. It was a very large facility performing civil aircraft maintenance. The technical staff of 33 engineers and technicians were from every part of the country except Uzbekistan. There were no natives.

Most of them lived in an apartment complex owned by the factory. This was quite a large complex, only available to the factory employees. There were dozens of ugly four story buildings parallel to each other. The apartment buildings had no elevators and no internal toilets. There were several wooden outhouses between the buildings. I have no idea how the tenants managed. They were certainly affordable, the equivalent of about 30 rubles per month on a salary of 1,200 rubles per month. That is affordable. The factory men’s rooms were open holes, partitioned and no doors. This is your government at work if you let it. This factory was only few hundred miles away from the location were the Soviets launched the Sputnik.

If you think affordability was due to a benevolent government, think again. It had to do with power and population control.

In my next post I will talk about Free Education Under Communism.

Note from the editor

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If it doesn’t work for you, there is a 60 day money back satisfaction guaranty and you get to keep the software.

More information at Currency Trading

Computer Security

Here is the latest: Netcom3 Internet Security.

Better feel safe than sorry.

Social Security Is A Government Handout And Medicare Is Not Free

2008-04-22T20:31:00.000-07:00

Social Security Is A Government Handout And Medicare Is Not Free

If you wander how a nationalized government health program would work, take a look at the information below.

Medicare is already a government program and it is not free to you. Besides, the benefits provided are minimal. Try to get into a private insurance plan after you reach the age of 65. You can’t. If you can the cost is bound to be prohibitive.

Everybody is required to pay into Social Security and Medicare. It is mandated and it is based on your income. These are not considered taxes collected by the government and you can’t opt out. If you are self-employed, you must pay for Social Security and Medicare even if your business is losing money.

If you hope that the government will deliver free healthcare to everybody, think again. Here is a simple case of how the government manages Social Security and Medicare benefits.

When I was making ten thousand dollars per month, I would get statements from Social Security Administration stating my SS benefit at retirements. It was $1,400, and then $1,500, and son on. I already knew, there was no way anybody can survive on Social Security. It could not even pay the rent.

This is a true story about my friend Joe (not his real name).

The year was 2001, September 11, at the age of 61 Joe was semi-retired looking for a job. In his spare time, Joe was trading stocks and options. The 9/11 attack, forced the stock exchange to close for a whole week. When it opened, Joe’s options were worthless. He took a sizable loss. It wiped out his trading account. It forced him to pull money from his IRA account while looking for a job, any job. He was desperate enough to get any job, telemarketing, selling cars, etc., while looking for a job in his old profession.

Joe was only one year away for qualifying to collect social security, at the age of 62. Had he waited to be 65, his social security benefit would have been $1,650 per month. Early collection at the age of 62 amounted to $1,400.

Joe applied for Social Security and started collecting his SS checks after he reached the age of 62 ½.

At his age Joe couldn’t find a job in his profession. After spending months, doing telemarketing and other odd jobs that didn’t last, Joe had to take an entry retail job to make ends meet. This job paid $8.50 per hour.

At the age of 65, Joe was automatically enrolled in the Medicare program by the Social Security Administration. Medicare withheld $94.00 per month from Joe’s Social Security check. By now, his monthly check from Social Security was $1,300.

What Joe did not know, was that the Social Security penalizes you if earn more than $11,000 per year while collecting social security. The penalty is 50% of the amount above $11,000, if you are 65 ½ or less. In his retail job Joe earned 16,600 for the year when he was 64. His tax return showed $5,600 above the $11,000 threshold. Fifty percent of that amount equals $2,800.

Shortly after filing his taxes, Joe was notified by Social Security Administration that he was overpaid in the previous year by the amount of $5,600 and owed the US Government $2,800. He either had to pay it back, or two social security checks would be withheld.

Joe tried to mitigate the payment by forfeiting his Medicare premium since he was covered by an insurance program provided by his employer. He found out that Medicare premium is mandatory and had to be paid every month for as long as he was collecting social security. In fact, even if Joe could have afforded to live without the social security checks for two months, he still would have had to pay the $94 premium for the Medicare.

Joe managed to work a payment plan of $150 per month, withheld from his SS monthly check. By now, Joe’s Social Security check amounted to $1,150, until the penalty is paid in full (about 19 months).

Keep in mind, on Joe’s meager job of $16,600 a year, he already paid about $1,500 in taxes, social security and medicare withholdings. The penalty above applies to wages before taxes.

I can vouch for Joe. We worked together for many years. Some years back I sold him my condo. His credit rating was 850. Last time I talked to him, he filed for personal bankruptcy. He is still paying back the penalty. He had to change his retail job because California garnished his wages. He owed slightly over $1,000 in state taxes due to early withdraws from his IRA account.

Learning from Joe’s experience, you can conclude that the Social Security program is anything but “Security”. If you are financially secure and start collecting your benefits at the age of 65 ½, it is a nice addition (some pocket change). The government is not providing for your financial security. You are. The capital gains from investments, even if they are not under IRA, are taxed, but not penalized (50%).

If you run into financial difficulties and are forced to elect early distribution of your benefits, the government immediately reduces your monthly benefit drastically (about 15%). To add insult to the injury, the government only allows you to earn $11,000 (taxable), after which it will apply a penalty of 50% on everything above the $11,000 threshold.

You have contributed to you Social Security all your working life. It is not yours to own. The government changes the rules and there is nothing you can do about it.

Medicare is not free. At the age of 65, Social Security Program enrolls you automatically in the Medicare Program. Medicare requires all social security beneficiaries to pay an insurance premium. It lowers the monthly social security benefit by $100. You can’t opt out from Medicare.

Note from the editor

Paying too much for gas? Use foreign exchange trading to pay for it.

If it doesn’t work for you, there is a 60 day money back satisfaction guaranty and you get to keep the software.

More information at Currency Trading

Computer Security

Here is the latest: Netcom3 Internet Security.

Better feel safe than sorry.